Dubey & Ors Vs. State of Bihar & Ors  Insc 240 (21 February 2008)
Chatterjee & Harjit Singh Bedi
J U D
G ME N T
APPEAL NO 1468 / 2008 (arising out of SLP ) No. 7972/2006) HARJIT SINGH BEDI,J.
This appeal is directed against the order dated December 7, 2005 of the Division Bench of the Patna High Court whereby the
judgment of the learned Single Judge dated October 12, 2004 dismissing the Writ Petition has
been confirmed. The facts of the case are as under:
appellants were appointed as Class IV employees i.e. Peons in the
respondent-Bank in the year 1971. They have been compulsorily retired by the
Bank vide order dated June 5, 2004 made purportedly under Rules 232 and 235 of
the Bihar Rajya Shakari Bhumi Vikas Bank Samiti (hereinafter referred to as the
against the order dated June 5, 2004, the appellants filed several writ
petitions in the Patna High Court raising pleas, inter-alia, that the action
taken by the Bank was not justified under Rule 232 as they had not been retired
compulsorily on the ground of inefficiency and that Rule 235 was not a source
of power so as to justify an order of compulsory retirement as it only dealt
with the grant of contributory provident fund and gratuity to those employees
who had reached the age of 50 years and had completed 30 years of service at
the time of retirement. In response to the notice issued by the High Court, the
respondent-Bank filed its reply. It was, inter-alia, pointed out that the Bank
was grossly over-staffed and being inefficiently run with the result that it
had sustained huge losses that had brought it to a precarious financial
position, and that before the action had actually been taken against the
appellants, a committee had been set-up which had examined the entire structure
of the Bank and as a follow- up a large number of offices and Branch Offices
had been closed and a consequent re-structuring made of those which still
continued to operate. It was further highlighted that the over-staffing of the
Bank was evident as against the total requirement of 166 Peons, 507 had in fact
been appointed and that the decision to compulsorily retire the appellants had
been taken with hesitation and as one of the measures necessary to ensure the
survival of the Bank. It was also pointed out that the Board of Directors in
its meeting held on December
24, 2003 had examined
the relevant facts and concluded that in the first phase, compulsory retirement
should be ordered of lower grade employees who had completed 30 years of
service and 50 years of age. A copy of these proceedings have been appended as
Annexure P-1 to the Paper Book.
learned Single Judge in his judgment dated October 12, 2004 accepted the
explanation tendered by the respondent insofar as the factual aspect was
concerned and also observed that Rule 232 was not applicable in such a case
whereas Rule 235 was in fact applicable and accordingly dismissed the Writ
Petition, as already mentioned above.
appeal filed before the Division Bench of the High Court was also dismissed.
Priya Hingorani, the learned counsel for the appellants has forcefully argued
that Rule 235 on which the respondents had placed reliance for dispensing with
the services of the appellants by way of compulsory retirement was not in fact
a source of power as it only dealt with the payment of gratuity and provident
fund to a certain category of employees and that it was only under Rule 232
that an employee could be compulsorily retired and that too on the ground of
inefficiency and as it was not the case of the respondent-Bank that the
appellants were inefficient, the impugned action was unjustified. It has also
been urged that the appellants had put in more than 30 years of service with
the Bank and if any re-structuring was to be made so as to make Bank's working
more efficient, it would have been appropriate to dispense with the staff at
the top i.e. senior officers of the Bank rather than the low paid Class IV
employees such as the appellants.
These arguments have been controverted by Shri Shravan Kumar, the learned
senior counsel for the respondents who has pointed out that Rule 235 was itself
the source of power and operated in a field different from Rule 232 and that it
was not for this Court to interfere so as to determine as to which employee
should be retrenched first, and who later, as this was a matter for the
internal administration of the Bank.
have heard the learned counsel for the parties and gone through the record.
Rules 232 and 235 are reproduced hereinbelow:
232: The Bank may, any bank employee who has committed 21 years of duty and 25
years of total service calculated from the date of his first appointment to
retire from the Bank's services if it is considered that the efficiency or
conduct of the employee is not such as to justify his retention in service.
any bank employee is so required to retire, no claim to any special
compensation shall be entertained.
235: A person who retires voluntarily or is required to be retired compulsorily
in bank's interest on reaching the age of 50 years completing 30 years of
service shall be entitled to contributory provident fund and gratuity as
Concededly the action against the appellants has not been taken under Rule 232
which deals with the compulsory retirement of an employee who has put in 21
years of duty and 25 years of total service if it is considered that the
efficiency or the conduct of the employee does not justify his retention in
service. Rule 235 however talks about compulsory retirement in the Bank's
interest of those who have reached the age of 50 years and have completed 30
years of service and also talks about the benefit of contributory provident
fund and gratuity, as admissible to such employees. Undoubtedly, action under
Rule 232 can only be taken if the employee concerned is inefficient or is
guilty of misconduct whereas the scope of Rule 235 is much wider and compulsory
retirement can be ordered in the Bank's interest. The fact that the two Rules
operate in different fields is also clear from the varying qualifying service
and that those who retire under Rule 235 are given some additional financial
benefits as a solatium for having to go despite the fact that their efficiency
has in no manner been impaired and merely because Rule 235 also talks about the
payment of contributory provident fund and gratuity it does not take away the
right to retire compulsorily those who have reached the age of 50 years and
have completed 30 years of service and whose retirement is in the Bank's
interest. We therefore endorse the observations of the High Court that the
action taken was justified under Rule 235, as correct.
are equally of the opinion that it is not for this Court to opine as to who
should be retained in service and who should be retired and at what stage and
situation as this is a matter to be left to the exclusive discretion of the
facts of the case show that the Bank was not only heavily over staffed but was
also running into huge losses and substantial pruning which would undoubtedly
be hurtful, was required for its survival.
accordingly find no merit in the appeal.
with no order as to costs.