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PETITIONER: PUNJAB NATIONAL BANK

       Vs.

RESPONDENT: P.K. MITTAL

DATE OF JUDGMENT13/02/1989

BENCH: RANGNATHAN, S. BENCH: RANGNATHAN, S. MUKHARJI, SABYASACHI (J)

CITATION:  1989 AIR 1083            1989 SCR  (1) 612  1989 SCC  Supl.  (2) 175 JT 1989 (1)   264  1989 SCALE  (1)353

ACT:     Labour and Services: Punjab National Bank Service  Regu- lation No.. 20(2): Withdrawal of resignation  letter--Effect of--Whether  bank  entitled to accept  resignation  from  an earlier date.     Civil   Services: Resignation  by   employee--Withdrawal Permissibility and effect of.

HEADNOTE:     Clause  (2) of Regulation 20 of the Service  Regulations of the Punjab National Bank lays down that no officer  shall resign  from the service of the bank otherwise than  on  the expiry  of  three months from the service on the bank  of  a notice  in writing of such resignation. The proviso  thereto empowers  the  competent authority to reduce the  period  of three months or remit the requirement of notice.     The respondent, a permanent officer of the bank, made an application on 21st January 1986, purporting to resign  from the  service with effect from 30th June, 1986. He,  however, received  a letter from the bank on 7th February,  1986  in- forming   him that his resignation letter had been  accepted by the competent authority with immediate effect by  waiving the condition of notice.     He  thereupon  filed a writ petition in the  High  Court challenging the validity of the purported acceptance of  his resignation  with effect from 7th February, 1986 and  for  a direction  to  consider him as in service up to  30th  June, 1986.  Thereafter,  on  15th April, 1986  he  wrote  another letter  to the Bank purporting to withdraw  the  resignation letter dated 21st January, 1986.     The  High Court held that the  petitioner’s  resignation letter  would have become effective only on the  30th  June, 1986,  that under the Regulations there was no  jurisdiction whatever in the competent authority to determine his service earlier  than  that and that until  the  resignation  became effective on 30th June, 1986 he had a right to withdraw  the same. Consequently, it quashed the order dated 7th February, 1986  and  declared that the petitioner continued to  be  in service with the bank. 613     In this appeal by special leave it was contended for the

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appellant that Regulation 20(2) provided for a notice to the employer only in order to protect the employer’s  interests, that  its  requirements could, therefore, be waived  by  the employer  if  it  so desired unilaterally,  that  under  the proviso to clause (2) it was competent for the bank to waive any notice at all and to accept the resignation with immedi- ate  effect or with effect from such other date as the  bank may consider appropriate. Dismissing the appeal,     HELD: 1. Until the resignation becomes effective on  the terms  of the letter read with Service Regulation 20 of  the Punjab National Bank, it is open to the employee, on general principles, to withdraw his letter of resignation. [619C]     Raj Kumar v. Union of India, [1968] 3 SCR 857; Union  of India  v.  Gopal Chandra Misra, [1978] 3 SCR 12  and  Balram Gupta v. Union of India, [1987] Suppl. SCC 228.     2. Clause (2) of Regulation 20 makes it incumbent on  an officer of the bank, before resigning, to serve a notice  in writing of such proposed resignation. The clause also  makes it  clear that the resignation will not be effective  other- wise than on the expiry of three months from the service  of such notice. [616H; 617A]     3.  What the proviso to clause (2) contemplates is  that in  a case where the employee desires that  his  resignation should be effective even before the expiry of the period  of three months or without notice being given by him, the  bank may consider such a request and waive the period or require- ment of notice if it considers it fit to do so. It does  not empower the bank to thrust a resignation on an employee with effect  from a date different from the one on which  he  can make his resignation effective under the terms of the resig- nation. In the instant case, the employee had not  requested the  bank  to reduce the period of notice or  to  waive  the requirement of notice. [617F; 618G]     4. There are two ways of interpreting clause (2). One is that  the  resignation of an employee from service  being  a voluntary act on his part he is entitled to choose the  date with  effect from which his resignation would  be  effective and give a notice to the bank accordingly. The only restric- tion is that the proposed date should not be less than three months  from the date on which the notice is given.  In  the instant  case, the letter dated 21st January 1986,  sent  by the employee purporting to 614 resign with effect from 30th June, 1986 fully complied  with the  terms of this clause and so the resignation would  have become effective only on that date. The other interpretation is  that when an employee gives a notice or resignation,  it becomes  effective  on the expiry of three months  from  the date thereof. On this interpretation the respondent’s resig- nation would have taken effect on or about 21st April,  1986 even though he had mentioned a later date. In either view of the  matter,  the respondent’s resignation  did  not  become effective till 21st April, 1986 or 30th June, 1986. The bank could  not  have accepted that resignation  on  any  earlier date.  The letter dated 7th February, 1986  was,  therefore, without jurisdiction. [617A-B; 618A-B, G-H]     The respondent had thus continued to be in service  till the 21st April, 1986 or 30th June, 1986. But, by that  time, he  had  exercised his right to  withdraw  the  resignation. Since the withdrawal letter was written before the  resigna- tion became effective, the resignation stood withdrawn  with the result that the respondent continued to be in the  serv- ice of the bank. [619A-B]     Delhi Electric Supply Undertaking v. Tara Chand,  [1987]

