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Chairman v. Pandyan Grama Bank Employees - WRIT APPEAL No.527 of 2005 [2007] RD-TN 2501 (26 July 2007)


DATED : 26.07.2007





WRIT APPEAL No.527 of 2005

The Chairman,

Pandyan Grama Bank,

31, Administrative Office,

Virudhunagar 626 001. ...Appellant Vs

Pandyan Grama Bank Employees Association (PGBEA), rep.by its President S.Kannan,

6, Pitchai Street,

Virudhunagar 626 001. ...Respondent Appeal against the order, dated 29.12.2004, made in W.P.No.18035 of 1999, on the file of this Court.

For appellant : Mr.N.G.R.Prasad For respondent : M/s.P.V.S.Giridhar Associates J U D G M E N T


Respondent association is a registered one, affiliated to the Bank Employees Federation of India. The appellant bank, namely, Pandyan Grama Bank, which is one of the Regional Rural Banks (RRBs), is functioning in various rural areas in Tamil Nadu. The said bank was established under a Special Statute, namely, Regional Rural Banks Act,1976. A good number of members in the respondent association were appointed by the said bank on 01.09.1982. The due date for their annual increment was 01.09.1983. However, as per the norms of the State Government in the year 1984, the date of increment was shifted to 01.07.1984. But, vide staff circular No.S-13/85, dated 20.03.1985, in order to avoid anomaly of pay scales between seniors and juniors, particularly for overcoming the juniors getting more pay than the seniors, the date of increment was shifted to IV quarter i.e., 01.10.1984 with retrospective effect and, hence, the staff were getting annual increment from 1984 till the year 1990, on 1st October every year.

2. As per the IV Pay Commission, new scales of pay were introduced with effect from 01.10.1984. Since the bank employees were not satisfied with the pay scales introduced by the State Government, they and other Regional Rural Bank Employees Association, in order to get pay equal to the pay drawn by the employees of their sponsor banks, filed writ petitions before the Hon'ble Supreme Court of India, wherein, on 01.09.1987, the Central Government was directed to constitute a National Industrial Tribunal, under the Industrial Disputes Act,1947, and to refer the dispute to it. Accordingly, the National Industrial Tribunal (NIT) was constituted for considering the demands of RRB employees. Thereafter, the NIT passed an award on 30.04.1990, holding that the employees of RRBs would be entitled to pay scales, allowances and other benefits, on par with the employees of comparable level in corresponding posts of sponsor banks w.e.f. 01.09.1987 and the above said award was accepted by the Government of India. The NIT also directed that the Government of India may decide the equation of posts and fixation of pay, in consultation with the authorities concerned. Consequently, the Government of India appointed an Equation Committee. The Equation Committee gave recommendations on the subject assigned to it and the Government of India also came forward to implement the recommendations of the said Committee. The Committee issued instructions to RRBs vide Circular No.11/3/99 -RRB-I & II, dated 22.02.1991, with reference to fixation of pay. The pay scales of bank staff underwent a metamorphic change, on implementation of the Equation Committee recommendations.

3. Adverting to the claim of the respondent, the association contends that its members were denied the benefit of annual increment on 01.10.1987 and the attendant monetary benefits available to them for the subsequent years. The management was under the impression that the anniversary of service should be counted and consideration of annual increment, as decided by the association, does not arise. Hence, the management sought for a clarification from NABARD. Thereafter, vide a letter, dated 05.07.1991, NABARD sent a letter, with clarification in the form of questions and answers to the Chairmen and Managing Directors of all the sponsor banks and the Chairmen of RRBs.

4. The main thrust of argument of the learned counsel for the respondent is that as per the recommendations of the Equation Committee and the instructions issued by NABARD, the management has not initiated any proceedings, to consider the welfare of its staff.

5. Mr.N.G.R.Prasad, learned counsel for the appellant/management would strenuously contend that the members of respondent association entertained a misconception in their minds and the pay fixation undertaken by the management as per the recommendations and instructions of the Committee and NABARD is well within its legal framework and it is futile to assail the same. He further contends that on the date of implementation of pay fixation i.e., 01.09.1987, the pay fixed was inclusive of increment due and no further fitment or increment need be granted and, further, even though RRB employees were getting increment on 1st October of every year, as per the norms prescribed by the State Government, by virtue of the award of the NIT and the recommendations of Equation Committee, the pay of employees of RRBs was restructured and uniformity was arrived at with the pay scales of the employees of sponsor banks, with reference to their period of service.

6. We find considerable force in the above said argument.

7. Conversely, it is contended by the learned counsel for the respondent that the management has miserably failed to properly implement the recommendations and directions contained in the award, in the case of awarding increment, fixing the cut-off date as 01.10.1987. It is his further contention that though the respondent association forwarded a representation to the management on 16.04.1999, seeking benefit of increment w.e.f. 01.10.1987 and they were assured with the desired result, the appellant management denied the representation, having been received.

