-1- IN THE HIGH COURT OF BOMBAY AT GOA WRIT PETITION NO.81 OF 2002 Shri Patrick Miranda, aged About 48 years, Indian National, Resident of Madel, Margao –Goa. ….…Petitioner V e r s u s 1. Indian Overseas Bank, A Banking Company and Nationalised Bank under the Banking Companies (acquisition and transfer of Undertakings) Act 1976, Through its Manager, Vasco Branch, Vasco-da-Gama, Goa. 2. The General Manager, Personnel Administaration Department, Indian Overseas Bank, Central Office, 763 Anna Salai, Chennai – 600 002. ...…Respondents Mr. V. A. Lavande, Advocate for the Petitioner Mr. M. S. Sonak, Advocate for the Respondents. Coram :- S.. A. BOBDE F. M. REIS, JJ. Judgment Reserved on : 13 th June, 2011 Judgment Pronounced on : 12 th August, 2011 ORAL JUDGMENT (Per F. M. Reis, J.) The Petitioner seeks, inter alia, the following reliefs in the above Petition,for a writ of mandamus or a writ in the nature of mandamus, order or direction quashing and setting aside the communication dated 21.02.2001 and also to direct the Respondent-Bank to accept the Voluntarily Retirement Scheme application dated 15.12.2000 of the Petitioner. -2- 2. It is the case of the Petitioner that he joined the Indian Overseas Bank which is a Nationalised Bank as a Clerk on 26.05.1975 and he was promoted to the officer's cadre as Junior Management Scale I on 01.02.1981. Thereafter the Petitioner was promoted to the Middle Management Scale II on 01.01.1991 and at such post the Petitioner has been working up to the date of the Petition. It is further his case that there are five grades in Officers Cadre as enumerated at para 4 of the Petition. The Respondent-Bank according to the Petitioner came out with a Voluntarily Retirement Scheme for the officers and employees of the Banks which was circulated to the staff by Circular dated 02.12.2000. The scheme was valid for a period of five weeks from 15.12.2000 to 19.01.2001. The scheme was finalised in view of the process initiated by the Government of India advising the public sector banks to carry out a detailed manpower planning in order to adopt measures to have optimum human resource at various levels in keeping with the business strategies and requirements of each banks. A committee was constituted by the Bank to examine the issues of the burden of manpower and to suggest remedial measures and, consequently, Voluntary Retirement Scheme was prepared and placed before the Government to assist the Banks in their efforts to optimize the human resources. On the basis of the recommendations of the committee, the Indian Bank's Association obtained the objections from the Government of India so as to place them before the respective Boards for adopting and implementing the Voluntary Retirement Scheme. After obtaining the necessary approval from the Board, the Respondent-Bank adopted the Scheme on 25.11.2000 for implementation. Clause 4 of the said Voluntary Retirement Scheme provides for the eligibility criteria which, inter alia, contemplates that all permanent employees -3- with 15 years of service or 40 years of age are eligible to seek voluntary retirement under the scheme and there are different categories which do not fall for eligibility for such Voluntary Retirement Scheme namely specialised Officers, who have executed service bonds, Officers serving abroad under special arrangements, employees against whom disciplinary proceedings are contemplated or are under suspension, employees appointed on contract basis and highly skilled and qualified employees who have been given a specialised training in the area of Credit Foreign Bank Exchange, Investment and Information Technology. Clause 4 further stipulates that the competent authority shall have absolute discretion either to accept or reject the request of the Officer/employee seeking voluntary retirement under the Scheme depending upon the requirement of the Bank and that the reasons for such rejection shall be recorded by the authority competent. Clause 13 further provides that it will not be open to the Officers to withdraw the request made by voluntary retirement under the Scheme after having exercised such option. 3. Accordingly, it is the case of the Petitioner that as he had joined the services of the Bank on 26.05.1975, he had completed more than 25 years and being over 40 years of age, he was eligible to apply for such Voluntary Retirement Scheme. The Petitioner submitted the application in the prescribed form for voluntary retirement by application dated 15.12.2000 but, however, by communication dated 21.02.2001, the competent authority decided not to accept the application for voluntary retirement submitted by the Petitioner. The reason recorded by the Respondent-Bank was that considering the business/organizational requirements and administrative exigencies of the Bank, -4- the said application came to be refused. It is further the case of the Petitioner that Officers similarly placed like the Petitioner shouldering higher responsibilities and placed in vital areas, were relieved under Voluntary Retirement Scheme. A representation was also made by the Petitioner by communication dated 10.03.2001 but, however, there was no communication from the Respondent on the representation. 