THE HON’BLE SRI JUSTICE SANJAY KUMAR WRIT PETITION NO.13024 OF 2004 DATED 26TH NOVEMBER, 2009 BETWEEN The Andhra Pradesh State Cooperative Central Bank Employees Association, Registered No.B1100, rep. by its General Secretary, Sri Ch.Madhav Rao S/o Sri Narhari Rao, resident of Chittoor. … Petitioner and State of Andhra Pradesh rep. by its Secretary Food, Agriculture and Cooperation Department, Secretariat Buildings, Saifabad, Hyderabad. And Others … Respondents THE HON’BLE SRI JUSTICE SANJAY KUMAR WRIT PETITION NO.13024 OF 2004 ORDER: In this writ petition, the entitlement of dependants of deceased employees of Co-operative Central Banks to compassionate appointment falls for consideration. The Andhra Pradesh State Co-operative Central Banks Employees’ Association is espousing their cause and challenges the circular dated 08.09.2003 issued by the Andhra Pradesh State Co- operative Bank Limited, Hyderabad (APCOB), the third respondent; the circular dated 18.06.2004 of the Commissioner for Co-operation & Registrar of Co-operative Societies (CC&RCS), Andhra Pradesh, Hyderabad, the second respondent; the consequential instructions issued by the APCOB vide its circular dated 03.07.2004 and after amendment of the prayer in the writ petition, the circular dated 30.07.2005 issued by the APCOB. By way of the above circulars the scheme of compassionate appointment of dependants of deceased employees of Co-operative Central Banks was practically done away with. Though the case has a long and chequered history, most of the contentious issues raised in the writ petition no longer survive for consideration in view of later developments and the irreversible passage of time. The sequence of events however needs iteration for proper understanding of the case. The Government of Andhra Pradesh, the first respondent, evolved a scheme for compassionate appointment of dependants of its deceased employees under G.O.Ms.No.687, General Administration (Ser.A) Department, dated 03.10.1977. The same was extended to the dependants of deceased employees of Co-operative Societies under G.O.Ms.No.623, Food and Agriculture (Coop.VI) Department, dated 26.10.1978, subject to fulfillment of the conditions stipulated therein. Revised instructions were issued in this regard by the CC&RCS, AP, Hyderabad, under the circular memo dated 23.08.1995 and thereafter, under circular dated 04.12.1999. While so, a Settlement under Section 18(1) of the Industrial Disputes Act, 1947 (for brevity, ‘the Act of 1947’) was effected by and between the Andhra Pradesh Co-operative Banks’ Association, Hyderabad and the Andhra Pradesh Bank Employees Federation, Hyderabad, acting on behalf of the integrated cadres of employees working in the District Co-operative Central Banks (DCCBs) in the State. This Settlement was approved by the CC&RCS, AP, vide letter dated 31.05.1997 as required under Section 116-C of the Andhra Pradesh Co-operative Societies Act, 1964 (for brevity, ‘the Act of 1964). The Settlement came into effect from 15.06.1997. The APCOB and the DCCBs assured the Supreme Court in Civil Appeal No.8913 of 2003 that this binding Settlement was not affected by the amendment of Section116-C of the Act of 1964. So far as the issue of compassionate appointments is concerned, the Settlement prescribed that in the case of death/medical invalidation, appointment on compassionate grounds would be provided as in the Government of Andhra Pradesh. Presently, I am not concerned with compassionate appointment on the ground of medical invalidation as the prayer in the writ petition is limited to the entitlement in this regard of dependants of deceased employees. The Government of Andhra Pradesh issued circular memo dated 12.08.2003 consolidating the instructions with regard to compassionate appointment of dependants of deceased Government employees. Prior thereto, the Government of Andhra Pradesh had issued G.O.Ms.No.36, Public Enterprises (III) Department, dated 05.09.2001, whereby the scheme of compassionate appointment of dependants of deceased employees in State Level Public Enterprises (SLPEs) was dispensed with and in lieu thereof ex gratia was directed to be paid to such dependants. It appears that the APCOB addressed letters dated 15.10.2004, 29.10.2004 and 17.11.2004 to the Government seeking instruction as to whether G.O.Ms.No.36 dated 05.09.2001 was applicable to the APCOB and the DCCBs. A similar letter was addressed by the CC&RCS on 24.11.2004 to the Government. In the meanwhile, the Managing Director of the APCOB issued the impugned circular dated 08.09.2003 stating that compassionate appointments were being made in some of the DCCBs without obtaining prior approval from the CC&RCS and the APCOB and that, as a series of measures were being initiated for reduction of cost of establishment as per Section 116-C of the Act of 1964, it was considered necessary to stop all appointments on compassionate grounds as a part of cost control measures. Accordingly, all the General Managers of the Banks were directed to ensure that no appointments were made on compassionate grounds from the date of issue of the said circular. The petitioner-Association alleges that the very same officer who was the Managing Director of the APCOB at the time of issuance of the circular dated 08.09.2003 thereafter assumed office as the CC&RCS, AP and issued the later circular dated 18.06.2004 which, in terms, was a reiteration of his earlier circular dated 08.09.2003. The circular dated 18.06.2004, while referring to the earlier circular dated 08.09.2003, reads to the effect that the instructions of the