Case: All India Idbi Sc, St, Nav Buddhist &amp; Obc Vs. Idbi Bank Limited

India Act, 1964. Therefore, this is a transfer of undertaking and Repeal Act. By Chapter II transfer and vesting of the undertaking of development bank meaning Industrial Development Bank of India established under subsection (1) of Section 3 of the IDBI Act, 1964 is provided. The Central Government may by a Notification appoint a date on which there will be a transfer to and vesting in the company of the whole of the undertaking of development bank. That is provided by Section-3. The general effect of transfer and vesting of undertaking as set out in Sections 4 and 5 would mean that the general effect of transfer and vesting of the undertaking, is provided by Section-4, whereas in respect of officers and other employees of the development bank, Section-5 is enacted. Sub-section (1) of Section-5 says every officer or other employee of the development bank except a Director of the Board or the Chairman and Managing Director or any whole time Director serving in the employment immediately before the appointed day shall, insofar as such officer or other employee is employed in connection with the undertaking which has vested in the company by virtue of the subject Act, become on and from the appointed day, an officer or, as the case may be, the other employee of the company and he shall hold his office or service therein by same tenure, at the same remuneration, upon the same terms and conditions, with the same obligations and with the same rights and privileges as to leave etc and other benefits as he would have held under the development bank if its undertaking had not vested in the company and shall continue to do so until expiry of a period of six months from the appointed day, if such officer or other employee opts not to continue to be the officer or other employee of the company within such period. Therefore, such of those officers or other employee of the development bank opting not to continue to be the officer or other employee of the company would derive their benefits for six months from the appointed date and equally there is no guarantee that these service conditions can never be altered or revised. The subsections of Section 5 would indicate as to how it would be open for the company to manage the affairs of the bank as it deems fit or proper so as to achieve the object and purpose of setting up the same.21. We do not see any reason for the Petitioner to rely upon language of sub-section (1) of Section-5. It does not mean and by any stretch of imagination that the terms and conditions of service as prevailing prior to this vesting and transfer of IDBI in a company remain and continue in the same form, despite the vesting in a company. The undertaking vests in different legal entity and if that different entity decides to operate on business principles so as to face other competitors in the market, then, it was open for it to take such decisions as it deems fit and proper. We do not think, therefore, that there is any prejudice caused or any right which is pre-established is violated. Therefore there is no question of any alteration in the terms and conditions, to the detriment of the officers of the bank.22. We do not see how in the above circumstances the principles of either legitimate expectation or promissory estoppel can be invoked. The tests for applicability of the same are salutary. They have been set out in several decisions of the Honble Supreme Court of India. Even if we refer to the decision relied upon and copy of which is annexed to the written submissions, what we find is, in that decision itself, (Pratima Chowdhury v/s Kalpana Mukherjee and Another reported in (2014) 4 SCC Pg.196, the Honble Supreme Court clarifies that rule of estoppel is a doctrine based on fairness. It postulates the exclusion of the truth of the matter. All for the sake of fairness. For Section 115 to apply firstly one party should make a factual representation to the other and secondly the other should accept and rely upon the factual representation. Thirdly, having relied on the same, the second or other party should alter its position. The instant altering of position should be such that it would be inequitable to require him to revert back to the original position. Thus, for the principles to apply, certain preconditions and prerequisites have to be satisfied. We do not think that they are satisfied in the facts and circumstances of the present case.23. The concept of legitimate expectation has no role to play where the States action is, as a public policy or in public interest unless the action taken amounts to an abuse of power. The Court cannot by invoking this doctrine usurp the discretion of the public authority which is empowered to take decisions under law and the Court is expected to apply an objective standard which leaves to the deciding authority a full range of choice which the legislature has presumed as intended. In the case of Union of India v/s Hindustan Development Corporation reported in 1993 3 SCC 499 , the legal principles have been set out and which are reiterated in Sethi Auto Service Station V/s Delhi Development Authority and Others reported in (2009) I SCC pg.180. We are therefore of the view that the Petitioner cannot rely upon above principles. Equally, they cannot rely upon any correspondence and which is exchanged by some officer or association or its office bearers or some member of the Parliament with the Ministry of Finance. Whatever it might have to say earlier, the Ministry of Finance is before us. It has now supported the stand of 1st Respondent and has not placed any material contrary to it. In such circumstances, all the more we do not think that in writ jurisdiction, we can grant any relief to the Petitioner.

