1 IN THE HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JODHPUR -------------------------------------------------------- CIVIL WRIT No. 2695 of 1997 BAJRANG SINGH V/S GEN. INSU. COR.OF INDIA & ORS Mr. M. MRIDUL assisted by Mr. AK CHOUDHARY, for the petitioner. Mr. M.S. SINGHVI assisted by Mr. HEMANT DUTT, for the respondent. Date of Order : 10th December, 2009 HON'BLE SHRI N P GUPTA,J. JUDGMENT Petitioner by this writ petition seeks to have quashed the order dt. 22.5.1997 (Annexure-2), categorizing the petitioner as Development Officer, to be invalid, and prays for declaration, that the petitioner stands appointed as Assistant Administrative Officer w.e.f. 1.1.1973, with all consequential benefits. This is second round of litigation, inasmuch as earlier also the petitioner had filed the writ petition, being S.B. Civil Writ Petition No. 554/1978, which was allowed in part, and the order dt. 28.2.1978 was set aside, being not speaking one, and direction was given to the appellate authority to decide the appeal as per directions 2 given therein, then the matter was carried in intra court appeal, vide S.A.W. No. 752/1994, which came to be disposed of vide order dt. 2.9.1996, wherein with consent of the parties it was directed, that the appellant may submit representation, within the time given, which shall be duly considered by the appellate committee by proper application of mind, and the National Insurance Company Ltd. was directed to constitute a specific appellate committee for the specific purpose, and the committee was directed to decide the representation within a period of three months from the date of representation. The petitioner submits that accordingly he filed a representation on 20.9.1996, being Annexure-1, and the same was decided vide Annexure-2, which is subject matter of grievance. The facts are, that according to the petitioner he entered the services of General Assurance Society Limited. At the time of taking over of this society by General Insurance Business (Nationalisation) Act, 1972, hereafter referred to as the Act, the petitioner was holding the post of Branch Secretary, and was posted at Sriganganagar in the pay scale of 200-20-400-25-600, and was in the officer’s cadre. He produced Annexures 3 to 5 for that purpose. The case of the petitioner further is, that the said Company along with other companies came to be taken over in terms of the aforesaid Act, and were merged to form part of different companies, and the General Assurance Society in 3 which the petitioner was serving came to be merged with National Insurance Company on 1.4.1973. In exercise of powers conferred under Section 16(1)(g) of the Act, the Central Government made some publication, and published General Insurance (Nationalisation of Pay Scale and other Conditions of Service of Officer) Scheme, 1975, hereafter referred to as the Scheme of 1975, which came in force on 1.10.1975. With the above background the petitioner's case is, that the order dt. 30.9.1975 served on the petitioner from the C.M.D. of General Insurance Co. informing about the committee having declared the petitioner as a member of the development staff, as such he is not covered by the term “officer” as defined in Section 3(1) of the Scheme. This is Annexure-6. Thus, the real bone of contention in the present litigation is as to whether he was rightly categorized as member of the Development Staff, or was required to be categorized as officer. The committee was appointed by the Board of Directors of General Insurance Company of India. Vide Annexure-8, the petitioner was shown at S.No. 30 out of 39 names contained therein shown as members of the Development Staff. On receipt of this Annexure-8, the petitioner submitted representation Annexure-9. Having not received any reply reminders were sent. In the meantime another 4 circular dt. 9.12.1975 came to be issued by the National Insurance Company, stating that the Development Staff named in the circular have been appointed in the rank of Administrative Officer/ Assistant Administrative Officer (Development). This circular contained the names of 16 persons whose names appear in Annexure-8. This has been produced as Annexure-10. According to the petitioner Sarva Shri Nagpal, S.L. Mittal, R.K. Agarwal, P.N. Ahuja, R.K. Kansal came to be appointed vide Annexure-10. Vide Annexure-10 the Development Staff were appointed in the rank of Administrative Officer/ Assistant Administrative Officer (Development). The petitioner also contends that the letter dt. 14.10.1976 came to be served on the petitioner conveying that he was provisionally categorised as Inspector Grade I by Categorization Committee in terms of the Scheme of 1976, and he is required to signify his approval, and if the applicant does not signify his acceptance, his services will be terminated. Faced with this situation the petitioner signified the approval, but this was under protest. Then, the petitioner represented