HIGH COURT OF CHHATrESSARH AT BILASPUR WRIT PETITI.ON N0.07/2001 PETITXONER R. Mukhopadhyay Vs. RESPONDENTS Union of India & others. !f WRIT PETITION [s1 N0.7090/2007 PETITIQNER M.K. Khastagir Vs. RESPONbENTS Union of India <& others. <& ^> WRITPETITION N0.1335/2005 PETITIONER Hari Singh Kanwar Vs. RESPQNDENTS Union of India & others. ORDER FOR CONSI&ERATION --« ^ '-^1'- HON'BLE MR. R.N. CHANDRAKAR. J 5 '^r-Jts- A....- POST FOR ORDER ON 16 JUNE. 2009 Sd/- Dhirendra Mishra Judge Sdf- R.N. Chandrakar judge Sd/- DhirendraMishra Judge HI6H COURT OF CHHATTISGARH AT BILASPUR &IVISION BENCH: HON. MR. bHIREN&RA MISHRA. & HON. MR. R.N. CHAN&RAKAR. JJ PETITIONER RESPONDENTS PETITIONER WRIT PETITION N0.07/2001 R. Mukhopadhyay, Legal Manager, South Eastern Coalfields Limited, Bilaspyr (Chhattisgarh) Vs. 1. Union of India through Secy. Ministry of Law, New t>elhi. 2. Coal Mines Provident Fund Commissioner. 3. Regional Coal Mines Provident Fuhd Commissioner, Bilaspur. 4. South Eastern Coalfields Limited, Through its Chairman-cum-Managing Director, Seepat Road, Bilaspur. WRITPETITION [s] N0.7090/2007 M.K. Khastagir, Aged about 60 years, S/o Shri Late N.C. Khastagir, R/o B-50, SECL Indira Vihar, Bilaspur- 495 006 RESPQNDENTS f- PETITIONER RESPONDENJLS Vs. 1. Union of India through the Secretary, Ministry of Coal, New Delhi. 2. Regional Co.mmissioner, Coal Mines Provident Fund, Seepat Road, Bilaspur (CG). 3. South Eastern Coalfields Limited, Through its Chairman-cum-Managing [)irector, Seepat Road, Bilaspur. & WRIT PETITION N0.1335/2005 Hari Singh Kanwar, Aged about 58 years, S/o Narayan Singh Kanwar, R/o House No.48/920 Old Sarkanda, Bilaspur (C6) Vs. 1. Union of India (through The Secretary) Ministry of Coal, Shastri Bhawan, New Delhi. 2. Commissioner, Coal Mines Provident Fund, Dhanbad (Jharkhand). 3. Regional Commissioner, Coal Mines Provident Fund, Bilaspur. 4. South Eastern Coalfields Limited, Through its Chairman-cum-Mdnaging Director, Seepat Road, Bilaspur (C6)- 495 006. Central Coalfields Limited Staff Provident Fund, Through its Trustee/Finance Mana9er CCL, Darbhanga House, Ranchi, Jharkhand. Present: Petitioner in Person. Mr. 6ary M-ukhopadhyay, Advocate. Mr. R. Mukhopadhyay & Mr. Gary Mukhopadhya, Advocates Mr. S.K. Beriwal, Advocate ^. Mr. Alok Bakshi, Advocate appears on behalf of Mr. A.S. Geharwar, Advocate Mr. P.S. Koshy, Advocate Mr. H.B., Agarwal, Sr. Adv. with Miss Rinki Tamrakar, Advocate. In W.P. No.07/2001. (s) For petitioner fin W.P. No.7090/07. j For petitionep in W.P. No.1335/2005.1 For respondept-Union of India inall thejpetitions. For respondent-Coal Mines Provident Fund in all the petitions. j For respondeht SECL in W.P.No.07/2001 & W.P. (s) No.7090/07 ^ For respond^nt SECL in W.P. No.1333/2005. O R D ER l (Passed on J^^Tune, 2009) | Dhirendra Mishra.^' 1 l. These petitions are being disposed of by this common order,as tthe petitioners in these petitions have impu9ned the constitutional validity of Para-61 of the Coal Mines Provident Fund Scheme (for short 'the Scheme') framed in exercise of the powers conferred by Section 3 of the Coal Mines Provident Fund and Miscellaneous Provisions Act, 1948 (for short 'the Act, 1948'). 2. For the purpose of this order, reference is made to the facts of W.P. No.07/2001 (R. Mukhopadhyay Vs. Union of India & ors). triefly stated, facts of the case are that the petitioners herein have been retired as Offieers workingunder the South Eastern Coalfields Limited (for short 'SECL'). Petitioners namely R. Mukhopadhya & M.K. Khastagir became members of the Coal Mines Provident Fund (for short 'CMPF') after joining their services in the erstwhile Rewa Coalfields Limited & Chr-imiri Colliery Company Limited respectively. Whereas; petitioner-Hari Singh Kanwar joined National Coal Development Corporation (for short 'NCbC'), a Central Sovernment undertaking,and became member of NCDC Provident Fund (for short 'NCDCPF'). After nationalization of the Coat Mines in the year 1973, NCt)C as well as erstwhile private sectpr companies came under the management of Coal Mines Authori't'y' Limited. Subsequentiy, coal industry was reprganized and Coal India Limited (for short 'CIL'), a government company, was formed with its subsidiaries companies including SECL. The SECL and Central Coalfields Limited (for short 'CCL') are also government companies registered under the Companies Act, 19S6. After nationalizatjon, NC&C got merged with CIL and Heffd-office of NCDC, Ranchi became the registered office of ^" CCL. After formation of CCL. NCDCPF was renamed as Central y Cotflfields Limited Staff Provident Fund (for short 'CCLSPF') "and the rules applicable to the members of NCDCPF continugd to be same as the members of CCLSPF. As per Rule 15 (a) of the CCLSPF Rules, CCLSPF was a contributory provident fund. Contribution of each member was deducted from his salary and equal