IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE K.BALAKRISHNAN NAIR & THE HONOURABLE MR. JUSTICE C.T.RAVIKUMAR MONDAY, THE 10TH AUGUST 2009 / 19TH SRAVANA 1931 WA.No. 530 of 2008() -------------------- AGAINST THE JUDGEMENT/ORDER IN WPC.35210/2001 Dated 19/09/2007 .................... APPELLANT/RESPONDENT NO.2: ------------------ KHADI AND VILLAGE INDUSTRIES COMMISSION, 3, IRLA ROAD, VILE PARLE (WEST), MUMBAI-56. BY ADV. SRI.K.KESAVAN KUTTY,SC,KVIC RESPONDENTS/PETITIONERS: --------------------------- 1. P.P.GEORGE, PROJECT MANAGER, KHADI AND VILLAGE INDUSTRIES COMMISSION, CENTRAL SLIVER PLANT, KUTTUR, TRICHUR-13. 2. B.B.GIRIMATH, DY.DIRECTOR/MANAGER-II, KHADI GRAMODYOG BHAVAN, KVIC, M.G.ROAD, PALLIMUKKU, ERNAKULAM. ADDL.R3: UNION OF INDIA REP. BY THE SECRETARY TO GOVT. OF INDIA, MINISTRY OF INDUSTRY, DEPARTMENT OF AGRO & RURAL INDUSTRIES, NEW DELHI. (ADDL.R3 IMPLEADED AS PER ORDER DT.24.3.2008 IN I.A.NO.306/2008) ADV. SRI.V.N.ACHUTHA KURUP, SENIOR ADVOCATE FOR R1 & R2 SRI.BINDU SREEKUMAR FOR R1& R2 SRI.B.S.SWATHI KUMAR FOR R1 & R2 SRI.THOMAS THOMAS, FOR ASST.SG, FOR R3. THIS WRIT APPEAL HAVING BEEN FINALLY HEARD ON 10/08/2009, ALONG WITH WA NO. 562 OF 2008, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: K. BALAKRISHNAN NAIR & C.T.RAVIKUMAR, JJ. ---------------------------------------- W.A.Nos.530 & 562 OF 2008 ---------------------------------------- Dated this the 10th day of August, 2009 J U D G M E N T ~~~~~~~~~~~ Balakrishnan Nair, J. This appeals are filed against the common judgment in O.P.No.35210/2001 and 38463/2002, which were disposed of by the learned Single Judge on 19.09.2007. W.A. No.530 OF 2008 : 2. This appeal is treated as the main case for the purpose of referring to the exhibits. The appellant was the 2nd respondent in the Original Petition. Respondents 1 and 2 herein were the petitioners. They were the employees of the appellant, Khadi and Village Industries Commission. By Ext.P2 order dated 18.10.1998, the Central Government gave sanction for revising the scales of pay of five categories of officers under the appellant. The appellant implemented pay revision for the officers under it as per Ext.P3 order dated 18.12.1998 in tune with Ext.P2. While implementing Ext.P2, benefits were W.A.No.530 & 568/2008 2 extended to certain similarly placed employees holding posts, equivalent to those enumerated in Ext.P2. The Central Government by Ext.R2(f) communication dated 20.5.1999 directed the appellant to withdraw Ext.P3 to the extent it covers equivalent categories, other than those specifically mentioned in Ext.P2. There was a further direction to recover the excess payment made to them on the strength of Ext.P3. In obedience to said direction, the appellant took Ext.P4 decision to withdraw the decision taken by it to extent the benefit of pay revision to officers in equivalent categories. The respondents 1 and 2, who were the petitioners in the Original Petition, were the beneficiaries of Ext.P3 and they were not covered by Ext.P2. In the light of Ext.P4, they would be denied the pay revision benefits and also will have to refund the excess amount received by them. Therefore, this Writ Petition was filed seeking to quash Ext.P4 and also for consequential reliefs. 3. The appellant filed a counter affidavit and along with that it produced Ext.R2(f) communication of the Central Government dated 20.5.1999 directing it to withdraw the W.A.No.530 & 568/2008 3 benefits granted as per Ext.P3 to persons not covered by Ext.P2. In view of Section 16 of the Khadi and Village Industries Commission Act, 1956, the Central Government is competent to issue appropriate directions to the appellant and the appellant is bound to comply with those directions. Therefore, the appellant submitted that the action taken by it is justified. The Central Government has been given chance, on more than one occasion, to place its objections against granting reliefs in the Original Petition. When they failed to do that, the learned Single Judge proceeded on the footing that the Central Government has no objection in granting the reliefs to the petitioners. The learned Single Judge took the view that the appellant is competent to take a decision in the nature of Ext.P3 and the Central Government should not have interfered with that. Based on that finding, Ext.P4 was quashed. Feeling aggrieved by the direction of the learned Single Judge, the present appeal is filed. 4. We heard the learned counsel for the appellant and also the learned counsel for the 3rd respondent, Union of India. The learned counsel for the appellant submitted that it is bound W.A.No.530 & 568/2008 4 by the direction issued by the Central Government as per Ext.R2(f). Power of the Government to issue such a direction is referable to Section 16 of the Khadi and Village Industries Commission Act, 1956. The learned counsel also referred to Regulation 3(3) of the Khadi and Village Industries Commission Regulations, 2007, which provides that for employing persons, with monthly remuneration, which may exceed Rs.20,000/- per month, prior sanction of the Central Government is necessary. We heard Mr.Thomas Thomas, who represented the Assistant Solicitor General of India. He fully supported the contentions of the appellant. 5. We heard the learned senior counsel, Sri.V.N.Achutha Kurup, for the respondents 1 and 2. The learned senior counsel fully supported the view taken by the learned Single Judge. 6. Section 16 of the aforementioned Act reads as follows: “16. In the discharge of its functions under this Act, the Commission shall be bound by such directions as the Central Government may give to it.” W.A.No.530 & 568/2008 5 The functions of the Commission are mentioned in Section 15. Going by those functions, we notice that they do not include fixation of scales of pay or revision of pay of employees. Such things not being part of the functions enumerated in Section 15, the Central Government cannot issue any direction to the appellant under Section 16 concerning them. Regulation 3(3) of Khadi and Village Industries Commission Regulations, 2007, deals with first appointment in service and it does not cover revision of salary of existing employees. 6. In view of the above position, we find no merit in the contentions of the appellant and of the Central Government. We are also told by the learned counsel for the appellant that revision of pay was granted to equivalent categories having regard to the financial position of the Commission and also after surrendering a few posts and thereby effecting some cut on expenditure. 7. Going by the statutory provision mentioned above, we are of the view that the Central Government have no jurisdiction W.A.No.530 & 568/2008 6 to issue an order in the nature of Ext.R2(f). Revision of pay of the employees is a matter for the Commission to decide and having regard to relevant facts it has taken a decision. Therefore, the Central Government should not have interfered with that. It is so declared. In the result, we uphold the quashing of Ext.P4 done by the learned Single Judge. Accordingly, the Writ Appeal is dismissed. W.A.No.562/2008: The judgment in W.A.No.530/2008 will govern this appeal also. So, this appeal is also dismissed. (K.BALAKRISHNAN NAIR, JUDGE) (C.T.RAVIKUMAR, JUDGE) ps