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2 SCR 425, distinguished.

JUDGMENT:     CIVIL  APPELLATE JURISDICTION: Civil Appeal No. 2014  of 1986.     From  the  Judgment and Order dated 24.4.  1986  of  the Delhi High Court in C.W. No. 477 of 1986. Dr. Anand Prakash, D. Mehta, Atul Nanda and S.K. Mehta for the Appellant. S.K. Bisaria for the Respondent. The Judgment of the Court was delivered by     RANGANATHAN,  J. A very short question as to the  inter- pretation  of the service regulations of the  appellant-bank comes  up  for consideration in this  appeal.  The  relevant service  regulation  is  Regulation No. 20  which  reads  as under:               "20(1) Subject to sub-regulation (3) of  regu-               lation 16, the bank may terminate the services               of  any  officer by giving him  three  months’               notice  in  writing  or by  paying  him  three               months’ emoluments in lieu thereof.               615               (2)  No officer shall resign from the  service               of  the bank otherwise than on the  expiry  of               three months from the service on the bank of a               notice in writing of such resignation. Provid-               ed  further that the competent  authority  may               reduce  the period of three months,  or  remit               the requirement of notice."     The respondent, a permanent officer in the bank, sent  a communication  to  the bank on 21st January, 1986.  By  this letter  he purported to resign from the service of the  bank due  to personal reasons. He added that the date of  receipt of the letter should be treated as the date of the commence- ment  of the notice period so that, inclusive of  the  same, his  resignation would become effective on 30th June,  1986. According to the respondent, the Deputy General Manager, who was  the competent authority under the Service  Regulations, had agreed that the resignation may be accepted with  effect from 30th June, 1986. However, what actually transpired  was that  the respondent received a letter from the bank on  7th February,  1986  informing him that his  resignation  letter dated 21st January, 1986 had been accepted by the  competent authority with immediate effect by waiving the condition  of notice  and that, consequently, he was being  relieved  from the  service of the bank with effect from the  afternoon  of the  same date, namely, 7th February, 1986.  The  respondent thereupon filed a writ petition in the High Court  challeng- ing the validity of the purported acceptance of his resigna- tion with effect from 7th February, 1986 and for a direction to  the  bank to treat him as in service of the bank  up  to 30th June, 1986 and as entitled to all benefits while  being in such service.     A further development took place after the filing of the writ  petition  and before it came up for hearing.  On  15th April,  1986, the respondent wrote a letter to the  bank  by which he purported to withdraw the resignation letter  dated 21st  January, 1986. The High Court, therefore,  dealt  with the  situation resulting from this  subsequent  development. The High Court held that the petitioner’s resignation letter would  have  become effective only on the 30th  June,  1986. Under the regulations there was no jurisdiction whatever  in the  competent authority to determine his services  earlier.