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

Explanation:
0[ds]It is in these circumstances that it was advised that the Bank undertakes a broad consultative process and thereafter arrive at an informed and rational decision. It is in these circumstances the bank submits that prior to conversion into a commercial bank and subsequent merger of two other commercial banking entities having varied set of terms and conditions of service as also pay and allowances, the employees of IDBI bank Limited had different terms and conditions than what are prevailing now. The then rules of sick leave provided for availing of sick leave not exceeding 18 months at half pay on production of a medical certificate during the entire period of service of an employee. Accordingly, certain employees were having their sick leave account equivalent to 18 months at half pay. It is in these circumstances that the bank decided to take decision as contained in the Circular. Mr. Talsania would submit that the prevailing leave of 540 days at half pay now post rationalization has been readjusted and revised cap of 360 days. As such the readjustment cap to 360 days was done with the approval of the Board and the Circular was issued as per the practice. There is nothing unilateral and/or arbitrary. The IDBI was earlier governed by the Act of Parliament, namely, the Industrial Development Bank of India Act, 1964. That was repealed on IDBI converting into a banking company in 2004, through Industrial Development Bank (Transfer of Undertaking and Repeal) Act, 2003. In terms of Section 5 (1) of the IDBI Repeal Act, IDBI does not intend to perpetually protect the terms and conditions of service of employees as the provision is designed to be effective to only six months, essentially to protect those employees who opt not to continue in the service of the new entity namely, IDBI Bank Ltd. The IDBI Repeal Act does not create a static situation and is not intended to perpetually freeze the terms and conditions of contract of employment including the remuneration structure in an ever changing, vibrant and dynamic market environment. Mr. Talsania therefore submits that paragraph 6.5 at page 100 of thecannot be read in isolation but must be read together with the preceding and subsequent paragraphs which would indicate that there is absolutely no discrimination. No terms and conditions including pay leave etc have been altered to the detriment and prejudice of the officers. Sick leave is a conditional right. That is not earned by the officer but it is accumulated for a period of service rendered by the employee with the bank subject to limit specified with the approval of the Board. It is in such circumstances that Mr. Talsania would submit that there is no legal, statutory or contractual right which has been infringed Hence, the Writ Petition be dismissed.15. With the assistance of both the advocates, we have perused the bulky record namely, the Petition, its Annexures, the affidavits filed in reply, rejoinder,r so also written submissions.16. Upon perusal of all these materials, we are of the considered view that there is no merit in the Writ Petition. The Petitioner has not been able to demonstrate anypreexisting legal right and whichwould enable it to seek a writ of mandamus for the enforcement of the same. As is well settled, a writ of mandamus is not issued for the mere asking. It is a writ and one of the prerogative writ which can be issued in this Courts extraordinary, equitable and discretionary jurisdiction under Article 226 of the Constitution of India. In a recent decision of the Honble Supreme Court of India delivered in the case of Rajasthan State Industrial Development and Investment Corporation and Another v/s Diamond and Gem Development Corporation Limited and Another reported in AIR 2013 Supreme Court 1241, the preconditions for issuance of such a writ are set out. The relevant paragraphs of this judgment readIt is evident from the above, that generally the court should not exercise its writ jurisdiction to enforce the contractual obligation. The primary purpose of a writ of mandamus, is to protect and establish rights and to impose a corresponding imperative duty existing in law. It is designed to promote justice (ex debito justiceiae). The grant or refusal of the writ is at the discretion of the court. The writ cannot be granted unless it is established that there is an existing legal right of the applicant, or an existing duty of the respondent. Thus, the writ does not lie to create or to establish a legal right, but to enforce one that is already established. While dealing with a writ petition, the court must exercise discretion, taking into consideration a wide variety of circumstances,the facts of the case, the exigency that warrants such exercise of discretion, the consequences of grant or refusal of the writ, and the nature and extent of injury that is likely to ensue by such grant