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PETITIONER: MANJUSHREE PATHAK

       Vs.

RESPONDENT: THE ASSAM INDUSTRIAL DEVELOPMENT CORPORATION LTD.  & ORS.

DATE OF JUDGMENT:       31/08/2000

BENCH: S. Rajendra Babu J. & Shivaraj V. Patil J.

JUDGMENT:

Shivaraj V. Patil J.

L...I...T.......T.......T.......T.......T.......T.......T..J

Leave granted.

   In  this appeal, the appellant has assailed the judgment and  order  dated 5.12.1997 passed by the Division Bench  of the  High  Court  of Assam,  Nagaland,  Meghalaya,  Manipur, Mizoram,  Tripura  and Arunachal Pradesh at Gauhati made  in Writ Appeal No.  124/96.  In brief, the facts leading to the filing of this appeal are the following.

   The  appellant  joined the services of  the  respondent- Corporation  in 1973 as Receptionist-cum-Telephone Operator. After  passing LL.B degree examination, she was promoted  to the  post of legal Assistant in 1981.  Subsequently she  was promoted  as Assistant Law Officer, Law Officer and  finally as  Senior  Law  Officer in 1995  [re-designated  as  Deputy Manager (Law)].

   In  1992  the  respondent-Corporation issued  a  special scheme  "AIDC Voluntary Retirement Scheme, 1992" (for  short the  ‘Scheme’) as a special measure in the form of a  golden handshake providing an option to its employees for voluntary retirement  who  had  completed 10 years of service  in  the Corporation or 40 years of age.

   The  appellant having served the  respondent-Corporation for nearly 23 years and attaining the age of 42 years with a view to avail the benefit of the Scheme, made an application on  7.12.1995  seeking  voluntary  retirement  in  the  form prescribed,  requesting  to accept her option for  voluntary retirement   with   immediate   effect.   The   recommending authority  on  the  same day recommended for  accepting  her voluntary  retirement.   Voluntary retirement ought to  have come into effect with immediate effect.  Since the appellant was  not allowed to hand over the charge and there was  none to  take  over  charge from her and certain  other  official formalities  were  also  left  to be carried  out,  she  was compelled  to continue to attend to her duties.  When  there was  no response from the respondent-Corporation till  third week of January, 1996, she wrote a letter dated 23.1.1996 to the  Managing Director of the respondent-Corporation stating that she had come to know that her application for voluntary retirement would be placed before the Board of Directors and

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that  there  was  no need for the same as under  the  Scheme Managing  Director  himself was the competent  authority  to accept  application  of her voluntary retirement.  No  reply was  given  to the said letter.  The appellant  addressed  a letter  dated  14.2.1996 to the Chairman of the  respondent- Corporation  stating  that  the failure of  the  respondent- Corporation  to  accept her voluntary retirement has  caused great  inconvenience  and that she was entitled to  get  her voluntary retirement accepted forthwith.  In the said letter also  she made it clear that in the absence of any  specific order  she would consider herself to be free person  without any  obligations  to  the   respondent-Corporation  and  her contract  of service would stand determined with effect from the  date  of  submission of her application  for  voluntary retirement.   Further in the said letter she stated that  in case  there  was  any  delay, she  would  presume  that  her voluntary  retirement was deemed to have been accepted  with effect  from  15.2.1996  and that she would not  attend  her duties  any more.  The appellant wrote a third letter to the Managing Director of the respondent-Corporation on 15.2.1996 requesting  for  payment  of retirement benefits  under  the Scheme.    Strangely   the   Managing    Director   of   the respondent-Corporation  issued  a  show cause  notice  dated 15/16.2.1996,  which  was  received  by  the  appellant   on 17.2.1996.  In the said show cause notice it was stated that the  appellant  had  been  participating  in  the  political activities  of the BJP and that she intended to contest  the election on a BJP ticket which amounted to misconduct and as such   a  reply  was  sought   for  the  same.   Under   the circumstances,  the  appellant approached the High Court  by filing  Writ Petition Civil Rule No.  816/96 seeking reliefs that   the  appellant  was  no   longer  employee   of   the respondent-Corporation  having gone on voluntary  retirement with   effect   from   7.12.1995     and   to   direct   the respondent-Corporation  to  give all retirement benefits  by setting aside the show cause notice dated 15/16.2.1996.  The learned  Single Judge accepted the case of the appellant and granted relief.  The respondent-Corporation aggrieved by the order  of  the  learned Single Judge took up the  matter  in appeal  and the Division Bench of the High Court allowed the appeal and set aside the order of the learned Single Judge.

   The  learned counsel for the appellant urged that  there was  no  requirement  of three months’ prior notice  in  the Scheme;   the  option of voluntary retirement ought to  have been     accepted    with       immediate    effect;     the respondent-Corporation, having offered that the Scheme was a golden  and  unique opportunity to eligible  employees,  was bound  to  accept the application of the  appellant  seeking voluntary  retirement when all the conditions of the  Scheme were  satisfied.   It  was  further  contended  that  Dinesh Chander  Sangma’s  case  referred to in the  judgment  under appeal fully supports the case of the appellant.

