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CASE NO.: Appeal (civil)  5786 of 2000

PETITIONER: Central Bank of India & Ors

RESPONDENT: Madan Chandra Brahma & Anr

DATE OF JUDGMENT: 22/08/2007

BENCH: K.G. BALAKRISHNAN & P.K. BALASUBRAMANYAN

JUDGMENT: J U D G M E N T  

CIVIL APPEAL NO.5786 OF 2000

P.K. BALASUBRAMANYAN, J.

                1.              On 9.6.1969, Respondent No. 1 was appointed  temporarily as an Assistant in Gauhati Bank.  On  19.7.1969, the Central Bank (hereinafter referred to as "the  appellant Bank") along with other banks was nationalized.   As per the relevant Regulation, the age of superannuation  was fixed as 58 years in all Nationalized Banks including  the appellant Bank.  On 1.8.1975, the Gauhati Bank was  merged with the Purbanchal Bank.  The Scheme of  Amalgamation between the Gauhati Bank and the  Purbanchal Bank was not brought on record.  Suffice it to  say, that the age of superannuation in the Purbanchal  Bank was also 58 years.  Respondent No. 1, who had  meanwhile been confirmed in the Gauhati Bank, had been  promoted on 1.7.1975 as an officer in that Bank.  On  amalgamation, respondent No. 1 thus became an officer of  the Purbanchal Bank with effect from 1.8.1975, the age of  superannuation being 58 years.

2.              On 29.8.1990, the Purbanchal Bank merged  with the appellant Bank under a Scheme of Amalgamation  under the Banking Regulation Act, 1949.  The Appellant  Bank was to frame Regulations with a view to bring the  employees of Purbanchal Bank on a par with those of the  Appellant Bank.  On 6.5.1991, the appellant Bank, in  terms of clause 11 of the Scheme of Amalgamation, fixed  the pay and other service conditions of officers and  employees of the erstwhile Purbanchal Bank and made the  Central Bank of India Service Regulations 1991 applicable  to them with effect from 1.4.1991.   Respondent No. 1,  whose date of birth had been recorded as 1.8.1934, was to  attain the age of 58 years by 31.7.1992.  On 17.7.1992, the  appellant Bank informed respondent No. 1 that he would  be reaching the age of superannuation on 1.8.1992.   Respondent No. 1 by his reply dated 23.7.1992, sought to  dispute his date of birth.  That apart, he also claimed that  he would retire not on attaining the age of 58 years but  only on the attaining the age of 60 years, as per Regulation  19 of the Service Regulations 1979 on the basis that his

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original appointment in the Gauhati Bank was on 9.6.1969  and hence he was entitled to continue in service of the  appellant Bank, till he attained the age of 60 years.  The  appellant Bank did not accept this stand of respondent No.  1 and retired him on his attaining the age of 58 years.

3.              Respondent No. 1 approached the High Court  challenging his being retired on attaining the age of 58  years and, of course, also raising an issue about his date of  birth.  The learned single judge held that there was no  merit in the challenge to the date of birth recorded in the  records of the Bank.  He further held that respondent No. 1  was entitled to continue in service only till he attained the  age of 58 years in the face of the Regulations.  The learned  single judge, hence, dismissed the Writ Petition.   Respondent No. 1 filed an appeal.  The Division Bench of  the High Court held that even though the age of  superannuation in the entry Bank, the Gauhati Bank, was  58 years and continued to be so until its amalgamation  with the Purbanchal Bank and the age of retirement in the  Purbanchal Bank was also 58 years, since Respondent No.  1 must be deemed to be an employee of the Central Bank  right from the inception, he was entitled to continue in  service until he attained the age of 60 years.  It was  reasoned that respondent No. 1 must be taken to be an  officer recruited in the appellant Bank prior to 19.7.1969  but promoted as an officer on or after 19.7.1969 in terms of  the Regulations of the appellant Bank and entitled to  continue till he attained the age of 60 years.  Thus, setting  aside the decision of the learned Single Judge, the Division  Bench of the High Court allowed the Writ Petition and  taking note of the fact that respondent No. 1 had attained  the age of 60 years as on the date of the judgment, directed  the appellant Bank to pay within the time fixed by that  court, all the arrears of salary and other allowances as  admissible to respondent No. 1, if he were allowed to  continue in service up to the age of 60 years.

4.              Feeling aggrieved by this decision, the appellant  Bank along with its officers has filed this appeal.  The  Union of India has been impleaded as Respondent No. 2.

5.              Regulation 19 of the Central Bank of India  (Officers) Service Regulations, 1979 to the extent it is  relevant reads: "(1)  Rules for age of retirement \026 The age of retirement of an officer in the Bank  on or after the appointed date be determined as  under-

1.1     An officer employee of the Bank  recruited/promoted prior to 19th July,  1969 shall retire on completion of 60 years  of age.

