Vs. Chairman and Managing Director, Dena Bank  INSC 78 (20 January 1995)
B.L. (J) Hansaria B.L. (J) Ahmadi A.M. (Cj) Sen, S.C. (J)
1995 SCC Supl. (1) 346 JT 1995 (1) 633 1995 SCALE (1)306
Government of India, by a reso- 634 lution dated July 19,1973 appointed a committee consisting of
five members to standardise pay scale, allowances and perquisites of the
Officers in the 14 Nationalised Banks.
committee came to be popularly referred as the 'Pillai Committee' named after
its Chairman. It submitted its report in May 1974. The Government appointed a
Study Group of Bankers in September 1976 to make suggestions for the
implementation of the report. The Committee suggested certain modifications in
the method of implementation and submitted its further report in February 1977;
and the Government adopted the report as modified by the Group of Bankers.
question of implementation of the report as adopted by the Government was
discussed by the Indian Bank's Association with various representatives of all
the Confederations of Banking Officers Organisation, and the Secretary of this
Association addressed a private and confi- dential letter to Chief Executives
of various Banks including Dena Bank on March 15, 1978 &at the Government
has desired to bring Pillai Committee's recommendations in force latest with
effect by May 1978. The Chief Executives were, therefore, advised to take steps
to introduce the new scales of pay and allowances as per the Committee's report
and to make appropriate fitment in the emoluments of the existing officers with
effect from 1st May, 1978, or even earlier if so desired, after discussion with
the organisations representing the Officers. This letter further informed the
Chief Executives about the desire of the Government that all new appointments
on or after 1st May,
1978 should be on the
terms and conditions contained in the Pillai Committee report.
aforesaid communication was followed by a secret letter from the Joint
Secretary of the Ministry of Finance, Department of Economic Affairs (Banking
Division) dated March
28, 1978, mentioning
about the concern of the Govern- ment about the delay in the implementation of
the recommendations of the Pillai Committee. In view of this, the Banks were
advised by the Joint Secretary that if there is going to be delay in the total
implementation of the recommendations, immediate steps should be taken to bring
the new pay scales and allowances applicable to all new recruits and new promotees
from clerks to Officers cadre, pending fitment of the existing officers in the
letter contains some other advice also.
is in the aforesaid background that the Dena Bank (hereinafter the Bank)
offered to appoint the appellant, pursuant to his application , in the Bank as
Economic Officer in the pay scale 1 as laid down by the Pillai Committee, which
is Rs.700-1800, with other allowances, per- quisites and benefits as per the Pillai
Committee recommendations. This offer is dated 26th May 1978 and states that the present emoluments would be as under:-
Basic Pay Rs.700.00 Dearness Allowance Rs.311.00 ---------- Rs. 1011.00
appellant joined the Bank accordingly and after about 10 years of his service
approached the Madhya Pradesh High Court with the grievance that he had been
denied some increments in "Scale C" meant for Officers. He also
claimed for the first time about his fitment in the new pay scale a.,;
recommended by the Pillai Committee for "Scale C" Officers 635 who
were categorised as junior Management Grade Scale 1'Officers by the Committee.
The High Court dismissed the writ petition. Feeling aggrieved, this appeal has
There is no dispute that the appellant is entitled to the benefit conferred by
the report in question. Question is whether by fixing his basic pay at Rs.
700/- at the time of his appointment itself, the benefit has been made
available to him or not. The contention of the appellant is that though the
basic pay meant for Junior Management Grade Scale 1 Officer as recommended by Pillai
Committee man made available to him, the fitment of which mention has been made
in Dena Bank (Officers) Service Regulations, 1979 (hereinafter the Regulation)
has not been; and it is this claim of his which he is pursuing. The case of the
Bank on the other hand is that the appellant is not entitled to any fitment of
which mention has been made in para 8 of the Regulation inasmuch as question of
fitment can arise only for the existing Officers and not for new appointees
like the appellant. The further case of the Bank is that whatever was made
available by the Pillai Committee's report to incumbent like the appellant had
been given while offering appointment to him, as has been clearly stated in the
offer of appointment by which the appellant was made aware of the
recommendations which he had read and noted as endorsed by him in the offer of
appointment. To this the reply of the appellant is that if anything further is
due to him, same may not be denied on the slippery ground of estoppel, which
was also one of the reasons which had prevailed with the High Court in
dismissing the writ petition.