against such categorization. The representation came to be replied, conveying that the representation has been noted and the matter will be looked after in due course. Then, when nothing turned up for long, the petitioner got served notice for demand of justice, and then as advised by the order dt. 23.9.1977 the petitioner preferred an appeal before the Appellate Committee created vide order dt. 5 10.8.1977, but no order having been made on the appeal, the petitioner gave reminder. However, ultimately the appeal was rejected on 28.2.1978. Challenging that appellate order the petitioner filed the Writ Petition No. 554/1978. The case of the petitioner regarding categorization is, that admittedly no criteria, or guidelines, or guiding principles were laid down by law making authority on the basis of which categorization has been made. The categorization is alleged to be discriminatory and arbitrary, as those put in administrative staff were placed in a far inferior position, as compared to the petitioner, on the basis of criteria said to have been adopted, and for that purpose has pleaded instances of certain persons who had been holding the post of Branch Manager in General Assurance Society, in which the petitioner was holding the post of Branch Secretary, and the post of Branch Manager and post of Branch Secretary were identical, inasmuch as the posts are interchangeable, and having the same pay scales. It was also contended, that the categorization of the petitioner as Development Staff was not reasonable. Various factual aspects have been highlighted, like pointing out that in Annexure-18, the chart prepared by the Company, the services rendered by the petitioner was set out as one year whereas he served for 5½ years, out of 5½ years for 3 ½ years he was officer-in-charge, and for 2 years he was 6 Branch Secretary, while other persons placed in a far inferior position were categorized as Administrative Staff. A reply to the writ petition had been filed in the form of affidavit of Shri K.P. Bannerjee, Regional Manager, Jaipur Region of National Insurance Company. The stand taken is, that before merger into four companies there were as many as 107 companies, some of them were quite big, and others were very small; so much so that some companies were paid compensation amounting to over Rs. 2 crores, as against it some companies were paid compensation as low as Rs. 1000/- only, and there was no comparison between one company, or the other, and duties and responsibilities under different companies were also varied, and even the Managing Director of a company to which compensation of Rs. 1000/- was paid had been categorized as an Assistant Administrative Officer. An example has been given, that an IAS officer holding the charge of a Secretary in a State Government may be appointed, when transferred to the Central Government, as a Director, or at best as Joint Secretary, depending upon the length of service. It was pleaded that after merger the structure of the four companies became much bigger, and the categorization had to be carried in the new set up from the erstwhile smaller companies, and the officers of the previous company could not be categorized on the basis of the designation alone, held by them in the previous company. It was pleaded that 7 Clause 5 of the Merger Scheme provided that the employees of the merged company shall continue to work on the same terms and conditions until their conditions of service were altered by the transferee company. According to Section 16 (4) of the Act it provided that if the changed terms and conditions were not acceptable to the concerned employee, then the transferee company could terminate the services by giving him the notice prescribed under the Act. On the precise aspect of controversy, the stand taken is, that on taking control of the aforesaid 107 companies, it was felt that there was no uniform system of management, and each company had its own method of management. Many companies gave very high sounding designations to their employees, not commensurate with the responsibilities shouldered by them, some companies paid very high emoluments to their employees, and employees working at the same station under different companies carrying on similar duties, functions and responsibilities were paid differently, and held different designations. In that view of the matter, the Government of India appointed a committee of experts vide Annexure R/1. The committee was headed by Shri K.P. Mathrani and was known as Mathrani Committee, which was to advise the Government, regarding the management and set up to be adopted in the Nationalised Insurance Industry; what designations and pay scales ought to be given to the employees; and what should be their other conditions of service. The committee was also assigned the task of 8 actually categorising the officers of Higher Level Management. The employees working could be divided into three broad