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K. Chelliah Vs. the Industrial Finance Corporation of India and anr. - Court Judgment

LegalCrystal Citation
SubjectService
CourtChennai High Court
Decided On
Reported in(1980)2MLJ206
AppellantK. Chelliah
RespondentThe Industrial Finance Corporation of India and anr.
Cases ReferredState of Uttar Pradesh v. Chandra Mohan
Excerpt:
- .....50 years of age on 3rd december, 1972, 55 years of age on 3rd december, 1977, and completes 30 years of service on 1st june, 1980, and attains 58 years of age on 3rd december, 1980 relying on an earlier decision of this court, in kanthimathi v. state of tamil nadu : (1979)2mlj316 , the learned counsel for the petitioner contended that in order to make a compulsory retirement under regulation 33(1) to be valid, the petitioner's case should have been sent to the review committee six months before he attained the age of 55 years and since in this case, as seen from the counter affidavit, though the review committee was constituted in may, 1977, the petitioner's name was sent to the review committee only on 8th september, 1977 and the review committee considered his case on 5th october,.....
Judgment:
ORDER

V. Ramaswami, J.

1. This is a petition for the issue of a writ of certiorari to quash the order of the respondents dated 17th October, 1977, compulsorily retiring the petitioner from service under Regulation 33 of the Staff Regulation of the Industrial Finance Corporation of India.

2. The petitioner was appointed as a clerk of the Industrial Finance Corporation of India, hereinafter called the Corporation by an appointment order dated 18th May, 19SO, issued by the Manager of the Corporation at Madras. He joined duty at the Madras Office of the Corporation on 1st June, 1950, He was promoted as Inspector in 1961. When he was due for promotion as Manager, there were certain disciplinary proceedings against him which ultimately ended in an order of dismissal in May, 1965. This order of dismissal was confirmed in appeal on 26th November, 1969. The petitioner questioned the validity of this order and prayed for a writ of certiorari in this Court in Writ Petition No. 1162 of 1970. This writ petition was allowed by this Court on 29th October, 1971 and the petitioner was ordered to be reinstated in service. Accordingly he, was reinstated in service but transferred to Calcutta on 17th February, 1972. Thereafter he served in a number of places in India and ultimately he was transferred to Cochin. While he was serving as Assistant Manager at Cochin, he was compulsorily retired under Regulation 33(1) of the Staff Regulations of the Corporation hereinafter called the Regulations with effect from 16th January, 1978. This order was served on the petitioner at his Madras address in West Mambalam, Madras. The order compulsorily retiring him from service reads as follows:

It has been decided to retire you from service of the Corporation in terms of Regulation 33(1) of the Staff Regulations of the Corporation. Accordingly, you are hereby given three months' notice from the date hereof, on the expiry of which, you will retire from the Corporation's service on Monday the 16th January, 1978(Afternoon). You are already on ordinary leave for 35 days from the 10th October 1977, to the 11th November 1977, If there is any further ordinary leave to your credit, you may avail yourself of the same from Tuesday the 17th January, 1978, in which case, you will be deemed to have retired from service of the Corporation on the expiry of such leave, in terms of Explanation II to Staff Regulation 33 referred to above.

Please acknowledge receipt.

3. The learned Counsel for the petitioner contended that the petitioner was born on 3rd December, 1922, and therefore he had completed 50 years of age on 3rd December, 1972, 55 years of age on 3rd December, 1977, and completes 30 years of service on 1st June, 1980, and attains 58 years of age on 3rd December, 1980 Relying on an earlier decision of this Court, in Kanthimathi v. State of Tamil Nadu : (1979)2MLJ316 , the learned Counsel for the petitioner contended that in order to make a compulsory retirement under Regulation 33(1) to be valid, the petitioner's case should have been sent to the Review Committee six months before he attained the age of 55 years and since in this case, as seen from the counter affidavit, though the Review Committee was constituted in May, 1977, the petitioner's name was sent to the Review Committee only on 8th September, 1977 and the Review Committee considered his case on 5th October, 1977, and since the Review Committee had not considered his case six months prior to 3rd December, 1977 when the petitioner had attained the age of 55, the provisions of Regulation 33 had not been complied with. It was further contended that this Court as also the Supreme Court in an earlier decision in State of Uttar Pradesh v. Chandra Mohan : (1978)ILLJ6SC , have held that the provisions relating to compulsory retirement have statutory force and non-compliance with the same would make the compulsory retirement itself illegal.

