Murari Sinha Vs. Project & Development India Ltd. & Anr  Insc 131
(13 March 2002)
Phukan & P. Venkatarama Reddi Phukan, J.
this appeal by special leave the appellant has assailed the judgment dated
21-06-1999 passed by the Patna High Court in LPA No.57 of 1999 (R). By the
impugned judgment the Division Bench affirmed the judgment of the learned
Single Judge dated 03-02-1999 passed in CWJC No.2970 of 1997 (R).
appellant joined the respondent-company as a Draftsman Trainee in the year 1964
and was promoted to the post of General Foreman (Electrical). On October 12, 1995, the respondent-company issued an
improved Voluntary Retirement Scheme (for short 'VRS') giving more benefits to
the employees, which was effective from 12the October, 1995 to 18th October, 1995.
appellant applied for voluntary retirement on 18th October, 1995 under the scheme, which was accepted by the Management on 30th July, 1997 with the condition that 'the
release memo along with details particulars will follow'. On August 07, 1997, the appellant sent a letter
withdrawing his option from the VRS by registered post but no response was
received by him from the respondents.
on September 27, 1997 another letter was sent by the
appellant withdrawing his option from the scheme. This letter was received on 25th September, 1997 but there was no reply from the
respondent. The respondent- company issued a memorandum on 25th September, 1997 releasing the appellant from the
service of the company w.e.f. 26th September, 1997 (afternoon). The appellant filed a petition under Article 226 of the
Constitution before the High Court challenging the said release order, which
was dismissed by the learned Single Judge and it was upheld by the impugned
judgment. That is how the matter is before us.
appeal came up for final hearing before a Division Bench of this Court and by
order dated April 13, 2000, the appeal was allowed on the reasoning that the
appellant was not relieved from service and was allowed to continue in service
till 26-09-1997, which, for all practical purpose would be the "effective
date" as it was on this date that he was relieved from service. As the
appellant had already withdrawn the offer from VRS on 07-08-1997, the
resignation in spite of its acceptance could be withdrawn before the said
"effective date" and, therefore, such withdrawal was valid in law
[See Shambhu Murari Sinha versus Project & Development India & Another
(2000) 5 SCC 621]. The Division Bench relied on the following decisions of this
Court namely, Balram Gupta versus Union of India [(1987) Supp. SCC 228], J.N. Srivastava
versus Union of India [(1998) 9 SCC 559] and Power Finance Corpn. Ltd. versus Pramod
Kumar Bhatia [(1997) 4 SCC 280].
Review Petition was filed by the respondents which was allowed by another
Division Bench of this Court and the order is extracted below:- "Delay
counsel for the parties.
find that the scheme providing for voluntary retirement of employees, prima
facie, discloses that once an option to voluntary retire is exercised by an
employee and the same is accepted by the employer, the employee is not entitled
to withdraw the voluntary retirement. The said scheme which has bearing on the
case was not adverted to while deciding this appeal.
the decision of this Court in Balram Gupta vs. Union of India & Anr. 1987
(Supp.) SCC 228, Raj Kumar vs. Union of India, 1968 (3) SCR 857 and Union of
India vs. Gopal Chandra Mishra, 1978 (2) SCC 301 which are applicable to this
case were not considered while deciding the appeal. Moreover, the decision
under review is likely to affect a large number of employees.
are, therefore, of the opinion that the judgment under review deserves to be
reviewed. We, therefore, set aside the judgment dated 13.4.2000 and restore the
appeal to its original number. The Review Petition is thus allowed. Let this
appeal be posted for hearing.
view of the decision on Review Petition, the Contempt Petition is
rejected." We have perused the whole scheme and we do not find any
condition that once an option to voluntary retire is exercised by an employee
and the same is accepted by the employer, the employee is not entitled to
withdraw from voluntary retirement. This position is accepted at the Bar. While
allowing the appeal, the Division Bench of High Court in fact considered the
ratio laid down in Balram Gupta's case (supra).
short question to be decided is what was the effective date in the case in
hand, before which the appellant could have withdrawn his offer of the voluntary
retirement under the scheme.
only contention raised before us by the learned counsel for the appellant is
that in view of the law laid down by this Court since 1978, the appellant was
within his right to withdraw his option for voluntary retirement even after its
acceptance but before the actual date of release from the employment.
support of this contention learned counsel has placed before us various
decisions of this Court.
contra, the learned counsel for the respondent has contended that from the date
of acceptance of the letter of voluntary retirement by the respondent, the
relationship of employer and employee came to an end and, therefore, the
appellant ceased to be an employee of the respondent w.e.f. 30th July, 1997. Learned counsel also sought to
raise the question of financial burden on the respondent-company, which we need
not consider while deciding the legal issue involved in the present appeal.
Constitution Bench of this Court in Union of India & Others versus Gopal
Chandra Misra & Others [(1978) 2 SCC 301] in paragraph 50 held that the
general principle is that in the absence of a legal, contractual or
constitutional bar, a 'prospective' resignation can be withdrawn at any time
before it becomes effective, and 'it becomes effective when it operates to
terminate the employment or the office-tenure of the resignor.' (emphasis ours)
As stated above in the present case in the VRS, there was no indication
regarding effective date of voluntary resignation and there is also no condition
that once it was accepted it could not be withdrawn.
