REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 2760 OF 2010
Indian Bank and another …Appellants
Versus
Mahaveer Khariwal …Respondent
J U D G M E N T
M.R. SHAH, J.
1. Feeling aggrieved and dissatisfied with the impugned
judgment and order dated 02.02.2009 passed by the Division
Bench of the High Court of Delhi at New Delhi in Letters Patent
Appeal No. 246 of 2007, by which the Division Bench has allowed
the said appeal preferred by the respondent herein and has
quashed and set aside the judgment and order passed by the
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learned Single Judge and has quashed and set aside
communication dated 20.04.2004 of the bank rejecting the
application for voluntary retirement and has directed the
appellantbank to release retiral dues of the respondent in
accordance with the Pension Regulations, 1995 with simple
interest at the rate of 9% per annum from the date of filing of writ
petition, the employerbank has preferred the present appeal.
2. The facts leading to the present appeal in nutshell are as
under:
That the respondent herein – original writ petitioner –
employee (hereinafter referred to as the ‘employee’) was working
with the appellant bank – employer (hereinafter referred to as the
‘employer’), who was promoted as Chief Manager SMGIV. In
March, 1998, he was transferred and posted as Chief Manager,
Colombo Branch, Colombo. Thereafter, by order dated
13.05.2013, he was transferred from Colombo overseas branch to
the Defence Colony Branch, New Delhi as Chief Manager (BM).
The employee applied for 30 days’ leave to visit London as his son
was admitted in the hospital. Thereafter, the employee wrote to
the employer seeking extension of leave. The application for leave
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as well as the application for extension of leave were refused by
the employer and the employee was directed to report on duty at
Defence Colony Branch, New Delhi. That on 21.01.2004, the
employee submitted an application seeking voluntary retirement
from the services of the employer in accordance with Circular No.
32/9798 dated 15th July, 1997 and the format given by the
employer for submitting the notice of voluntary retirement. In
the application for voluntary retirement, the employee requested
for waiver of three months’ notice, as required under Regulation
29 of the Indian Bank Employees Pension Regulations, 1995
(hereinafter referred to as ‘Pension Regulations, 1995’) and
requested/authorised the employer to deduct the salary of the
notice period from out of the amount payable by the employer on
retirement. The employer vide letter dated 20.04.2004, which
was served on the employee on 23.04.2004, rejected the request
of the employee for voluntary retirement on the ground that the
employee was not eligible under Pension Regulations, 1995.
3. Being aggrieved by the rejection of the application for
voluntary retirement, the employee preferred Writ Petition (C) No.
16972 of 2005. One another prayer was for a direction to the
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employer to reimburse the educational expenses for the son of
the employee, who had been sent to Singapore for his education
while he was posted at Colombo. One another prayer was for
grant of traveling allowance bills for the journey from Colombo to
New Delhi, which was declined by the employer on account of
delay in submitting the bills. The learned Single Judge by
judgment and order dated 11.10.2006 dismissed the writ petition
so far as challenge to the rejection of his voluntary retirement
application vide communication dated 20.04.2004. However,
granted the prayers for traveling allowance bills and educational
expenses.
4. Feeling aggrieved and dissatisfied with the judgment and
order passed by the learned Single Judge in dismissing the writ
petition with respect to his prayer to quash the letter dated
20.04.2004 rejecting his request for voluntary retirement, the
employee preferred Letters Patent Appeal before the Division
Bench of the High Court. The Division Bench, by the impugned
judgment and order, has allowed the said Letters Patent Appeal
and has quashed and set aside the letter dated 20.04.2004 and
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has directed the employer to release retiral dues of the employee
in accordance with Pension Regulations, 1995.
5. Feeling aggrieved and dissatisfied with the impugned
judgment and order passed by the Division Bench of the High
Court, the employer has preferred the present appeal.
6. Shri Ravi Sikri, learned Senior Advocate has appeared on
behalf of the employer and Shri Sanjeev Kumar, learned Advocate
has appeared on behalf of the employee.
