CWP No.1165 of 2001 [1] THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH. C. W. P. No. 1165 of 2001 Date of Decision: 11 - 11 - 2008 Mulkh Raj Indoria and others ....Petitioners v. Municipal Corporation, Amritsar and others ....Respondents CORAM: HON'BLE MR.JUSTICE KANWALJIT SINGH AHLUWALIA *** Present: Mr.B.R.Mahajan, Advocate for the petitioners. Mr.R.S.Bal, Advocate for respondent Nos.1 and 2. Mr.Ajaib Singh, Addl.A.G., Punjab for respondent No.3. *** KANWALJIT SINGH AHLUWALIA (ORAL) The present writ petition has been preferred by three employees of Municipal Corporation, Amritsar. They have sought writ in the nature of certiorari seeking quashing of order dated 10.10.2000, Annexure P-9, passed by the Commissioner, Municipal Corporation, Amritsar in which it has been stated that since the Director, Local Government, Punjab on 15.3.1995 had annulled resolution No.31/1 dated 1.9.1994 whereby it was resolved that pension be granted to non provincialised staff who had retired before 1.4.1990. It has been further prayed that a writ in the nature of CWP No.1165 of 2001 [2] mandamus be also issued directing the Municipal Corporation, Amritsar and State of Punjab through the Secretary to Government of Punjab, Department of Local Government to release pension and other benefits admissible to the petitioners in accordance with resolution dated 14.8.1995, Annexure P-6 as confirmed by resolution dated 13.11.1995, Annexure P-7. From the perusal of the writ petition, the following facts emerge:- Petitioner No.1 Mulkh Raj Indoria joined service in Municipal Committee, Amritsar on 7.3.1951 and superannuated as Assistant on 31.1.1990. Petitioner No.2 joined service on 8.3.1950 and retired as Tax Inspector on 28.2.1989, whereas petitioner No.3 joined the service on 15.11.1951 and completed his innings with Municipal Corporation on 31.5.1988 and retired as Sub Divisional Clerk. Petitioners have based their claim on notification Annexure P-1 issued by the State Government on 28.7.1994. Mr.Mahajan appearing for the petitioners has read sub-clause (2) of Clause 1 of the notification dated 28.7.1994 which reads as under:- “(2) They shall be deemed to have come into force on and with effect from the first day of April, 1990 in the case of employees who are members of the provincialised Service of a Corporation, and in the case of employees who are members of a non-provincialised Service of a Corporation, they shall come into force from such date, as the concerned Corporation may, determine, by a resolution passed in this behalf.” Mr.Mahajan has stated that as per this clause, the Municipal Corporation was competent to determine the date of employees who had retired and were entitled to pension. In para 4 of the petition, it has been stated that on CWP No.1165 of 2001 [3] 1.9.1994 the Municipal Corporation passed resolution No.31/1, Annexure P-2 and resolved that all those employees who retired after formation of the Municipal Corporation on 1.4.1977 up to 1.4.1990, in case they are prepared to deposit contributory provident fund and that they shall not claim the arrears of pension, be given the benefit of pension with effect from 1.4.1990. The Government of Punjab, Department of Local Government vide Annexure P-3 had annulled this resolution. Qua annulment of resolution it was stated that since the cut off date 1.4.1990 vide notification dated 28.7.1994 has been fixed, a separate cut off date cannot be fixed qua non provincialised employees. In response to this, Mr.Mahajan has stated that resolution No.17/17 has been passed on 21.3.1995 and the earlier resolution No.31/1 dated 1.9.1994 was reiterated, as Corporation decided to stick to its earlier resolution. Letter Annexure P-5 is again addressed by the Government to the Commissioner, Municipal Corporation, Ludhiana whereby he was advised to adopt the pension scheme in respect of non provincialised staff strictly in accordance with the provisions of Punjab Municipal Corporation Employees Pension and General Provident Fund Rules, 1994. Annexure P-6 notices comments recorded by the Accounts Officer, Municipal Corporation, Amritsar that house of Municipal Corporation be advised that for grant of scheme of pension vide 1994 notification, Annexure P-1, cut off date be fixed as 1.4.1990. However, General House of Corporation decided to give pension to non provincialised employees who had retired after 1.4.1977. Annexure P-7 resolution No.44/1 was again passed qua those employees who retired after 1.4.1977. Annexure P-9 is a communication which is impugned whereby it was stated that as per the Government decision cut off date for non provincialised staff CWP No.1165 of 2001 [4] for grant of pension will be 1.4.1990. Mr.Mahajan has assailed Annexure P-9 on the ground that Government cannot determine and decide as to how, why and from which date pension is to be granted. He has contended that so far as Municipal Corporation employees are concerned, Municipal Corporations being autonomous bodies have their own funds, corpus and they can spend those funds taking their financial commitments into consideration. Reliance was placed on a Division Bench judgment of this Court in Sham Dass Sharma and others v. State of Punjab through Secretary to Government, Punjab, Local Government Department, Punjab and others, 1995(1) PLR 82. This