C.W.P. No. 7520 of 2008 1 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH C.W.P. No. 7520 of 2008 DATE OF DECISION: October 13, 2009 J.K. Sharma and Another .........PETITIONER(S) VERSUS The State of Punjab and Others ......RESPONDENT(S) CORAM:HON'BLE MR. JUSTICE AJAI LAMBA Present: Mr. T.S. Dhindsa, Advocate, for the petitioners. Ms. Charu Tuli, Sr. DAG, Punjab. AJAI LAMBA, J. Gist of the claim of the petitioners is to get benefit of past service rendered in Punjab State Electricity Board (for short 'the PSEB'), for it to be treated as qualifying service for the purposes of grant of pensionary benefits. Facts are as under:- Sv./Sh. J.K. Sharma and Balwinder Singh have approached this Court by way of filing this civil writ petition under Article 226 of the Constitution of India praying for issuance of a writ in the nature of certiorari quashing order dated 07.09.2007 (Annexure P-1). Vide the impugned order, Director, Technical Education and Industrial Training Department, Punjab has conveyed to the petitioners that C.W.P. No. 7520 of 2008 2 the Finance Department has shown its inability to agree with the proposal of giving benefits of past service with the PSEB. Claim of the petitioners is for counting the service rendered in the PSEB for the purposes of counting qualifying service for pensionary benefits under the State Government/respondent department. The facts are not in dispute. Petitioner no. 1, Sh. J.K. Sharma joined the PSEB on 14.05.1971 and served the PSEB till 19.09.1977. While serving the PSEB, this petitioner, through proper channel, applied for the job of Workshop Superintendent in the Department of Technical Education and Industrial Training, Punjab. At that point in time, the petitioner was serving as Foreman. Be that as it may, petitioner no. 1 was selected by the Punjab Public Service Commission as Workshop Superintendent. The said petitioner joined the respondent-department on 20.09.1977 after submitting his resignation on 19.09.1977. Petitioner no. 1 retired in February 2003. So far as petitioner no. 2-Balwinder Singh is concerned, he served the PSEB from 13.09.1974 to 27.06.1980. While serving as Sectional Officer, in 1980, the said petitioner through proper channel, applied for the job in the respondent-department. Petitioner no. 2 was selected by the Punjab Public Service Commission as Workshop Superintendent and joined as such on 27.06.1980. Resignation was submitted by petitioner no. 2 in the PSEB on the same date i.e. 27.06.1980. Petitioner no. 2 retired on 30.06.2007 while serving the respondent-department of Technical Education and Industrial Training, Punjab. A short affidavit of Mr. B. Purushartha, IAS, Director, Technical Education & Industrial Training, Punjab, Chandigarh sworn on 12.10.2009, C.W.P. No. 7520 of 2008 3 has been filed in Court today on behalf of the respondents, which is taken on record. Information given to the Court in the affidavit is that the petitioners had applied through proper channel and the posts on which the petitioners were working in the PSEB were pensionable posts. Learned counsel for the petitioners contends that a Division Bench of this Court has considered a similar issue and had granted the petitioner in that case the benefit of service with the PSEB. In this regard, reference has been made to order passed by this Court while dealing with CWP No. 10619 of 1991 titled Shri K.K. Sharma Vs. The State of Punjab & Others decided on 02.12.1991. Learned counsel has also referred to a later judgment rendered by this Court while dealing with CWP No. 10988 of 1989 decided on 23.04.2009 titled Gurcharan Dass Vs. State of Punjab and others. For the claim made in the petition, learned counsel has relied on Rule 3.17-A Volume 2 Chapter III and Rule 7.5 Volume 1 Part I Chapter VII of the Punjab Civil Services Rules (for short 'CSR'). Learned counsel, while concluding the arguments, contends that it is the admitted case of the respondents that the petitioners served the PSEB on pensionable posts. The petitioners sought permission of the PSEB for seeking employment in the respondent-department through proper channel. There has been no break in service and in this view of the matter, the petitioners cannot be denied the benefit of past service with the PSEB. Learned counsel for the respondent-State has only contended that service in the PSEB would not be government service and, therefore, benefit of the Rules on which reliance has been placed, cannot be taken. I have heard the learned counsel for the parties. Reference is required to be made to the contents of Annexure P-2 C.W.P. No. 7520 of 2008 4 i.e. a letter addressed by petitioner no. 2-Balwinder Singh, to the respondent-department. It has been impressed on the respondent- department that the petitioner had