6.1 Shri Ravi Sikri, learned Senior Advocate appearing on
behalf of the employer has made the following submissions,
assailing the impugned judgment and order passed by the
Division Bench:
i) that the High Court has not properly appreciated Regulation
29 of the Pension Regulations, 1995 in its true perception;
ii) that the High Court has not properly appreciated the fact
that as per Regulation 29, a request for voluntary retirement by
an employee requires permission/acceptance of the employer
concerned;
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iii) that vide communication dated 20.04.2004, the application
of the employee for voluntary retirement was rejected within three
months from the date of submitting the voluntary retirement
application and therefore there could not be a deemed acceptance
of voluntary retirement;
that what is relevant is taking the decision within three
months and not the service of the decision on the application for
voluntary retirement. It is submitted that in the present case,
the decision was taken within a period of three months.
iv) that the High Court has failed to appreciate that an
employee who seeks voluntary retirement is to give three months’
mandatory notice in writing to enable the employer to make
necessary arrangements for an alternate hand in place of the
employee seeking voluntary retirement. It is submitted that in
the present case, three months’ mandatory notice was not given
and therefore his application for voluntary retirement was
defective to that extent. It is submitted that therefore the
employer rightly rejected his application for voluntary retirement
which was not in consonance with the Pension Regulations,
1995;
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v) that the High Court has failed to appreciate that the
employee’s offer of surrendering three months salary in lieu of
mandatory notice period could not be considered to be a valid
application for waiver of the three months’ notice requirement;
vi) that the High Court has erred in holding that the employee
was, in fact, transferred to the foreign branch and was not sent
on deputation. It is submitted that as such the respondent was
on deputation at the overseas branch at Colombo at the relevant
point of time and therefore as per Regulation 29(1) of the Pension
Regulations, 1995, the employee was not eligible to apply for
voluntary retirement unless after having been transferred or
having returned to India, he has resumed charge of the post in
India and has served for a period of not less than one year. It is
submitted that therefore the employee did not fulfil the statutory
requirement of serving for a period of one year after returning to
India, as contemplated under Regulation 29(1);
vii) It is submitted that as such after rejection of the application
for voluntary retirement, the employer initiated departmental
proceedings against the employee for his unauthorised absence
from 26.11.2003 to 19.01.2004 and from 22.01.2004 and the
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disciplinary authority imposed the penalty of compulsory
retirement on the employee. It is submitted that therefore the
Division Bench of the High Court ought not to have allowed the
appeal.
Making the above submissions, it is prayed to allow the
present appeal and quash and set aside the impugned judgment
and order passed by the Division Bench and restore the
judgment and order passed by the learned Single Judge and
restore the decision of the bank dated 20.04.2004 rejecting the
application of the employee for voluntary retirement.
7. Shri Sanjeev Kumar, learned Advocate appearing on behalf
of the employee has supported the impugned judgment and order
passed by the Division Bench of the High Court. It is submitted
that the Division Bench has rightly set aside the communication
dated 20.04.2004 by which the application of the employee for
voluntary retirement was rejected. It is submitted that the
Division Bench of the High Court has rightly interpreted
Regulation 29 and has rightly considered that the bar under
Regulation 29(1) shall not be applicable insofar as Regulation
29(1) is concerned, as the employee was not on deputation at
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Colombo Branch but was on transfer. It is submitted that the
question is not when the decision was served upon the employee,
but the question is whether the rejection of the voluntary
retirement application vide communication dated 20.04.2004 was
legal, just and proper and was in consonance with Regulation 29
or not. It is submitted that on true interpretation of Regulation
29, the High Court has rightly allowed the appeal and has rightly
quashed and set aside the communication dated 20.04.2004.
8. We have heard the learned counsel for the respective parties
at length.
It is not in dispute that in the present case the employee
submitted the voluntary retirement application on 21.01.2004.
In the application itself, the employee requested for waiver of
three months’ notice and requested to deduct the salary amount
of the notice period from out of the amounts payable to him by
the employer on retirement. It is not in dispute and it cannot be
disputed that the notice of voluntary retirement requires
acceptance by the appointing authority. However, as per proviso
to SubRegulation 2 of Regulation 29, in case the appointing
authority does not refuse to grant the permission for retirement
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before the expiry of the period specified in the notice, the
retirement shall become effective from the date of expiry of the
said notice period. In the present case, on the 90th day vide
communication dated 20.04.2004 the application of the employee
for voluntary retirement was rejected without assigning any
specific reasons and by observing that the employee is not eligible
for voluntary retirement under Pension Regulations, 1995. The
said communication was sent to the employee on the very date,
i.e., 20.04.2004, however the same was received by the employee
on 23.04.2004. The learned Single Judge dismissed the writ
petition so far as challenge to the communication dated
20.04.2004 is concerned. However, on appeal, by the impugned
judgment and order, the Division Bench has set aside the
communication dated 20.04.2004 by which the request of the
employee for voluntary retirement from the service of the
employer came to be rejected.
