HON’BLE SRI JUSTICE GODA RAGHURAM AND HON’BLE SRI JUSTICE NOUSHAD ALI WRIT APPEAL No.86 of 2010 BETWEEN: The Andhra Pradesh State Cooperative Central Bank Employees Association, Redg.No.B 1100 rep. by its General Secretary. ….. PETITIONER And 1. State of Andhra Pradesh rep. by its Secretary, Food, Agriculture and Cooperation Department, Secretariat Buildings Saifabad, Hyderabad, and others. ….. RESPONDENTS Counsel for the petitioner: Sri Siva Counsel for the first respondents 1 & 2: G.P. for Cooperation Counsel for the first respondent No.3: Sri A.H. Rama Krishna Rao The Court made the following order: JUDGEMENT: (per Hon’ble Sri Justice Noushad Ali) This Writ Appeal has been filed by the Appellant-Association aggrieved by the orders in W.P.No.13024 of 2004, dated 26.11.2009, to the extent the order restricting the benefit of compassionate appointment to the dependents of only those deceased employees of the District Cooperative Central Banks whose death occurred on or after 23.02.2007, instead of granting the said relief to all those eligible under the scheme of appointment. Heard Sri D. Prakash Reddy, learned Senior Counsel instructed by Sri Siva, learned counsel for the appellant, learned Government Pleader for Cooperation for respondent Nos.1 and 2 and Sri A.H. Rama Krishna Rao learned Standing Counsel for A.P. State Cooperative Bank Limited-respondent No.3. On a proposal of the Registrar of Cooperative Societies, Andhra Pradesh, to extend the employment facilities to the dependents of deceased employees of Cooperative Societies as in the case of Government Servants, the Government of Andhra Pradesh while accepting the proposal, issued orders in G.O.Ms.No.623, Food and Agriculture (Coop.VI) Department, dated 26.10.1978. As per the said orders, a son/daughter/spouse of a deceased employee of Cooperative Societies/Agricultural Development Banks etc., who died in harness, if there was no other earning member in the family, be appointed to the category of post as per the eligibility without the medium of Employment Exchange. Application in that regard should be made within a period of one year from the date of occurrence of death of the employee. The said orders expressly covered the cases of death of employees occurred one year before the issue of the order. The Commissioner of Cooperatives & Registrar of Cooperative Societies, Andhra Pradesh issued Revised Instructions in circular Memo Rc.No.62417/94.C5, dated 23.08.1995 which inter alia provided that such appointments should be made to the post of category-V or to the post of attender, but such appointments should not be to any other higher post. It also provided that application for appointments should be made within a period of one year from the date of occurrence of death of an employee and in the case of minors of 16 years of age and above, application should be made within one year but appointment would be considered only after he/she attained the age of 18 years within a period of 2 years from the date of occurrence of death of the employee. The appointments should be on consolidated wages of Rs.1,400/- per month for category-V and Rs.1,000/- per month to attenders, until the posts were adjusted against future vacancies in the latest cadre strength fixed by the Commissioner of Cooperatives and Registrar of Cooperative Societies (CC & RCS) from time to time. This condition relating to consolidated payment was modified vide Circular Rc.No.32250/97/C1, dated 07.08.1999 of the Registrar of Cooperative Societies, Andhra Pradesh, permitting to allow regular scale of pay and allowances attached to the posts subject to fulfillment of conditions stipulated in the relevant G.Os., and Registrar’s instructions issued from time to time. By a further circular Rc.No.18908/99/C-5, dated 04.12.1999 of the Registrar of Cooperative Societies, Andhra Pradesh, the District Cooperative Central Banks were advised to make a provision in their special byelaws relating to service conditions of employees to the effect of adopting Government Orders/Registrar of Cooperative Societies instructions issued from time to time, mutatis mutandis for making appointment of dependants of deceased employees on compassionate grounds and wherever necessary for relaxation of qualification/age prescribed under special byelaws by the competent authority. The appointing authorities were directed to make purely temporary appointments to the Cadre-VII posts i.e., attenders, and confirmation/regularization to be made only after the relevant rules were relaxed. The State Government vide Circular Memo No.60681/Ser.A/2003-1, dated 12.08.2003, issued consolidated and comprehensive note on the scheme of compassionate appointments as a social security measure to help the families of the deceased Government Employees. It inter alia provided for appointment of one of the dependants from the family members of the deceased employee, who dies in harness, there being no other earning member in the family. The dependant family member means spouse/son/daughter/ adopted son/adopted daughter/unmarried younger brother/sister of an unmarried employee. Application for appointment should be made within one year from the date of demise and in the case of minor dependents below the age of 18 years, if such minor attains the age of 18 years within 2 years of the date of death of the employee, such applications also would be considered. The said circular also stipulated the eligibility and qualifications required. At