1.2     An Officer employee of the Bank recruited  prior to 19th July, 1969 but promoted as  an officer on or after 19th July, 1969 shall  retire on completion of 60 years of age.

1.3     An officer employee of the Bank recruited  whether as an Award Staff or as an officer

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employee on or after 19th July, 1969 shall  retire on completion of 58 years of age\005"

Whereas the case of the appellant Bank is that clause  1.3 of Regulation 19 is attracted since respondent No. 1  became an employee of the Bank only after 19.7.1969 and  must be taken to be an employee recruited after 19.7.1969,  the claim of respondent No.1 is that, since he was recruited  to the Gauhati Bank prior to 19.7.1969 and promoted as  an officer after 19.7.1969 in the Gauhati Bank, he must be  taken to have been recruited to the appellant Bank prior to  19.7.1969 and was entitled to continue in service till he  attained the age of 60 years in terms of clause 1.2 of the  Regulation.  While the learned single judge held that clause  1.3 would apply, the Division Bench has taken the view  that clause 1.2  of the Regulation 19 would apply.

6.              On a plain understanding of the factual  situation, it appears to us that respondent No. 1 could be  taken to have become an officer of the appellant Bank only  on the amalgamation of the Purbanchal Bank with the  appellant Bank.  Admittedly, that was on 29.8.1990, well  after 19.7.1969.  Strictly speaking, respondent No. 1 was  not recruited in the appellant Bank, if we literally construe  the expression ’recruited’ occurring in the Regulation.  But  obviously the expression includes those who have become  officers of the appellant Bank by way of amalgamation or  merger.  Here, the merger took place only on 29.8.1990,  long after 19.7.1969.  In this situation, it is clear that  respondent No. 1 could be deemed to have been recruited  to the service of the appellant Bank only after 19.7.1969.  If  so, it would be clause 1.3 of Regulation 19 that would  apply and not clause 1.2 of that Regulation.  We may also  notice that there is nothing inequitable or unjust in the  result thus reached, since the age of superannuation  insofar as respondent No. 1 and those similarly situated  were concerned, was 58 years both in Gauhati Bank, the  entry Bank and the Purbanchal Bank with which the  Gauhati Bank merged on 1.8.1975.

7.              Chairman, Canara Bank, Bangalore Vs. M.S.  Jasra & Ors., 1992 (2) SCR 68) relied on  was a case where  an employee of Lakshmi Commercial Bank, which came to  be amalgamated with Canara Bank, claimed that he was  entitled to continue in service of the Canara Bank until he  attained the age of 60 years, since that was the age of  superannuation in the Lakshmi Commercial Bank of which  he was the employee, prior to its amalgamation.  His claim  was rejected by the Canara Bank and he challenged that  decision in a writ petition in the High Court.  The High  Court allowed the Writ Petition and held that the employee  was entitled to continue until he attained the age of 60  years.  It was contended on behalf of the Canara Bank that  on the basis of Section 45 of the Banking Regulation Act,  1949 and the consequent amalgamation of Lakshmi  Commercial Bank with Canara Bank, the service conditions  under Lakshmi Commercial Bank would not be available to  the employee; and that the terms and conditions of service  applicable to employees of corresponding rank and status  in Canara Bank would only apply.  This Court upheld the  contention of the Canara Bank and held that the employee  became an employee of Canara Bank and was, therefore,  entitled only to the right given by proviso (ii) to clause (i) of  sub-section (5) of Section 45 of the Banking Regulation Act,