or refusal.15. Hence, discretion must be exercised by the court on grounds of public policy, public interest and public good. The writ is equitable in nature and thus, its issuance is governed by equitable principles. Refusal of relief must be for reasons which would lead to injustice. The prime consideration for the issuance of the said writ is, whether or not substantial justice will be promoted. Furthermore, while granting such a writ, the court must make every effort to ensure from the averments of the writ petition, whether there exist proper pleadings. In order to maintain the writ of mandamus, the first and foremost requirement is that the petition must not be frivolous, and must be filed in good faith. Additionally, the applicant must make a demand which is clear, plain and unambiguous. It must be made to an officer having the requisite authority to perform the act demanded. Furthermore, the authority against whom mandamus is issued, should have rejected the demand earlier. Therefore, a demand and its subsequent refusal, either by words, or by conduct, are necessary to satisfy the court that the opposite party is determined to ignore the demand of the applicant with respect to the enforcement of his legal right. However, a demand may not be necessary when the same is manifest from the facts of the case, that is, when it is an empty formality, or when it is obvious that the opposite party would not consider the demand.17. These are not tests evolved for the first time. The conditions and the tests were always there and have been merely reiterated in this decision. We have seen that the Circular dated 31st July, 2009, copy of which isto the Writ Petition is issued by the bank after a meeting was held on 23rd May, 2009. It is a Circular issued and internally to the Heads of Verticals, Departments/ Regional and Branch Heads, Director of the JN IDBI Staff College of the IDBI Bank Limited. The Circular states that the Board of Directors at its meeting held on 23rd May, 2009 has approved certain changes to the leave rules as applicable to the officers ofeIDBI in terms ofthe relevant provisions of Officers Service Rules, 2006. The modified service rules shall be uniformly applicable to all officers of IDBI bank Including the officers ofB, effective from August 01, 2009. The types of leave enumerated in paragraph 2 of this Circular were revised and harmonized. The Circular is not challenged, the authority and power of the Board to meet and take a decision is not challenged, that the banks power to issue such Circulars and therefore they can be issued and amended or substituted from time to time also is not challenged. Pertinently, this is not a entire union or association of officers before us. It is All India Industrial Development Bank of India Scheduled Caste/Scheduled Tribes andas also Other Backward Class Officers Welfare Association through its Vice President Mr. Mane which is before us. There is therefore enough material on record for us to conclude that it is only one of the group of officials and organizing themselves as above which is seeking to challenge this Circular. Though paragraph 2 of this Circular is read and insofar as it concerns leave, what we must read also is that the revised and harmonized categories of leave were applicable to all officers of bank and effective from August 1, 2009. From 10th August 2009, the officers can apply for modified leave, through the Absence Management System. Consequent to the approval of the revised and harmonized type of leave by the board of the bank, the extent and types of leave and leave rules applicable to above officers earlier stood abolished. The details of the revised rules are atto this Circular. The process to be followed by the officers / supervisors and LRKs for the types of leave indicated in paragraph 2, is furnished atto this Circular. The issues relating to migration of leaves as per the revised rules and course of action to be followed, is furnished atThe entire procedure is set out and what is evident from the Appendix and particularly in relation to sick leave is that an officer shall be eligible for 30 days of half pay sick leave for each completed year of service, subject to a maximum of 360 days during the entire service period. The officers will be eligible for sick leave on half pay only after completion of one year of service. Availment of sick leave is for a minimum of four days. If sufficient casual leave balance is not available, less than four days of sick leave can be availed. On completion of three years of service, an officer will be eligible for sick leave on full pay. Sick leave on full pay means an officer would get salary on full pay on double debit of the number of days of sick leave availed. The sick leave can be availed of only on production of medical certificate, acceptable to the bank. The bank reserves its right to require, an officer desiring to resume duty on expiry of sick