IN THE HIGH COURT OF GUJARAT AT AHMEDABAD SPECIAL CIVIL APPLICATION No 1635 of 1991 For Approval and Signature: HON'BLE MR.JUSTICE K.S.JHAVERI ============================================================ 1. Whether Reporters of Local Papers may be allowed : NO to see the judgements? 2. To be referred to the Reporter or not? : NO 3. Whether Their Lordships wish to see the fair copy : NO of the judgement? 4. Whether this case involves a substantial question : NO of law as to the interpretation of the Constitution of India, 1950 of any Order made thereunder? 5. Whether it is to be circulated to the concerned : NO Magistrate/Magistrates,Judge/Judges,Tribunal/Tribunals? -------------------------------------------------------------- MAFATLAL FINE SPINNING & MANU CO LTD Versus UNION OF INDIA -------------------------------------------------------------- Appearance: 1. Special Civil Application No. 1635 of 1991 MR ASHOK L SHAH for Petitioner No. 1-5 MR DIPAK A THAKER for Respondent No. 1-2 MR BHARAT T RAO for Respondent No. 2 -------------------------------------------------------------- CORAM : HON'BLE MR.JUSTICE K.S.JHAVERI Date of decision: 26/07/2004 ORAL JUDGEMENT This petition is filed by the petitioners for seeking direction against the respondents to give them benefits of Family Pension Scheme. 2.0. While admitting this petition, this Court [Coram: G.N. Ray, R.K. Abichandani, JJ.] passed the following order :- "RULE. To be heard with Special Civil Applications nos. 678 of 1998 and 679 of 1998." 3.1. Since Special Civil Applications nos. 678 and 679 of 1998 are disposed of by this Court [Coram : Hon'ble Chief Justice Mr. D.M. Dharmadhikari, as he then was] on 23rd June, 2004, on the same grounds this petition is being disposed of. 4.0. The short facts of the case are that the petitioners had earlier a Provident Fund Scheme for their employees. Thereafter, they framed a family pension scheme in accordance with the provisions of Employees Provident Fund and Family Pension Fund Act, 1952. The pension scheme was brought into force w.e.f. 1st March, 1971. Under Clause 3 of the pension scheme, a family fund was to be constituted to which contributions were to be made by employees as members and by the employer. The relevant clause 3 reads as under :- "3. Membership of the family pension fund- Subject to sub-paragraph (3) of paragraph 1, this Scheme shall apply to every employee- (a) who becomes a member of the Employees' Provident Fund or of Provident Funds of Factories and other establishments exempted under Section 17 of the Act on or after the 1st day of March, 1971. (b) who has been a member of the Employees' Provident Fund or of Provident Funds of Factories and other establishments exempted under Section 17 of the Act immediately before the commencement of this Scheme and opts to exercise his option under paragraph 4. [Provided that an employee who attains the age of more than (59) years on the date on which he would, but for this provision, have become eligible for membership or have been required to become a member of this Scheme shall not be eligible for membership under this Scheme.]" 4.1. The provisions of sub-clause (b) of clause 3 (above quoted) of the Scheme gave an option to the existing and past employees in service, prior to the enforcement of the scheme w.e.f. 1st March, 1971, to opt for the pension scheme in place of the Provident Fund Scheme earlier applicable to them. So far as the employees appointed after 1st March, 1971, the pension scheme was made compulsorily applicable and those employees inducted after 1st March, 1971 had no such option. 4.1. Clause 3 of the scheme quoted above came up for challenge at the instance of the employees in the High Court of Bombay and the learned Single Judge of the High Court of Bombay in Writ petition no. 451 of 1980 by judgment dated 25th June, 1987 struck down sub-clause 3(a) declaring it to be ultravires Article 14 of the Constitution of India. The learned Judge read down clause (b) of the said scheme as under :- "(b) who is a member of of the Employees' Provident Fund or of Provident Funds of factories and other establishments exempted under Section 17 of the act and opts to exercise his option under paragraph 4." 4.2. As a result of the judgment of the High Court of Bombay, the option to contribute to the family pension fund was equally available to past, existing and future employees in the scheme which came into force on 1st March, 1971. The petitioners stopped deduction of contribution to the fund from the employees who have not opted to the scheme on the basis of the judgment of the Bombay High Court. 5.0. It is better to quote the actual contents of the impugned communication dated 21st January, 1988 addressed by the Regional Provident Fund Commissioner, to the petitioners. "With reference to your letter No. R/P/111 dated 8th January, 1988, regarding judgment of Bombay High Court, in case of Mafatlal Group Staff Association & Ors. v. Regional Provident Fund Commissioner, Maharashtra State & Ors. In this connection, it may be indicated that the aforesaid judgment of the High Court of Bombay is not applicable to the Gujarat. You are, therefore, requested to please advise your clients not to stop the deduction of the Family Pension Fund." 6.0. Learned counsel for the petitioners contends that the petitioners were bound to obey the judgment and directions of the Bombay High Court rendered between the employees of the company. It was erroneous on the part of the Regional Provident Fund Commissioner to issue the impugned communication (annexure-c). 7.0. After hearing the learned counsel for the petitioners, in the opinion of this Court, the petitioners are bound by the judgment of the Bombay High Court to apply the family pension scheme uniformly to all employees in the manner directed by the Court. Merely because some of the employees of the petitioners are in Gujarat, there is no ground to apply the scheme differently to them and contrary to the directions of the High Court of Bombay. 7.1. In the circumstances, the petition is allowed. It is directed that the Regional Provident Fund Commissioner, Gujarat State will not act upon the impugned communication dated 21st January, 1988, if the judgment of the learned Single Judge of the Bombay High Court (supra) still holds the filed and has not been upset by any Higher Court. Rule is made absolute. In the facts and circumstances of the case, the parties shall bear their own costs. [K.S. JHAVERI, J.] /phalguni/