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1949 which entitled him to the same terms and conditions  of service as employees of the corresponding rank or status  in Canara Bank.  Age of superannuation of the employees  in Canara Bank being 58 years only, the employee could  not claim to retire at the age of 60 years.  In the case on  hand, the age of superannuation both in the Gauhati Bank  and the Purbanchal Bank, which subsequently got  amalgamated with the appellant Bank, was only 58 years.     The notification sanctioning the amalgamation under  Section 45(7) of the Banking Regulation Act is dated  29.8.1990.   Clause 10 provides that employees like the  respondent are deemed to have been appointed by the  appellant Bank on the same terms and conditions of  service as were applicable to them before the close of  business on 14.7.1990.  They were to be granted the same  pay  as employees of the appellant Bank, were to hold office  on the same terms and conditions of service that are  applicable to the employees of the appellant Bank.  The  communication from the central office dated 6.5.1991  relating to pay and other conditions of service of such  officers, by paragraph 6, has elaborately provided for the  reckoning of their prior services in the Purbanchal Bank   on matters specified herein.  It does not contemplate the  treating of the employee as having joined the appellant  Bank on the day the employee joined the Purbanchal Bank.   Thus, the scheme adopted, worked and accepted by all,  does not provide for treating such an employee as having  entered the service of the appellant Bank even prior to the  amalgamation, except for the purposes specified.  If at all,  the Pay and other service conditions of officers of the  erstwhile Purbanchal Bank Limited dated 6.5.91 gives an  indication, it is that the original date of appointment has  relevance only for purposes such as provident fund,  gratuity, for sanction of loans, etc.  It has to be noticed that  in the matter of placement in the  appellant bank, the  service of one and a half years in the  Purbanchal Bank has  to be treated as service for one year only in the appellant  bank.  That resolution heavily relied on by the Division  Bench of the High Court only provides that officers like  Respondent No.1 would be governed by the Central Bank of  India (Officers) Service Regulations, 1979 with  effect from  1.4.1999.   The fact that the regulation had been made  applicable, would not mean that such officers must be  taken to have been recruited from the date of their entry in  the Purbanchal Bank.   The applicability of the Regulations  with effect from 1.4.1991 is subject to exceptions provided  thereunder.   It is in that context that the non-reckoning of  service for one year in Purbanchal Bank as equivalent to  service of one year in the appellant bank assumes  significance.   In this situation, while applying Regulation  19, it is not possible to uphold the plea that the respondent  should be taken to have been recruited to the appellant  bank prior to 19.7.1969 so as to attract paragraph 1.2  thereof.   The right to be treated on a par with the  employees of the appellant Bank is one thing, but the right  to insist that the employee must be deemed to have become  an employee of the appellant Bank even before the  amalgamation is another.  It may be noted that clause (i) of  sub-section (5) of Section 45 of the Banking Regulation Act,  1949 has only provided that an employee, such as the  respondent, had the right to get the same remuneration  and to have the same terms and conditions of service which  they were getting or by which they were being governed  immediately before the date of the order of moratorium.    The right to be treated on a par with the employees of the

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appellant Bank cannot extend to a right to be treated as  having entered the service of the appellant Bank even  before the very amalgamation.  The decision referred to  above also shows that it is the age of superannuation in the  transferee Bank that would govern and the age of  superannuation in the transferee Bank subsequent to  19.7.1969, is only 58 years.

8.              As we have noticed earlier, the age of  superannuation, when respondent No. 1 joined service in  the Gauhati Bank was 58 years and when that Bank  merged with the Purbanchal Bank, it continued to be 58  years.  As far as we can see, there is nothing in the  Regulations or the Resolution which would enable  respondent No. 1 to claim that he was entitled to continue  until the age of 60 years when the age of superannuation of  even an officer originally recruited to the appellant Bank  after 19.7.1969 was only 58 years.  Even though,  respondent No. 1 may carry his date of appointment in  Gauhati Bank for the purpose of service benefits to the  extent specified, the same does not extend to supporting a  claim that he must be deemed to have been recruited in the  Central Bank prior to 19.7.1969.    We are, therefore, of the  view that the High Court was in error in holding that  respondent No. 1 was entitled to continue in service in the  appellant Bank till he attained the age of 60 years and was  entitled to monetary benefits on that basis.  On a plain  reading of Regulation 19 in the context of the materials  available, we are satisfied that respondent No. 1 was bound  to retire on attaining the age of 58 years.  The learned  single judge was, therefore, justified in dismissing the Writ  Petition.  The Division Bench was not justified in allowing  it.

9.              We may notice here that in B.S. Yadav and  another vs.  Chief Manager, Central Bank of India and  others (1987 (3) SCC 120)  this Court upheld the rule  providing for different retirement ages for the employees  recruited by the Central Bank before its nationalization and  for those recruited to the Bank after its nationalization.   The age of superannuation of the former was 60 years and  of the latter only 58 years.  When this is the position and  the date of retirement is 58 years after nationalization of  the bank we find no reason to hold that those who came to  the bank after nationalization by way of amalgamation  should stand on a better footing than the employees  recruited to the Central Bank itself after nationalization.   

10.             Having held on law that the respondent is not  entitled to the relief claimed by him, we feel that some  compensation should be directed to be paid to him, in the  circumstances, in exercise of our jurisdiction under Article  142 of the Constitution of India.  The respondent, we  notice, was fighting on a question of interpretation of the  Regulation of the appellant bank and has remained in  court for a considerable time.  Taking note of the  divergence in the views of the High Court, our conclusion  and the circumstances of the case, we feel that it would be  appropriate to direct the appellant to pay a sum of Rs.1  lakh to the respondent ex gratia.  We clarify that the  direction is not intended to be a precedent in any manner.   

11.             We, therefore, allow this appeal and setting aside  the decision of the High Court dismiss the Writ Petition

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filed by respondent No. 1 in the High Court.  We direct the  appellant to pay a sum of Rs.1 lakh to Respondent No.1 ex  gratia within three months from today.  In the  circumstances, we direct the parties to suffer their costs  here and in the High Court.