applied for the post of Workshop Superintendent through proper channel. The resignation to join on the new post was accepted by the PSEB. As per instructions/letters dated 24/25th January, 1960 and 24th March 1960, benefit of earlier service is protected. It has further been said that prior to formation of the PSEB in 1959, Department of Electricity of Punjab Government was there which, as a whole, was transferred to the PSEB alongwith its staff and assets on the same conditions as were on the government posts. Pension of the PSEB employees for government service is shared by the Punjab Government proportionately. The PSEB is a body wholly owned and controlled by the Government. A reference has been made to Rule 4.4 of Punjab Civil Services Rules Volume I Part-I Chapter IV to say that it protects the pay of government employees on getting appointment in other departments of the State Government in the higher, same or identical pay scale. It also allows protection of pay to the employees who hold a post in a body, incorporated or not; which is wholly or substantially owned or controlled by the Government, on their appointment under the government in identical time scale. Reference has been made to various provisions under the Civil Services Rules. Reference to the letter (Annexure P-2) has been made in para no. 6 of the petition. In the written statement filed on behalf of the respondents, there is no reply to the detailed averments in the representation. In para no. 5 of the petition, it has again been asserted that former Department of Electricity was transferred to the PSEB. Further, it has been C.W.P. No. 7520 of 2008 5 asserted that the PSEB is an autonomous body, wholly owned and controlled by the State Government. In the written statement, it is the admitted position that the Department of Electricity was transferred to the PSEB. The fact in regard to control of the Government has been denied, however, without giving any basis or reasons for denial. In the replication filed on behalf of the petitioners, it has further been highlighted that the service rules governing the employees of the PSEB and that of the State Government are identical in terms of age of retirement, deduction of General Provident Fund, commutation of all pensionary benefits etc. payable to the employees. The replication further impresses on the Court that the PSEB was earlier a government department and, therefore, the services rendered by the petitioners in the PSEB are required to be counted for all intents and purposes, particularly when there is no break in service rendered in the PSEB and starting of service in the respondent-department. An exact reference to the relevant provisions in the CSR is required to be made. Provisions of Rule 3.17-A Volume 2 Chapter III of the CSR are required to be noticed. The relevant portion of the Rule reads as under:- “3.17-A. (1) Subject to the provisions of rule 4.23 and other rules and except in the cases mentioned below, all service rendered on establishment, interrupted or continuous, shall count as qualifying service:- xxxxxxxxx xxxxxxxx (v) Service preceding resignation C.W.P. No. 7520 of 2008 6 except where such resignation is allowed to be withdrawn in public interest by the appointing authority as provided in the relevant rules or where such resignation has been submitted to take up, with proper permission, another appointment whether temporary or permanent under the Government where service qualifies for pension.” The other relevant provision would be Rule 7.5 Volume I Part 1 of the CSR, which reads as follows:- “7.5(1) Resignation from a service or a post, unless it is allowed to be withdrawn in public interest by the appointing authority, entails forfeiture of past service. (2) A resignation shall not entail forfeiture of past service if it has been submitted to take up, with proper permission, another appointment, whether temporary or permanent, under the Government where service qualifies for pension. xx xx xx xx" The order passed by this Court, while dealing with Shri K.K. Sharma's case (supra), to which reference has been made by the learned counsel for the petitioners, reads as under:- “The petitioner undertakes to produce the entire evidence before the respondent no. 1 in order to show that he served Punjab State Electricity Board for a particular period as well as that proper permission was granted to the petitioner by the Punjab State Electricity Board to join the other post which the State of Punjab. In case the C.W.P. No. 7520 of 2008 7 authorities are satisfied regarding the service rendered and the permission, then they are directed to calculate the pensionary benefits of the petitioner under Rule 3.17 (a-5) of the Punjab Civil Services Rules. The respondent will be at liberty