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Until  the resignation became effective on 30th June,  1986, the petitioner had a right to withdraw the same and in  fact had also exercised that right. The High Court concluded:               "We  may  notice that this writ  petition  was               filed at a stage               616               when  the petitioner had not sent  his  letter               dated 15th April, 1986 whereby he withdrew his               resignation letter dated 2 Ist January,  1986.               This  is a subsequent development  during  the               pendency  of the writ petition. Therefore,  we               are  not  called upon to  decide  the  earlier               grievance that the resignation could not  have               been accepted at an earlier date. Even to that               submission we would have said that there is no               provision of acceptance but that question does               not arise so we will not deal with it further.               Result is that the impugned order dated 7th of               February,  1986  is hereby quashed and  it  is               declared  that the petitioner continues to  be               in service with the respondent-bank.  However,               in  view  of the facts of  the  present  case,               parties  are directed to bear their own  costs               of the present proceedings."     The  bank has preferred this appeal. Dr. Anand  prakash, learned  counsel  for  the  appellant-bank,  submitted  that regulation 20(2) provided for a notice to the employer  only in  order to protect the employer’s interests and to  enable the employer, in case it decided to accept the  resignation, to make other arrangements in place of the resigning employ- ee. He submitted that, this being a provision for the  bene- fit of the employer, its requirements could be waived by the employer,  if  it so desired, unilaterally- The  proviso  to clause  (2) of the regulation indeed makes it clear that  it is open to the bank to waive the requirement of notice or to reduce  the period of the notice to less than three  months. He,  therefore, submitted that, when the respondent sent  in his resignation on 21st January, 1986, it was not  incumbent on  the  bank to wait till 30th June, 1986 when  the  notice period would expire. It was competent for the bank to  waive any notice at all and to accept the resignation with immedi- ate  effect or with effect from such other date as the  bank may  consider  appropriate.  It  was  further  contended  by learned  counsel  that, once the resignation letter  of  the respondent  had been accepted by the bank and  given  effect to,  to there was no further possibility of  the  respondent seeking  to withdraw the resignation letter as he  has  pur- ported  to  do  in this case.  Learned  counsel,  therefore, submitted  that the bank’s letter dated 7th  February,  1986 was quite valid and effective and that the respondent’s writ petition ought to have been dismissed.     We have given careful thought to this contention of  the learned  counsel  and we are of the opinion  that  the  High Court was right in the conclusion it reached. Clause (2)  of regulation 20 makes it incumbent on an officer of the  bank, before resigning, to serve a notice in writing 617 of  such proposed resignation and the clause also  makes  it clear  that the resignation will not be effective  otherwise than on the expiry of three months from the service of  such notice. There are two ways of interpreting this clause.  One is that the resignation of an employee from service being  a voluntary act on the part of an employee, he is entitled  to choose the date with effect from which his resignation would be effective and give a notice to the employer  accordingly.

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The only restriction is that the proposed date should not be less than three months from the date on which the notice  is given  of the proposed resignation. On this  interpretation, the  letter  dated 21st January, 1986 sent by  the  employee fully  complied  with the terms of this clause.  Though  the letter  was written in January, 1986 the employee gave  more than three clear months’ notice and stated that he wished to resign with effect from 30th of June, 1986 and so the resig- nation  would have become effective only on that  date.  The other  interpretation  is  that, when an  employee  gives  a notice of resignation, it becomes effective on the expiry of three months from the date thereof. On this  interpretation, the  respondent’s resignation would have taken effect on  or about  21.4.1986 even though he had mentioned a later  date. In  either view of the matter, the respondent’s  resignation did  not  become effective till 21.4.1986 or  30.6.1986.  It would have normally automatically taken effect on either  of those  dates as there is no provision for any acceptance  or rejection  of the resignation by the employer, as is  to  be found  in other rules, such as the Government.Services  Con- duct Rules.     Much reliance was placed on the terms of the proviso  to clause  (2)  of regulation 20 to justify the action  of  the bank in terminating the respondent’s services earlier but we do  not  think that the proviso can be  interpreted  in  the manner suggested by learned counsel for the bank. The resig- nation  letter  of the officer has to give  at  least  three months’  advance notice under the main part of  the  clause. What  the proviso contemplates is that in a case  where  the employee  desires that his resignation should  be  effective even  before  the expiry, of the period of three  months  or without  notice  being given by him, the bank  may  consider such a request and waive the period or requirement of notice if  it  considers it fit to do so. That  question  does  not arise  in  the  present case because the  employee  had  not requested  the  bank to reduce the period of  notice  or  to waive the requirement of notice. Dr. Anand Prakash seeks  to interpret  the proviso as empowering the bank, even  without any  request=  on the part of the employee,  to  reduce  the period  or waive the requirement of notice. In other  words, he  says the bank has power to accept the  resignation  with immediate effect even though 618 the  notice is only of a proposed future resignation. We  do not  think this contention can be accepted. As we  have  al- ready  mentioned, resignation is a voluntary act of  an  em- ployee.  He  may choose to resign with immediate  effect  or with  a notice of less than three months if the bank  agrees to  the  same. He may also resign at a future  date  on  the expiry,  or beyond the period, of three months but for  this no further consent of the bank is necessary. The  acceptance of the argument of Dr. Ananad Prakash would mean that,  even though  an-employee might express a desire to resign from  a future  date, the resignation can be accepted, even  without his  wishes,  from an earlier date. This would  not  be  the acceptance  of  a resignation in the terms in  which  it  is offered. It amounts really to forcing a date of  termination on the employee other than the one he is entitled to  choose under  the. regulations. As rightly pointed out by the  High Court,  the termination of service under clause (2)  becomes effective  at the instance of the employee and the  services of  the employee cannot be terminated by the employer  under this clause.     Dr. Anand Prakash emphasises that as clause (2) and  its proviso are intended only to safeguard the bank’s  interests