4. The question for consideration, therefore is whether the compulsory retirement in this case is in accordance with Regulation 33. Regulation 33 of the Corporation as it originally stood prior to 20th December, 1976 when it was substituted by a New Regulation 33 as per Administrative Circular No, 42 of 1976 of that date read as follows:

33. Superannuation and Retirement.--(1) An employee shall retire on completion of fifty-eight (58) years of age provided that the Corporation may at their discretion retire an employee on completion of 30 years of service or 55 years of age, whichever shall first happen. For Class IV employees the age of compulsory retirement shall be 60 years. Such option shall also be available to an employee to retire-from the service of the Corporation after he completes 30 years of service, or attains the age of 55 years.

(2) The power conferred by Sub-Regulation (1) to retire an employee on the completion of 30 years of service or 55 years of age shall be exercisable by the Chairman; in the case of officers in Class I, prior approval of the Board shall be necessary.

Explanation I.--For the purpose of this Regulation, service shall not include any period of service rendered by an employee before attaining the age of 21 years.

Explanation II.--Notwithstanding anything contained in this Regulation, where an employee has ordinary leave earned but not availed of as on the date of retirement as prescribed in the above Regulation, he may be permitted to avail of the leave subject to a maximum of 6 months in respect of leave earned under these Regulations and in that case the employee will be deemed to retire from service at the expiry of the leave.

(3) Where an employee is re-employed in the Corporation's service or is permitted to be employed outside the Corporation while he is on leave preparatory to retirement he may be required or permitted to avail of such leave or any part thereof immediately after he ceases to be so employed but the period during which he is so employed shall not--

(i) if the re-employment is in the Corporation's service, count for any purpose as service or duty in relation to his previous employment in the Corporation except to the extent provided for in the terms of re-employment.

(ii) if the employment is outside the Corporation, count for any purpose as service or duty in the Corporation except for purposes of Regulation 130 and Chapter IV of these Regulations.

The Regulation as substituted by the said Administrative Circular in force from 20th December, 1976 read as follows:

33. Superannuation and Retirement.--(1) An employee, other than an employee, in Class IV, shall retire on completion of fifty-eight (58) years of age, whereas an employee in Class IV, shall retire when he attains the age of 60 years. The Corporation shall, however have absolute right to retire an employee, if it considers necessary to do so in the interests of the Corporation, by giving him notice of not less than three months in writing, on completion of 30 years of service or 50 years of age, whichever shall first happen, or at any time thereafter. Such option to retire from the service shall also be available to an employee, in any class, after he completes 30 years of service or attains the age of 55 years, by giving three months notice in writing to the competent authority.

(2) The power conferred by Sub-Regulation (1) to retire an employee on completion of 30 years of service or on attaining the age of 50 years, or at any time thereafter, shall be exercisable by the Chairman; in the case of officers in Class I, prior approval of the Board shall be necessary.

Explanation-I.--For the purpose of this Regulation, service shall not include any period of service rendered by an employee before attaining the age of 21 years.

Explanation-II.--Notwithstanding anything contained in this Regulation, where an employee has ordinary leave earned but not availed of as on the date of retirement as prescribed in the above Regulation, he may be permitted to avail of the leave subject to a maximum of 6 months in respect of leave earned under these Regulations and in that case the employee will be deemed to retire from service at the expiry of the leave.