amoynt was contributed by the company to the fund. Both these amounts were deposited to the fund balance in the credit of the members. Similarly, CMPF is also a contributory fund. The employer is to contribute equal amount as the employee and both the amounts are to be deposited with CMPF through SECL every month. >- ^ V; Rule 19 (d) of CCLSPF Rules provides that interest payable on the balanceof the fund of the member is to be calculated at the close of financial year in the ;manner prescribed for the Seneral Provident Fund of the Sovernment of India, whereas, interest is to be paid to the rriembers of CMPF as per Para-61 of the Scheme. After nationalization of the Coal Mines in the year 1973, all the employees of the coal mines came under the same employer i.e. CIL, however, service conditions for the employees including provident fund rules continued to remain separate. In exercise of powers conferred under SectioitS (E) of the Act, 1948, the Coalmin.es Family Pension Scheme, 1971 was superceded and a new pension scheme was framed as Coal Mines Fdmily Pension Scheme, 1998. However, benefitsof this ,scheme were not extended to the members of CCLSPF and members of Coalmines Authority Limited Staff Provident Fund. The above exclusion caused resentment amongst the members of CCLSPF and in these circumstances the Board of Trustees of CCLSPF resolved to-merge CCLSPF with CMPF so that the members of CCLSPF could also became eligible for p&nsion and accordingly merger was effected vide gaz'ette notification dated 8.10.2004. In consequence of the above merger all the amount in the credit of the members of CCLSPF was transferred to CMPF and accordingly, petitioner Hari Singh Kanwar also became eligible for pension subject to compliance of conditions imposed by subsequent gazette notification dated 13.2.2003. After petitioner- Hari Singh Kanwar became member of CMPF, he was paid interest annually in terms of Para-61 of the Scheme. 4. The common grievance of the petitioners in these p'etitions is that the members of CMPF are denied interest on their deposits towards provident fund from the date the same is reducted from their salary and equal amount is deposited by the SECL in their CMPF nccount. 5. Contention of l.earned counsel for the petitioners is that the contribution of CMPF amount of the petitioners is to be de-posited every month and therefore, they should also be paid interest with effect from the date of deposit. Prior to merger of CCLSPF in CMPF, petitioner-1-lari Singh Kunwar was paid interest in the manner of calculation of interest under the Seneral Provident Fund, as per Rule 19 (d) of the CCLSPF Rules. Rule 11 (2) sub-para (iii) of GPF (Central Services) Rules clearlystipulates that interest shall be paid on all sums credited to the subscribers account after last day of the <. preceding year from the date of deposit upto the end of the current year. The manner of calcutation of interest under the Scheme is given in Para 61 (2) according to which no interest is to be paid to the employee for the monthly contribution from the date of deposit. Where opehing balance of the employee is Nil in any particular financial year in that case he will not be entitled for any interest for the whole year though he has regularly deposited the monthly contribution towards provident fund. Under Para 61 (2) of the Scheme the employee suffers recurring loss of interest throughout his service ^- care.er in this manner. -y Petitioner-Hari Singh Kanwar was getting^ interest on his deposits from the date of deposit and interest was calculated in.-ithe manner prescribed in Rule 11 of GPF (CS) Rules. After the date of merger of CCLSPF and CMPF, he became entitled for CMPF only after depositing substantial amount with interest to the pension fund, however, the benefit which he was enjoying since joining coal industry was taken away after merger as per the Scheme. Calculation of inferest under Para 6''! (2) of the Scheme is illegal and arbitrary. ^' •^ \ c? 7.0n; the other hand learned counsel for respondents No.2 & 3 submitted that the Scheme has been framed by the Central Sovernment to offer best possible return on provident fund contribution and its investment with maximum security on deposits, at the same time discharging the duties under the Scheme keeping the corpus dependable. Because of prudent investment by the CMPF organization, its subscribers are getting higher rate of interest than the 6PF subscribers, as would be evident from the comparative table. The provisions of 6PF <& CMPF Actcannot be compared. The Scheme under CMPF Act has been framed qs industry-specific, whereaSi, Employees Provident Fund Scheme, 1952 covers around 30 million employees who are paid interest on monthly running basis. The said scheme debars a subscriber to become its member whose monthly salary exceeds Rs.6500/- under Para 2 (f)(ii) of the E.f'.F. Scheme, 1952. Whereas, there is no such bar and limitation under the Scheme. Apart frpm this, the members of the Scheme are getting benefit of 12% matchin9 contribution from the employer. In absence of any ceiling of income, the Senior Executive of Coal Company is getting matching contribution of Rs.7,000/- to 8,000/- per month from their employer apart from the interest that would accrue on such co'ntribution. Under the EPF Scheme, 1952 contribution for some employees is 10% of the gross wage while for others it is 12% of gross wage, where.as, the Scheme provides for 127o contribution across the board, irrespective of ctass of employees and their earnings. It was further argued that W.P. No.6402/2002 (P.N. Chakrovorthy Vs. Union of India <& others) and W.P. No.6431/02 (G.K. Mitra Vs. Union of India & others) were filed before the High Court of Madhya Pradesh seeking similar relief and the same were dismissed by the High Court on c- 7 26.2.2004. Special Leave Petition (Civil) No.10382/2004 was filed by the petitioner in W.P. No.6420/02 before the Hon'ble Supreme Court and the same was also dismis-sed in limine vide or^ler dated 17.9.2004. (Annexures R-16 to R-18 in W.P. No.1335/05). 7. Similar arguments were advanced by learnedcou sel for the respondent-Union of India and respondent-SECL. 8. Mr. 6ary Mukhopadhyay, learned counsel for the petifioners submits that the earlier petitions filed for similar relief were dismissed with an observation that " it is submitted by the lebrned counsel for the respond6nts that the Board of Trustees, after ponsidering various aspects of the matter, "'i' have decided that interest should be calculated on the original balance at the end of the year. No authority has been produced before this Court by the petitioner tp show that the Scheme is arbitrary and ultra-vires of the Act". S.L.P. has also been dismissed at the threshold without entering into the m?rits. Relying upon the judgment i"n the matter of 0.5. Nakara and others Vs. Union of India reported in AIR 1983 SC 13& > it was argued that the absence of precedent cannot bf^a ground to dismiss a petition challenging constitutional validyy of a scheme framed under the Act. Further relying upon the judgment of the Hon'ble Supreme Court in the matter of t '. '. - - . Kunhayammed & others Vs. State of Kerala & another reported in (2000) 6 SCC 359 it was argued that where a SLP is dismissed by a non-speaking order without assigning reasons for dismissing the SLP, it would neither attract the doctrine of merger so as to stand substituted in place of the order put in issue before it nor would it be a dectaration of law by the Court under Article 141 of the Constitution for there is no law which has been declared. »• >r > ~-y •c. V 9. We haye heard learnedcounsel for the parties. 10.So far as the last argument advanced by learned counsel for the respondent- Coal Mines Provident Fund that a writ petition for similar relief has been dismissed by the High Court of Madhya Pradesh and S.L.P. against the order of dismissal has been 'further dismissed by the Hon'ble Supreme Court is coheerned, after perusal of the order of dismissql passed by the High Court qnd subsequent dismissal by fhe Hon'ble Supreme Court, we find substance in the arguments of the petitioners that the petition has been dismissed only on the ground that no authority has been produced toshpw that the scheme is arbitrary and ultra-vires of the Act. Appeal against the above order has been dismissed at the threshold and it does not assign reasons for dismissing the special leave petition. Relying upon the judgments in the matters of t).S. Nakara (supra) & Kunhayammed (supra), we hold that dismissal of the earlier writ petition for similar relief firtally by the Hon'ble Supreme Court will not make the instant petitions non- maintainable and we propose to decide the same on merits. 11. Before entering into the merits of the rival contentions, we prbpose to trace the history of the legislation under consideration. The Act, 1948 (Annexure R-l) was enacted with an object of making provisions for framing of provident fund scheme; family pension scheme; deposit linked insurance scheme and bonus scheme for the persons employed in the coal mines. In exercise of powers under Section 3 of the Act, 1948 ! a, Coal Mines Provident Fund Scheme (Annexure R-2) was framed vide notification dated 11.12.1948. In further exercise of powers under Section 3 of the Act, 1948 a Coal Mines Family Pension Scheme, 1971 (Annexure R-3) was also frd.med. Coal Mines Deposit Linked Insurance Scheme, 1976-(Annexure R-4) was also framed in exercise of powers under Section 3 (6) ^- of the Act, 1948. However, in further exercise of powers under Section 3 (E) of the Act, 1948 Coal Mines Pension Scheme, 1998 (CMPS) (Annexure R-5) was prepared in supercession of Coal Mines