Gupta versus Union of India & Anr. [(1987) Supp.
SCC 228] the principle laid down in Gopal Chandra Misra (supra) was summarised
as follows:- "A complete and effective act of resigning office is one
which severs the link of the resignor with his office and terminates his
tenure." In Balram Gupta's case, the appellant-employee offered to
voluntary retire from service w.e.f.31st March, 1981 and accordingly sent a
letter within the notice period. However, he changed his mind and sent a letter
on 31.01.1981 seeking to withdraw his notice of voluntary retirement but the
request was disallowed by the concerned authority on the ground that the
withdrawal of notice could only be with the specific approval of the authority.
This Court held that the dissolution of the contract of employment would be
brought about only on the date indicated i.e.31.03.1981 and upto that date the
appellant continued as Government employee. He is at liberty to withdraw his notice
of voluntary retirement and for this purpose, prior approval is not required.
decision in J.N. Srivastava versus Union of India [(1998) 9 SCC 559] is also to
the same effect. This Court held as follows:- "It is now well settled that
even if the voluntary retirement notice is moved by an employee and gets
accepted by the authority within the time fixed, before the date of retirement
is reached, the employee has locus poenitentiae to withdraw the proposal for
voluntary retirement. The said view has been taken by a Bench of this Court in
the case of Balram Gupta versus Union of India." In Nand Keshwar Prasad
versus Indian Farmers Fertilizers Cooperative Ltd. & Ors. [(1998) 5 SCC
461], in paragraph 11, this Court reiterated that it is open to the employee
concerned to withdraw letter of resignation before the date indicated in the
notice of voluntary retirement. It was also observed therein:
appears to us that the law is well settled by this Court in a number of
decisions that unless controlled by condition of service or the statutory
provisions, the retirement mentioned in the letter of resignation must take
effect from the date mentioned therein and such date cannot be advanced by
accepting the resignation from an earlier date when the employee concerned did
not intend to retire from such earlier date." In Raj Kumar versus Union of
India [(1968) 3 SCR 857] the normal rule has been stated as follows:-
"When a public servant invited by a letter of his resignation
determination of his employment, his service normally stands terminated from
the date on which the letter of resignation is accepted by the appropriate
authority and in the absence of any law or rule governing the conditions of his
service to the contrary it will not be open to the public servant to withdraw
his resignation after it is accepted by the appropriate authority in consonance
with the rules governing the acceptance, the public servant concerned has locus
poenitentiae but not thereafter." The above cases may not have direct
application to the facts of the present case, however, the principles laid down
therein deserve notice.
Power Finance Corporation Ltd. versus Pramod Kumar Bhatia [(1997) 4 SCC 280]
this Court went a step further and observed thus:- "It is now settled
legal position that unless the employee is relieved of the duty, after
acceptance of the offer of voluntary retirement or resignation, jural
relationship of the employee and the employer does not come to an end." It
was pointed out in that case that the acceptance of voluntary retirement was
not unconditional and before the conditions could be complied with, the
employee could withdraw from the scheme. On those facts, the above observations
were made. It is not necessary to consider whether in all cases, actual relief
becomes the crucial date. However, the ratio of decision in Balram Gupta's case
coupled with the observations of the Constitution Bench in Gopal Chandra Misra's
case (underlined above) could usefully applied to the present case.
to the case in hand the letter of acceptance was a conditional one inasmuch as
though option of the appellant for the voluntary retirement under the scheme
was accepted but it was stated that the 'release memo along with detailed
particulars would follow'. Before the appellant was actually released from the
service, he withdrew his option for voluntary retirement by sending two letters
dated August 07, 1997 and September 24, 1997, but there was no response from the respondent. By office
memorandum dated 25th
September, 1997, the
appellant was released from the service and that too from the next day. It is
not disputed that the appellant was paid his salaries etc. till his date of
actual release i.e. 26 September, 1997, and, therefore, the jural relationship
of employee and employer between the appellant and the respondents did not come
to an end on the date of acceptance of the voluntary retirement and said
relationship continued till 26th of September, 1997. The appellant admittedly
sent two letters withdrawing his voluntary retirement before his actual date of
release from service. Therefore, in view of the settled position of the law and
the terms of the letter of acceptance, the appellant had locus poenitentiae to
withdraw his proposal for voluntary retirement before the relationship of
employer and employee came to an end.
therefore, hold that the respondent could not have refused to accept the
resignation of the appellant as it was sent before the jural relationship of
employee and employer came to an end. Consequently, the impugned judgment is
liable to be set aside, which we hereby do. The appellant shall be entitled to
rejoin his duty and he shall be paid all his salaries and other benefits during
the period he was out from the service. The learned counsel for the respondent
has stated that by this time the appellant might have retired from service on
attaining the age of superannuation, if that be so, he shall be paid full
salary and allowances for the entire period he was out of service till the date
of his retirement and thereafter, he shall be entitled to get all retiral
benefits counting the above period as if he was in service.
therefore, allow the appeal by setting aside the impugned judgment. We leave
the parties to bear their own cost.