to send for the records of the Electricity Board in order to satisfy itself with the documents produced by the petitioner with regard to his service with the Punjab State Electricity Board. We hope that the matter will be decided by the respondents expeditiously, preferably within six months.” While dealing with the case of Gurcharan Dass (supra), after reproducing Rule 7.5 of the CSR, the following has been held by this Court:- “According to sub-rule (1) of Rule 7.5 of the Rules if a civil servant tendered resignation from a service or a post it entail forfeiture of past service unless of course it is permitted to be withdrawn in public interest by the appointing authority. However, sub-rule (2) of Rule 7.5 carved out an exception that if resignation is tendered to take up, with proper permission, another appointment under the Government where service qualifies for pension then it is not to entail forfeiture of past service. Therefore, the cardinal element to avoid forfeiture of service is that proper permission to take up another appointment is required to be obtained.” Learned counsel for the respondents has only made reference to C.W.P. No. 7520 of 2008 8 provisions of Rule 3.17 Volume 2 Chapter III of the CSR to contend that the provisions, on which reliance has been placed by learned counsel for the petitioners, would be applicable only to State Government employees and not to employees of the PSEB or Corporations. Rule 3.17 Volume 2 Chapter III of the CSR reads as under:- "3.17. If an employee was holding substantively a permanent post on the date of his retirement, his temporary or officiating service under the State Government, followed without interruption by confirmation in the same or another post, shall count in full as qualifying service except in respect of:- (i)periods of temporary or officiating service in non-pensionable establishment; (ii)periods of service in work-charged establishment; and (iii)periods of service paid from contingencies. Note 1.- In the case of a Central Government employee who is permanently transferred to the Punjab Government and becomes subject to these rules, under Rule 1.1(b) of these rules, the term "continuous temporary/officiating service" shall include such service rendered under Central Government. Note 2.- In case of a purely temporary Central Government employee who is permanently transferred to Punjab Government and becomes subject to these rules, the term "continuous temporary service" includes the C.W.P. No. 7520 of 2008 9 temporary service under the Central Government. The pensionary liability in respect of such cases shall be allocated on the length of service." Learned counsel for the respondents, however, has not been able to cite any judgment to show that the petitioners are not entitled to the benefit of service with the PSEB. Learned counsel for the respondents has further not been able to distinguish the judgments cited on behalf of the petitioners in so much as, in the case of Shri K.K. Sharma (supra), the PSEB was the earlier employer. In the case of Gurcharan Dass (supra), the Punjab Housing Development Board was the employer. The benefit of service with the PSEB and the Punjab Housing Development Board was given to the employees for the purposes of calculating retiral benefits. Consideration of the facts indicates that the petitioners served the PSEB on pensionable posts. Provisions of Rule 7.5 sub-Rule 2 of Volume 1 Part I of the CSR shows that a resignation shall not entail forfeiture of past service if it has been submitted to take up, with proper permission, another appointment under the Government where service qualifies for pension. In the case in hand, it is the admitted position that the petitioners took proper permission before seeking appointment with the respondents. The posts on which the petitioners earlier served were pensionable posts. In Rajasthan State Electricity Board, Jaipur Vs. Mohan Lal and others, reported as 1967 SLR 573, the second contention before the Hon'ble Supeme Court of India was that the Board (Rajasthan State Electricity Board) could not be held to be "State" as defined in Article 12 of the Constitution and, consequently, no direction could be issued to the Board by the High Court under Article 226 or Article 227 of the Constitution of India C.W.P. No. 7520 of 2008 10 on the basis that action of the Board had violated Articles 14 and 16 of the Constitution. The High Court had rejected both these grounds and had accepted the plea of Mohan Lal (the respondent before the Hon'ble Supreme Court of India) and issued a direction to the Board to consider the promotions afresh before taking into account the claim of respondent no. 1. The Board went up in appeal before the Hon'ble Supreme Court of India. While dealing with