Posted: 15 Oct 2015 01:53 AM PDT
We reproduce below article by Shri R.K. Pathak in light of recent judgement by Supreme Court in LIC Resignee case.
SUPREME COURT DISTINGUISH M R PRABHAKAR Vs CANARA BANK JUDGEMENT ON RESIGNATION
1) D. Malleshwar Rao Vs Andhra Bank
2) S. K Kool Vs Bank of Baroda
3) Smt. Shashikala Devi Vs Central Bank of India
4) Vijaya Bank Vs M Narsimhappa
Banks and IBA are not only denying lawful claims of Resignee [ Left Over Category] but also through battery of lawyers taking advantage of its own wrong and seeking judgments against financially weak litigants by suppressing the facts & also filing special leave petitions and review in the High Courts.
Banks and IBA are relying on UCO Bank Vs Sanwarmal, Canara Bank Vs M R Prabhakar judgments and with forceful argument from battery of lawyers made successful attempt to sideline the principle laid down in Sheel Kumar Jain Vs New India assurance Company.
The very good example of such attempt is reflected in the recent judgment of Delhi High Court in the matter of IDBI Bank Vs Roshan Lal Gupta [RSA 189 of 2010] dated 16/05/2014, wherein honorable Justice by allowing appeal of Bank madeoll following observations:-
“This judgment in the case of Anand Parkash Batra (supra) reads as under:-
“1. The issue to be decided in the present writ petition is the claim of the petitioner to pensionary benefits in accordance with the 1995 Pension Scheme of the respondent-bank. Respondent denies entitlement of the petitioner to the 1995 Pension Scheme on the ground that the scheme will not apply as per para 22 of the 1995 Pension Scheme when a person has resigned from service as distinguished from having voluntary retired.
2. Before this Court two judgments of the Supreme Court are cited. First is the judgment of Supreme Court in the case of Sheel Kumar Jain Vs. New India Assurance Company Limited & Ors. (2011) 12 SCC 197 on behalf of the petitioner, and the second is the judgment in the case of M.R.Prabhakar and ors VS. Canara Bank and ors (2012) 9 SCC 671 on behalf of the respondent-bank.
3. The ratio of the judgment in the case of Sheel Kumar (supra) shows that a Division Bench of two judges of the Supreme Court held that if an employee is not expected to know that in spite of serving a qualifying service period which would entitle grant of pension under a subsequent implemented pension scheme (which operates from a retrospective date) his resignation will lead to forfeiture of services, then, once an employee has otherwise completed the requisite period of qualifying service for grant of pension under the retrospectively operating pension scheme, the language of a resignation letter should not be treated as one seeking a resignation by the employee, but that letter should be treated as an application for voluntary retirement.
4. It is clear that in Sheel Kumar’s case (supra) a Division Bench of the Supreme Court took an equitable view because a person is not expected to know the adverse consequences against him unless so provided by the relevant rules and especially when benefits of pension scheme is given retrospectively whereby qualifying service completes many years earlier/ prior to the introduction of the pension scheme (i.e in the retrospective period) and in which period there would be persons who had ‘resigned’ but who on the date of resignation had otherwise completed the qualifying service period for grant of pension.
5. I must concede that my heart really is in accordance with the ratio in the case of Sheel Kumar’s case (supra). This is all the more so because in the counter-affidavit filed by the respondent-bank there is no reference to the earlier service rules of the respondent-bank that in such service rules prior to application of the 1995 Pension Scheme a distinction was in fact drawn between resignation and voluntary retirement. However, I am bound by the ratio in the case of M.R.Prabhakar’s case (supra) which distinguishes the judgment in Sheel Kumar’s case (supra) on the ground that the judgment in Sheel Kumar’s case (supra) dealt with the pension schemes of insurance companies and not the pension schemes of the banks, and that as per para 22 of the 1995 Pension Scheme of the Banks if a person had resigned there results forfeiture of his services and such a person is not entitled to benefits of 1995 Pension Scheme.
6(i)I must state that it is a moot point for consideration at an appropriate time by the Supreme Court that if a scheme operates retrospectively i.e it commences at a date for its implementation many years prior to the same being introduced, then surely an adverse consequence of denial of benefits of such retrospectively operating scheme should not be denied to an employee whose services come to an end in the retrospective period unless such employee was made aware of the adverse consequences. In this regard it bears note that it is held by the Supreme Court in a catena of judgments that terminal benefits are not a bounty but are natural entitlements which become due to an employee for the services rendered by the employee with the employer-organization. Therefo
(ii) A most important aspect for giving benefit of pension scheme is noted and stated by the Supreme Court in the case of UCO Bank Vs. Sanuwar Mal (2004) 4 SCC 412, as “The pension scheme herein is based on actuarial calculation; it is a self financing scheme, which does not depend budgetary support and consequently it constitutes a complete code by itself. The scheme essentially covers retires as the credit balance to their provident fund account is larger as compared to employees who resigned from service.” Thus, clearly there is a valid reason to treat resignation as retirement qua those employees who have at the time of resignation rendered the requisite qualifying service for grant of pension and they ought to be treated differently for being entitled to grant of pension under the scheme than those persons who on resignation have not completed the period of qualifying service inasmuch as the employee who renders the qualifying service has that much credit to his provident fund by which no budgetary support is required for payment of pension.