Explanation-III.--In order to implement the power to retire an employee as mentioned in Sub-Regulation (1) above, the Corporation shall review the cases of such employees six months before they attain the age of 50 years and 55 years or before they complete 30 years of service for which purpose special review committee shall be constituted by the Chairman for making recommendations in the matter.

(3) Where an employee is re-employed in the Corporation's service or is permitted to be employed outside the Corporation while he is on leave preparatory to retirement he may be required or permitted to avail of such leave or any part thereof immediately after he ceases to be so employed but the period during which he is so employed shall not....

(i) if the re-employment is in the Corporation's service, count for any purpose as service or duty in relation to his previous employment in the Corporation except to the extent provided for in the terms of re-employment.

(ii) If the employment is outside the Corporation, count for any purpose as service or duty in the Corporation except for purposes of Regulation 130 and Chapter IV of those Regulations.

While Sub-Regulation (1) of Regulation 33 conferred a power on the Corporation to retire an employee before the normal superannuation, Explanation III provided the procedure to be followed in compulsorily retiring a person. But the procedure prescribed refers to retiring a person at the age of 55 while no substantive power is given to retire an employee at the age of 55 under Sub-Regulation (1). 1, therefore, called for the files relating to the Administrative Circular No. 42 of 1976 in order to find out the real intention of Regulation 33.

5. We have seen already that the original Regulation provided a power for compulsorily retiring an employee on the completing 30 years of service or 55 years of age, whichever shall first happen. That was the only occasion on which the original Regulation enabled the Corporation to compulsorily retire an employee. It appears that the Government of India sent a communication to the Corporation intimating that the Government have taken a policy decision to bring the public sector banks and financial institutions in line with the general practice obtaining in Government regarding the age of retirement. They also informed the Corporation that under the rules applicable to Class land Class II officers of the Government, the Government have absolute right to retire them, if it is necessary to do so in public interest, from Government service by giving them three months' notice after they attained the age of 50 years and again after they attain the age of 55 years and also after they completed 30 years of qualifying service for pension, The Government also further pointed out that this procedure was followed by Government with a view to weeding out those officers who are keeping indifferent health and who also prove to be inefficient and whose integrity is not beyond reproach. The Board of Directors of the Corporation considered this suggestion of the Government in their meeting held on 26th June, 1976, and decided to amend the Regulation accepting the suggestion of the Government But while amending the Regulation, due to careless drafting, the intention has not been given full effect. As may be seen from the substituted Regulation, it speaks of compulsory retirement of a person on completion of 30 years of service or on his attaining 50 years of age, whichever shall first happen. Under Explanation I, for the purpose of this Regulation, service shall not include any period of service rendered by an employee before attaining the age of 21 years. Therefore no employee could complete 30 years of service before he attained the age of 51 years. We cannot accordingly give any meaning to the words 'whichever shall first happen' in the two categories of cases of persons completing 30 years of service or attaining 50 years of age, because a person could complete 30 years of service only when he attained the age of 51 years. The words 'whichever shall first happen' will always mean therefore on completion of 50 years of age. The intention as seen from the file, appears to be to consider the case of an employee at three stage, once when he attains the age of 50 years or 30 years of service whichever is earlier, and the third occasion is at any time after he completes 55 years of age or 30 years of service. It is possible for a person to complete 30 years of service before he attains the age of 55 years and therefore, in the original Regulation which was not intended to be changed by the subsequent amendment it was provided that the Corporation may at their discretion retire an employee on completion of 30 years of service or 55 years of age, whichever shall first happen. That should have been the second occasion when the case of an employee could have been considered. The third occasion is, even if he is retained after 55 years of age or 30 years of service, the case of an employee should have been considered before he is superannuated. But the intention has not been given effect to in the Regulation and we cannot now read into the Regulation anything which is not found there. I may also mention that even in the Rules relating to Government servants where a Government servant's superannuating age is 58 years, there are three stages at which the compulsory retirement should be considered, at the first stage when he attains the age of 50 years, at the second stage when he attains the age of 55 years and at the third stage at any time after he attains the age of 55 years but before retirement. But so far as the third category is concerned, the Rules specifically provide under what circumstances a person can be compulsorily retired if he is to be retired after 55 years. So far as the retirement of a person at the age of 50 or 55 years is concerned, the Government need consider only whether it is in the public interest to retire him and the concerned Government servant will have no right to question that order except on ground of mala fides or under other circumstances which may warrant interference, as decided by Courts.

