08 May 1996
Supreme Court
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STATE OF U.P. Vs ROADWAYS MINISTERIAL STAFF ASSON.

Bench: RAMASWAMY,K.
Case number: C.A. No.-009040-009040 / 1996
Diary number: 76380 / 1994
Advocates: Vs ABHIJAT PARASHAR MEDH


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PETITIONER: STATE OF U.P & ANR.

       Vs.

RESPONDENT: ROADWAYS MINISTERIAL STAFFASSOCIATION U.P. & ANR.

DATE OF JUDGMENT:       08/05/1996

BENCH: RAMASWAMY, K. BENCH: RAMASWAMY, K. FAIZAN UDDIN (J) G.B. PATTANAIK (J)

CITATION:  JT 1996 (6)   208        1996 SCALE  (5)18

ACT:

HEADNOTE:

JUDGMENT:                   THE 8TH DAY OF MAY, 1996 Present: Hon’ble Mr. Justice K. Ramaswamy Hon’ble Mr. Justice Faizan Uddin Hon’ble Mr. Justice G.B.Pattanaik K.S.Chauhan and R.B.Misra, Advs. for the appellants Aseem Mehrotra and A.P.Medh, Advs. for the Respondents                          O R D E R The following Order of the Court was delivered: State of U.P.& Anr. V. Roadways Ministerial Staff Association U.P.& Anr.                          O R D E R      Leave granted.      We have heard counsel on both sides.      The   respondent-Association    filed   writ   Petition No.3273/82 in  the High  Court of  Allahabad, Lucknow  Bench seeking to  declare Rule  9(II) of  the U.P.  State Roadways Organization (Abolition  of Posts & Absorption of Employees) Rules, 1982  made in exercise of the power under Article 309 of the Constitution (for short, the ’Rules’), as ultra vires and also  for issue of a mandamus restraining the appellants from changing  their status  of Government  servants as  the Corporation employees.  The Division  Bench in  the impugned order held as under:      "In view  of what  has been  stated      above, part  or Rule 8 is valid and      the   absorption   rules   of   the      employees are  perfectly valid. The      writ petition  to the  above extent      deserves  to   be   dismissed   and      regarding pensionary benefits it is      allowed. A  direction is  issued to      the opposite  parties to  opt those

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    options who were sent on deputation      vide G.O. dated 7.6.1972 as amended      by  G.O.   dated  5.7.1972  to  the      Corporation   notwithstanding   the      fact that  they have  not  attained      the age  of superannuation  and  on      the date  of absorption  they  will      still  continue  in  service,  they      will be  entitled to all pensionary      benefits and  for that purpose they      will  be   treated  in   Government      service. But  for the above relief,      the  writ   petitions  are   hereby      dismissed and interim order, if any      stands discharged.  However,  there      will be no order as to costs."      The question,  therefore, is: whether the view taken by the High  Court is correct in law? It is not in dispute that the members  of the  respondent Association had their status as Government  employees but  they had come on deputation to the Corporation. Rule 4(1) of the Rules envisages as under:      "4(1) An employee of the U.P. State      Roadways  Organization,   who   was      placed  on   deputation  with   the      Corporation and  who does  not wish      to be  absorbed in  the service  of      the  Corporation  shall,  within  3      months  from  the  notification  of      these   Rules   in   the   Gazette,      intimate    the     Secretary    to      Government   in    the    Transport      Department that he does not wish to      be so absorbed."      Rule 5 envisages as under:      "The relevant  posts  in  the  U.P.      State Roadways  Organization  shall      stand abolished,           (i)  Where   the  employee  is      deemed to have opted for absorption      in the  service of the Corporation,      in accordance  with sub-rule (2) of      rule 4,  from the date of expiry of      three  months   from  the  date  of      notification of these rules;           (ii)   Where    the   employee      intimates the Government his option      for  being   not  absorbed  in  the      service of the Corporation from the      date on which the period of notice,      as provided  in rule 6, expires or,      as  the   case  may  be,  when  the      services   stand    terminated   or      dispensed with  the accordance with      the said rule."      Rule 8 envisages as under:      "On the  absorption of  an employee      in the  service of the Corporation,      the   following   consequences   in      regard to  his services  under  the      Government shall follow:-           (i)  Leave   account  of   the      employee shall  be  transferred  to      the Corporation and the Corporation      shall not  be entitled  to  receive      any contribution or compensation on

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    this account from the Government.           (ii) Government shall bear the      liability for  pension,(which  dies      not include family pension) and for      gratuity,  (if   admissible  to  an      employee),  in  proportion  to  the      qualifying    service     in    the      Government rendered  by an employee      before the date of his being placed      on deputation with the Corporation,      the  entire  liability  for  family      pension  shall   be  borne  by  the      Corporation.           (iii)   In   respect   of   an      employee  who   did  not  hold  any      pensionable post  but was  a member      of  an  Employee’s  Provident  Fund      Scheme,    the     liability    for      contribution required to be made by      an employer,  for the  period prior      to 1.6.1972,  shall be  that of the      Government  and  with  effect  from      1.6.1972, it  shall be  that of the      Corporation.           (iv) An  employee shall,  from      the date  of his  absorption, cease      to   subscribe   to   his   General      Provident  Fund  account,  if  any,      under the  State Government and the      amount to  his credit  in the fund,      together  with   interest  thereon,      according to  rules, till the month      preceding the  date of  transfer of      his account shall be transferred to      his new  account to be opened under      the Corporation."      A bare  reading of these Rules clearly indicates that a Government employee  who was sent on deputation and who does not wish  to be  absorbed in  the service of the Corporation was required  to  intimate  within  three  months  from  the notification of  these Rules  to  the  Government    in  the Transport Department that he does not wish to be so absorbed in the Corporation. If he fails to avail of that remedy, the Rules envisage  that he  shall be deemed to be absorbed as a Corporation employee,  Admittedly, none  of the  persons had exercised the  option. As  a result, by operation of Rule 5, the employee  is deemed  to have opted for absorption in the service of  the Corporation, in accordance with sub-rule (2) of rule  14 from the date of expiry of three months from the date of  the notification  of  the  Rules.  The  consequence envisaged in  Rule 8(ii)  is that  the Government shall bear the liability  for pension  which does  not  include  family pension and  for gratuity,  if admissible to an employee, in proportion to  the extent  of the period of service with the Government rendered  by an  employee before  the date of his being placed  on deputation with the Corporation. The entire Liability for  the family  pension shall  be  borne  by  the Corporation. It  would thus  be clear that the three months’ cut off  period given  under the  Rules from the date of the publication of  the Rules  is the appropriate and reasonable cut off  period. Any  employee who  failed to  avail of  the same,  by  giving  notice  to  the  Secretary  in  Transport Department  that   he  did   not  wish  to  be  absorbed  as Corporation employee,  must be  deemed to  be an employee of the Corporation.  Corporation, therefore,  is liable to bear

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the liability  of a  deemed employee from the date mentioned in Rule  8(ii) read  with Rule  4(2)  and  Rule  5  thereof. Resultantly, such  employees are  not entitled  to cont  the period  from  the  date  of  the  deputation  till  date  of absorption to  be the Government employee for computation of the pensionary benefits in their favour.      The appeal is accordingly allowed and the writ petition stands dismissed. But in the circumstances without costs.