United Bank of India vs Sh. P.K. Duggal and Others

S. Muralidhar, J.—This is an application filed by Smt. Kamlesh Duggal the wife of late P.K. Duggal, the respondent in the above appeal, seeking clarification of the order dated 22.5.2008 passed by this Court dismissing the above appeal.

The above appeal was directed against an order dated 31.7.2006 passed by the single Judge allowing Writ Petition (C) No. 3227 of 1987 filed by the respondent. The learned single Judge set aside an Award dated 28.11.1986 passed by the Industrial Tribunal upholding the action of the appellant bank declining to reinstate the respondent in service w.e.f. 1.8.1976 with back wages, despite his having been exonerated of all the charges in an enquiry conducted by the predecessor bank of the appellant.

This Court while dismissing the appeal found merit in the cross - objections filed on behalf of the respondent that the amount due to him had to be calculated from the date of the report of the enquiry officer i.e. 24.3.1977. It noted that the deposit of Rs. 2,72,000/- by the appellant in the court during the pendency of the appeal was made in November 2006 and therefore the wife of the respondent (who died in 1989 during the pendency of the writ petition) was entitled to the interest on the said amount @ 6% simple interest per annum from 1.4.1977 till November 2006.

In the present application it is stated by Smt. Duggal that pursuant to the aforementioned order she was paid a sum of Rs. 4,82,800/-, by a pay order dated 20.10.2008, towards the interest. It is submitted that the respondent did not calculate the retiral dues of late P.K. Duggal in terms of the rules and regulations of the appellant bank. Despite her writing to the bank on 31.1.2009, no action was taken. She then filed Writ Petition 9496 of 2009 in this Court on 20.5.2009. On 5.10.2009 Smt. Duggal withdrew the writ petition with liberty to move an application in the LPA for clarification. That is how the present application has been filed.

It is urged by Mr. Saini, learned Counsel for the applicant, that the sum of Rs. 2,72,000/- deposited by the appellant during the pendency of the appeal in this Court did not constitute the entire retiral dues payable to the respondent. For instance, the respondent has been denied some of the terminal benefits including arrears of salary and allowances, leave encashment, LFC, medical aid, gratuity and family pension. He submits that once the learned single Judge had set aside the Award and directed that the bank should pay to the respondent the wages and any other benefits to which the respondent was entitled, there was no justification in not making payment of all the dues owing and payable to the respondent.

In response to the application an affidavit has been filed by the appellant bank contending that the respondent did not work for the period from 1976 till 1989 and therefore the calculation of the amount due was made on that basis.

This Court was not satisfied with the above explanation and required by an order dated 15.12.2009, the appellant bank to file a detailed affidavit.

An additional affidavit dated 21.1.2010 has been filed by the appellant. It is stated that the total back wages were calculated at Rs. 4,30,998/- whereas the respondent had claimed Rs. 4,90,000/-. The difference of Rs. 62,000/- was on account of the petitioner claiming back wages and allowances from January 1976 whereas in terms of the order of the learned single Judge he was to be paid only from August 1976. Further special pay and personal allowance were not payable to the respondent since he had never actually worked with the bank and had been placed under suspension pending enquiry. Again, as far as LFC, medical aid, gratuity and leave encashment are concerned, the same excuse is offered that the respondent never worked with the bank. As regards family pension, it is stated that the regulations came into effect only in 1995 whereas the respondent expired in 1989 and the legal heirs of the respondent had not exercised their option in writing within 120 days of the notified date.

This Court finds no justification whatsoever in the stand taken by the appellant bank.

The understanding of the order of the learned single Judge by the appellant bank is erroneous. The judgment dated 31.7.2006 of the learned single Judge, which has been affirmed by the Division Bench, clearly states in para 11 that as a consequence of the Award being set aside, "the petitioner (i.e. P.K. Duggal) is entitled to reinstatement in service in view of the proviso to Clause 2(b) of the Agreement dated 25.7.1976 between respondent Nos. 2 and 3" (i.e. the United Bank of India & the appellant herein and the Narang Bank of India Limited, its predecessor). Further in para 12 it is stated "it has been brought on record that the petitioner was suspended w.e.f 28.1.1976. As a consequence he would be entitled to reinstatement in service with full back wages and continuity from that date". Since this finding of the learned single Judge has been affirmed, it is now not open to the appellant bank to contend that the respondent is not entitled to be paid full back wages and continuity from 28.1.1976.

The learned single Judge further noticed that Smt. Kamlesh Duggal had been substituted as the legal representative of P.K. Duggal after the latter expired on 22.9.1989. Since reinstatement could therefore not be effected Smt. Kamlesh Duggal was held to be "entitled to receive the amount payable to him". As far as back wages are concerned, the liability was split into two periods. The back wages till 1.8.1976 was to be paid by the Narang Bank Limited and thereafter till the petitioner�s death or superannuation it was to be the responsibility of the appellant United Bank of India. While they were entitled to make adjustment of the amount already paid their liability to make such payments was never in doubt. Since Narang Bank Limited was in liquidation and taken over by the appellant, the liability was that of the appellant.

It is plain to this Court from the above order that the stand of the appellant bank that because P.K. Duggal has never worked with the appellant bank, he was not entitled to LFC, medical aid, gratuity and leave encashment and any other retiral benefits is wholly misconceived. It is plain that P.K. Duggal had to be treated as having continued in service throughout, i.e. as if his services were not terminated. The reinstatement dated back to the date of the termination of his services. There is therefore no question of denying any of the above benefits as he has been reinstated with "full back wages". Further, as long as P.K. Duggal remained out of service till the order dated 31.7.2006 of the learned single Judge reinstating him, there was no question of his family exercising the option for payment of family pension. Such an option could have been exercised only after the order terminating the respondent�s services was set aside. The rejection of the claim for pension was on a technical ground and cannot be legally sustained.

Accordingly, the present application is disposed of by clarifying that the amount of Rs. 2,72,000/- deposited by the appellant bank in this Court during the pendency of the appeal did not constitute the entire amount owing and payable to Smt. Kamlesh Duggal, the legal representative of respondent P.K. Duggal. The appellant bank will recalculate the amounts due to Sh. P.K. Duggal and pay them to Smt. Kamlesh Duggal, in terms of the present order, within a period of 12 weeks from today.

The application is disposed of in the above terms with costs of Rs. 5,000/- to be paid by the appellant bank to Smt. Kamlesh Duggal within a period of 12 weeks from today.