Managing Director, APCOB, under the circular dated 08.09.2003 should be scrupulously adhered to and that it should be ensured that no appointments were made on compassionate grounds or any other grounds. The subsequent circular dated 03.07.2004 was issued by the APCOB referring to the two earlier circulars and instructing the General Managers of all the DCCBs to adhere to the circular instructions and not to make any appointments on compassionate or any other grounds. Aggrieved thereby, the petitioner-Association approached this Court by way of the present writ petition. While matters stood thus, the Government of Andhra Pradesh, responding to the letters of the APCOB and the CC&RCS, AP, in connection with G.O.Ms.No.36 dated 05.09.2001, issued letter dated 23.07.2005 informing that G.O.Ms.No.36 dated 05.09.2001 was applicable to the APCOB and the DCCBs and requesting them to follow the instructions therein, subject to compliance with Section 116-C of the Act of 1964. Acting thereupon, the APCOB issued circular dated 30.07.2005 informing the General Managers of all the DCCBs that as per G.O.Ms.No.36 dated 05.09.2001, the scheme of compassionate appointment of dependants of deceased employees had been dispensed with by introducing payment of ex gratia, in lieu thereof. The General Managers of all the DCCBs were advised to take necessary steps to follow the said instructions. The petitioner-Association accordingly amended its prayer in the writ petition, including a challenge to the instructions issued by the APCOB in its circular dated 30.07.2005. The APCOB was however not consistent with regard to the ban on compassionate appointments. This is evident from the letter dated 07.07.2004 addressed by the APCOB to the CC&RCS, AP, requesting the lifting of the ban on compassionate appointments due to shortage of clerical staff in the DCCBs and where dependants of deceased employees were eligible for V cadre posts. Thereupon, the CC&RCS, AP, issued circular memo dated 23.10.2004 partially relaxing the ban on compassionate appointments subject to certain conditions. The General Manager of the APCOB filed a counter affidavit on behalf of the CC&RCS, AP, stating that he was authorized to do so under the letter dated 09.11.2004 addressed by the CC&RCS, AP. An attempt was made therein to justify the issuance of the impugned circulars by citing the dismal financial condition of the DCCBs in the State and its cascading adverse effect on the APCOB. However, the counter is significantly silent about the binding commitment made in the Settlement dated 15.06.1997 that compassionate appointments in the DCCBs would be the same as in the Government of Andhra Pradesh. No reference whatsoever was made to the Settlement in the counter. No mention was also made about the undertaking given by the APCOB and the DCCBs before the Supreme Court in Civil Appeal No.8913 of 2003 that the amendment to Section 116-C of the Act of 1964 would have no effect upon the binding Settlement dated 15.06.1997. The same stand had also been projected by the State and recording the same, the Supreme Court had disposed of the appeal by its order dated 07.11.2003. The counter affidavit filed by the same General Manager on behalf of the APCOB, the third respondent, is equally evasive on the above aspects. It is relevant to note that the Settlement dated 15.06.1997 was followed by the Settlement dated 07.07.2008 effected by and between the Andhra Pradesh Co-operative Banks’ Association, Hyderabad and the Andhra Pradesh Bank Employees Federation/ the Andhra Pradesh Co-operative Central Banks Employees’ Association, under Section 18(1) of the Act of 1947. So far as the issue of compassionate appointments is concerned, the Settlement dated 15.06.1997 continues to govern the field. Therefore, the appointments on compassionate grounds in the DCCBs continue to be as in the Government of Andhra Pradesh even under the Settlement dated 07.07.2008. Though the Settlement dated 15.06.1997 was stated to be for a period of five years, it continued to be binding as a contractual obligation till replaced by another Settlement (MANAGEMENT OF KARNATAKA STATE ROAD TRANSPORT CORPORATION, BANGALORE v. KSRTC STAFF AND WORKERS' FEDERATION[1] a n d LIFE INSURANCE CORPORATION OF INDIA v. D.J.BAHADUR[2]). This is also evident from that fact that under the later Settlement dated 07.07.2008, the earlier Settlement dated 15.06.1997 was given a continuum. Therefore, the said Settlement was binding on the parties and was also understood to be so, as projected before the Supreme Court in Civil Appeal No.8913 of 2003. In the light of this binding Settlement, the action of the APCOB and CC&RCS, AP, in issuing instructions contrary to the settlement with regard to compassionate appointments in DCCBs, was clearly unsustainable. Further, the action of the Government and thereafter, the APCOB and the CC&RCS, AP, in extending to the DCCBs the scheme floated by the Government in respect of SLPEs is also open to question, being in violation of the binding Settlement, which only spoke of parity with Government employees. However, it is brought to my notice that the Government has issued fresh instructions in G.O.Ms.No.1, Public Enterprises (PE.III) Department, dated 22.02.2008, providing for revival of the scheme of compassionate appointments even in SLPEs. As per the said G.O., the scheme of compassionate appointments would come into force with immediate effect but earlier cases were directed not to be entertained thereunder and were to be processed as per the orders issued in G.O.Ms.No.36 dated 05.09.2001. G.O.Ms.No.1 