There can be no denial on the facts as noted above that though Pillai
Committee's recommendations were formally made effective from 1st July, 1979,
the same had come to be implemented with effect from 1st May 1978; and it is
because of this, that though the appellant's offer of appointment is dated 26th
May, 1978 his basic pay was stated as Rs.700/-, though in the advertisement,
which was published on 25/26 August, 1977 pursuant to which appellant had
applied, emolu- ments to be given were said to range from Rs. 325 to Rs.925/-.
So the only question left for our consideration, as already indicated, is
whether anything further is due to the appellant because of what has been
stated in para 8 of the Regulation relating to fitment.
According to us, the appellant is not entitled to any amount on this score for
the following reasons:-
The question of fitment can really arise only qua those officers who were in
the old scale of pay and which came to be revised pursuant to Pillai
Committee's Report, and not qua those who had already been given new pay scale,
as was the appellant.
Para 7 of the Regulation which deals with categorisation shows that Scale 'C'
post was placed in Junior Management Grade Scale 1. The appellant having been
put in the pay scale of Rs.700-1800, which as per the Report was meant for
Junior Management Grade Scale 1, there is sufficient force in the contention
advanced on behalf of the Bank in the written submissions field on 11. 1.95,
that the appellant was not holding the post in Scale 'C' on 1.7.79; and insofar
as he is concerned, this post has already been equated 636 with Junior Management
Grade Scale 1 at the time of his appointment.
The contention of the appellant as advanced in "Short Note of
Argument" submitted on 10. 1.95 that he was entitled not only to the pay
scale laid down by the Pillai Committee Report but benefits also (which word
has been emphasised) has no cutting edge inasmuch as perusal of the Report
shows that apart from the matter relating to the pay scale it dealt with
"Amenities, Facilities and Benefits in Kind" which formed subject
matter of Chapter 7 of the Report. So, the claim of fitment cannot be sustained
on the basis of what was recommended on the score of benefits in kind.
The decision of this Court in Shri Devenadra Management Trainees v. Punjab
National Bank, JT 1993 (6) SC 537, which has been referred in the aforesaid
note of the appellant in support of his submission, does not really advance his
case, because, as rightly mentioned in the written submissions on behalf of the
Bank, that case was different on facts.
the employees were not initially appointed in the regular pay scale as
recommended by the Pillai Committee Report but were given fixed emoluments of
Rs.700/-. It is because of this that they were ordered to be given the benefit
of the Pillai Committee Report. Facts here are quite different.
are, therefore, of the view that there is no merit in the contention of the
appellant that he is entitled to any higher emolument on the score of
'fitment'. But then the offer of appointment which was given to the appellant
shows that while fixing his emoluments, Dearness Allowance (DA) was mentioned
as Rs.311.50. We, however, find that DA, as per Chart 1 given in the booklet
titled "Pay Scales, Allowances and Perquisites of Officers in the Nationalised
Banks" issued by All India Confederation of Bank Officer's Organisations (Maharashtra
State Unit), of those officers whose basic pay is Rs.700 is required to be
Rs,450. If this was so as per the recommendations of the Pillai Committee, the
DA of the appellant would be required to be raised to Rs.450. The Bank would
verify this and do the needful within a period of two months from today by
passing a speaking order in this regard, a copy of which would be sent to the
appellant for his information.
Subject to the aforesaid observation relating to change in DA, the appeal is
dismissed. On the facts and circum- stances of the case, we however, make no
order as to costs.