Family Pension Scheme, 1971. As already stated in foregoing paragraphs, the provisions of CMPS were not applicable to the members of CCLSPF. After the Board of Trustees of CCLSPF deeided to merge CCLSPF with CMPF and after notification of the same, the CMPS Rules were applicable to the erstwhile employeesof NC&C. The Scheme is in force in whole of the country and the same is applicable to all the coal mines workers wprkingunder different subsidiaries companies of the CIL. Para-27 of the '^; ' Scheme provides for rate of contribution towards providerit fund by the employee and the employer.. Para-29 provides for recovery of member's contribution from his salary. Para-37 cast a dutyupon the employer to ask every member of the fund tof declare particulars concerning himself and his nominee in Form-A for communication to the Commissioner. Contribution Cards are also issued under the Scheme to the members. Period of currency of contribution card is one year. Para-4.1 mandates that the employer shall on or before expiration pf' <<• period of currency prepare a contribution card in respect of each member employee by him or a ledger in the Form-YY. Under Para-42 every employep is to submit to the Commissioner or such other officer subordinate to him, as may be authorized by him on his behalf, contribution cards. Para-42 (5) cast a duty on the emptoyer to submit. statement of contribution in Form-VV for currency period calculated on the basis of ledger in Form-yY. Para-50A provides for the manner in which remittance of CMPF amount is to be deposited to the current .account of CMPF ui/ith the Imperial Bank. Para-54 provides that all the moneys belonging to the CMPF shall be 10 r A '-»• either deposited in the Imperial Bank of India OR any such other scheduled banks as may be approved by the Centrat Sovernment from time to time, or invested insecurities mentioned or referred to in Clauses (a) to (d) of Section 20 of the Indian Trust Act, 1882. Sub-para 2 of Para-54 requires that the Board shall prepare a classified summary of the asset of(tthe funds as on 31s March of each year or on such other dates as the Central Government may specify. Para-61 of the Scheme deals with the manner in which the Commissioner shall credit the occount of each member, interest in respect of period of currency of the cards expiring in such financial year. Para-61 (2) describes the manner in which interest is to be calculated. The interest for The period of currency of the card is to be credited with effect from the last day of the period on the opening balance at the creditof the member on the first day thereof. iZ.The petitioners have impugned the above provision of computation of inferest on the ground that by adopting the abpve manner of computation of interest, the petitioners are deprived- of the interest for the amount deposited by them during currency of financial year. It was argued that after deducting the contribution towards providerft fund from the * salaries of the petitioners, the respondents are dutybound to pay interest from the date of deduction from the salary and deposit in the provident fund account. Denial of payment of interest from the date of deposit is infringement of their fundamental rights. Relying upon the judgment in the matter of Alok Shanker Pandey Vs. Union of India & others reported in (Z007) 3 SCC 545 it was argued that interest is normal accretion on capital with passage of time. Provision regarding interest and its calculation for general provident fund is mentioned in Rule 11 of 6PF (Central Services) Rules. o 11 •rom perusal of the same it would be evident that the interest is payable to the members of 6PF from the date of deposit, however, Para-61 of the Scheme deprives the members of CMPF from interest from the date of deposit, »vhich is per-se arbitrary and irrational and the same debars the petitioners of their legitimate claim. 13. We have already referred the development of law that has taken place since 1948. The above legislation is a beneficial legislation enacted for the benefits of coal mines employees. Initially, provisions were made only for generationof provident fund of the member employees under the Scheme. Subsequently, another scheme was framed for family pension •^^' after retirement of the emptoyee. Family Pension Scheme wdS reframed in the year 1998 superceeding earlier scheme of 1971. Earlier 1998 Coal Mines Family Pension Scheme (CMPS) excluded such employees who are not the members of the CMPF Scheme. However, considering the resentment of NCDC employees, who we.re governed by CCLSPF, the Board of Trustees decided to merge CCLSPF into CMPF and thereafter benefit of family pension was also made available to other •< eniployees of.coal industries who were not covered jn The past. Before the merger of CCLSPF, members of CCLSPF were ^- .. . - . . . . . . . ^i entitled