the aforesaid contention and while referring to the earlier decisions rendered by the Hon'ble Supreme Court of India, the following has been held in para no. 6:- "...........These decisions of the Court support our view that the expression 'other authorities' in Art. 12 will include all constitutional or statutory authorities on whom powers are conferred by law. It is not at all material that some of the powers conferred may be for the purpose of carrying on commercial activities. Under the constitution, the State is itself envisaged as having the right to carry on trade or business as mentioned in Art. 19 (1)(g). In Part-IV, the State has been given the same meaning as in Art. 12 and one of the Directive Principles laid down in Art. 46 is that the State shall promote with special care the educational and economic interests of the weaker sections of the people. The State as defined in Art. 12, is thus comprehended to include bodies created for the purpose of promoting the educational and economic interests of the people. The State, as constituted by our Constitution, is further specifically empowered under Art. 298 to carry on C.W.P. No. 7520 of 2008 11 any trade or business. The circumstance that the Board under the Electricity Supply Act is required to carry on some activities of the nature of trade or commerce does not, therefore, give any indication that the Board must be excluded from the scope of the word 'State' as used in Art. 12. On the other hand, there are provisions in the Electricity Supply Act which clearly show that the powers conferred on the Board include power to give directions, the disobedience of which is punishable as a criminal offence. In these circumstances, we do not consider it at all necessary to examine the cases cited by Mr. Desai to urge before us that the Board cannot be held to be an agent or instrument of the Government. The Board was clearly an authority to which the provisions of part III of the Constitutiion were applicable." Before giving the above observations, the Hon'ble Supreme Court of India has considered the identitiy of the Board. Above extracted portion from the Supreme Court judgment establishes that Board has to be held to be an agent or instrument of the Government. The stand of the respondents to the effect that the petitioners are not government servants and, therefore, are not entitled to the claim, has to be rejected. The Board, being an agent or instrument of the Government, the services rendered for it cannot be ignored by the respondents for the grant of retiral benefits. The Hon'ble Supreme Court of India in R.L. Marwaha Vs. Union of India and Others, (1987) 4 SCC 31 has considered the issue viz. "whether an employee of an autonomous body established under the C.W.P. No. 7520 of 2008 12 auspices of the Central Government is entitled to claim the benefit of the period of service rendered by him in a pensionable post under the Central Government prior to his service being absorbed in the autonomous body for computing qualifying service for purposes of pension." While considering the issue in para no. 8, the following has been held:- " 8. There is no dispute that the ICAR though it is a body registered under the Societies Registration Act, 1960, is a body which is sponsored, financed and controlled by the Central Government. There has been a continuous mobility of personnel between Central Government departments and autonomous bodies, like the ICAR both ways and the government thought, and rightly so, that it would not be just to deprive an employee who is later on absorbed in the service of the autonomous body, like the ICAR the benefit of the service rendered by him earlier in the Central Government for purposes of computation of pension and similarly the benefit of service rendered by an employee who is later on absorbed in the Central Government service the benefit of the service rendered by him earlier in the autonomous body for purposes of computation of pension. If that was the object of issuing the notification then the benefit of such notification should be extended to all pensioners who had rendered service earlier in the Central Government or in the autonomous body as the case may be with effect from the date of the said government order." C.W.P. No. 7520 of 2008 13 A Division Bench of this Court while dealing with CWP No. 6680 of 2005 decided on 03.05.2007 in the case of S.C. Kapuria Vs. Punjab State Electricity Board and others, has considered similar issue as raised in the present petition. In the said case, the petitioner approached this Court for quashing order whereby claim of the petitoner for counting his service rendered under the Punjab Government for pensionary benefits was rejected by the PSEB. While relying on R.P. Singla Vs. State of