Case: National Building Const. Corpn Vs. S Raghunathan

2. S.L.P.(C) No. 10372 of 1997 has been filed by the appellant (hereinafter referred to as `NBCC) against the judgment and order dated 13.9.96 of the Delhi High Court by which C.W.P. No. 1464 of 1992 in which the respondents prayer for directions to NBCC to pay the Foreign Allowance @ 125% of the basic pay, as revised by the Fourth Pay Commission, w.e.f. 1.1.1986 while they were still in Foreign service in a Foreign Country, was allowed. Payment of Deputation (Duty) Allowance was also allowed by another order dated 25.7.97 passed in CM 8287/96 filed in the same Civil Writ. The other S.L.P., namely, S.L.P. (Civil) No. 20753 of 1997 arises out of S.L.P. No. 472 of 1994 filed by the respondents in that case for the same reliefs. This writ petition has also been allowed by the Delhi High Court by judgment and order dated 25.7.97 in which the earlier judgments dated 13.9.96 and 25.7.97 have been followed. The questions involved in both the appeals are the same with the only difference that in the first petition there are 11 respondents while in the 2nd there are 5, out of whom one is the widow of a deceased respondent.3. NBCC is a Government of India Enterprise (Government Company) engaged in the business of construction work in India and abroad. In addition to its own permanent work force, it obtained the services of personnel drawn from other Government Departments, including Central Public Works Department, from where the respondents were brought on deputation for one of the overseas projects being executed by the NBCC in Iraq. Respondents joined the NBCC on deputation on the basis of certain office orders one of which is the office order dated 21.11.1993 which reads as under :"The Director General of Works, CPWD, has been pleased to place the services of the following Executive Engineers (Civil) of this Department at the disposal of National Buildings Construction Corporation, New Delhi for appointment as Resident Engineer (Civil) for posting on their projects in Iraq for a period of two years in the first instance with immediate effect in public interest as per terms and conditions of foreign service shown in the Annexure :S/Shri1. V. Nainai, Asian Games, New Delhi.2. A.K. Mittal, EE(C), O/O C.E.(CDO) New Delhi.3. Pawan Kumar, EE(C) Bikaner Cen. Divn., Bikaner.4. KVLN Rao, EE(C),Project, New Delhi.5. G.C. Khattar, EE(C), SSW (Constn. Zone) CPWD, New Delhi.6. S.K. Mittal, EO to CE (NDZ), CPWD, New Delhi.7. S. Ramamurthy, EE(C),project, New Delhi.8. K. John Surgeon, EE(C), Hyderabad Cen. Division, CPWD, Hyderabad.2. It is certified that but for their deputation to National Building Construction Corporation, New Delhi, these officers would have continued to officiate as Executive Engineer (Civil) in CPWD.3. These Executive Engineers (Civil) may please be relieved immediately by making dual arrangements. Their substitutes are being posted separately.4. This issues with the approval of Ministry of Works and Housing vide their U.O. No.s. Neena GargDy. Director of Admn."4. The terms and conditions of foreign service were contained in a separate document annexed to this office order which provided as under :1. The Officer will have the option either to draw his grade pay in the Central P.W.D. from time to time plus a deputation (duty) allowance or the pay in the scale of pay of the new post as may be fixed under normal rules as per Ministry of Finance (Deptt. of Expenditure) No. 10/24/E11(6)/60, dated 4.5.61, as amended from time to time.2. Dearness allowance will be regulated at the rates admissible to Central Government Servants.3. House Rent and City Compensatory Allowance will be regulated at the rate admissible to the employees of the foreign employer.4. Liability for leave salary in respect of disability leave granted on account of disability incurred in or through foreign service even though such disability manifests itself after the termination of foreign service, will be borne by the foreign service employer.5. He would be entitled to travelling and daily allowance for journeys in connection with his duties on foreign service as admissible to him under the rules framed by the Foreign Employer.6. The contribution towards leaves salary and pension for the period the officer remains on foreign service will be paid by foreign employer according to the rates in force from time to time in accordance with the orders issued by the President under F.R. 116.7. He will remain subject to leave rules applicable to the service of which he is a member.8. He will be eligible to the Medical Attendance and the treatment not inferior to that admissible to an officer of the corresponding State under the Central Government Rules.9. Joining time, joining time pay and travelling allowance on transfer to the foreign service and reversion therefrom shall be regulated under rules framed by Foreign Employer and paid for by him.10. He will be entitled to leave travel concessions