groups being; (i) supervisory, clerical and subordinate staff, (ii) Development Staff and (iii) Administrative and Managing Officers. Under Section 16(1) (g) the Central Government framed three schemes, one being the General Insurance (Rationalisation of Pay Scales and other Conditions of Service of Supervisory, Clerical and Subordinate Staff) Scheme, 1974, second being the General Insurance (Rationalisation of Pay Scales and other conditions of Service of Officers) Scheme, 1975 and the third being the General Insurance (Rationalisation of Pay Scales and other Conditions of Service of Development Staff) Scheme, 1976. Then, the Administrative and Managerial Staff were again divided into three broad categories, being one Higher Management, Middle Management and Lower Management, and since the officers to be categorized for Middle Management, and Lower Management were very large, and it was not possible to categorise them by the said Mathrani Committee, the task was assigned to GIC, who passed a resolution constituting another Committee. However, prior to the categorization, each employee was called upon to submit his bio-data, to enable the concerned committee to categorize him suitably. The bio-datas were placed before the Committee, and the Committee then categorized them suitably. According to the original scheme framed by the Central Government, it did 9 not provide for any reconsideration of the categorization carried out by the said committee, and therefore, the Central Government constituted appellate committee for each of the company, to consider the appeals preferred by the employees against the categorization, before which committee the petitioner filed appeal, but the committee did not find any merit. Then, it is pleaded, that categorization was carried out on the basis of the nature of duties and responsibilities shouldered by the incumbent, and in order to determine whether a person belonged to Development Staff or Administrative Staff, one important factor is, as to whether the salary of the incumbent was tied down with the business procured by him, which is a statutory requirement. Section 40-C of the Insurance Act, 1938, read with Rule 17-E of the Insurance Rules, 1939, which puts a limit on the expenditure which an Insurance Company, carrying on general insurance business, can incur on management, particularly on the staff appointed for procuring insurance business, and the Company is bound to follow the Code of Conduct, regarding cost of field workers, for the reason, that a field worker must procure a particular amount of premium to justify his salary. It was also pleaded that before categorization each employee was required to submit his bio-data to enable the said committee to decide as to whether the concerned employee belonged to field staff or administrative staff, and each employee was given opportunity to submit all the 10 particulars about his duties and functions, which were taken into consideration by the committee, before deciding as to whether the petitioner was a member of the Development Staff or was on the administrative staff. The bio-data submitted by the petitioner is produced as Annexure R/5. Question no. 14 of the proforma required information regarding the nature of duties performed by the incumbent, and question no. 25 requires the particulars of administrative duties discharged by him, and the petitioner gave similar reply to question no. 14 and 25, by describing as under:- “Administration and Development. Business underwriting of all departments. Issuing and maintaining of all kinds of documents. Disbursement of salary, Commission and other exp. relate to branch. Development of business and control of branch. Maintenance of Branch accounts. To advice controlling office and clients to improve underwriting and risk.” It is contended, that in the bio-data he admitted that he belonged to Development Staff category, the business produced by him and the cost ratio also show that the petitioner belonged to Development Staff, and then the nature of duties like disbursement of salary was wrongly mentioned, as it was a one man office. The Branch did not have an office. Disbursement of commission to the agents received by the petitioner in the name of a particular agent, appointed by the petitioner is not, and cannot be considered as managerial function. Maintenance of accounts 11 is not a managerial function, but clerical function. Then, it was pleaded that even if some of the duties were to be considered as managerial, still it will not make any difference, as the main duty of the petitioner remains that of development. Reliance was placed on the judgment of the Hon'ble Supreme Court in Anada Bazar Patrika (P) Ltd. Vs. The workmen reported in 1969(2) LLJ-670, and it is pleaded that since the salary was tied down with cost ratio, he belonged to Development Staff. It was pleaded that the petitioner was working as a one man office, and the petitioner was