4. Being aggrieved by the said refusal by the Respondent-Bank, the Petitioner has filed the above Petition on the ground that the reasons given by the Respondent-Bank cannot be considered to be valid reasons and that the manner in which the application has been accepted and rejected by the Respondent-Bank, it clearly demonstrates that it is done arbitrarily and without any rational and without any guidance. It is further his case that there are similarly placed employees of the Bank, who have been promoted on the same date as the Petitioner in the same scale and having the same number of years as Officers and that employees who are younger as well as older to the Petitioner have been relieved. He has further contended that the exercise of the Respondent-Bank in refusing to the Voluntary Retirement Scheme to the Petitioner, has no legal sanction and cannot stand the test of reasonableness but smacks of arbitrariness and deserves to be quashed and set aside. As such, the above Petition is filed seeking the aforesaid reliefs. 5. The Respondents filed their counter through their Senior Manager Shri Manoj S. Kantak. He has stated in the reply that the Petitioner was employed by the Bank and posted at the Central Office and, on promotion, he continued as Officer at Nungambakkam Branch. Thereafter, he was posted at different places in -5- Goa and that the Petitioner whilst working as a Deputy Manager for the Vasco Branch, applied for the Voluntary Retirement Scheme, 2000. It is further his contention that the Board of Directors of the Respondent-Bank in their meeting dated 25.11.2000, approved a Voluntary Retirement Scheme for the Officers and it was valid for a period of five weeks. He has further stated that the Petitioner has no fundamental right to compel the competent authority to accept his application for voluntary retirement and that it is a special scheme by which absolute discretion is given to the competent authority either to accept or reject their application. He has further stated that when the application of the Petitioner was considered, it was found that he was imparted training in Foreign Exchange (Bourse) Course and it was felt that the services of the Petitioner who has been trained in Foreign Exchange is required by the Bank and, accordingly, he was asked to be retained for promoting the interest of the Bank. It is further the case of the Respondents that the Petitioner was not eligible to apply for Voluntary Retirement Scheme and it was denied that he did not fall under the category enumerated in Clause 4.2 of the Scheme. It further stated that considerable expenses as well as efforts were required for the purpose of imparting training to the Petitioner and, as such, the same was considered by the competent authority and rejected. It is further their case that the Voluntary Retirement Scheme 2000 floated by the Bank only prescribes some eligibility to seek voluntary retirement and is not a condition of service. It is further their case that the applications were accepted after considering the skill, profile and track record of the service of the applicants with a view to downsize the human resources at various levels. Such action of the Respondents cannot be interpreted by the Petitioner at his own whims and caprices stating that even officers shouldering higher responsibilities and placed in vital -6- areas were relieved under the said Scheme. It was further their case that the action on the part of the Respondent-Bank is justified in view of the law laid down by the Apex Court and that the Bank treated the application from the employees as an offer which could be accepted or rejected. It is further their case that the impugned communication dated 21.02.2001 was passed after following the provisions of the Scheme and nothing contrary to the Scheme was done in the instant case. It was further their case that action on the part of Respondent-Bank is legal and cannot be said to be void. It is further their contention that discretionary exercise by Respondent-Bank is in accordance with law and there is no discrimination whilst considering the application of Voluntary Retirement Scheme under the special Scheme as alleged by the Petitioner. On the contrary, it is their case that the Respondent no.1 has acted fairly, judiciously and without any arbitrariness and there are no malafides in rejecting the application of the Petitioner. 