this juncture, the Managing Director, Andhra Pradesh State Cooperative Bank Limited issued a Circular No.P&D/F.7/SR/2003- 2004/375, dated 08.09.2003 prohibiting appointments on compassionate grounds. Reiterating and affirming the same, the CC & RCS also issued a circular Rc.No.43051/04/Z6/District Cooperative Central Banks, dated 18.06.2004. It is stated that the Officer, who issued the circular dated 08.09.2003 in the capacity of Managing Director assumed office as CC & RCS and issued circular dated 18.06.2004 in the capacity as CC & RCS. The circular dated 18.06.2004 was again reiterated in circular No.Adm.B/SWC/F.111/3137, dated 03.07.2004 of the Managing Director, Andhra Pradesh State Cooperative Bank Limited. Yet another circular No.Admn.B/SWC/F.102/3515, dated 30.07.2005 emanated from the General Manager (HRD), Andhra Pradesh State Cooperative Bank Limited, informing the General Managers of all the District Cooperative Central Banks that the Government has issued orders in G.O.Ms.No.36, dated 05.09.2001, dispensing with the compassionate appointments and introducing payment of ex gratia in lieu thereof and the G.Ms. of the District Cooperative Central Banks were called upon to adhere to the said instructions. The circulars referred to above were challenged by way of the present Writ Petition on the ground that the said circulars are violative of a statutory settlement reached under Section 18(1) of the Industrial Disputes Act, 1947 (for short ‘the I.D. Act’) effected by and between the A.P. Cooperative Banks Association, Hyderabad and the Andhra Pradesh Bank Employees Federation, Hyderabad acting on behalf of the integrated cadres of employees working in the District Cooperative Central Banks in the State which was approved by the CC & RCS, A.P. vide letter dated 31.05.1997 as required under Section 116-C of the A.P. Cooperative Societies Act, 1964. The said settlement prescribed that in the case of death/medical invalidation, appointment on compassionate grounds would be provided as in the Government of Andhra Pradesh and the said settlement was also followed by another settlement dated 07.07.2008. The settlement being statutory binds the parties thereto and dispensing with the appointments on compassionate grounds pursuant to the circulars is illegal. The learned Judge elaborately considered the matter, and on appreciating the respective contentions, held that the settlement dated 15.06.1997, which was continued under a later settlement dated 07.07.2008, is binding on the parties, therefore the action of APCOB and CC & RCS, Andhra Pradesh, in issuing instructions contrary to the settlement with regard to compassionate appointments in District Cooperative Central Banks is clearly unsustainable and the action of the Government and the APCOB and CC & RCS, Andhra Pradesh, in extending the scheme floated by the Government to the District Cooperative Central Banks in respect of SLPEs is also open to question, being in violation of the binding settlement. Having held so, the learned Judge proceeded to consider the matter in the light of the orders issued by the Government in G.O.Ms.No.1, Public Enterprises (PE.III) Department, dated 22.02.2008 under which the scheme of compassionate appointments in SLPEs was revived prospectively, directed the respondents to consider the cases of dependents of the deceased employees of the District Cooperative Central Banks, whose death occurred on or after 23.02.2007, for appointment on compassionate grounds without insisting on the stipulation in G.O.Ms.No.623, dated 26.10.1978 that the application should be made within one year of the date of death of the employee. As the benefit has been restricted to the dependents of those deceased employees, whose death occurred on or after 23.02.2007 leaving all those eligible dependents of the employees, who died before the said date, this Writ Appeal has been filed. As per the provisions of Section 18 (1) of the I.D. Act a settlement arrived at by an agreement between the employer and the workmen otherwise than in the course of conciliation proceedings is binding on the parties to the agreement and a settlement arrived at in the course of conciliation proceedings or an arbitration award or an award of a Labour Court, Tribunal or National Tribunal enumerated in sub-section (3) of Section 18 of the I.D. Act, which has become enforceable, is binding on the parties to the industrial dispute, or other parties summoned to appear in the proceedings as parties to the dispute, unless such parties were so summoned without proper cause as per the opinion of the concerned authority. A settlement as defined in Section 2(p) of the I.D. Act means – a settlement arrived at in the course of conciliation proceedings and includes a written agreement between the employer and workmen arrived at otherwise than in the course of conciliation proceedings, where such agreement has been signed by the parties thereof, in such a manner as may be prescribed, and the copy thereof has been sent to the appropriate Government and the conciliation officer. In view of the provisions of Section 18 r/w Section 2(p) of the I.D. Act, a settlement arrived at as provided under the Act is a statutory agreement and binding on the parties to the said agreement. Section 19 of the I.D. Act provides for period of operation of settlement and awards. As per the said provision a settlement comes into operation on such date as is agreed upon by the parties to the