   The learned counsel for the respondent-Corporation while supporting  the  judgment and order impugned in this  appeal submitted  that  the  filing  of   the  writ  petition   was pre-mature  as  three  months’ period from the date  of  the application  seeking voluntary retirement was not yet  over. Under  Clause 8.1 of the Scheme, the  respondent-Corporation had  discretion either to accept or to reject the request of any   employee   for  voluntary   retirement   viewing   the organizational requirement and any other relevant factors in this  regard  and that the appellant had no vested right  to claim for acceptance of the voluntary retirement.

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   We  have  carefully considered the submissions  made  on behalf of the parties in the light of the material placed on record.   As  per  Clause 3 of the Scheme, an  employee  who completed  10 years of service in the respondent-Corporation or completed 40 years of age could seek voluntary retirement by  making  an  application  in the  prescribed  form.   The General   Managers/Heads   of  the   Departments   are   the recommending authorities in respect of the employees working under  their  control  and  the  Managing  Director  is  the accepting  authority of voluntary retirement applications as per Clause 4.  Clause 5 speaks of the conditions which apply to  those requesting for voluntary retirement - (1) once  an employee  has  applied  for voluntary retirement  under  the Scheme,  the  option cannot be withdrawn;  (2) There  should not  be any vigilance case pending/contemplated against  the concerned employee or/and his/her evidence in some important case    would    be    of     material    value    to    the respondent-Corporation;   (3) (a) Employees under suspension or  against whom disciplinary proceedings are pending or/and contemplated  will not be eligible for voluntary retirement; (b)  The  Scheme will not apply to those employees who  have already  submitted  their  resignation  as  on  date;    (c) Employees  who  are  under bond/agreement will also  not  be eligible  for  voluntary retirement unless they fulfill  the bond/agreement obligations.

   As  per  Clause  7,  the eligible  employee  may  submit application  in the prescribed form for voluntary retirement under  the  Scheme to the Managing Director  through  proper channel.

Clause 8.1 reads thus:

   "Notwithstanding  any  of the aforesaid provisions,  the Scheme  does not confer any right on an employee to have the request for voluntary retirement accepted by the management. The  management  shall  have full discretion  to  accept  or reject   the  request  from   any  employee  for   voluntary retirement  viewing  the organizational requirement and  any other relevant factors in this regard."

   Para  2  of  the prescribed application form is  to  the following effect:

   "I,  of my own accord and without any external  pressure and  coercion,  am opting to voluntary retirement under  the said  Scheme.   I shall be obliged if you kindly  accept  my option for voluntary retirement with immediate effect."

                           (Emphasis supplied)

   There  is no dispute that the appellant was eligible  to apply  for  voluntary retirement having completed nearly  23 years’ service and 42 years of age;  there was no impediment coming  in  the way of the appellant for  seeking  voluntary retirement  as per clause 5 of the Scheme.  The  application made  in the prescribed form as per the Scheme  contemplates acceptance of option for voluntary retirement with immediate effect.

   The  appellant  made the application in  the  prescribed form  on  7.12.1995  requesting   for  its  acceptance  with immediate   effect.   The   respondent-Corporation  did  not respond  or react to the said application till 17.2.1996, on

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which  date the appellant received notice asking her to show cause  why action should not be taken for alleged misconduct of indulging in political activities.  In spite of reminders and letters by the appellant as stated above while narrating the facts, it is only after the appellant handed over charge on  15.2.1996  and  requested   for  release  of  retirement benefits  on 15.2.1996, the show cause notice aforementioned was  issued  to the appellant.  In our view, the  said  show cause  notice was of no consequence.  It appears to us  that it was issued only to defeat the claim of the appellant.  On the  date  when the appellant submitted her application  for voluntary  retirement,  neither  vigilance enquiry  nor  any disciplinary  proceedings were pending or contemplated.   In other  words,  as  per Clause 5 she was not  prevented  from making  an application to opt for voluntary retirement.  The recommending  authority  as  per  Clause  4  of  the  Scheme recommended  for acceptance of the application on  7.12.1995 itself.   We  are  unable  to understand  why  the  Managing Director  of  the respondent-Corporation did not accept  the same  although it was required to be accepted with immediate effect as per para 2 of the prescribed application form.  No doubt,  as per Clause 8.1 of the Scheme extracted above, the Management  had  discretion to accept or reject the  request from  any  employee  for voluntary  retirement  viewing  the organizational  requirement and any other relevant facts but that does not mean that the respondent- Corporation being an authority  coming  within the purview of Article 12  of  the Constitution  can  abdicate its duty to act  reasonably  and fairly  in exercise of discretion.  It is strange as to  why the  Managing  Director of the  respondent-Corporation,  the competent  authority to accept the application made for  the voluntary  retirement,  did  not  act  on  it  at  all  till 17.2.1996.  He ought to have exercised his discretion as per Clause  8.1 if not immediately at least within a  reasonable time.    The   last   paragraph  of   the   Memorandum   No. AIDC/Estt/1485/93/746-51  dated  20/21.5.1993 issued by  the respondent-Corporation reads thus:

   "The  Corporation has thus offered a unique opportunity. It  is now for all eligible and interested employees of  the Corporation  to  avail of this golden opportunity in  a  big way."

