THE HON’BLE SRI JUSTICE G.CHANDRAIAH W.P.NO.21323 OF 1999 O R D E R Heard both the counsel. 2. The writ petition has been ﬁled for a writ of Mandamus declaring the action of the respondents – the Krishna District Co-operative Central Bank Limited, Machilipatnam, Krishna District (for short ‘the Bank’) in refusing to grant the petitioner two increments towards acquiring graduation qualiﬁcation as per the settlements dated 4.3.1981 and 15.6.1997, as illegal and arbitrary and further declare the proceedings in REF.No.EST.129/99-2000 dated 18.6.1999 issued by the 2nd respondent – The Deputy General Manager of the Bank, as illegal and arbitrary and further to hold that the petitioner is entitled to two increments as per the settlements referred to above. 3. The averments made in the aﬃdavit ﬁled in support of the writ petition are that the petitioner was appointed as Clerk on 22.12.1980 in the erstwhile Vijayawada Co-operative Central Bank and by virtue of the enactment of the Single Window System by the Government of Andhra Pradesh, the Vijayawada Co- operative Central Bank, got merged in the Krishna District Co-operative Central Bank Ltd in the year 1987. The service conditions of the employees are governed by various settlements entered into under Section 12(3) of the Industrial Disputes Act and they became statutory conditions of service. As per the conditions of the settlement on 4.3.1981, which got the eﬀect of a rule, a provision has been made under condition XIV of the said agreement for the purpose of sanction of increment to a person on acquiring graduation qualiﬁcation. As per the said provision, employees in category 5 will be paid two increments in the grade, if they become graduates or if they were graduates already. The petitioner acquired the graduation qualiﬁcation in B.Com., in September, 1993 and accordingly he was given two increments. While so, another settlement was arrived at on 15.6.1997 between the A. P. Co-operative Banks Associations, Hyderabad and the A. P. Co-operative Bank Employees Association, Hyderabad, whereby it was agreed that the employees who are sanctioned graduation increments earlier to the settlement, will continue to draw the same and in future one increment will be allowed for the employees who attained graduation after this settlement and one increments for a post graduate master degree. As the petitioner was already drawing two increments as per the earlier settlement, the beneﬁt given to him is not taken away by the subsequent settlement dated 15.6.1997. If such a beneﬁt is intended to be taken away, the same can be done as per Section 9-A of the Industrial Disputes Act. The grievance of the petitioner is that while re-ﬁxing the salary as per the new settlement, two increments given to the petitioner, were reduced to one increment. Therefore, the petitioner ﬁled representation and by the impugned proceedings dated 18.6.1999 his request was rejected. Aggrieved by the same, the petitioner filed the present writ petition. 4. The 1st respondent – General Manager of the Bank ﬁled counter aﬃdavit to the eﬀect that the petitioner obtained degree certiﬁcate on 5.4.1994 and as per the earlier settlement dated 4.3.1981, the petitioner was granted two increments and subsequently by virtue of the agreement dated 15.6.1997, the employees who attained graduation after the settlement, are entitled to only one increment and not two increments and as the settlement was given eﬀect to, from 1.11.1992 and as the petitioner obtained degree qualiﬁcation in the year 1994, in the revised pay scale ﬁxed as per the new settlement dated 15.6.1997, he was given only one increment and by stating these reasons, his representation was rejected and the same does not warrant any interference. Therefore, the writ petition was sought to be dismissed. 5. The petitioner ﬁled reply and reiterated the averments made in the writ affidavit. 6. The learned counsel appearing for the petitioner submitted that as per the settlement dated 4.3.1981, an employee in category 5 who possess the qualiﬁcation in degree, would be entitled to two increments and accordingly the petitioner was granted. By virtue of the subsequent agreement dated 15.6.1997, in future, only one increment will be allowed to employees who acquire graduation qualiﬁcation. He contended that in the absence of any speciﬁc provision, taking away the increments already granted, the two increments granted to the petitioner cannot be reduced to one. He further contended that as per the settlement dated 15.6.1997, the graduation increments that were already granted continue to be drawn by the employees. He contended that though the settlement dated 15.6.1997 was given eﬀect to from 1.11.1992, in view of the speciﬁc provision that employees who were already sanctioned increments will continue to draw, the increments give to the petitioner cannot be taken away. Therefore, he submitted that the impugned order rejecting the representation of the petitioner is not sustainable. He further contended that reducing