dispute, and if no date is agreed upon, on the date on which the memorandum of settlement is signed by the parties to the dispute such settlement shall be binding for such period as is agreed upon by the parties, and if no such period is agreed upon, for a period of six months from the date on which memorandum of settlement is signed by the parties to the dispute, and shall continue to be binding on the parties after expiry of the period aforesaid until the expiry of two months from the date on which notice in writing of an intention to terminate the settlement is given by one of the parties to other party or parties to the settlement. Thus from a reading of Section 19 of the I.D. Act it is clear that where the parties have not stipulated any period during which a settlement should be in operation, the statute has prescribed a period of six months and further directs that such settlement should continue to be binding on the parties even after the expiry of six months until the expiry of two months from the date of issuance of notice in writing of an intention to terminate the settlement by one of the parties to the other party to the settlement. Section 19 of the I.D. Act has thus prescribed terminus a quo and terminus ad quem. In the instant case, it is not in dispute that a settlement has been arrived at between the parties on 15.06.1997 followed by another settlement dated 7.07.2008 and the provision relating to compassionate appointments continued to be in force. None of the parties intended to terminate the settlement nor prescribed a terminus ad quem. The learned Single Judge has also noticed that the settlement dated 15.06.1997 has been given a continuum by the later settlement dated 7.07.2008 and that the said settlement is binding on the parties. That being so, the respondents would not have resiled from the agreement, which is statutorily binding on them, and declined to provide employment to the dependents of the deceased employees. It may be true that the Government of A.P. issued orders in G.O.Ms.No.36, Public Enterprises (PE.III) Department, dated 5.09.2001 dispensing with the scheme of compassionate appointments of dependents of the deceased employees in the State Level Public Enterprises and in view thereof ex gratia was directed to be paid to such dependents. But the said G.O., could not have been made applicable to the employees of the APCOBs and District Cooperative Central Banks in the light of the aforesaid statutory settlement. In fact, the said G.O., was not understood as applicable to the APCOBs and District Cooperative Central Banks, until the Government had issued letter dated 23.07.2005 informing that the said G.O. was applicable and requested APCOBs and District Cooperative Central Banks to follow the instructions subject to complying with Section 116-C of the A.P. Cooperative Societies Act, 1964. This fact is evident from the Circular Memo dated 23.10,2004 issued by the Commissioner of Cooperatives and Registrar of Cooperative Societies, A.P., partially relaxing the ban on compassionate appointments subject to certain conditions. Even otherwise, by interim order dated 2.09.2004, granted in W.P.M.P.No.16639 of 2004, the circulars dated 8.09.2003 and 18.06.2004, which interdicted compassionate appointments, remained suspended during the pendency of the writ petition. Therefore, there were no fetters on the respondents to provide employment to those eligible as per the scheme for compassionate appointments. The respondents were in fact under a statutory duty, which they should have discharged by appointing those eligible dependents. It is true that under the orders issued in G.O.Ms.No.1, dated 22.2.2008, the compassionate appointments scheme was restored in the State Level Public Enterprises and Cooperatives with prospective effect from the date of issuance of the orders in the matter, on certain conditions and that it was directed therein that the earlier cases should not be entertained and all such cases were directed to be processed as per the orders issued in G.O.Ms.No.36, dated 5.09.2001 by granting ex gratia. But in the light of the said binding statutory settlement as noticed above and the interdiction of appointments by virtue of the circulars dated 8.09.2003 and 18.06.2004, which were suspended pending the writ petition and ultimately declared as unsustainable, the fetters placed by the orders issued in G.O.Ms.No.1, dated 22.02.2008 making it applicable prospectively, in our considered opinion, is not sustainable as it would result in deprivation of employment of those dependents of the deceased, who died in harness and who were otherwise eligible, and cause injustice to them. We therefore, deem it just and appropriate to modify the orders in the writ petition to the extent the order has restricted from consideration of the cases of those dependents of the employees of the District Cooperative Central Banks, who died on or after 23.02.2007 only, and hold that all those dependents who would have applied but for the impugned circulars, should be eligible for consideration for appointment on compassionate grounds. We, however, make it clear that those who have already availed ex gratia as per the order issued in G.O.Ms.No.36 dated 5.09.2001, are not eligible for consideration. The Writ Appeal is disposed of with the above modification. There shall be no order as to costs. ____________________ GODA RAGHURAM, J. ________________ NOUSHAD ALI, J. 3rd November, 2010. Js/Skmr.