   As per sub-clause (i) of Clause 5 of the Scheme, once an employee  applied for voluntarily retirement it could not be withdrawn.   The  appellant  wanted  to  avail  this  golden opportunity.  With this background it is not known as to why her  application  was not accepted.  From the letter of  the appellant dated 23.1.1996, it is clear that she informed the Managing  Director of the respondent-Corporation that  there was no need to place her application before the Board and he himself was competent to accept it.  The non-response of the respondent-  Corporation  to  the letters of  the  appellant dated  23.1.1996,  14.2.96  and  15.2.1996  and  issuing  of show-cause    notice    by     the    respondent-Corporation subsequently,  clearly  indicate that all was not well  with the  respondent-Corporation in dealing with her  application seeking   voluntary  retirement.   A  subsequent   complaint alleging indulgence of the appellant in political activities was  not germane to consideration of the application of  the appellant having regard to the relevant factors mentioned in Clause  8.1  of  the Scheme particularly when there  was  no infirmity   or  impediment  in  terms   of  the  Scheme   in considering  and accepting the application of the  appellant for  voluntary retirement having regard to the fact that the

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appellant on her part did what all was required to be done.

   Clause 6 of the Scheme deals with the benefits available under  the  Scheme.   Sub-clause  (v)  of  the  said  Clause contemplates  one  month’s/three months’ notice pay (as  per conditions  of  service applicable to him/her).  Rule 18  of AIDC  Limited  (Employees)  Service  Rules,  1992  and  AIDC Limited  Recruitment and Promotion Rules, 1992 to the extent it is relevant reads:  -

   "18.   An  employee shall not leave or  discontinue  his service  in  the Corporation without first giving notice  to the  Managing Director in writing of his intention to  leave or  discontinue the service.  The period of notice  required shall be -

a)            .......

b)            after completion of probationary period -

(i)          Three months in case of Class I and              Class II officers.

(ii)        One month in case of employees in             Class III & IV service.

   In lieu of notice, an employee shall be liable to pay to the  Corporation a sum equal to his substantive pay for  the period of notice required of him.

   Provided  that any shortfall of the notice period may be adjusted  towards  the  earned  leave due  to  the  employee concerned."

   There  is  some controversy as to applicability of  this Rule   in  respect  of   employees  offering  for  voluntary retirement under the Scheme.

   Assuming that three months’ prior notice was required to be  given  by the appellant in the case on hand in terms  of Rule  18 itself any shortfall in the notice period could  be adjusted  towards the earned leave due to the appellant.  It is  on  record  that  the  appellant  in  her  letter  dated 14.2.1996 (Annexure-2) has clearly requested to allow her to go  on voluntary retirement latest by 5.2.1996 and that  the Managing  Director  to  adjust   balance  notice  period  by deducting  earned leave calculated up to 5.2.1996.  In spite of  the  same the Managing Director of the Corporation  kept mum.

   The  Division Bench of the High Court has failed to  see that  the  Scheme  conferred discretion on  the  Corporation under  Clause  8.1 coupled with the duty to act  judiciously when  application  for voluntary retirement was made  by  an employee.   The  said clause did not confer  any  unfettered discretion upon the Corporation to refuse the benefit of the Scheme  to any employee being an authority coming within the meaning  of Article 12 of the Constitution.  It was not open to  the  Managing Director of the respondent-Corporation  to act  on  extraneous  consideration by issuing  a  show-cause notice  dated 15/16.2.1996 so as to deprive the appellant of the  benefit  flowing  from   acceptance  of  her  voluntary retirement.   It is true that under Clause 8.1 of the Scheme discretion  was available to the respondent-Corporation  but that  discretion was not absolute.  It was circumscribed  by

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the  terms  mentioned  in the said Clause and it was  to  be exercised  judiciously.   In the case on hand  the  Managing Director of the Corporation has failed to act reasonably and fairly.   He abdicated his duty by not exercising discretion at  all in the light of facts and circumstances of the  case stated above in sufficient details.

   We  are of the view that the Division Bench of the  High Court  was also not right in saying that the appellant filed the  writ  petition even before any action was taken by  the Managing  Director  of the respondent-Corporation either  to accept  or  reject  the application.  It is clear  from  the undisputed   facts   that  the   appellant   submitted   the application  in the prescribed form to accept her  voluntary retirement  from service with immediate effect;  waited  for sufficiently  long  time  and wrote letters in  January  and February,   1996  pursuing  the   authority  to  accept  the application  seeking  voluntary retirement.   Further  after receiving   show-cause   notice  on   17.2.1996   from   the respondent- Corporation, the appellant had no good reason to wait any longer.  In this view it could not be said that the writ petition filed was pre-mature.

   In the result, for the reasons stated above, this appeal is entitled to succeed.  Hence the judgment and order of the Division Bench of the High Court are set aside and the order passed  by  the  learned Single Judge of the High  Court  is restored.   The  appeal is allowed accordingly.  Parties  to bear their own costs.