two increments, which were already granted, to one increment, amounts to change in conditions of service and such a change, which is aﬀecting the conditions of service, which is not contemplated under the settlement dated 15.6.1997, can be done only after issuing a notice under Section 9-A of the Industrial Disputes Act. In support of this contention, he relied on the judgment of the Apex Court reported in I.OVERSEAS BANK LTD. v. THEIR WORKMEN[1]. The learned counsel further relying on an unreported judgment of a learned single Judge of this court in W.P.No.21602/1994 dated 02.12.2004, submitted that in similar circumstances where the employees of the erstwhile Primary Agricultural Development Banks were transferred to the service of the concerned District Co-operative Central Bank and are governed by the service conditions of the District Co-operative Central Bank, where under the employees who acquire the qualiﬁcation of graduation are entitled to two increments in the concerned pay scales and when such a beneﬁt was sought to be denied to the employees who were transferred from Primary Agricultural Development Bank to the District Co- operative Central Bank under administrative instructions dated 20.6.1994; it was held that such a condition is not in consonance with the mandate under Section 18(3) of the Industrial Disputes Act, where under the transferred employees from the erstwhile Primary Agricultural Development Bank to the District Co- operative Central Bank became employees of the latter bank, and accordingly set aside such an instruction. With these contentions, the learned counsel for the petitioner sought to set aside the impugned order and direct the respondents to sanction two increments, which were already granted to the petitioner. He further submitted that the petitioner acquired post graduation qualiﬁcation and as per the new settlement dated 15.6.1997, he is entitled for one more increment. 7. On the other hand, the learned counsel for the respondents reiterating the averments made in the counter affidavit, sought to dismiss the writ petition. 8. In view of the above rival contentions, the point that arises for my consideration is whether the two increments granted to the petitioner by the respondent - Bank by virtue of the settlement dated 4.3.1981 on acquiring qualiﬁcation in graduation, can be reduced to one increment by virtue of the subsequent settlement dated 15.6.1997, in the absence of any speciﬁc provision to that eﬀect and without issuance of any notice as contemplated under Section 9-A of the Industrial Disputes Act, 1947? 9. In order to consider the above issue, it is necessary to note the admitted facts and the relevant clauses in the settlements dated 4.3.1981 and 15.6.1997 and the provisions under the Industrial Disputes Act, 1947. 10. There is no dispute that the petitioner was appointed as Clerk on 22.12.1980 in the erstwhile Vijayawada Co-operative Central Bank and by virtue of the introduction of Single Window System, by the Government of Andhra Pradesh, the said Bank merged in the Krishna District Co-operative. There is also no dispute that the service conditions of the employees are governed by various settlements entered into, under Section 12(3) of the Industrial Disputes Act and they are statutory conditions of service. As per the Settlement dated 4.3.1981 the employees in category 5 are eligible for two increments for possessing the graduation qualification. The said provision is extracted as under for better appreciation: “XIV. Special increments for qualifications: All employees in Category 5 will be paid 2 increments in the grade if they become graduates or if they were graduates already.” 11. The petitioner passed the graduation in B.Com. in the year 1993 and as per the above settlement dated 4.3.1981, the respondent – Bank granted two increments. While so, another settlement was entered into on 15.6.1997 between the A. P. Co-operative Banks Association, Hyderabad and the A. P. Co-operative Bank Employees Association, Hyderabad. The relevant provision with regard to grant of increments is as under: “Regarding Graduation Increments: The employees who are sanctioned graduation increments earlier to this Settlement will continue to draw the same. In future one increment will be allowed for the employees who attained Graduation after this Settlement and one increment for a Post-Graduate Master Degree.” 