& Sind Bank & Anr Vs. S. Ranveer Singh Bawa & Anr  Insc 311 (21 April 2004)
V.N. Khare, S.B. Sinha & S.H. Kapadia. Kapadia, J.
question that arises for consideration in this case is whether respondent who
earlier opted for voluntary retirement scheme could be permitted to withdraw therefrom
after having received the payments under the scheme? The facts giving rise to
the dispute lie within narrow compass. Appellant is a nationalised bank. On
28.10.2000, in order to down size the strength of its staff, the appellant
floated the voluntary retirement scheme (hereinafter referred to for the sake
of brevity as "VRS"). The scheme was to commence with effect from
1.12.2000 and it was to remain in operation up to 31.12.2000. On 6.12.2000, respondent
no.1, Ranveer Singh Bawa, opted for VRS. On 22.12.2000, respondent no.1
requested that he be allowed to withdraw his option. On 23.12.2000, the scheme
stood modified. On 30.12.2000 and 17.1.2001, the said respondent wrote
reminders and requested that he be permitted to withdraw his option. However,
in view of clause 10.4 of the scheme, the appellant did not permit him to opt
out from the VRS. Consequently, w.e.f. 29.1.2001, respondent no.1 was relieved
from service. Aggrieved, he filed the writ petition in the High Court on
26.3.2001 inter alia seeking resumption of duties without any break in service.
On 24.7.2001, the learned Single Judge allowed the writ petition on the ground
that the optee is entitled to withdraw his option before its acceptance by the
bank. Against the decision of the learned Single Judge, the appellant carried
the matter in appeal to the Division Bench. By impugned judgment dated
5.9.2001, the Division Bench dismissed the Letters Patent Appeal.
this civil appeal by special leave petition.
case of Bank of India v. O.P. Swarnakar reported in [(2003) 2 SCC 721], two
questions arose for determination, namely, whether the scheme is an offer, as
contended on behalf of the bank or an invitation inviting offers from employees;
and secondly, whether the optees having accepted the payments/benefits under
the scheme could be permitted to resile therefrom. On the first question, it
was held that the said scheme was contractual in nature; that it constituted
invitation and not an offer; and that no consideration passed in terms of the
scheme so as to constitute an agreement. Under the circumstances, it was held
that revocation was possible and effective at any time before acceptance as up
to such acceptance no legal obligation existed. On the second question, it was
held that those employees who have accepted the payments/benefits under the
scheme cannot approbate and reprobate nor can they be permitted to withdraw.
the appeal came up for hearing, it was submitted on behalf of the appellant on
facts that the respondent no.1 herein had received and accepted
payments/benefits under the scheme and consequently, he was not entitled to
withdraw therefrom. In this connection, reliance was placed on the averments in
the counter-affidavit filed by the appellant on 28.2.2004 in I.A. No.1 of 2003
filed in the present civil appeal.
urged that the said respondent had two savings bank accounts no.4775 and 4777,
in which the bank credited salaries, notice period salary as well as leave
encashment benefits under the scheme, which was never objected to by the
the credits in the savings bank accounts were used by the respondent to repay
his car loan to the bank amounting to Rs.65220/-, which was one of the conditions
prescribed in the scheme. Further, the said respondent had utilized the credits
in the said accounts for investment in fixed deposits.
it was submitted that the respondent had received the payments under the
scheme, he had utilized those payments to discharge his obligations under the
scheme by repayment of car loan and he had invested the amounts in fixed
he was not entitled to withdraw from the scheme.
Bhushan, learned senior counsel appearing on behalf of the respondent, on the
other hand, contended that on 6.12.2000, respondent herein opted for VRS. He
urged that the scheme was open up to 31.12.2000. On 22.12.2000, the said
respondent withdrew his offer. He repeatedly reminded the management thereafter
to accept his request for withdrawal.
reminders, on 29.01.2001, the management relieved the respondent from service,
which was challenged by him by filing writ petition in Delhi High Court on
26.3.2001. It was urged that although the respondent succeeded in the writ
petition, till date the appellant has failed to reinstate the respondent. It
was submitted that the appellant had unilaterally credited the salaries, the
notice pay and the leave encashment benefits in the account of the respondent with
the appellant bank and consequently, the receipts of payments cannot
constitute waiver or acquiescence on the part of the respondent.
highest, it was receipt of payment under protest. In this connection, reliance
was placed on the fact of pendency of the writ petition in the High Court.