6. The Petitioner filed his affidavit in rejoinder and disputed the contentions raised by the Respondents in the said counter. It is further his case that he received training of Foreign Exchange about 13 years back and that it does not come within the purview of Clause 4.2 (e) of the said Scheme. It is further his case that though he had undergone training in Foreign Exchange conducted by the Reserve Bank at the Bankers Training College in Mumbai, there was no specialised training and that he was posted at Vasco Branch where there was no Foreign Exchange dealings. It is further his case that the Respondents are indulging in a pick and choose policy and reiterated the contentions raised in the Petition. Along with the reply, he has produced the copy of the Judgment passed by the Hon'ble -7- High Court of Allahabad High Court in Civil Misc. Writ Petition No. 6162/2003 filed by a similar employee Shri Tribhuwan Nath Srivastava, whose application for Voluntary Retirement Scheme came to be rejected. The said Writ Petition was allowed by the Hon'ble High Court of Allahabad by Judgment dated 03.09.2003. It is further mentioned therein at Para 22 that the Respondents had preferred a Special Leave Petition bearing no. 1149/03 before the Hon'ble Apex Court. The additional affidavit was filed by the Respondents on 22.09.2002 stating, inter alia, that another representation dated 17.02.2009 was filed by the Petitioner praying for re-consideration of the acceptance of the Voluntary Retirement Scheme proposal with monetary benefits. In view of the Order dated 14.10.2008, the said representation was duly considered and a decision was taken not to accept the application of the Petitioner. An additional affidavit also came to be filed by the Respondents dated 20.10.2010 alongwith some documents and an affidavit in reply in rejoinder was filed by the Petitioner and alleged, inter alia, that the documents produced by the Respondents are not far from suspicion and that the alleged resolution is not the resolution in the eyes of law. Specific statements made in the affidavit by the Respondents have been dealt with by the Petitioner in his said rejoinder at paras 5, 6, 7 and 8. Thereafter, this Court by Order dated 25.10.2010 in view of the doubt created by the Petitioner to the correctness of the photo copies produced by the Respondents permitted inspection of the documents. Subsequently, an affidavit was filed by the Petitioner making allegations that there was ambiguity on inspection of the records of the Respondent-Bank as stated in the said affidavit. Thereafter, additional affidavit was also filed by the Respondents disputing the contentions put forward by the Petitioner in the said affidavit. -8- 7. Shri V. A. Lavande, the learned Counsel appearing for the Petitioner has submitted that the whole action on the part of the Respondent-Bank is arbitrary and cannot pass the test of reasonableness as guaranteed by the Constitution of India. The learned Counsel has submitted that the Respondents are taking contrary stands and have not come forward with any specific justifiable reason to refuse the application for voluntary retirement under the said Scheme. The learned Counsel further submitted that there are instances wherein similarly placed employees were allowed the benefit of the said Scheme while on the contrary, the Petitioner who was entitled to get the benefits of the said Scheme was on account of unjustifiable and invalid reasons, refused the benefit of Voluntary Retirement Scheme by the Respondent-Bank. The learned Counsel has further submitted that on examination of the records of the Respondent-Bank, the Petitioner found several ambiguities and the same discloses malafides on the part of the Respondents in fabricating records so as to justify the refusal of the benefits to the Petitioner. The learned Counsel has further submitted that the Respondent-Bank is not entitled to indulge in a pick and choose policy which is not at all accepted in law as it would result in discrimination to the Petitioner. He further submitted that the Petitioner has made the eligibility criteria and, as such, there was no justification for the Respondent-Bank to send the impugned communication to the Petitioner. The learned Counsel has taken us through the material on record and pointed out that there is nothing on record to suggest that any specialised training in Foreign Exchange was given to the Petitioner which would justify the action on the part of the Respondent-Bank and this itself violates the Petitioner's fundamental rights guaranteed under Article 14 and 16 of the Constitution of India. The learned Counsel, as such, submitted that the impugned communication deserves to be set -9- aside and the rule to be made absolute in terms of the prayer clause. 