as admissible to Central Government Employees of his status and expenditure on this amount will be borne by the foreign employer.11. The whole expenditure in respect of any compensation allowance for the period of leave in or at the end of foreign service shall be borne by the foreign employer.12. He will not be allowed to join pension scheme which may be in force in the Foreign Service.13. The foreign service will commence from the date he relinquishes the post under the Central P.W.D. and end on the day he resumes duty in the Central P.W.D.14. The provisions of Government accommodation, if any, occupied by him at the time of proceeding on deputation would be subject to the conditions laid down in the Ministry of W.H. and S.O.M. No.dated 13.12.68, as may be amended from time to time.15. He will be subject to C.G.F.I.S. Recovery contributions towards C.G.F.I.S. May be effected from the deputationist and the amount remitted to the Pay and Accounts Officer concerned."5. The other Office Orders were also issued in similar terms. Each of the respondents executed separate and individual contract/employment agreement with the NBCC and worked with the NBCC for different periods from8. Under the service agreement, the respondents were given an option either to draw their salary in the scale of pay admissible to the employees of Central P.W.D. from time to time together with Deputation (Duty) Allowance or salary in the scale of pay for the new posts fixed under normal rules in terms of Ministry of Finance (Department of Expenditure) No. 10/24/EII(6)/60 dated 4.5.1961 as amended from time to time.6. The respondents opted for the Central P.W.D. scale and wanted their salary to be paid to them in that scale as revised from time to time.7. In order to give effect to the recommendations of the Fourth Pay Commission, Central Civil Service (Revised Pay) Rules, 1986 were made by the Government of India which provided, inter alia, that revised pay would be payable with effect from 1st January, 1986.8. The pay of the respondents in their parent Department, namely, C.P.W.D., was also revised and fixed in the new scales with effect from 1.1.86 by office order dated 2.1.91 which related to respondent No. 5. Similar orders were issued in respect of all the respondents. It is pointed out that although arrears were paid to other employees, it was not paid to the respondents or the employees who were posted abroad despite their representations. Ultimately, NBCC informed the respondents that in the case of deputationists who were posted on overseas projects and were drawing the pay of their parent Department, their cases were under consideration and they would be informed of the decision as and when the same was finally taken.9. The recommendations of the Fourth Pay Commission, allegedly, had given rise to some unrest amongst employees of various public sector undertakings who filed a Writ Petition directly in this Court. The Writ Petition was disposed of on 14th March, 1986 with the direction to the Government of India to appoint a High Power Committee to look into their grievances. Consequently, the Government of India appointed a High Power Committee on 7th April, 1986 under the Chairmanship of Mr. Justice R.B. Mishra, a retired Judge of this Court.10. The High Power Committee submitted its report to the Government on 24.11.88 and by Order dated 3.5.90, this Court directed that the recommendations of the Committee may be implemented.11. In order to implement the High Power Committee report, NBCC issued an order dated 15th October, 1990 for revision of wages of all its employees posted on overseas projects including those who had joined on deputation. This order was challenged by the respondents directly in this Court in Civil Writ Petition No. 1091 of 1991 but it was dismissed as withdrawn on 18.12.91 with liberty to approach the High Court. The respondents then filed the Writ Petition in the High Court claiming the following reliefsTo issue a writ of mandamus, or a writ, order or direction in the nature of mandamus directing the respondent to make payments due to the petitioners from 1.1.1986 till their repatriation to India on the basis of the CCS (Revised Pay) Rules, 1986 announced by the Government, and in accordance with the terms originally agreed upon at the time of deputation;(ii) To pass a writ of mandamus, or a writ, order or direction in the nature of mandamus directing the respondent Corporation to pay duty allowance and DA from the due dates announced by the Government for admissibility of DA from 1982 onwards;(iii) To issue a writ of mandamus, or a writ, order or direction in the nature of mandamus directing respondent to effect proportionate increases in HRA, CCA, other Special allowances (like foreign allowance, area allowance, medical allowance,allowance, food subsidy etc.) and terminal benefits of the petitioners also, as in the case of deputations who are posted in India;(iv) To issue a writ of mandamus, or a writ, order or direction in the nature of mandamus directing the respondent to make the payment of arrears of pay as admissible to the petitioners;(v) To issue a writ of mandamus, or a writ, order or direction in the nature of mandamus directing the respondent to pay interest @ 18% on the amounts due to the petitioners from 1.1.1986 for the delay committed by the respondents;(vi) To issue a writ of certiorari, or a writ order or direction in the nature of certiorari quashing the order dated 15.10.1990 passed by respondent Corporation.