Therefore, the short question which is posed for the
consideration before this Court is, whether the rejection of the
request of the employee for voluntary retirement vide
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communication dated 20.04.2004 was legal and in consonance
with Regulation 29 of the Pension Regulations, 1995 or not.
9. While considering the aforesaid question, Regulation 29 is
required to be referred to, which reads as under:
“29. Pension on Voluntary Retirement:
1) On or after the first day of November, 1993, at any time
after an employee has completed twenty years of
qualifying service he may, by giving notice of not less
than three months in writing to the appointing authority
retire from service:
Provided that this subregulation shall not apply to an
employee who is on deputation or on study leave on
abroad unless after having been transferred or having
returned to India he has resumed charge of the post in
India and has served for a period of not less than one
year:
Provided further that this subregulation shall not apply
to an employee who seeks retirement from service for
being absorbed permanently in an autonomous body or
a public sector undertaking or company or institution or
body, whether incorporated or not to which he is on
deputation at the time of seeking voluntary retirement:
Provided that this subregulation shall not apply to an
employee who is deemed to have retired in accordance
with clause (l) of regulation 2.
(2) The notice of Voluntary retirement given under subregulation (1) shall require acceptance by the appointing
authority:
Provided that where the appointing authority does not
refuse to grant the permission for retirement before the
expiry of the period specified in the said notice, the
retirement shall become effective from the date of expiry
of the said period.
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(3)(a) An employee referred to in subregulation (1) may
make a request in writing to the appointing authority to
accept notice of Voluntary Retirement of less than three
months giving reasons thereof;
(b) On receipt of a request under clause (a), the
appointing authority may, subject to the provisions of
subregulation (2), consider such request for the
curtailment of the period of the notice of three months
on merits and if it is satisfied that the curtailment of the
period of notice will not cause any administrative
inconvenience, the appointing authority may relax the
requirement of notice of three months on the condition
that the employee shall not apply for Commutation of a
part of the pension before the expiry of the notice of
three months.
(4) An employee, who has elected to retire under this
regulation and has given necessary notice to that effect
to the appointing authority. shall be precluded from
withdrawing his notice except with specific approval of
such authority;
Provided that the request for such withdrawal shall be
made before the intended date of his retirement.
(5) The qualifying service of an employee retiring
voluntarily under this regulation shall be increased by a
period not exceeding five years, subject to the condition
that the total qualifying service rendered by such
employee shall not in any case exceed thirtythree years
and it does not take him beyond the date of
superannuation,
(6) The pension of an employee retiring under this
regulation shall be based on the average emoluments as
defined under clause (d) of regulation 2 of these
regulations and the increase. not exceeding five years in
his qualifying service. shall not entitle him to any
notional fixation of pay for the purpose of calculating his
pension.”
10. On a fair reading of Regulation 29, it emerges that an
employee is entitled to apply for voluntary retirement after he has
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completed 20 years of qualifying service. He can apply for
voluntary retirement by giving notice of not less than three
months in writing to the appointing authority (Regulation 29(1)).
However, as per proviso to SubRegulation (1) of Regulation 29,
SubRegulation (1) of Regulation 29 shall not apply to an
employee who is on deputation or on study leave on abroad
unless after having been transferred or having returned to India
he has resumed charge of the post in India and has served for a
period of not less than one year. The said proviso shall be dealt
with and considered hereinbelow. It also appears that as per
SubRegulation (2) of Regulation 29, the notice of voluntary
retirement given under SubRegulation (1) shall require
acceptance by the appointing authority. However, as per the
proviso to Subregulation (2), the appointing authority has to
take a decision before the expiry of the period specified in the
notice. It provides that where the appointing authority does not
refuse to grant the permission for retirement before the expiry of
the period specified in the notice, there shall be deemed
acceptance of the voluntary retirement application and the
retirement shall become effective from the date of expiry of the
period mentioned in the notice. However, at the same time, as
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per SubRegulation 3(a), an employee may make a request in
writing to the appointing authority for waiver of the three months’
notice and may make a request to accept the notice of voluntary
retirement of less than three months giving reasons thereof.
