IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA CWP No. 106 of 2005. Reserved on: 3.11.2009 Date of decision: 8.1.2010 Union of India & ors. …. Petitioners Versus CRI, Employees Ass. & anr. ….. Respondents Coram: The Hon’ble Mr. Justice Deepak Gupta, J. The Hon’ble Mr.Justice V.K.Ahuja, J. Whether approved for reporting ? No For the petitioners: Mr.Sandeep Sharma, Assistant Solicitor General of India. For the respondent: Mr.Ajay Sharma, Advocate for respondent No.1. _________________________________________________ Deepak Gupta, J. This writ petition by the Union of India is directed against the order dated 28.6.2004 passed in Original Application No.761-HP-03 by the learned Central Administrative Tribunal, Chandigarh Bench whereby the Original Application has been allowed and the following directions have been issued:- “For the foregoing reasons, this OA is allowed. We quash the impugned action of 2 respondents and orders at Annexures A-1 and A- 2 to the extent these deny payment of Remote Locality Allowance (Special Compensatory Allowance) to the applicants at par with the employees posted at Shimla w.e.f. 1.9.1997 with a direction to implement the provisions of Clauses (v) and (iv), reproduced above from orders dated 9.7.2003 and 16.7.2003, and to continue to pay the enhanced Special Compensatory Allowance/Remote Locality Allowance to the applicants even with effect from 1.8.1997 at the same rates as admissible to the employees posted at Shimla with all consequential benefits. This benefit can be denied only to those employees or the applicants who joined service at Kasauli after 31.5.1991 or to those who were either not a party to the judgments passed given earlier and had been regularized after 31.5.1991. The OA is allowed to the extent indicated above. Parties are, however, left to bear their own costs.” The case has a long and chequered history. The Union of India runs the Central Research Institute (CRI) at Kasauli in the State of Himachal Pradesh. The Government of India granted “Special Compensatory (Remote Locality) Allowance” (hereinafter referred to as ‘SCA’) to its employees posted in remote areas. Shimla was classified as ‘C’ class city and Kasauli was an unclassified city. The employees at Shimla were getting a higher rate of 3 SCA. Therefore, the employees of the CRI, Kasauli filed Original Application No.92-HP/1988 claiming same rate of SCA as was payable to the employees of the Central Government at Shimla. This application was allowed by the learned Tribunal and a direction was issued to the Government of India to grant SCA to the applicants from the date the same was being paid to the Central Government employees posted at Shimla at the same rates. Thereafter, the Union of India again classified the various areas in the State of Himachal Pradesh for the grant of SCA. Reclassification was done and Kasauli was put in a separate category ‘D’ whereas Shimla was placed in category ‘C’. On the recommendations of the 5th Central Pay Commission, the rates of SCA were revised on 20th July, 1998 and different SCA was payable for different categories. Thereafter, the employees association of the CRI took up the matter with the Union of India and again claimed that they be paid SCA at par with the rates in Shimla in consonance to the orders of the Central Administrative Tribunal dated 19.5.1989 passed in OA No.92/HP/88. The 4 Union of India accepted the prayer of the employees only in respect of those persons who were the petitioners in O.A No.92/HP/88. The request of other employees who were not petitioners in the said O.A was not acceded to. Relevant portion of the order dated 28.7.1999 issued in this behalf reads as follows:- “I am directed to refer to Ref.No.EA/53/98 dated 4-10-98 (copy enclosed) addressed to Union Minister of Health & F.W. by President, C.R.I. Employees Association, Kasauli on the above subject and to say that on the basis of C.A.T. Judgment dated 19-5-89 delivered by the C.A.T. Chandigarh Bench in O.A No.92/HP/1989, Finance Ministry had agreed to grant of S.C.(RL)A at Shimla rates to the petitioner of the case. Keeping in view of the above mentioned Judgment and also the disadvantageous position of the employees of C.R.I., Kasauli, it was also decided to grant of this allowance at Shimla rates. Accordingly, Finance Ministry also agrees for grant of Special Compensatory (Remote Locality) Allowance at the revised rates for petitioners only. However, extension of this allowance to Non-petitioners or to other in General is not agreed to. This has the Concurrence of Ministry of Finance (Exp.’s) U.O.Nos.1375/98 & 688/E.II(B)/99 dated 20-7-99.” 