(vii) To grant cost of the petition; and(viii) To pass such other order or orders, as may be deemed fit and proper in the facts of the present case.12. In this Writ Petition, a statement was given by the counsel for NBCC on 30th October, 1992 that the claim of the respondents was not disputed but the payment could not be made to them on account of the embargo put up by the United Nations and that the Government of India had approached the United Nations Authorities for lifting the embargo. On 15th February, 1993, another statement was given by the counsel for NBCC before the High Court that NBCC had applied for loan to make payment to the employees who had worked in Iraq and who were entitled to be paid on the basis of the Fourth Pay Commission Report. Consequently, the time was prayed for making the payment.13. On the basis of these two statements of the counsel for NBCC, the Writ Petition was disposed of on 21st July, 1993 by issuing a direction to NBCC to make payment to the respondents within eight weeks. NBCC, however, filed a review application before the High Court on the ground that the statements of the counsel made before it do not correctly reflect their stand but the High Court dismissed the review application on 12th October, 1993. It was against this order that NBCC filed Special Leave Petitions before this Court. Leave was granted and the two Civil Appeals No. 7113/95 and 7114/95 were disposed of by this Court on 4th August, 1995. The appeals were allowed and the order dated 21st July, 1992, passed by the High Court, was set aside. The Writ Petitions were directed to be restored for being disposed of on merits.14. The High Court by the impugned judgment dated September 13, 1996 and 25.7.97 disposed of both the petitions and it is its direction to NBCC to pay Foreign Allowance @ 125% on the revised basic pay with effect from 1.1.86 which is the only contentious issue between the parties in these appeals.

Reasoning:
29. The above extracts indicate the reasoning and the approach of the High Court. They indicate the precise ground on which the claim of the respondents was allowed. We are constrained to observe that the approach of the High Court was wholly erroneous and the reasoning is equally fallacious.30. As pointed out by this Court in Food Corporation of India v. Kamdhenu Cattlefield (Cattlefeed?) Industries, (1993) 1 SCC 71 , which has already been referred to above, the question whether the expectation and the claim is reasonable or legitimate, is a question of fact in each case. It was also observed that this question had to be determined not according to the claimants perception but in larger public interest.31. Incidentally, in this case, the question of "Legitimate Expectation" was not raised in the petition and no foundation was laid in the pleadings for such a plea being advanced before the Court. Strangely, the High Court allowed this plea at the stage of argument and allowed the petitions only on the grounds of "Legitimate Expectation" without least realising that there was hardly any legitimacy in the claim of the respondents. In the absence of pleading and the affidavit of the respondents in support thereof, the whole exercise done by the High Court cannot but be termed to be speculative.32. That apart, the High Court suffered from a misconception that whenever there was a revision of the pay scales, Foreign Allowance as also the other allowances were correspondingly raised on the basis of the revised basic salary. Respondents had served on deputation with the NBCC in their foreign projects at Iraq from87 and during this period the pay structure was revised only once to implement the recommendations of the Fourth Pay Commission. Was there any other revision in the pay structure of the respondents or any of them during their tenure with the NBCC; if so, when ? To whom was the benefit of such revision available ? Who are those other Officers and employees serving on deputation in a foreign country who were benefitted by any revision in the pay structure during the period87 ? These are the few questions which legitimately arise, and unless there is material on record to answer these questions, the observations of the High Court that whenever there was a revision in the pay scales, Foreign Allowance was correspondingly increased and, therefore, the respondents had come to entertain "Legitimate Expectation", are wholly speculative, besides being erroneous.