REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.    99            OF 2009 (Arising out of SLP (C) No. 5166 of 2008)

V.V.G. REDDY … APPELLANT

Versus

APSRTC, NIZAMABAD REGION & ANR.       … RESPONDENTS

J U D G M E N T

S.B. Sinha, J.

1. Leave granted.

2. Appellant  is  before  us  questioning  the  judgment  and  order  dated

21.9.2007 passed by a Division Bench of the High Court of Judicature of

Andhra Pradesh at Hyderabad in Writ Appeal No.658 of 2007 and others

whereby and whereunder the said writ appeal preferred from a judgment and

order dated 29.10.2002 passed in W.P. No. 21410 of 2002 filed by appellant

and others was allowed.   

3. Respondent – Corporation is constituted and incorporated under the

Road Transport Corporation Act, 1950 (64 of 1950).  Appellant joined its

services  as  a conductor  in  the  year 1981.  A disciplinary proceeding was

initiated against him.  He was placed under suspension in the year 1982.  In

the  said  disciplinary  proceeding,  he,  having  been  found  guilty  was

dismissed from services.   

An  industrial  dispute  was  raised  by  him,  which  was  eventually

referred to the Labour Court by the State of Andhra Pradesh in exercise of

its  powers  conferred  upon  it  under  Section  10(1)(c)  of  the  Industrial

Disputes Act, 1947 (for short, “the Act”).   

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4. By reason of an Award dated 1.8.1988, the Labour Court directed his

reinstatement  in  service  with  continuity  therein  but  without  attendant

benefits and back wages.

5. Pursuant  to  or  in  furtherance  of  the  said  Award,  appellant  was

reinstated in service.  However, he was not paid his salary at par with his

colleagues whose services had been regularized with effect from 1.10.1983.

6. He filed an Execution Petition being E.P. No. 18 of 1989 in I.D. No.

581 of 1987 before Labour Court, Hyderabad praying that his services be

directed  to  be  regularized  at  par  with  his  colleagues  with  effect  from

1.10.1983.  The said Execution Petition was allowed.  

7. As despite the same, his pay was not fixed at par with his colleagues

and no notional increments had been granted, a legal notice was issued on

his behalf by an Advocate on 2.3.1992.   

He thereafter filed a writ petition before the High Court which was

marked as Writ Petition No. 21410 of 2002 praying for grant of notional

increments for the period between 1.10.1983 and 15.2.1989.   

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By reason of a judgment and order dated 29.10.2002, the said writ

petition was allowed by a learned single judge of the High Court, directing:

“The controversy in this writ  petition is no more res integra, in view of the decision of a Division Bench  of  this  Court  in  APSRTC,  Khammam Region and another Vs. P. Nageswara Rao.  The Division  Bench  while  dealing  an  analogous question has held that when an award was passed by the  labour  court  directing  the  respondents  to reinstate the petitioner into service, the action of the  respondent  –  Corporation  in  fixing  the  pay without  taking  into  consideration  the  notional increments  is  illegal.  It  is  further  held  that  the Corporation  cannot  rely  on  any  circular  or regulation that takes away the plain meaning of the award in the judgment.”

8. A writ  appeal  was preferred thereagainst  by the respondent  herein.

However, the said writ appeal was barred by limitation and an application

for condonation of delay having not been allowed, the same was dismissed.

A Special  Leave  Petition  filed  thereagainst  being  Special  Leave  Petition

(Civil)  No.  1114  of  2004  was  allowed  by  a  judgment  and  order  dated

13.2.2007 in terms whereof the matter was remitted to the High Court for

disposal of the case on merit.  By reason of the impugned judgment, the writ

appeal preferred by the respondent herein has been allowed.  

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9. Ms. T. Anamika, learned counsel appearing on behalf of the appellant

would urge that in view of the fact that the appellant was denied back wages

only  by  the  Labour  Court  and  having  been  reinstated  in  service  with

continuity, the High Court committed a serious error in declining to grant

notional increments in his favour from the date of his dismissal till the date

of passing of the Award.  Strong reliance in this behalf has been placed on

the decision of this Court in Devendra Pratap Narain Rai Sharma vs.  State

of Uttar Pradesh & ors. [AIR 1962 SC 1334].

10. Mr.  D.  Mahesh  Babu,  learned  counsel  appearing  on  behalf  of  the

respondents, on the other hand, supported the impugned judgment.  

11. The  award  appeared  to  have  been  passed  by  the  labour  court  on

consent of the parties.  Appellant himself stated so in his affidavit in support

of the writ petition.  

12. The terms of the consent order have not been produced before us by

the appellant.   We will,  however, proceed on the premise that the parties

thereto agreed that the appellant would be reinstated within a month from

the said date.  Appellant was, therefore, not only denied back wages but also

the attendant benefits.  

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13. Interpretation of terms of consent will depend upon the nature of the

lis and the background events.   

14. Appellant, as noticed hereinbefore, had not only foregone back wages

but also attendant benefits.  The word “attendant benefits” should be given

its natural meaning.  The “attendant benefits” was in regard to a period for

which he had been denied back wages.  A person may be denied back wages

which otherwise can be interpreted to  mean that  he would be entitled to

claim the benefit of increments notionally.  