5 Thereafter other employees who were not parties in O.A No.92/HP/88 filed Original Applications being O.A Nos.811/HP/2001 and O.A No.1017/HP/2001. Both these Original Applications were disposed of by the learned Tribunal and it was held that the employer could not make any discrimination between different employees. The Tribunal held that it was not entering into the controversy as to whether employees of the CRI, Kasauli were entitled to the benefit of SCA or not. However, since Union of India had granted the benefit to the applicants in OA No.92/HP/99, it could not deny the same to the other employees who were similarly situated. While disposing of O.A No.811/HP/2001, the learned Tribunal had made the following observations:- “On a consideration of the matter and having regard to the facts of this case, we are of the opinion that the action of the respondents cannot be justified in law. We are, however, not entering into controversy in this case as to whether the employees of the CRI, Kasauli are entitled to the benefit of Remote Locality Allowance or not. We are only considering one aspect as to whether this allowance could be granted to some of the employees of the CRI, Kasauli and denied to the other similarly situated 6 employees of the same Institute. Once the respondents came to the conclusion that the applicants in OA 92-HP of 1988 were entitled to the grant of Remote Locality Allowance, they cannot, at the same time, deny that very benefit to the applicants who are similarly situated though they were not applicants in the earlier OA. The respondents in our view were not justified in denying the benefit of Remote Locality Allowance to the similarly situated employees. It is a clear case of discrimination and the OA thus deserves to be allowed. In view of the above, the OA is allowed and the applicants are held entitled to the same benefit as has been extended by the respondents to some of the their employees by order, annexure A-2. However, in the facts of this case, we make no order as to costs. Before parting with the order, we make it clear that the above decision shall not be taken as a decision that all employees of the CRI, Kasauli are entitled to the grant of Remote Locality Allowance. It will still be open to the respondent-authorities to take a decision as to whether such a benefit is to be extended to all the employees of CRI, Kasauli or not, but not by reference to the decision dated May 19, 1989.” The operative portion of the judgment passed in O.A No.1017/HP/2001 reads as follows:- “Before concluding, we want to record our displeasure over the manner in which the respondents have taken action. In our order dated 10.5.2002, it was made clear that the 7 Bench was not entering into controversy whether the employees of CRI, Kasauli are entitled to the benefit of RLA or not. The Bench had only considered one aspect as to whether this allowance could be granted to some of the employees of CRI, Kasauli and denied to the other similarly situated employees of the same Institute. However, before parting with the order, it was made clear “that the above decision shall not be taken as a decision that all employees of CRI, Kasauli are entitled to the grant of RLA. It will still be open to the Respondent authorities to take a decision as to whether such a benefit is to be extended to all the employees of CRI, Kasauli or not, but not by reference to the decision dated May 19, 1989. We find the respondents still have not taken any decision till date with the result more and more applicants are claiming the same benefit on the ground of discrimination. It appears that respondent authorities are in deep slumber and not bothered to look into the matter as to rectify the mistakes committed by them in the past which has undoubtedly resulted into a heavy loss to the exchequer. We hope that the authorities will wake up and take suitable decision as early as possible.” Thereafter, the Government of India, Ministry of Heath & Family Welfare issued a letter on 9th July, 2003. According to this communication, the issue regarding grant of SCA to the employees of CRI, Kasauli was considered in consultation with the 8 Department of Health and Ministry of Finance and it was decided that all employees of the Central Government posted at Kasauli including the CRI, Kasauli are eligible for grant of SCA from 15.11.1985 or the date of their posting at Kasauli. It was further decided that upto 30.5.1991the SCA was granted at the rates at which it was admissible for Shimla and w.e.f. 31.5.1991 the allowance would be governed by the rates mentioned in O.M dated 31.5.1991. However, protection was granted to those employees who were already drawing the allowance at the higher rates than the one prescribed in OM dated 31.5.1991. Resultantly, the higher allowance paid to the employees in view of the orders of the Tribunal was protected. It was further directed that recoveries of excess payments be made from those employees posted at Shimla who had been given enhanced Shimla rates w.e.f. 1.8.1997. On the basis of this communication, Office Order No.812/03 was issued on the same lines on 16.7.2003. Thereafter, the petitioners filed the OA No.761/HP/2003 challenging the orders dated 9.7.2003 and 16.7.2003. These orders have been set 9 aside by the learned Tribunal. Hence the present writ petition. During the pendency of O.A No.92/HP/88, two contempt petitions being Contempt Petition Nos.147 of 2003 and 151 of 2003 were filed by the applicants in O.A No.1017/HP/2001 and O.A No.811/HP/2001 respectively and directions were issued that the orders dated 10.5.2002 and 2.7.2002 be complied with. Consequently, all the employees who were appointed after filing of O.A No.92/HP/88 and were not applicants in the said O.A were paid SCA at par with the applicants of O.A No.92/HP/88. We have heard Sh.Sandeep Sharma, learned Assistant Solicitor General of India for the Union of India and Sh.Ajay Sharma, learned counsel for the respondents. On behalf of the Union of India, it is contended that the employees posted at Kasauli have no claim for grant of Special Compensatory (Remote Locality) Allowance at the rates which are admissible in Shimla after re-classification was done pursuant