6. As already stated, we have now to interpret the Regulation and see whether the impugned order could be brought under any of the categories mentioned in the Regulation. The first category as already stated is on completion of 30 years of service or on attaining 50 years of age whichever shall first happen. Whatever that may mean, since that is not the occasion on which the petitioner is sought to be compulsorily retired, that need not detain us any further. The Corporation is also given power to retire a person at any time thereafter. That means at any time after his attaining 50 years of age or his completing 30 years of service. But the procedure prescribed under the Explanation does not cover a case of compulsory retirement after attaining 50 years of age or completing 30 years of service whichever is earlier. The learned Counsel for the petitioner contended that the reference to attaining 55 years of age in the Explanation should be taken as giving a clue that there is a power to retire a person even at the age of 55 years of age and if the Corporation seeks to retire a person on attaining 55 years of age, the Corporation should follow the procedure prescribed under the Explanation. Learned Counsel then contended that in this case, though the order, in terms, stated that the petitioner was sought to be retired from service with effect from 16th January, 1978, from the counter-affidavit it is clear that the respondents wanted to retire him on completing the age of 55 years and that therefore, since admittedly the Review Committee did not consider the case of the petitioner six months prior to his attaining the age of 55 years, the order should be held to be illegal. I cannot agree with this contention of the learned Counsel, Explanation III gives the procedure prescribed in order to implement the power to retire an employee as mentioned in Sub-Regulation (1). If in terms Sub-Regulation (1) does not provide for such a power to retire an employee at the age of 55, though as already stated, the files show that the Government wanted to retire a person at the age of 55, but it had not been given effect to, we cannot imply any power to retire an employee at the age of 55 in the absence of a specific provision under sub-Regulation (1). A Regulation, as that of Regulation 33, will have to be strictly complied with and unless specific words conferring power to compulsorily retire a person are there we cannot imply any power to retire compulsorily. It therefore follows that though a power to retire a person at any time after attaining 50 years of age is conferred under Sub-Regulation (1) of Regulation 33, there is no specific procedure prescribed. Accordingly each case probably will have to be decided on its own merits.

7. In this case, the admitted facts are that the Corporation referred the petitioner's case to the Review Committee and the Review Committee considered and passed a resolution to recommend a compulsory retirement. The Chairman of the Corporation who is the competent authority, on the basis of the records available and on the recommendations of the Review Committee, considered that it was in the interest of the Corporation that the petitioner should be retired with effect from 16th January, 1978 and in those circumstances it cannot be stated that the power was either arbitrarily exercised or that it could not be said to be in the interest of the Corporation. Further, whether the interest of the Corporation required a compulsory retirement of the concerned employee is a question for the Chairman of the Corporation to consider and this Court cannot sit in judgment over his decision. It was his subjective satisfaction, so to say, which is not open to objective scrutiny in proceedings under Article 226 of the Constitution of India. Since the validity of the Regulation itself is not in question and since the order compulsorily retiring the petitioner is in accordance with the existing Regulation, I could not interfere with order in proceedings under Article 226 of the Constitution. Since even on merits the writ petition is liable to be dismissed, it is not necessary for me to decide whether this Court has no jurisdiction in this case under Article 226.

8. The writ petition accordingly fails and it is dismissed. But there will be no order as to costs.


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