Case: K. ANANDA RAO Vs. SRI S.S. RAWAT, IAS

by the Government. It further stated that if an employee was retired on attaining age of 58 years, he/she shall be reinstated and continued upto 60 years. However, this GO dated 08.08.2017 did not in any way depart from or dilute the principles as to what would be the situation in case of interregnum period or gap period as was specifically referred to and dealt with in memo dated 28.06.2016. The situation becomes quite clear by further instructions issued on 11.06.2018 which again referred to gap period. 14. Since all these issues were not canvased before this Court and were not gone into by this Court on 09.08.2017, the question that arises is whether the expression ?consequential benefits? occurring in the order dated 09.08.2017 must be given the interpretation that the employees were entitled to all salaries and emoluments for the period that they had not even worked in their respective organisations? The order dated 09.08.2017 does not indicate that any such aspect of the matter was in contemplation of this Court or the matter was addressed from this stand point. In the absence of any discussion, it is very difficult to say that this Court had thought of granting something which was in excess of what was contemplated in various policy documents culminating in the GO dated 08.08.2017. Those policy documents were not overridden or in way found to be inoperative. As a matter of fact, they were not even referred to. 15. In this background we need to consider the expression ?consequential benefits? in said order dated 09.8.2017. The contempt petitioners submit that going by the law laid down by this Court in B. Prabhakar Rao 2 and particularly direction No.2 therein the financial benefits in the nature of salary and other emoluments must be given to the employees even for the period that the employees had not worked. But the situation in B. Prabhakar Rao 2 was completely different. There, the issue was only regarding raising of age of retirement from 55 years to 58 years. In the present case the decision of raising the age of superannuation was more or less contemporaneous with bifurcationof the erstwhile State of Andhra Pradesh. The division of assets and liabilities was still to be undertaken. The issue of allocation of employees in various institutions in the erstwhile State was also to be finalized. And lastly, there was a clear direction issued by this Court invoking powers under 142 of the Constitution of India. No such power was invoked or exercised while passing the order dated on 09.08.2017. 16. In Sureshchandra Singh 4 , this Court dealt with somewhat similar issue. After enhancement of the retirement age of the Central Government employees from 58 years to 60 years, the employees working in Public Sector Undertakings/Enterprises also raised similar demand on the principle of parity. The matter was considered by this Court in paragraph 5 as under: ?5. Here the Government of India took a policy decision to increase the retirement of Central Government employees. Application of that decision in respect of employees of public sector enterprises is dependent upon so many factors that are to be taken into account in the light of the peculiar characteristics of each company or corporation or department. So the first OM itself provides that the order will come into force only with effect from the date of notification of amendment to the relevant rules and regulations. So it is for the authority concerned to make necessary changes in the rules and regulations after taking into account all the relevant aspects. Immediately after the first OM dated 13-5-1998 the Department of Public Enterprises, Ministry of Industry, Government of India issued OM dated 19-5-1998 wherein the modalities of the implementation of the first OM in this Department was detailed. Here it is pertinent to note that the OM dated 19-5-1998 is not an instruction issued in the name of the President. On the other hand, it was issued by the Department of Public Enterprises, which is advisory in nature. It accorded a broad discretion to the corporations or companies for the implementation of the enhanced retirement age after taking into account all the relevant factors. Pursuant to this direction the Board of Directors of FCIL took the decision not to increase the retirement age of its employees. The relevant factors that prevailed upon the Board of Directors are fully set out in its resolution and they are: that the Company is one of the highest loss-making company in the country; that the accumulated loss till the relevant date was to the tune of Rs 5049 crores; that the Company is incurring financial losses of roughly Rs 2.35 crores everyday; that the Company has no capacity to pay salaries to its employees; that the Company was referred to BIFR and was declared as sick on 6-11-1992; that as on the relevant date the Company has the negative net worth to the tune of Rs.4316.21 crores and; that the Company has surplus manpower; that it is not taking any new employees but on the contrary it is making conscious efforts to reduce the surplus manpower.? 17. Thus, purely on the principle of parity the employees of the institution or entities in Schedule IX and X of 2014 Act could not demand the benefit of enhancement of the age of superannuation from 58 years to 60 years. That benefit came to be conferred under policy documents and finally by the GO dated 08.08.2017. Thus, the source was in those policy documents and naturally the extent of benefits was also spelt out in those instruments issued by the Government. The Circular dated 28.06.2016 which was more or less adopted in proceedings dated 11.06.2018 must be taken to be the governing criteria in respect of such employees. Unless and until that governing criteria was departed from specifically, mere expression ?consequential benefits? would not entitle the concerned employees anything greater than what was contemplated in the policy documents issued by the State Government.