for interest on the amount deposited by them towards provident fund in accordance with the manner in which the interest wascomputed under Rule 11 of 6PF (CS) Rules. As per Rule 19 (d) of CCLSPFRules the deficit in the revenue account in any year was to be met by a grant from the Corporation now Company. The members of CMPF are also entitled for family pension, benefit which was not available to the members of CCLSPF. The procedur.e of investment of accumulated provident fund has been detailed in Para 54 pf the Scheme. r V--' ^ •V 12 'tStK,.'' .ir aa,'' It is not a case where the petitioners are denied total \ &\> interest on their deposits. The grievanee of the petitioners is thqt the manner in which the interest is computed, as per Para-61 of the Scheme, deprives them frbm payment of interest from the date their contribution is deposjted in the provident fund. Rate of interest deposited in ppovident fund account of the members, the manner in which provident fund s6 deposited is to be invested and the manner in which the interest is to be computed for payment to its members are the financial decisions that are to be taken by a responsible Sovernment keeping in view the overall interest of the concerned employees. The Scheme has been framed in the e>rercise of powers under Section 3 (E) of the Act, 1948 by the Central Sovernment. From various beneficial schemes framed by the Central Sovernment from time to time in their exercise of powers under Section 3 (E) of the Act, it cannot be said that the Central Sovernment isoblivious to the welfare of the coal mines employees. In these circumstances we are of the opinion that we cannot sit in judgment over the decision of the Central Sovernment as appellate authority in exercise of powers under Article 226 of the Constitution of India. l4.So far as the challenge to constitutional validity of Para-61 of the Scheme on the ground that the manner of computation of interest in (5PF is beneficial to the employees as the interest is computed from the dateof deposit, whereas, the employees under the CMPF scheme are deprived of the interest on the amount which is deposited during the currency of financial year is concerned, there are several distinguishing features under both the schemes, as already detailed in foregoing paragraphs. There is difference in the rate of interest payabl&^ to the employees who are members of 6PF and CMPF. It is Settled law that challenge to constitutional validity of the 13 statute cannot be basedon comparativ.e study of provisions of the impugned statute with another statute on the sdme subject but derived from different source. When a statute ts impugned under Article 14 of the Constitution of India, in that case the Court has to decide whether the statute. is so arbitrary or uhreasonable that it must be struck down. l5.In the matter of Union of India & others Vs. Dhanwanti bevi and others reported in (1996) 6 SCC 44, property of respondent-Owner was acquired under the Jammu & Kashmir Requisitioning & Acquisition of Immovable Properties Act, 1968 for public purpose vide notification under Section 7 of the Act. The Land Acquisition Officer awarded compensation to <•„•. the land owner with 107o escalation on account of passage of time. Feeling dissatisfied therewith the claimant-land owner sought reference under Section 8 of the Act to the Arbitrator, who enhanced the compensation and also awarded 15% solatium and 4% interest per annum on the enhanced compensation. The appellants-Union of India & others questioned the same by filing qn appeal in the 1-ligh Court, however, the award of the Arbitrator was subsequently confirmed and the appeal was dismissed. Allowing the appeal and setting aside the award of solatium and interest on the cohipensation, the Hon'ble Supreme Court in Parq-11 of the judgment held thus:- "11. Taking the question of entitlement to interest as a first question, as vehemently argued by Shri Vaidyanathan, broadly speaking, the act of taking possession of immovable properties generally implies an agreement to pay interest on its consideration for deferred payment. In a court of equity, when theseller parts with possession of immovable property, the purchaser becomes its owner while the seller receives ~r~ ^* 14 •4 :&<.. c^ rnoney as consideration in tieu of the property. The seller, therefore, is entitled to claim interest in place of his retaining possession of the property from the date the purchaser takes possession of the property tilt the date of payment. On this premise, claim forinterest is sought against the State when it exercises its power of eminent domain and acquires the property of a citizen for public purpose. This principle was extended in equity to recompensate the owner for deprivationof his possession and enjoyment thereof in accordance with law. It was, therefore, held in equity that the