SubRegulation 3(b) provides that on receipt of a request for
waiver of three months’ notice as per SubRegulation 3(a), the
appointing authority may, subject to the provisions of SubRegulation (2), consider such request for the curtailment of the
period of notice of three months on merits and if it is satisfied
that the curtailment of the period of notice will not cause any
administrative inconvenience, the appointing authority may relax
the requirement of notice of three months on the condition that
the employee shall not apply for commutation of a part of the
pension before the expiry of the notice of three months. In the
present case, the application of the employee submitting the
voluntary retirement application with a request for curtailment of
notice of three months was absolutely in consonance with
Regulation 29. The request made by the employee for
curtailment of the period of notice of three months was required
to be considered by the appointing authority on merits and only
in a case where it is found that the curtailment of the period of
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notice may cause any administrative inconvenience, the request
for curtailment of the period of three months’ notice can be
rejected. On considering the communication dated 20.04.2004
rejecting the application of the employee for voluntary retirement,
it does not reflect any compliance of SubRegulation 3(b) of
Regulation 29. As such, no reasons whatsoever have been
assigned/given except stating that the request is not in
accordance with Pension Regulations, 1995. Even otherwise, it is
required to be noted that even the communication dated
20.04.2004 was on the last day of the third month, i.e., 90th day
from the date of submitting the voluntary retirement application.
Therefore, there was no reason to reject the prayer of curtailment
of the period of notice considering the grounds mention in SubRegulation 3(b) of Regulation 29. Be that as it may, the rejection
of the application for voluntary retirement was not on the ground
that notice of three months is not given. The request made by
the employee for curtailment of notice of three months was also
not considered on merits. Therefore, as rightly held by the
Division Bench of the High Court, the application for voluntary
retirement was absolutely in consonance with Regulation 29 and
that the rejection was bad in law and contrary to Regulation 29.
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The Division Bench of the High Court is absolutely justified in
quashing and setting aside the communication dated
20.04.2004. We are in complete agreement with the view taken
by the Division Bench.
11. Now so far as the submission on behalf of the employer that
the employee was not eligible for voluntary retirement in view of
proviso to SubRegulation (1) of Regulation 29 as after he
returned to India from Colombo Branch he did not serve for a
period of not less than one year is concerned, there is a specific
finding given by the Division Bench that the said proviso shall
not be applicable to the facts of the case on hand as in the
present case the employee was on transfer to Colombo Branch
and was not on deputation. If we look at order dated 19.03.1998,
it cannot be said that the employee was sent on deputation as
Chief Manager, Colombo Branch. It says that he is posted as
Chief Manager, Colombo Branch. Even when he was relieved
from Colombo Branch to join at Defence Colony Branch, New
Delhi, in the communication dated 25.08.2003 (Annexure P5), it
speaks about the transfer order dated 13.05.2003. It is not the
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order of repatriation. Therefore, proviso to SubRegulation (1) to
Regulation 29 shall not be applicable.
12. Now so far as the submission on behalf of the employer
that the acceptance or nonacceptance of the voluntary
retirement application is required to be taken before the expiry of
the period specified in the notice, i.e., in the present case three
months and the same was taken on the last date of the three
months’ period and date of receipt of the
decision/communication is not material, it is true that in the
present case the decision was taken before the expiry of the
period specified in the notice, i.e., on or before three months (last
day of the third month), however, as observed hereinabove, the
rejection of the application for voluntary retirement itself is found
to be illegal and bad in law. Therefore, the aforesaid shall not
affect the ultimate conclusion reached by the Division Bench of
the High Court. As observed hereinabove, communication dated
20.04.2004 rejecting the voluntary retirement application was
bad in law and contrary to Regulation 29. Therefore, the
employee shall be entitled to all retiral benefits on the basis of his
voluntary retirement. Once, it is held that he is voluntary retired
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as per his application dated 21.01.2004 and the rejection of the
application of voluntary retirement is held to be bad in law, all
other subsequent proceedings of departmental enquiry will be
null and void and shall be non est, as after the voluntary
retirement, there shall not be an employeremployee relationship.
13. In view of the above and for the reasons stated above, the
appeal fails and the same deserves to be dismissed and is
accordingly dismissed. However, there shall be no order as to
costs.
……………………………………J.
[ASHOK BHUSHAN]
………………………………….J.
[R. SUBHASH REDDY]
NEW DELHI; ………………………………….J.
JANUARY 22, 2021. [M.R. SHAH]
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