Decision (1 = appeal accepted, 0 = rejected): 0

Explanation:
0[ds]10. It is true that the initial orders dated 27.04.2017, 05.05.2017 and 09.05.2017 were passed in matters pertaining to the employees of Gurukulam or Society. All these orders were ex-parte orders. Insofar as the employees of the Society are concerned, it was submitted before this Court on 27.04.2017 that a decision had already been taken by the Society for raising the age of superannuation and all that was required to be done in the matter was only a formal expression in the form of an appropriate legislation. The expression in the order dated 05.05.2017 that the protection afforded would apply ?to all similarly situated employees under the respondent institutions? was only in respect of the employees of the Society and not in relation to employees of all the other entities mentioned in Schedules IX and X of 2014 Act. As a matter of fact, no notice was issued in any matter apart from the matters pertaining to the Society and all such other matters were simply tagged with the main bunch of cases which came up before this Court and were disposed of on 09.08.2017. The learned Advocates appearing for the alleged contemnors are right in their submission that insofar as entities other than the Society were concerned, the order dated 09.08.2017 was not passed after due notice to them. Nonetheless the State was definitely represented before this Court on 09.08.2017 and was heard. We do not therefore, deem it appropriate to decide these Contempt Petitions purely on this issue and, therefore, proceed to consider the merits and whether there has been any violation of the directions issued by this Court on 09.08.2017.The raising of age of superannuation by amending Section 3 of 1984 Act was soon after the bifurcation of the erstwhile State of Andhra Pradesh. The concern as to what would be the situation if the employees were finally allocated to the newly carved State of Andhra Pradesh and the employees by that time had attained the age of 58 years, was dealt with in newly inserted Section 3A in 2014 Act. The principle was to re-induct them in the services under the State of Andhra Pradesh without any break in service. Further, if the employee had not attained the age of 60 years, he would be re-inducted; and in case he had attained the age of 60 years, what would in such cases be conferred upon the employees was notional advantage for the purpose of calculation of his pensionary benefits as if he had rendered service in the State of Andhra Pradesh.After the policy decision was taken on 05.08.2015 to raise the age of superannuation from 58 years to 60 years in respect of employees of Society, that decision was kept in abeyance by Resolution dated 18.06.2016. This Resolution states that the Government had taken stock of all the developments and had decided that the issue regarding enhancement of age of superannuation in respect of employees of the entities and institutions listed in IX and X Schedule of 2014 Act would be taken only after the issue of division of assets and liabilities of the concerned institutions between the two States was settled and the allotment of employees was finalized. This was followed by GO dated 28.06.2016 which dealt with issues like how after re-induction of the employees pursuant to enhancement of age of superannuation, the period that the employees were out of employment, was to be dealt with. Such period was referred to as the interregnum period or gap period, and was then dealt with under various heads. These developments are indicative that it was always in contemplation that if an employee had superannuated on attaining the age of 58 years and was thereafter re-inducted in service with superannuation age being 60 years, he would not be entitled to any salary or normal emoluments for what was referred to as the interregnum period or gap period, but would be entitled to certain notional benefits stipulated therein.Even after the disposal of petitions by the High Court, the matter was receiving the attention of the State Government which is evident from GO dated 08.08.2017. It referred to the background facts including the requirement to have the concerned rules or regulations regarding the service conditions of employees in establishments in Schedule IX and X to be amended after due approval by the Government and after consideration whether such establishments were finally capable and viable. One of the factors which was recited was about that the issue of division of assets and liabilities was still pending and that the allocation of the employees was not yet finalized. The GO modified the earlier decision dated 27.06.2017 to the extent it had made such decisions prospective and now gave retrospective effect from 02.06.2014. It thus undoubtedly relaxed conditions as regards the requirement to have the rules and regulations amended after due approval by the Government. It further stated that if an employee was retired on attaining age of 58 years, he/she shall be reinstated and continued upto 60 years. However, this GO dated 08.08.2017 did not in any way depart from or dilute the principles as to what would be the situation in case of interregnum period or gap period as was specifically referred to and dealt with in memo dated 28.06.2016. The situation becomes quite clear by further instructions issued on 11.06.2018 which again referred to gap period.Since all these issues were not canvased before this Court and were not gone into by this Court on 09.08.2017, the question that arises is whether the expression ?consequential benefits? occurring in the order dated 09.08.2017must be given the interpretation that the employees were entitled to all salaries and emoluments for the period that they had not even worked in their respective organisations? The order dated 09.08.2017 does not indicate that any such aspect of the matter was in contemplation of this Court or the matter was addressed from this stand point. In the absence of any discussion, it is very difficult to say that this Court had thought of granting something which was in excess of what was contemplated in various policy documents culminating in the GO dated 08.08.2017. Those policy documents were not overridden or in way found to be inoperative. As a matter of fact, they were not even referred to.In this background we need to consider the expression ?consequential benefits? in said order dated 09.8.2017. The contempt petitioners submit that going by the law laid down by this Court in B. Prabhakar Rao 2 and particularly direction No.2 therein the financial benefits in the nature of salary and other emoluments must be given to the employees even for the period that the employees had not worked. But the situation in B. Prabhakar Rao 2 was completely different. There, the issue was only regarding raising of age of retirement from 55 years to 58 years. In the present case the decision of raising the age of superannuation was more or less contemporaneous with bifurcationof the erstwhile State of Andhra Pradesh. The division of assets and liabilities was still to be undertaken. The issue of allocation of employees in various institutions in the erstwhile State was also to be finalized. And lastly, there was a clear direction issued by this Court invoking powers under 142 of the Constitution of India. No such power was invoked or exercised while passing the order dated on 09.08.2017.Thus, purely on the principle of parity the employees of the institution or entities in Schedule IX and X of 2014 Act could not demand the benefit of enhancement of the age of superannuation from 58 years to 60 years. That benefit came to be conferred under policy documents and finally by the GO dated 08.08.2017. Thus, the source was in those policy documents and naturally the extent of benefits was also spelt out in those instruments issued by the Government. The Circular dated 28.06.2016 which was more or less adopted in proceedings dated 11.06.2018 must be taken to be the governing criteria in respect of such employees. Unless and until that governing criteria was departed from specifically, mere expression ?consequential benefits? would not entitle the concerned employees anything greater than what was contemplated in the policy documents issued by the State Government.