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they should be interpreted on the lines suggested by him. We are of the opinion that clause (2) of the regulation and its proviso are intended not only for the protection of the bank but  also  for  the benefit of the employee.  It  is  common knowledge that a person proposing to resign often wavers  in his  decision and even in a case where he has taken  a  firm decision tO resign, he may not be ready to go out immediate- ly.  In most cases he would need a period of adjustment  and hence  like to defer the actual date of relief  from  duties for  a few months for various personal reasons.  Equally  an employer  may  like to have time to  make  some  alternative arrangement before relieving the resigning employee.  Clause (2)  is carefully worded keeping both these requirements  in mind.  It  gives  the employee a period  of  adjustment  and rethinking.  It also enables the bank to have some  time  to arrange  its  affairs, with the liberty, in  an  appropriate case, to accept the resignation of an employee even  without the requisite notice if he so desires it. The proviso in our opinion  should  not be interpreted as enabling  a  bank  to thrust a resignation on an employee with effect from a  date different from the one on which he can make his  resignation effective under the terms of the regulation. We,  therefore, agree  with  the  High Court that in the  present  case  the resignation of the employee could have become effective only on or about 21st April, 1986 or on 30th June, 1986 and  that the  bank could not have "accepted" that resignation on  any earlier  date.  The  letter dated 7th  February,  1986  was, therefore, without jurisdiction- 619     The  result  of  the above interpretation  is  that  the employee  continued  to be in service till the  21st  April, 1986  or 30th June, 1986, on which date his  services  would have  come normally to an end in terms of his  letter  dated 21st January, 1986. But, by that time, he had exercised  his right  to  withdraw the resignation.  Since  the  withdrawal letter was written before the resignation became  effective, the  resignation stands withdrawn, with the result that  the respondent continues to be in the service of the bank. It is true that there is no specific provision in the  regulations permitting the employee to withdraw the resignation. It  is, however, not necessary that there should be any such specif- ic rule. Until the resignation become effective on the terms of  the  letter read with regulation 20. it is open  to  the employee,  on general principles, to withdraw his letter  of resignation. That is why, in some cases of public  services, this right of withdrawal is also made subject to the permis- sion  of the employer. There is no such clause here.  It  is not  necessary  to labour this point further as it  is  well settled by the earlier decisions of this Court in Raj  Kumar v. Union of India, [1963] 3 SCR 857; Union of India v. Gopal Chandra Misra, [1978] 3 SCR 12 and Balram Gupta v. Union  of India, [1987] Suppl. SCC 228.     Learned  counsel  for the appellant  relied  on  certain observations  in Delhi Electric Supply Undertaking  v.  Tara Chand,  [1987] 2 SLR 426. Certain other decisions were  also cited  by  Dr. Anand Prakash but we do not think  that  they have  any bearing on the issue before us. Tara Chand  was  a case under regulation 8 of the regulations made by the Delhi Electric  Supply Undertaking under the Electricity  (Supply) Act,  1948. The regulation permitted the termination of  the services of a servant of the undertaking "on notice of three months from either side without any cause to be assigned  in case of permanent servants". The employee in that case  sent a  letter to the employer stating that "he was compelled  to resign for various reasons" and this resignation was accept-

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ed by the undertaking. The Delhi High Court in its  judgment (to which one of us was a party) observed that notice  under the regulation was intended for the benefit of the  employer which could, if it considered necessary or proper, waive the period  of notice and accept the resignation with  immediate effect. But that was a case where the employee, though bound to give three months’ notice, expressed his desire to resign with  immediate effect and it was also accepted by  the  em- ployer.  It was not the case that he had given notice  indi- cating a desire to be relieved at a future date. The analogy of that case would have applied to the present case as  well if  the respondent here had expressed his desire to  be  re- lieved  immediately  even  before the expiry  of  the  three months’ notice period and the bank had accepted it. The 620 employer  would then certainly have been entitled to  accept the  resignation, as requested by the employee, waiving  the notice  period.  The distinction between that case  and  the present one is that, here, the employee has chosen a  future date  on which his resignation would be effective but he  is being forced to "resign" before such date.     For the reasons discussed above, we affirm the  decision of  the High Court and dismiss this appeal. As the  employee has  got  a  relief much larger than the one  for  which  he initially came to Court and which has been made possible  by his subsequent conduct, we make no order as to costs. P  .S.S.                                        Appeal  dis- missed. 621