Punjab and another, 2002 (3) RSJ 504, Er. C.L. Malhotra Vs. The State of Punjab and Others (CWP No. 11839 of 2000) decided on 12.07.2001, Sh. Gurbax Singh Vs. Union of India and others (CWP No. 4007 of 1999) and The Sports Authority of India Vs. Sh. Gurbax Singh and others (CWP No. 10826 of 1999) decided on 26.05.2000, this Court has held that an employee is entitled to counting of his past service rendered with the State of Punjab towards his pensionary benefits. Under the circumstances, taking a cue from the judgment in the case of S.C. Kapuria (supra), even the petitioners could not be denied the same benefits of service rendered on pensionable posts in the PSEB. A Division Bench of this Court, while dealing with A.S. Bhatia Vs. Punjab State Electricity Board, 2001 (1) SCT 275, has considered an identical issue. The following has been held in para no. 9:- " 9. After hearing the learned counsel for the parties, we are of the view that the writ petition is liable to succeed. Apart from the fact that the Board itself had adopted the notification of the Punjab Government, dated February 26, 1990, on November 28, 1990 and understood it to mean that the previous service rendered by an emloyee C.W.P. No. 7520 of 2008 14 in another Department/Government is to be counted as qualifying service for pension, it actually took conscious decisions, dated March 16, 1992 and July 21, 1993. Otherwise also, nothing bars an employer to count previous service rendered in another department of Government independently of decision of the type, dated February 26, 1990, by the State Government. Moreover, adoption of the decision of the State Government was withdrawn on November 25, 1993, after the petitioner had retired and after a decision had been taken in his favour on July 21, 1993. In the aforesaid circumstances, the petitioner would be entitled to get one year 7 months and 9 days service, rendered by him in the CPWD, reckoned as qualifying service for maximum pensionary benefits in the Board." This court, in another case, has considered an identical issue while dealing with the case of R.P. Singla Vs. State of Punjab and another, 2002 (3) SCT 1062 [2002 (3) RSJ 504]. Following has been held in para no. 10:- " 10. After considering the rival contentions of the parties, I am of the opinion that the petitioner joined the service of the Board after performing about 13 years service in the Punjab Government and, therefore, that service has to be counted by the Board on the basis of shared liability and respondent No. 1 i.e. the State of Punjab cannot escape from its liability from depositing the pension contribution for the period rendered by the petitioner in the State service." C.W.P. No. 7520 of 2008 15 In a recent judgment rendered on 12.09.2008, while dealing with LPA No. 115 of 2006 titled The Punjab State Electricity Board Vs. The State of Punjab and others, a Division Bench of this Court has considered: "The common question that arises for consideration in this appeal and the accompanying petitions is whether the period for which an erstwhile employee of the Punjab State Electricity Board, who has served either with Government of India or Government of Punjab, is liable to be counted for the purpose of determining his pension and other retiral benefits and if so, on what terms?" Following is the relevant portion from the judgment:- "In Civil Writ Petition No. 15615 of 2001 Er. Jagjit Hari Mittal Versus The State of Punjab and others, decided on January 31, 2006, out of which LPA No. 115 of 2006 arises, a Single Bench of this Court has answered the said question in the affirmative and held that the period during which an employee has served either with the State of Punjab or with the Union of India, is liable to be counted for determination of his retiral benefits. The learned Single Judge has, while doing so, placed reliance upon a decision of this Court in Satwant Singh Sandhu Versus The State of Punjab and others, (CWP No. 6134 of 2000) decided on August 23, 2001. In Santwant Singh's case, a Division Bench of this Court was examining the question regarding entitlement of the employees retiring from services of the Punjab State Electricity Board to count their service rendered in the State of Punjab or the Union of India for dertermination of their retiral benefits. Answering the C.W.P. No. 7520 of 2008 16 question in affirmative, the Court relied upon a decision rendered by another Division Bench of this Court in C.L. Malhotra Versus The State of Punjab and others (CWP No. 11839 of 2000) decided on July 12, 2001 and declared that service rendered by an employee either with the Punjab Government or with the Government of India had to be counted for determining the pensionary benefits due to any one retiring from the service of