dated 22.02.2008 was therefore given prospective effect, i.e., from the date of issue of the said orders. The grievance of the petitioner-Association apropos the above development is that dependants of its deceased members, who would otherwise have been eligible for consideration for compassionate appointment, would be deprived of the same owing to the ‘prospective’ nature of G.O.Ms.No.1 dated 22.02.2008. It is no doubt true that G.O.Ms.No.1 dated 22.02.2008 does away with the distinction drawn between the Government employees on the one hand and the employees of SLPEs/DCCBs on the other. Earlier, dependants of deceased employees of the SLPEs and DCCBs were held entitled only to ex gratia but not compassionate appointment. Now, they stand on par with the dependants of deceased Government employees and would be entitled to compassionate appointment as per the consolidated instructions issued by the Government under circular memo dated 12.08.2003. This being so, the validity of equating DCCBs with SLPEs under the circular dated 30.07.2005 no longer survives for consideration in the present writ petition. It is to be noted that ‘compassionate appointment’ is not a mode of recruitment and is only a means of alleviation of the plight of the family of the deceased employee, which has lost its bread winner. This measure provides for employment of a dependant of such deceased employee so as to give immediate succor to the bereaved family. Therefore, by its very nature and import, compassionate appointment would have to be temporally proximate to the death of the employee. Even a legitimate claim for compassionate appointment does not survive over a period of time. That being so, notwithstanding the unsustainability of the circular instructions dated 08.09.2003, 18.06.2004 and 03.07.2004, impugned in this writ petition, dependants of deceased employees of the DCCBs who were deprived of the compassionate appointment lawfully due to them at that time can no longer lay a valid claim for such relief as the sands of time have obliterated their entitlement. It is relevant to note that this Court, by interim order dated 02.09.2004, granted suspension of the impugned circulars dated 08.09.2003 and 18.06.2004 in respect of compassionate appointments of dependants of employees who died in harness. It is however stated that in spite of the said interim order, no compassionate appointments were provided to the dependants of deceased employees of the DCCBs. Be that as it may, after the extension of G.O.Ms.No.36 dated 05.09.2001 to the DCCBs, the dependants of deceased employees had to be paid ex gratia and perhaps, all those who were deprived of compassionate appointment under the impugned circulars dated 08.09.2003 and 18.06.2003, would have been compensated at least to that extent. The only issue that survives for consideration is as to the effect of G.O.Ms.No.1 dated 22.02.2008. As per G.O.Ms.No.623 dated 26.10.1978, which extended the scheme of compassionate appointment to dependants of deceased employees of the DCCBs, the application for appointment under the scheme had to be made within a period of one year from the date of death of the employee. That being so, the cases of dependants of employees of the DCCBs who died on or after 23.02.2007 and who would have applied but for the Circular dated 30.07.2005, should be eligible for consideration for appointment on compassionate grounds even under G.O.Ms.No.1 dated 22.02.2008 and their cases cannot be scuttled under G.O.Ms.No.36 dated 05.09.2001 by settling their claims through payment of ex gratia. In the light of the Settlement which binds the APCOB, the DCCBs and the CC&RCS, AP, on the one hand and the Andhra Pradesh Co- operative Central Banks Employees’ Association on the other, appointment on compassionate grounds in the DCCBs was to be as per the scheme applicable to Government employees. The action of the State, the CC&RCS, AP, and the APCOB in deviating from the terms of the binding Settlement was therefore irregular and unsustainable. The impugned circulars dated 08.09.2003, 18.06.2004 and 03.07.2004 are accordingly declared to be illegal. However, owing to the lapse of time no relief can be granted pursuant to such declaration. In view of the distinction made between employees of SLPEs/DCCBs and Government employees being done away with by G.O.Ms.No.1 dated 22.02.2008, no orders require to be passed upon the validity of the circular dated 30.07.2005. In the light of the above, the injustice which is now sought to be perpetrated upon the members of the petitioner-Association by way of the ‘prospective’ nature of G.O.Ms.No.1 dated 22.02.2008 needs to be arrested to the extent of saving the cases of dependants of those deceased employees who fall within the zone of consideration as per G.O.Ms.No.623 dated 26.10.1978. Accordingly, there shall be a direction to the respondents to consider the cases of dependants of deceased employees of the DCCBs, whose death occurred on or after 23.02.2007, for appointment on compassionate grounds, without insisting on the stipulation in G.O.Ms.No.623 dated 26.10.1978 that the application should be made within one year of the death of the employee. Such consideration shall be in accordance with the consolidated instructions in circular memo dated 12.08.2003 issued by the Government of Andhra Pradesh, to the extent applicable. The writ petition is allowed to the extent indicated above but in the circumstances of the case, without costs. ____________________ SANJAY KUMAR, J. ___________ November, 2009. VGSR [1] (1999) 2 SCC 687 [2] (1981) 1 SCC 315