operating from his house. With a view to keep the cost ratio within limits, the insurance companies appointed one person to procure business, without opening an office. According to the respondents in such a one man show the question of performing any administrative or managerial functions does not arise. It was maintained that no administrative duties were spelled out in the previous writ petition, nor the same have been shown to have been performed, in his appeal, and the petitioner is mainly relying upon his designation in the previous company, which is of no consequence. Then, in para (w) the administrative duties shown by the petitioner in the representation Annexure-9 have been recapitulated, to explain as to how none of the duties spelt out by the petitioner disclose that he was performing any administrative duties. Regarding another employee who was employed as an office assistant, it was pleaded that he did not take up the appointment, and 12 secondly this was only for about one month prior to the appointed day, and this one month's experience cannot be considered sufficient for entitling him, for being categorized as an administrative officer. Then, it is pleaded that there is no allegation of bias against any member, whether against the petitioner or in favour of any other person. Then, in para-5 detailed reply had been given with respect to the comparison made by the petitioner in the writ petition about his case qua persons detailed therein, and it has been demonstrated as to how those persons were rightly categorized on the administrative side, and how the petitioner has been rightly categorized as Development Staff. The order of the Appellate Committee was sought to be supported. Then, reliance was placed on the judgment of the Hon'ble Supreme Court, in the case of United India and General Insurance Co. Ltd. Vs. K.S. Vishwa Nathan reported in 1985(3) SCC- 685, wherein the Hon'ble Supreme Court upheld the categorization carried out on the basis of duties and functions performed by the concerned incumbent, and it was pleaded, that the categorization of the incumbent directed to be made on the basis of designation as Assistant Secretary in the erstwhile company by the Madhya Pradesh High Court, in the case of Kamlesh Gupta Vs. Chairman United India Ins. Co. being Misc. Petition No. 233/81 was interfered by the Hon'ble Supreme Court in Civil Appeal No. 13 235/85, and the judgment of the High Court was set aside. Then various other pleadings have also been taken, but in substance the writ petition was prayed to be dismissed. Then, a rejoinder has been filed by the petitioner, interalia contending, that company in which the petitioner was employed, was paid compensation of Rs. 8 lacs. It was pleaded that in order to show that the persons were shouldering the same responsibility in the pre- amalgamation period as shouldered after amalgamation, reference was made to the position of Shri Ashok Goyanka, to contend that in the erstwhile Unit he was working as General Manager and was absorbed after categorization on the same post in National Insurance Company, and he ultimately retired as Chairman, General Insurance Corporation i.e. the highest post of the Insurance Industry. Then, the petitioner has produced a chart Annexure-21, showing, as to in which manner the designations were given on the basis of responsibility shouldered. Then, reference to Annexure-18 was reiterated. Then, regarding bio-data, it was submitted that the petitioner was discharging the duties of Branch Secretary, and since the proforma of bio-data, which was sent to him pertains to development staff, and is of no consequence, and the nature of duties were not considered. Then, Annexure-23 has been produced to support, that proforma bio-data was for the development personnel. Then, in para-9 14 it is pleaded that the salary of the petitioner was not tied down with the business procured by him. Before amalgamation, he was put in the pay scale of Rs. 200-600, with regular increments along with admissible allowances. However, petitioner was not receiving anything on the premium obtained in the Branch, where he was working as a Branch Secretary in the erstwhile unit, and has produced Annexure-23 to show, that he was working in the administrative capacity. Annexure-23 is a voucher about payment of salary to one Bishan Singh dt. 27.12.1972. It was reiterated that the answer to the queries in the proforma is not the end of the matter. There are lot of facts in possession of the petitioner, which show that he was working on the administrative side, and the petitioner has produced some documents collectively as Annexure-24 in that regard. It is maintained, that the duties which the petitioner was discharging as Branch Secretary, were duties of administrative nature alone, and not one, which the development staff performs. In that regard again reliance is collectively placed on Annexure 25. In para-12 it is admitted that branch was operating from the residence of the petitioner. Receipt has been produced as Annexure-28, electricity bill is also produced. It is maintained, that it is not the case, that some duties were being discharged as managerial ones, rather the main functions being discharged by petitioner were managerial, and only few were of Development Staff category. 