leave, to produce medical fitness certificate indicating that the officer is fit to resume duty. Sick leave can be combined with ordinary leave. The officer is not allowed to apply for sick leave while serving a notice period.18. Thus, a one sided projection and without reading the circular in its entirety particularly as above would definitely give an impression that the bank has in the garb of revision and harmonization of various leaves unilaterally reduced the leave period. However, nothing has been done beyond harmonizing and revising it but in the above manner. Therefore, if this Circular and the Appendices are all read together, it would mean that there is a power vesting in the Board to organize and manage so also administer the affairs of the bank and additionally to revise and harmonize the leaves. It is pertinent to note that several types of leaves availed of, have been harmonized and revised. The Petitioner only picks up for challenging the decision to revise and harmonize the sick leave. Even the decision in relation thereto has not been demonstrated to be affecting the interests of the employees/officers adversely. In the representation dated 11th September, 2009 requesting withdrawal of the Circular, it is vaguely stated that the two Circulars adversely affect the established service conditions of the officers ofby way of reduction, withdrawal and cancellation of existing facilities relating to various types of leave including violation of statues etc which are detrimental to the officers interest. Further, this has resulted into causing pecuniary loss, mental torture, harassment, indiscrimination and injustice to all. This is a vague assertion. If the pleadings in the Writ Petition are properly perused, this is not a grievance of all the officers. It is only a group of officials and organized on the above lines and members of the Petitioner who are aggrieved by this decision. Even when they make a representation they are unable to spell out a particular legal right vesting in them which has been adversely affected. In such circumstances, we do not think that the Petitioners counsel can successfully urge that the banks decision is arbitrary, discriminatory and violative of the mandate of Articles 14 and 16 of the Constitution of India. In matters of public employment, the right guaranteed by Article 16 (1) is of a fair, just and equitable treatment. We have perused the subsequent letter of 5th September, 2009, as well. The All India IDBI Officers Association, through its General Secretary complained to the bank that the various Circulars on the subject of terms and conditions of service and issued by the bank, are not acceptable to the officers and they requested to withdraw the same. The Officers association was aware, as of 5th September, 2009, that the Board Meeting was convened on 23rd May, 2009 but its Minutes have not been confirmed by the Board at subsequent meeting held on 15th July, 2009 and 28th August, 2009. IDBI Officers Association and which is claiming to be an All India Association prayed for withdrawal of the Circulars in their entirety. However, they have not pursued their grievances as allegedly projected in this letter. Further, on 3rd October, 2009, the President of the Petitioner association was informed by the bank that the modified rules have already been implemented. Therefore, the bank cannot accede to the request of the Petitioner to withdraw the Circular.19. Then, there was an Appeal which was stated to have been preferred under Section 19 (1) of the Right to Information Act, 2005. We need not pursue this part for we have substantial material on record to indicate that the necessary and requisite particulars and information as a whole, was provided by the bank.20. A small contention was raised in regard to the interpretation ofsubsection (1) of Section5 of theIndustrial Development Bank (Transfer of Undertaking and Repeal) Act, 2003.This is an Act to provide for transfer and vesting of the undertaking of the Industrial Development Bank of India and in the company to be formed and registered as a company under the Companies Act, 1956 to carry on banking business and for matters connected therewith or incidental thereto and also to repeal the Industrial Development Bank of India Act, 1964. Therefore, this is a transfer of undertaking and Repeal Act. By Chapter II transfer and vesting of the undertaking of development bank meaning Industrial Development Bank of India established undersubsection (1) of Section3 of the IDBI Act, 1964 is provided. The Central Government may by a Notification appoint a date on which there will be a transfer to and vesting in the company of the whole of the undertaking of development bank. That is provided byThe general effect of transfer and vesting of undertaking as set out in Sections 4 and 5 would mean that the general effect of transfer and vesting of the undertaking, is provided bywhereas in respect of