8. On the other hand, Shri M. S. Sonak, the learned Counsel appearing for the Respondents has submitted that there is no absolute right guaranteed to the Petitioner which would entitle him for any benefit under the Voluntary Retirement Scheme. The learned Counsel has further submitted that on account of the administrative and working exigencies at the Bank, the application of the Petitioner for acceptance of the Voluntary Retirement Scheme came to be refused. The learned Counsel further submitted that the Petition comes within the exception of clause 4.2 of the said Scheme which clearly provides that persons who have under gone such training are not eligible to apply for such Scheme. The learned Counsel further submitted that there is no dispute that the Petitioner was given specialized training in Mumbai and merely because he was posted on some occasions at places where such Foreign Exchange dealings are not carried out cannot by itself infer that the Respondent-Bank is not entitled to refuse the application of the Petitioner on the ground that he has been imparted training in Foreign Exchange dealings. The learned Counsel has taken us through the counter filed by the Respondents and pointed out that the contention of the Petitioner that he has been discriminated is far fetched and cannot be borne out from records as it is the right of the competent authority to consider the exigencies of the situation and decide the persons who should not be released by the Bank under the said Scheme. The learned Counsel strongly disputed the contention of the Petitioner that there was any arbitrariness on the part of the action of the Respondents or that the action of the Respondent-Bank smacks of any malafides. The learned Counsel has further pointed out that it is well settled that the Respondent-Bank has got the discretion to -10- accept or reject any application for Voluntary Retirement Scheme and, as such, the Respondent-Bank in exercise of such right has refused the application of the Petitioner and, there is nothing on record to show that in such action the Respondent-Bank acted highhandedly or arbitrarily. The learned Counsel has further pointed out that the Respondent -Bank has always acted reasonably and it cannot be accepted that there was any infringement committed by the Respondents in taking the necessary action on the application filed by the Petitioner under the Voluntary Retirement Scheme. The learned Counsel in support of his contention has relied upon the judgment of the Apex Court reported in (2006) 7 S.C.C. 664 in the case of Port Trust & Ors. vs. T.S.N. Raju & anr. and 2006(3) S.C.C. 708 in the case of HEC Voluntary Retd. Employees Welfare Society & anr. vs. Heavy Engineering Corpn. Ltd. & Ors. The learned Counsel as such submitted that the Writ Petition deserves to be rejected. 9. Having heard the learned Counsel, the point to be considered is whether the Respondent-Bank has acted reasonably whilst exercising its discretion in refusing the application for Voluntary Retirement Scheme filed by the Petitioner? 10. From the foregoing narration of the facts, we find that the Petitioner had claimed that he was eligible to take the benefit of the Voluntary Retirement Scheme 2000 by filing the requisite application before the competent authority of the Respondent-Bank and that the Respondent-Bank after due consideration have refused the application of the Petitioner. It is the contention of Shri Lavande, the learned Counsel appearing for the Petitioner, that such action on the part of the Respondent is arbitrary and cannot stand the test of reasonableness. In fact, it appears that the above Petition was filed by taking support of the Judgment of the -11- Hon'ble Allahabad High Court in the case of Tribhuwan Nath Srivastava vs. The Chairman and Managing Director I.O. Bank & Ors. (supra), but, however, the said Judgment of the Allahabad High Court was challenged in a Special Leave Petition before the Apex Court and the same came to be disposed of by the Judgment dated 04.02.11 which is reported in (2011) 3 S.C.C. 475. While allowing and setting aside the impugned Judgment, the Apex Court at Paras 25, 26, 27, 28, 29 and 30 stated thus : “25. But at the same time, it must also be realised that reasonableness is not something in the abstract. The reasonableness of a decision or an action can only be judged in the totality of the facts and circumstances and having regard to the object and purpose sought to be achieved. For example, if the object is to select someone for public employment or for promotion to a higher post, the only reasonable thing to do would be to select the most suitable and meritorious among the candidates. The selection of a person of inferior merit or someone who is not even eligible would be wholly unreasonable if the object is to choose the best as it should be in case of selection for public employment or promotion to a higher post. But in case an organisation undertakes manpower planning with a view to downsize the personnel and cut down the overhead costs, very different