was a case where cut off date of 1.4.1990 was challenged qua the provincialised employees. This was challenged and this cut off date was ordered to be made applicable to all employees. The Court held as under:- “7. The conditions of service of an employee are determined by the contract of employment and/or the rules governing the matter. Till recently, the employees were only entitled to the grant of contributory provident fund. In the year 1989, it was decided by the Government to grant pension to the employees of the Corporation with effect from April 1, 1990. This assurance has been granted statutory recognition through the rules. Even though these rules have been published in the year 1994, these have been enforced with effect from the agreed date viz. April 1, 1990. By virtue of Clause (3), all the employees who have joined service on or after April 1, 1990 and have opted for these rules, are entitled to the grant of CWP No.1165 of 2001 [5] pension. The date viz. April 1, 1990, has, thus, not been taken out of the `hat'. It has a historical basis. This was the date which had been accepted by the Government in December 1989. Consequently, the provision for enforcing the rule with effect from April 1, 1990, cannot be said to be arbitrary. 8. The grant of pension like any other benefit to the employees has financial implications. It creates a burden on the employer. For obvious reasons, the employer has the right to assess the position regarding its resources. If after the consideration of the matter, it finds that funds are available for the grant of certain benefits, it can grant such benefits as are found to be just and reasonable. It is a question of policy which has to be decided by the employer. In the present case, no material whatsoever has been placed on the record to show that the decision taken by the respondents is unjust or unfair. On the other hand, a perusal of the petition shows that a number of employees had retired many years back. To illustrate, petitioner No.1 had retired on November 30, 1979. Similarly petitioner No.2 had retired on April 1, 1981. The claim for the grant of pension by such employees after the lapse of so many years, is apparently unreasonable.” At first instance, the argument advanced by Mr.Mahajan may attract but on deeper probe, the same is devoid of merit. State make financial contributions for smooth running of the Municipal Corporations. A reference to the Punjab Municipal Corporation Act, 1976 (hereinafter to be referred as, `the Act') will demolish the argument advanced by CWP No.1165 of 2001 [6] Mr.Mahajan. Section 75 of the Act vests powers in the Corporation to make regulations and Section 75(a) is regarding the tenure of office, salaries and allowances, provident funds, pensions, gratuities, leave of absence and other conditions of service of officers and other employees appointed under this Chapter VI of the Act. Section 75 is subject to the rider. Section 398(2) states that no regulation made by the Corporation shall have effect until it has been approved by the Government and published in the official Gazette. Therefore, the Government was well within its domain to annul the resolution and to state that all employees of the Municipal Corporations whether provincialised or non provincialised should be equally treated so far as the grant of pension is concerned and fixation of cut off date 1.4.1990 is justifiable. The power of the State to fix a cut off date has not been disputed by Mr.Mahajan. State can fix any date as cut off date and this has been recognised in the judgment in Sham Dass Sharma's case (supra). Elected house of Corporation may as populist measure, entail itself with financial burden. Under Section 82 of the Act application of Corporation fund has been specified. Section 82(3) require sanction of the Government qua the expenditure which may be declared by the Corporation. Government has right to rein the Corporation in case unnecessary financial commitment is sought to be raised by the Corporation. Therefore, Section 82(3) call for sanction of the Government. Resolution passed by the Corporation to give pension to employees who retired before 1.4.1990, would have caused great financial burden. Government has right to impose financial discipline, therefore, resolution was rightly annulled. Government had another reason to ask for uniform fixation of cut off date in case Amritsar Municipal Corporation was allowed to deviate CWP No.1165 of 2001 [7] from Punjab Municipal Corporation Employees Pension and Gratuity Provident Fund Rules, 1994, then other Corporations, Municipal Committees, Municipal Councils would have fixed their own cut off date and this would have opened Pandora box, even provincialised employees for whom above rules were enacted on ground of discrimination, would have raised demand to take cut off date backward. Therefore, Government guided by larger considerations was justified to insist by annulling Corporation's resolution that cut off date for all employees will be 1.4.1990. In view of this, there is no merit in the arguments advanced by counsel for the petitioners, therefore, the present petition is liable to be dismissed. For the reasons stated above, the present petition is dismissed with no order as to costs. ( KANWALJIT SINGH AHLUWALIA ) November 11, 2008. JUDGE RC