officers and other employees of the development bank,ion (1) ofsays every officer or other employee of the development bank except a Director of the Board or the Chairman and Managing Director or any whole time Director serving in the employment immediately before the appointed day shall, insofar as such officer or other employee is employed in connection with the undertaking which has vested in the company by virtue of the subject Act, become on and from the appointed day, an officer or, as the case may be, the other employee of the company and he shall hold his office or service therein by same tenure, at the same remuneration, upon the same terms and conditions, with the same obligations and with the same rights and privileges as to leave etc and other benefits as he would have held under the development bank if its undertaking had not vested in the company and shall continue to do so until expiry of a period of six months from the appointed day, if such officer or other employee opts not to continue to be the officer or other employee of the company within such period. Therefore, such of those officers or other employee of the development bank opting not to continue to be the officer or other employee of the company would derive their benefits for six months from the appointed date and equally there is no guarantee that these service conditions can never be altered or revised. The subsections of Section 5 would indicate as to how it would be open for the company to manage the affairs of the bank as it deems fit or proper so as to achieve the object and purpose of setting up the same.21. We do not see any reason for the Petitioner to rely upon language ofIt does not mean and by any stretch of imagination that the terms and conditions of service as prevailing prior to this vesting and transfer of IDBI in a company remain and continue in the same form, despite the vesting in a company. The undertaking vests in different legal entity and if that different entity decides to operate on business principles so as to face other competitors in the market, then, it was open for it to take such decisions as it deems fit and proper. We do not think, therefore, that there is any prejudice caused or any right which isis violated. Therefore there is no question of any alteration in the terms and conditions, to the detriment of the officers of the bank.22. We do not see how in the above circumstances the principles of either legitimate expectation or promissory estoppel can be invoked. The tests for applicability of the same are salutary. They have been set out in several decisions of the Honble Supreme Court of India. Even if we refer to the decision relied upon and copy of which is annexed to the written submissions, what we find is, in that decision itself, (Pratima Chowdhury v/s Kalpana Mukherjee and Another reported in (2014) 4 SCC Pg.196, the Honble Supreme Court clarifies that rule of estoppel is a doctrine based on fairness. It postulates the exclusion of the truth of the matter. All for the sake of fairness. For Section 115 to apply firstly one party should make a factual representation to the other and secondly the other should accept and rely upon the factual representation. Thirdly, having relied on the same, the second or other party should alter its position. The instant altering of position should be such that it would be inequitable to require him to revert back to the original position. Thus, for the principles to apply, certain preconditions and prerequisites have to be satisfied. We do not think that they are satisfied in the facts and circumstances of the present case.23. The concept of legitimate expectation has no role to play where the States action is, as a public policy or in public interest unless the action taken amounts to an abuse of power. The Court cannot by invoking this doctrine usurp the discretion of the public authority which is empowered to take decisions under law and the Court is expected to apply an objective standard which leaves to the deciding authority a full range of choice which the legislature has presumed as intended. In the case of Union of India v/s Hindustan Development Corporation reported in 1993 3 SCC 499  , the legal principles have been set out and which are reiterated in Sethi Auto Service Station V/s Delhi Development Authority and Others reported in (2009) I SCC pg.180. We are therefore of the view that the Petitioner cannot rely upon above principles. Equally, they cannot rely upon any correspondence and which is exchanged by some officer or association or its office bearers or some member of the Parliament with the Ministry of Finance. Whatever it might have to say earlier, the Ministry of Finance is before us. It has now supported the stand of 1st Respondent and has not placed any material contrary to it. In such circumstances, all the more we do not think that in writ jurisdiction, we can grant any relief to the Petitioner.