In the recent judgment ASGER IBRAHIM AMIN Vs LIFE INSURANCE CORPORATION OF INDIA , the issue before the supreme court was “The second issue which confronts us is whether the termination of service of the Appellant remains unalterably in the nature of resignation, with the consequence of disentitling him from availing of or migrating/mutating the pension scheme or whether it instead be viewed as a voluntary retirement or whether it requires to be regarded so in order to bestow this benefit on the Appellant; who had ‘resigned’ after reaching the age of fifty and after serving the LIC for over twenty three years”.
Further Court observed that:-
“12 What is unmistakably evident in the case at hand is that the Appellant
had worked continuously for over 20 years, that he sought to discontinue his services and requested waiver of three months notice in writing, and that the said notice was accepted by the Respondent Corporation and the Appellant was thereby allowed to discontinue his services. If one would examine Rule 31 of the Pension Rules juxtaposed with the aforementioned facts, it would at once be obvious and perceptible that the essential components of that Rule stand substantially fulfilled in the present case. In Sheelkumar, this Court was alive to the factum that each case calls for scrutiny on its own merits, but that such scrutiny should not be detached from the purpose and objective of the concerned statute.
13 The Appellant ought not to be deprived of pension benefits merely because he styled his termination of services as “resignation” or because there was no provision to retire voluntarily at that time. The commendable objective of the Pension Rule is to extend benefits to a class of people to tide over the crisis and vicissitudes of old age, and if there are some inconsistencies between the statutory provisions and the avowed objective of the statute so as to discriminate between the beneficiaries within the class, the end of justice obligates us to palliate the differences between the two and reconcile them as far as possible. We would be failing in our duty, if we go by the letter and not by the laudatory spirit of statutory provisions and the fundamental rights guaranteed under Article 14 of the Constitution of India.
14 Reserve Bank of India v. Cecil Dennis Solomon, (2004) 9 SCC 461 relied upon by the Respondent, although distinguishable on facts, has ventured to distinguish “voluntary retirement” from “resignation” in the following terms:
10. In service jurisprudence, the expressions “superannuation”, “voluntary retirement”, “compulsory retirement” and “resignation” convey different connotations. Voluntary retirement and resignation involve voluntary acts on the part of the employee to leave service. Though both involve voluntary acts, they operate differently. One of the basic distinctions is that in case of resignation it can be tendered at any time, but in the case of voluntary retirement, it can only be sought for after rendering prescribed period of qualifying service. Other fundamental distinction is that in case of the former, normally retiral benefits are denied but in case of the latter, the same is not denied. In case of the former, permission or notice is not
mandated, while in case of the latter, permission of the employer concerned is a requisite condition. Though resignation is a bilateral concept, and becomes effective on acceptance by the competent authority, yet the general rule can be displaced by express provisions to the contrary. In Punjab National Bank v. P.K. Mittal (1989 Supp (2) SCC 175) on interpretation of Regulation 20(2) of the Punjab National Bank Regulations, it was held that resignation would automatically take effect from the date specified in the notice as there was no provision for any acceptance or
rejection of the resignation by the employer. In Union of India v.Gopal Chandra Misra ((1978) 2 SCC 301) it was held in the case of a judge of the High Court having regard to Article 217 of the Constitution that he has a unilateral right or privilege to resign his office and his resignation becomes effective from the date which he, of his own volition, chooses. But where there is a provision empowering the employer not to accept the resignation, on certain circumstances e.g. pendency of disciplinary proceedings, the employer can exercise the power. (emphasis is ours)
The legal position deducible from the above observations further amplifies that the so-called resignation tendered by the Appellant was after satisfactorily serving the period of 20 years ordinarily qualifying or enabling voluntary retirement. Furthermore, while there was no compulsion to do so, a waiver of the three months notice period was granted by the Respondent Corporation. The State being a model employer should construe the provisions of a beneficial legislation in a way that extends the benefit to its employees, instead of curtailing it.
15 The cases of Shyam Babu Verma v. Union of India, (1994) 2 SCC 521;
State of M.P. v. Yogendra Shrivastava, (2010) 12 SCC 538; M.R. Prabhakar v. Canara Bank, (2012) 9 SCC 671; National Insurance Co. Ltd. v. Kirpal Singh, (2014) 5 SCC 189; UCO Bank v. Sanwar Mal, (2004) 4 SCC 412 relied upon by the parties are distinguishable on facts from the present case.
16 We thus hold that the termination of services of the Appellant, in essence,was voluntary retirement within the ambit of Rule 31 of the Pension Rules of 1995. The Appellant is entitled for pension, provided he fulfils the condition of refunding of the entire amount of the Corporation’s contribution to the Provident Fund along with interest accrued thereon as provided in the Pension Rules of 1995.
Click here to view/ download Supreme Court Judgement in LIC Resignee Case
Friday, October 16, 2015
(Reproduced from 'BANK PENSIONER'