considerations would apply and in that case the application of the yardstick for selection for public employment or for promotion to a higher post would lead to results opposed to the very object of the exercise. -12- 26. We feel that the High Court committed the fundamental mistake in completely misconstruing the object and purpose of the voluntary retirement Scheme. As wrongly assumed by the High Court, the object of the Scheme was not to reward the good officers or to punish the bad ones. Even though depending upon personal circumstances, voluntary retirement under the Scheme might have appeared to some individual officers as personally beneficial, it was not envisaged by the Bank as a means to give personal rewards or to punish individual employees by granting or refusing to grant voluntary retirement to them. The objective of the Scheme as stated in the circular issued by the Bank was “to adopt measures to have optimum human resources at various levels in keeping with the business strategies, skill profile to achieve balanced age and requirement of the Bank”. 27. In Bank of India v. K. Mohandas, one of us (Lodha, J.) had the occasion to examine the genesis and raison d’tre of the voluntary scheme framed by the banks; in that judgment it was observed, in SCC paras 3, 4, 5 and 36, as follows: (SCC pp. 320-21 & 329) “3. In the month of May 2000, the Government of India, Ministry of Finance (Banking Division), advised the nationalised banks to carry out detailed manpower planning as these banks were found to have 25% of their manpower as surplus. A Human Resource Management Committee was constituted to examine the said issue and to suggest suitable remedial measures. 4. The Committee so constituted observed that high establishment cost and low productivity in public sector banks affect their profitability and it was -13- necessary for these banks to convert their human resources into assets compatible with business strategies. Inter alia, the Committee placed the draft voluntary retirement scheme with the Central Government that would assist the banks in their efforts to optimise their human resources and achieve a balanced age and skill profile in keeping with their business strategies. 5. With the approval of the Central Government, Indian Banks’ Association (IBA) circulated salient features of the draft scheme to the nationalised banks for consideration and adoption by their respective boards vide its letter dated 31-8-2000. The Board of Directors of each of the nationalised banks, keeping in view the objectives, considered the draft scheme and adopted it separately. * * * 36. Any interpretation of the terms of VRS, 2000, although contractual in nature, must meet the test of fairness. It has to be construed in a manner that avoids arbitrariness and unreasonableness on the part of the public sector banks who brought out VRS, 2000 with an objective of rightsizing their manpower. The banks decided to shed surplus manpower. By formulation of the special Scheme (VRS, 2000), the banks intended to achieve their objective of rationalising their force as they were overstaffed. The special scheme was, thus, oriented to lure the employees to go in for voluntary retirement. In this background, the consideration that was to pass between the parties assumes significance and a harmonious construction to the Scheme and the Pension Regulations, therefore, has to be given.” (emphasis added) 28. Bearing in mind the object and purpose of the Scheme as explained in the decision in Bank of India it is not difficult to see how the competent authority in -14- the Bank would deal with the applications for voluntary retirement made by individual officers; other things being equal between two applicants he would like to let go the one with the inferior service record and lower potential and consequently he would accept the application of the officer with the lower merit and may not accept the request of the officer with superior merit. This is for the simple reason that in the process of shedding surplus manpower no organisation would like to lose its best people. 29. From a purely subjective point of view the decision of the competent authority may appear to be “unfair” or even a “punishment” to the officer with the superior merit, nevertheless it would be the proper and reasonable exercise of discretion in view of the basic objective of the Scheme. We are not unconscious that the denial of request for voluntary retirement to an officer in practice may result in souring of relationship between the officer concerned and the bank (as it actually happened in this case) and as a consequence the officer concerned in future may not show the same competence and efficiency in the discharge of his duties for which he was sought to be retained in service. But that is a matter of personnel management and the competent authority is expected