to the notification dated 31.5.1991. It is further contended that the letter dated 28.7.1999 10 has no validity and could not supersede the Office Memorandum dated 31.5.1991. Therefore, the writ petitioners in occurrence with the Ministry of Finance restricted the SCA w.e.f. 1.8.1997 to the rates as applicable at Himachal Pradesh. The main grouse is that the order dated 31.5.1991 vide which the classification was done could not be superseded. It is also argued that the learned Tribunal has gravely erred in holding that the orders dated 9.7.2003 and 16.7.2003 do not supersede the decision dated 28.7.1999. Reliance on behalf of the petitioners- Union of India is placed on the observations made by the learned Tribunal in O.A No.811/HP/2001 and O.A No.1017/HP/2001 wherein the learned Tribunal had given liberty to the Union of India to take a decision as to whether or such a benefit is to be extended to all the employees of CRI, Kasauli or not. The learned Tribunal in the orders passed in O.A No.811/HP/2001 and O.A No.1017/HP/2001 had clearly stated that it is for the Government to decide whether all the employees of the CRI, Kasauli are entitled to the grant of Remote Locality Allowance or not. Whether such benefit is to be 11 granted to all the employees is a matter to be decided by the Government? Thereafter, again such an order was passed. Despite such orders having been passed on 9th July, 2003 and 16th July, 2003, the decision taken by the Union of India is not to withhold such allowance from the employees posted at Kasauli but only to restrict the rates. One of the main grounds which weighed with the learned Tribunal in upholding the contention of the petitioners was that the decision conveyed vide letter dated 28.7.1999 has not been superseded by any order. The Tribunal has taken the view that in fact the benefit of the Remote Locality Allowance has after 1999 been extended to other employees also. According to the learned Tribunal, the decision dated 28.7.1999 has never been withdrawn. There is a manifest error in this portion of the order of the Tribunal. The opening lines of the Office Order No.812/03 issued on 16.7.2003 read as follows:- “In supersession of all previous order regarding grant of Special Compensatory (Remote Locality) Allowance to the Employees of CRI, Kasauli with reference to the orders of the Hon’ble CAT dated 10.5.2002 in O.A No.811/HP/ 2001 and dated 2.7.2002 in O.A No.1017/HP/2001 12 following orders are issued on the decision of Ministry of Finance (Deptt. of Expenditure) vide I.D No.3(5)/99-E.II(B) dated 2.7.2003 conveyed vide Dte.General of Health Services letter No.C.18018/4/2001-EPI dated 9.7.2003.” This clearly indicates that Office Order No.812/03 dated 16.7.2003 was issued in supersession of all earlier orders which would obviously include the order dated 28.7.1999. Therefore, the learned Tribunal has erred in this regard. Admittedly reclassification of the cities was done. What city should be classified in what category for the purpose of grant of an allowance is for the administrative authority to decide. The Court cannot substitute its judgment for the decision of the administrative authorities who are best suited to decide this question. Therefore, we are of the considered view that after reclassification of the cities, the employees could only be granted the allowance at the rate fixed for Kasauli. However, we cannot loose sight on the fact that even after reclassification of the cities and Kasauli being placed in category ‘D’, the Union of India vide its letter dated 28.7.1999 took a decision 13 to grant the allowance at Shimla rates to those employees of the CRI who were parties in O.A No.92/HP/88. Once this decision was taken, the Tribunal was right in holding that similar benefit could not be denied to other employees. Therefore, the decisions given in O.A No.811/HP/2001 and O.A No.1017/HP/2001 are correct. It is true that in O.A No.92/HP/88 the learned Tribunal held that no discrimination could be made between the employees posted at Shimla and Kasauli. However, this decision was given in its peculiar facts. Thereafter, fresh classification was done by an expert body which recommended different rates of allowance for Shimla and Kasauli. No material has been placed on record to show that such classification is arbitrary or perverse. After having considered the entire facts of the case, we are of the considered view that Office Order No.812/03 dated 16.7.2003 is legal and valid but it must be given effect only w.e.f. 16.7.2003. Till that date the employees were being paid enhanced Shimla rates either on the basis of letter dated 28.7.1999 or the judgments passed in O.A 14 No.811/HP/2001 and O.A No.1017/HP/2001. Therefore, no recovery can be made for the amount paid upto 16.7.2003. After 16.7.2003 the employees would be entitled to the allowance only at the rates fixed for Kasauli and excess payment, if any, made may be adjusted from the future allowance payable instead of making recoveries. In case of employees who are retiring, the balance amount, if any, can be recovered from their retiral benefits. In view of the above discussion, the writ petition is allowed. The order of the learned Tribunal is set aside. The Office Order No.812/03 dated 16.7.2003 is upheld but it shall have effect only from 17.7.2003 and not prior to the said date. No order as to costs. ( Deepak Gupta ) Judge January 8, 2010 (V.K.Ahuja) (m) Judge