Case: Bank Of Baroda Vs. Rajender Pal Soni

is liable to take over the services of the appellant ? If that finding is recorded in favour of the respondent, necessarily the suit of the respondent would stand maintainable. Section 45 of the Act envisages the power of the Reserve Bank to apply to the Central Government for suspension of the business of a Banking Company and prepare a scheme for reconstitution or amalgamation. Admittedly, the Traders Bank was amalgamated with the appellant - Bank by exercise of the power under sub-section (1) read with sub-section (2) of Section 45 of the Act. The sanction in that behalf has been accorded by the Central Government in the scheme under sub-section (7). As seen, clause [10] of the scheme envisages that employees existing as on November 20, 1987 in the transferor bank, viz., the Traders Bank so taken over, shall become employees of the appellant-Bank. Admittedly, the respondent was not in service as on that date. Even no suit or proceedings was pending against the Traders Bank as on the date. Under those circumstances, the question arises: whether the suit is maintainable ? This Court in Chairman, Canara Bank, Bangalore vs. M.S. Jasra & Ors., 1994(4) SCT 349(SC) : AIR 1992 SC 1100 in paragraph 9, has considered the effect of sub-sections (4) & (5) of Section 45 of the Act and of the scheme framed thereunder which reads and held as under: "9. Sub-section (5) then specifies the provisions which may be made in such scheme. It is Cl. (i) and the provisos thereunder of sub-section (5) with which we are concerned. The opening words in sub-section (5) are: `The scheme aforesaid may contain provisions for all or any of the following matters.... It is clear that the scheme so framed under sub-section (4) may contain provisions for all or any of the matters specified in sub-section (5) so that it enables all or any of the specified matters to be provided in the scheme prepared under sub-section (4) and the matters specified in the several clauses in sub-section (5) do not automatically get incorporated in such scheme unless the scheme specifically includes any such matter. It means that the matter specified in Cl. (i) of sub-section (5) is not an invariable term to be read in such scheme framed under sub-section (4) for amalgamation of the banking company unless it is incorporated specifically in the scheme so prepared. Thus, such a scheme may or may not contain provisions for the continuance of the services of all the employees of the banking company in the transferee bank as is specified in Cl. (i). However, if the scheme does provide for this matter,then the continuance of the services of the employees of the banking company in the transferee bank as provided in Cl. (i) is subject to the requirements of the proviso thereunder. In other words, it is not necessary that every scheme of amalgamation framed under sub-section (4) must provide for continuance of services of all the employees of the banking company in the transferee bank, but where such a provision is made, it must contain a provision as required by the provisos in CI. (i). This is clear from the use of the word `may in the opening words of sub-sec. (5) and the word `shall in the proviso. In effect it means that where the scheme provides for continuance of the services of all the employees of the banking company in the transferee bank at the same remuneration and on the same terms and conditions of service which they were getting or, as the case may be, by which they were being governed immediately before the date of the order of moratorium, then the scheme must contain a provision that the transferee bank shall pay or grant not later than the expiry of the period of three years from the date on which the scheme is sanctioned by the Central Government to the said employees the same remuneration and the same terms and conditions of service as are applicable to the other employees of corresponding rank or status of the transferee bank subject to the qualifications and experience of the said employees being the same as or equivalent to those of such other employees of the transferee bank." 7. In U.P. Electricity Board, Lucknow through its Chairman and another vs. Radhey Mohan Verma [1994 Supp. (2) SCC 356] , similar question had arisen under the Electricity Act. It was held that the Board and amalgamated Company are entitled under that Act to enter into an agreement. Employees existing as on that date and against whom disciplinary proceedings were pending on that date could not be deemed to be employees of the Board. In the absence of any such agreement, it was held that by operation of Section 6(1)(ii) of the Electricity Act, the Board was not bound to take such an employee into the service. 8. In Rashtriya Mill Mazdoor Sangh vs. National Textiles Corporation, South Maharashtra Ltd. amd Ors. [1996 (1) SCC 313 ] similar question had arisen for consideration. This Court held that the liability to pay gratuity which became payable to a former employee prior to the taking over of the textile Company was of the textile company and not of the custodian. 9. It is contended by the learned counsel for the respondent that under the Scheme, the assets and liabilities are to be taken over by the appellant-Bank and, therefore, the employment of the appellant is one of the liabilities. Judicial review being one of the basic features of the Constitution, he cannot be prevented to avail of the judicial review against the appellant-Bank. We find no force in the contention. As far as service conditions are concerned, in view of the specific provision in the Scheme contained in paras 3 and 10 of the notification arrears of salary is a liability to be discharged by the transferor-Bank and not of the appellant-Bank. Under these circumstances, the suits are clearly not maintainable.

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

Explanation:
1[ds]9. It is contended by the learned counsel for the respondent that under the Scheme, the assets and liabilities are to be taken over by theand, therefore, the employment of the appellant is one of the liabilities. Judicial review being one of the basic features of the Constitution, he cannot be prevented to avail of the judicial review against theWe find no force in the contention. As far as service conditions are concerned, in view of the specific provision in the Scheme contained in paras 3 and 10 of the notification arrears of salary is a liability to be discharged by theand not of theUnder these circumstances, the suits are clearly not maintainable.