15 Then, a supplementary affidavit has also been filed by the respondent, being dt. 5.4.1999, by the then Regional Manager Shri R.C. Sayal. It was submitted that like the petitioner as many as 34 companies were paid compensation of more than Rs. 8 lacs, and 25 companies were paid compensation of more than Rs. 8 lacs. Out of 107 companies 69 companies were paid compensation of more than Rs. 8 lacs, while some were paid in crores, inasmuch New India Assurance Co. Ltd. was paid Rs. 8,20,07,678/-, Oriental Insurance Company Limited was paid Rs. 2,43,98,000/-, India Re Insurance Corp Ltd. was paid Rs. 2,05,02,200/-, and so on, and it is contended, that the petitioner's employer was very small company as compared to other companies, and thus the set up of the companies nationalized were vitally different, and were not comparable with each other. It was maintained, that the committee who categorized, not only looked into the work record of each officer categorized, but also interviewed all the officers and then selected them for appointment to different posts of senior management, and in that process Shri Ashok Goyanka was General Manager of the erstwhile unit, after looking into his work record and performance at the interview, he was found suitable for appointment to the post of General Manager in the nationalized unit. While the categorization of the Middle Management and Lower Management was carried out on the basis of their records, 16 the duties, and functions, disclosed by the incumbents in their bio-data, and no interviews were held. Thus, it is wrong to say, that if one officer of the General Assurance Society Ltd. happened to be categorized in the same position in the nationalized set up, all officers of the said company were required to be categorized similarly. Apart from Shri Ashok Goyanka no other General Manager or Manager was appointed as General Manager. It was pleaded that Shri R.C. Srivastava another employee of the General Insurance Society was employed as Assistant Branch Secretary at Allahabad, and claimed to be categorized as an officer, but he was also categorized as Development Officer, who filed a writ petition, which was dismissed vide judgment dt. 9.10.1985. It was maintained that no different criteria could be adopted for one company to categorize its employees on the same post in the nationalized unit. Regarding Annexure-21 it was pleaded that the chart is prepared by the petitioner himself, and is a self serving statement. It is pleaded that the categorization was not carried out as shown in the chart. Then, it was pleaded that for Lower Management, various incumbents were categorized by committee appointed by the Board of General Insurance Corporation of India for each Nationalized Unit, and separate proformas had been provided for Development Staff, and the officer, to enable them to give their bio-data, and the duties and functions performed by them, and the petitioner voluntarily filled the proforma 17 prescribed for the development. It was pleaded that Annexure-22 does not show that the petitioner did not submit his bio-data as a Development Staff voluntarily. Annexure-23 and 30 included with the rejoinder were pleaded to be forged documents, and it was maintained that no one was working under the petitioner. It was maintained that even in the earlier petition no. 554/1978, and in the representation made to the appellate committee, it was not pleaded by the petitioner, that some one was working under him, rather the stand of the respondent through out was that none was working under him, which was not disputed by the petitioner. Annexure-29 is a statistical statement giving the income and expenditure of the Branch at Sriganganagar, prepared by the petitioner himself. Then, Annexure-23 was pleaded to be salary sheet of the petitioner for the month of December, 1972, and the amount shown to have been expended towards salary and allowances for the said branch were just sufficient to meet the salary and allowances of the petitioner, and there could be no one working under him. It is pleaded that the petitioner has now filed Annexure-25, to be showing the purported salary sheet of Bishan Singh Rathore, while this document has been prepared by the petitioner, and is signed by the petitioner, and it does not show, as to who prepared the same, and was checked by whom, and if that salary is included in Annexure-29, the claim made by the petitioner stands falsified. Various pleadings taken in the reply were 18 reiterated. Then some documents have been filed to show, that the petitioner's salary was tied