12. As per the above provision in the Settlement dated 16.6.1997, the employees who acquire graduation after the settlement are entitled to one increment. It was also speciﬁcally made clear that the employees who were already sanctioned graduation increments earlier to the settlement, will continue the draw the same and in future i.e., after the settlement, the employees will be entitled to only one increment for acquiring graduation qualification. A reading of this provision would amply make it clear that the sanctioned increments cannot be taken away and that it will apply only to the future employees who acquire graduation qualiﬁcation after the settlement. The contention of the respondent – Bank is that the settlement dated 15.6.1997 is given retrospective eﬀect from 1.11.1992 and as the petitioner acquired qualiﬁcation and produced the certiﬁcate before the Bank in the year 1994 i.e., after the date giving eﬀect to the settlement dated 15.6.1997, he is entitled to only one increment. This contention cannot be countenanced for the reason that as per the above extracted provision in the settlement dated 15.6.1997, the increments which were granted earlier, will be continued to be drawn by the employees. It is also to be conspicuously noticed that there is no speciﬁc provision to the eﬀect that the increments already granted will be withdrawn and on the other hand, it is made clear that they will be continued to be drawn. In the present case, the petitioner was granted increments and there is no provision for withdrawal of the increments granted and the settlement in this regard is completely silent. Hence, in the absence of such a provision, the respondent – Bank is not justiﬁed in reducing the increments by considering the retrospective date of giving effect to the settlement. 13. It is to be further noticed that taking away increments, would amounts to aﬀecting the service conditions. At this juncture it is necessary to note Section 9-A of the Industrial Disputes Act as under: 9-A. Notice of Change:- No employer, who proposes to effect any change in the conditions of service applicable to any workman in respect of any matter specified in the Fourth Schedule, shall effect such change, - (a)without giving to the workman likely to be effect by such change a notice in the prescribed manner of the nature of the change proposed to be effected; or (b)within forty two days of giving such notice; Provided that no notice shall be required for effecting any such change- (a)where the change is effected in pursuance of any settlement or award; (b). . . 14. From the above provision it is clear that before eﬀecting any change in the conditions of service applicable to any workman speciﬁed in the Fourth Schedule, notice of such change shall be given. However, if such a change is eﬀected in pursuance of any settlement or award, no notice need be given. In the present case, as already noted above, by virtue of the subsequent settlement dated 15.6.1997, the employees who were sanctioned graduation increments earlier to the settlement, will continue to draw the same and in future, the employees who attain graduation after the settlement, will be entitled to one increment. In the settlement dated 15.6.1997 there is no speciﬁc provision for withdrawal of the increments which were already granted and the provision in this regard is completely silent. Hence, taking away or reducing the increments, which were already granted, is align to the settlement and this is aﬀecting the wages of the petitioner as mentioned in Fourth Schedule to Section 9-A of the Act. Therefore, the said change of increments cannot be construed as change in pursuance of the settlement dated 15.6.1997. When such is the case, the respondent – Bank before reducing the increment, which was already granted, ought to have issued notice as contemplated under Section 9-A of the Act and called for the objections of the petitioner. In similar circumstances, in I.OVERSEAS BANK LTD. v. THEIR WORKMEN (1 supra) where the key allowance given to a cashier of an Indian Overseas Bank was sought to be stopped by the Bank, which was not included in the Award, the Apex Court held that key allowance being accepted by the Bank as a gesture of goodwill, becomes terms and conditions of the service of the cashier and for stoppage of key allowance, notice of change under Section 9-A of the Act is necessary and that the key allowance was ordered to be paid till it was stopped in accordance with law. 15. Therefore, when the respondent – Bank is intending to take away the beneﬁt of one increment which was already sanctioned to the petitioner by virtue of the earlier settlement dated 4.3.1981 and which is not speciﬁcally withdrawn by the subsequent settlement dated 16.6.1997 and further when such reduction of increments amount to change in service condition, it ought to have issued notice of change under Section 9-A of the Act and as the said notice was not given before passing the impugned order, the same cannot be sustained and is liable to be set aside. 16. For the foregoing reasons, the impugned order is set aside and the respondent – authorities of the Bank shall consider the case of the petitioner for grant of two increments for acquiring graduation qualiﬁcation, which he was getting pursuant to the earlier settlement dated 4.3.1981 and pass appropriate orders in accordance with law, within a period of two months from the date of receipt of a copy of this order. 17. Accordingly the writ petition is allowed. In the circumstances of the case, there shall be no order as to costs. AVS --------------------------------- -- 27—08—2008 [1] V(33)FJR 457