15. We  may,  however,  notice  that  in  A.P.  State  Road  Transport

Corporation & ors. vs. Abdul Kareem [(2005) 6 SCC 36], this Court held:

“…..the Labour Court specifically directed that the reinstatement would be without back wages. There is no specific direction that the employee would be entitled  to  all  the  consequential  benefits. Therefore, in the absence of specific direction in that regard, merely because an employee has been directed to  be reinstated without  back wages,  he cannot  claim  a  benefit  of  increments  notionally earned during the period when he was not on duty during the period when he was out of service. It would  be  incongruous  to  suggest  that  an employee,  having been held guilty and remained absent from duty for a long time, continues to earn increments  though there is  no payment of wages for the period of absence.”

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16. In  A.P.  SRTC & Anr.  vs.  S.  Narsagoud [(2003)  2  SCC 212],  this

Court held:

“9. We find merit  in  the submission  so made. There  is  a  difference  between  an  order  of reinstatement  accompanied  by a simple  direction for  continuity  of  service  and  a  direction  where reinstatement  is  accompanied  by  a  specific direction that the employee shall be entitled to all the consequential benefits, which necessarily flow from reinstatement  or accompanied by a specific direction that the employee shall be entitled to the benefit of the increments earned during the period of  absence.  In  our  opinion,  the  employee  after having been held guilty  of  unauthorised  absence from duty cannot claim the benefit of increments notionally  earned  during  the  period  of unauthorised absence in the absence of a specific direction in that regard and merely because he has been directed to be reinstated with the benefit  of continuity in service.”

17. In  Devendra  Pratap  Narain  Rai  Sharma  (supra),  this  Court  upon

referring to Rule 54 of the Fundamental Rules framed by the State of Uttar

Pradesh, held as under:

“11. In  our  view,  this  contention  is  wholly misconceived.  Rule  54,  as  amended  in  1953, stands as follows :

“54.(1)  When  a  Government  servant  who has  been  dismissed,  removed  or  suspended  is reinstated,  the  authority  competent  to  order  the reinstatement  shall  consider  and make a specific order—

(a) regarding the pay and allowances to be paid to the Government servant for the period of his absence from duty and

(b) whether or not the said period shall be treated as a period spent on duty.

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(2)  Where  such  competent  authority  holds that  the  Government  servant  has  been  fully exonerated  or,  in  the  case  of  suspension,  that  it was  wholly  unjustified,  the  Government  servant shall be given the full pay to which he would have been entitled, had he not been dismissed, removed or suspended, as the case may be together with any allowances of which he was in receipt prior to his dismissal, removal or suspension.

(3) In other cases, the Government servant shall  be  given  such  proportion  of  such  pay and allowances  as  such  competent  authority  may prescribe.

Provided  that  the  payment  of  allowances under  clauses  (2)  and  (3)  shall  be  subject  to  all other conditions under which such allowances are admissible.

(4)  In  a  case  falling  under  clause  (2)  the period of absence from duty shall be treated as the period spent on duty for all purposes.

(5)  In  a  case  falling  under  clause  (3)  the period of absence from duty shall not be treated as period  spent  on  duty  unless  such  competent authority  specifically  directs  that  it  shall  be  so treated for any specified purposes.”

This  rule  has  no  application  to  cases  like  the present in which the dismissal of a public servant is  declared  invalid  by  a  civil  court  and  he  is reinstated.  This  rule,  undoubtedly  enables  the State  Government  to  fix  the  pay  of  a  public servant  whose  dismissal  is  set  aside  in  a departmental appeal. But in this case the order of dismissal was declared invalid in a civil suit. The effect of the decree of the civil  suit was that the appellant  was  never  to  be  deemed to  have  been lawfully dismissed from service and the order of reinstatement  was  superfluous,  The  effect  of  the adjudication of the civil court is to declare that the appellant  had  been  wrongfully  prevented  from attending to his duties as a public servant. It would not in such a contingency be open to the authority to deprive the public servant of the remuneration which  he  would  have  earned  had  he  been permitted to work.”

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The  said  decision,  in  our  opinion,  has  no  application  to  the  fact

situation obtaining in the present case.  

18. Appellant has not been directed to be reinstated in service by reason

of an Award holding that the order of termination was wholly illegal and,

thus, void ab initio.  On what premise, parties entered into a compromise is

not known.  It is possible to hold that findings of the Enquiry Officer which

might have been accepted by the disciplinary authority holding him guilty

of misconduct had not been set aside; the Management might have thought

that  denial  of  back  wages  and  attendant  benefits  would  be  sufficient

punishment.  If that be so, appellant being not in service during the period in

question,  namely,  1.10.1983  to  15.2.1989,  in  our  opinion,  would  not  be

entitled to increment.  

19. For the reasons aforementioned, the appeal is dismissed. No costs.

.……………………………….J. [S.B. Sinha]

...…………………………..…J. [Dr. Mukundakam Sharma]

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New Delhi; JANUARY 13, 2009

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