case of Bank of India v. O.P. Swarnakar (supra), this Court observed that estoppel
is based upon the acceptance and retention of benefits, by one having knowledge
or notice of the benefits from a contract or a transaction. The doctrine of estoppel
is a branch of the rule against assumption of inconsistent positions. One who
knowingly accepts the benefit of a contract is estopped from denying the
binding effect on him of such contract. This rule has to be applied to do
accordingly held that those optees who knowingly received the payments and
utilized them were not entitled to withdraw from the VRS. In the case of Punjab
National Bank v. Virender Kumar Goel & Ors. reported in [(2004) 2 SCC 193],
the applicant bank submitted that some of the optees having accepted the
benefits under VRS cannot be permitted to withdraw therefrom. In that matter,
several review petitions were filed and in some of those review petitions, it
was found that the optees were aware of the credits in their accounts and they
have even withdrawn the amounts deposited and had utilized the same and
consequently in such cases, this Court did not permit the optees to withdraw
from VRS. To the same effect is the order passed by this Court in the case of
Bank of India & Ors. v. Pale Ram Dhania, in Civil Appeal No.4098 of 2002
decided on 12.2.2004. In the light of the above judgments, we have to consider
the facts of the present case.
outset, it may be mentioned that before the High Court the only question which
arose for determination in this case was whether the respondent herein was
entitled to withdraw his option before the cut-off date. The question as to
whether the said respondent had received the payments/benefits and had utilized
the same was not there before the High Court. The last question has been raised
by the bank in I.A. No.1 of 2003 in the present civil appeal.
quote hereinbelow paragraphs 3, 4 and 5 of the counter affidavit dated
That the account statement submitted along with the additional affidavit at
pages 23-24 relates to Savings Bank Account No.4775 maintained by the
respondent. A perusal of the same would show that on 27.12.2000 salary to the
tune of Rs.15,154.00 was credited to his account.
on 25.1.2001 another credit entry amounting to Rs.14,600.42p was made on
account of salary. On 29.1.2001, a credit entry amounting to Rs.23,548.59 on
account of notice period salary as applicable under Voluntary Retirement Scheme
That thereafter on 1.2.2001 the respondent himself transferred a sum of Rs.60,000/-
in the said account and on that very day he adjusted his car loan amount to
Rs.65,220.00 payable to the bank.
stated that under Voluntary Retirement Scheme every employee who took the
voluntary retirement scheme and the benefits thereunder had to adjust the loans
payable by him to the bank and it was in pursuance to the provision of the
scheme that the respondent cleared the loan amount and also closed the said
account on 1.2.2001. It is noteworthy that in between, he had transferred a sum
of Rs.13,406.74p on 30.1.2001 and another sum of Rs.13,859 to his other
account. The deponent states that this clearly shows that the operation of the
said account by the respondent.
That the respondent was maintaining another account being Account No.4777 at Maharajpur
Branch of the appellant bank. A copy of which has been annexed by the
respondent at page 22 wherein the transfers had been made in this account. The
respondent had used and transacted the accounts as is evident from the account
statement annexed herewith for the period from 6.12.2000 to 16.10.2001. The
respondent has only annexed a part of the statement for the period from
4.1.2001 to 31.3.2001. The statement from 6.12.2000 to 16.10.2001 as annexed by
the appellant bank would show that the respondent operated this account on
regular basis. He had made a payment of Rs.30000/- on 13.1.2001 to State Bank
of India towards Public Provident Fund and
another deposit of Rs.60,000/- was made to SBI on 5.1.2001 as PPF deposit. The
leave encashment benefit of Rs.1,42,406.40 p. was credited in this account on
26.3.2001. The respondent made a FDR to the tune of Rs.1,42,406.40 p. on
31.3.2001 for a period of three years which is still lying with him and is due
only on 31.3.2004." From the averments herein, it is clear that respondent
no.1 had two savings bank accounts no.4775 and 4777. He had withdrawn his
option on 22.12.2000 and yet without any objection he receives three credits in
his account on 27.12.2000, 25.01.2001 and 29.01.2001 on account of salary
(including notice pay). Thereafter, he repays his car loan; invests Rs.30,000/-
in PPF and Rs.1,42,406.40 in fixed deposit for three years, which is a long
term investment. Therefore the principles of estoppel extensively discussed by
this Court in the case of Bank of India v. O.P. Swarnakar (supra) applies to
the facts herein. The conduct of respondent no.1 indicates his knowledge about
payments in his accounts; that he never objected to such payments and that he
had appropriated the amounts for his benefit. Therefore, he cannot resile from
the aforestated reasons, this appeal deserves to be allowed. We order
accordingly. The judgment and order under challenge is set aside, with no order
as to costs.