8. For a better appreciation of the issue in question, it has become imperative on the part of this Court to extract the relevant portions of the letter, dated 22.02.1991, issued by Ministry of Finance, Department of Economic Affairs (Banking Division), New Delhi, addressed to the Chairman and Managing Directors of all sponsor banks and the Chairmen of all RRBs, and also the questions and answers in serial Nos.7 and 8 in the NIT award  Equation Committee recommendations, which are as under : "Fitment into new scales of pay as on 01-09-1987. 4. As regards fitment into new scales of pay as on 01-09-1987, the procedure is detailed in the following sub-paragraphs : (i) The fitment into the new scales of pay should be on the basis of protection of Pay. DA means Basic. PA, Dearness Pay, Dearness Allowance, Adhoc or Additional DA, interim relief or any such allowances which forms part of pay on DA. The fitment in the new scales of pay on the appointed date should be such that the Pay + DA in the new pay scale is fixed at stage in new pay scale. In case there is no such stage, the pay may be fixed at the next higher stage."

9. In order to protect the concept of seniority to the extent it is denoted by the higher salary drawn by senior employees and also to avoid clustering of many employees at the same stage, the following recommendations are found in the letter, dated 22.02.1991: ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Those who have less than 5 years : First stage in of service as on the appointed date : sponsor bank scales ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Those who have completed 5 years : Second stage in the of service as on the appointed date : sponsor bank scales ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Those who have completed 10 years : Third stage in the of service as on the appointed date : sponsor bank scales ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Note : The above fitment is the least. If, however, an employee comes under fitment in higher stage on the basis of his existing Pay + DA being equated with equal of next higher stage than what was being drawn as explained in paragraph 4 (i) of this circular, such higher fitment should be given. (iii) (b) If Employees/Officers at two or more running stages in the RRB scales are fitted at the same stage in the sponsor banks scales then those in the higher stages in RRBs scales be given annual increment on the anniversary of the appointed date. In other cases, the annual increment would be on the date of anniversary of their service in the respective cadres, subject to usual service conditions....."

10. In the annexure appended to the letter, dated 05.07.1991, containing clarifications from NABARD, serial nos. 7 and 8 are relevant for the subject, which have been culled out as follows : ========================================================================================= Sr.No. Issue Details Clarifications (1) (2) (3) (4) ========================================================================================= 7 Whether the officer/employee It was the intention of in the RRB who is being the Equation Committee fitted at the second or third thatno senior employee stage of the sponsor bank should draw less than the scale will automatically be junior employee. In case entitled to draw additional where personnel belonging increment on the appointed to 2 or 3 stages in RRB date even if there is no scales get clubbed in a officer/employee in the first single stage in the or second stage in a sponsor bank scales, particular RRB. the seniors in the RRB stages should get one increment on the appointed date itself. Hence, those who are fitted in the second and third stage in the sponsor bank scales directly need not always get fitment increment on the appointed date itself provided no junior is fitted in the same stage. An example for this is available on page 81 in the Equation Committee Report in respect of Messengers. However, if a number of officer/employees in different stages are going to 2nd or 3rd stage in sponsor bank scales, in such cases, the senior employees/officers are entitled for one fitment increment on the appointed date itself. The example for this is available on page 80 in respect of Field Supervisors in the Equation Committee Report, in this particular case 1 to 5 stage employees in RRB scales are to be fitted in the 1st stage case 1 to 5 stage employees in RRB scales are case 1 to 5 stage employees in RRB scales are to be fitted in the 1st stage of the sponsor bank scales. Hence, the employees in the stages 2,3,4,5 of the RRB scales are entitled for one fitment increment irrespective of whether there is any employee in the 1st stage of the RRB or not. - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 8 In case of additional In some States, The instructions issued increment as above under the State under Para 4 (iii) (b) becomes payable, then Government rules, of GOI circular dated whether other the date of 22-9-1991 stipulates Jr.officers/employees increment was that the annual increment in the clubbed stage changed to the date would be on the date would be drawing their of effect of of anniversary of their next annual increment increment in salary services in the on the existing due date. i.e., January of respective cadres each year for subject to usual officer/employee as service conditions. per the option This means that in such exercised by them cases the existing date for revised pay of annual increment and scales. not anniversary of the services shall be recommended for the purpose of annual increment. =========================================================================================

11. Going by the recommendations and the clarifications aforenoted, we are at a loss to find any deviation, in the process undertaken by the management. Pertinent it is to state that nowhere in the award of NIT, recommendations of the Equation Committee and clarifications from NABARD, it is stated that after working out the pay scales as on 01.09.1987, the annual increment has to be considered as on 01.10.1987. Hence, the writ petition was misconceived. The aim of constitution of NIT is to see that the employees serving in RRBs should get pay scales on par with their sponsor banks. The clarification of NABARD under question No.7 is unequivocal. It proceeds that in case where personnel belonging to 2 or 3 stages in RRBs get clubbed in a single stage in the sponsor bank scales, the seniors in RRBs should get one increment on the appointed date itself. Hence, those, who are fitted in second and third stages in the sponsor bank scales directly need not always get fitment increment on the appointed date itself, provided no junior is fitted in the same stage. So, it is made clear that as per the contention of the management, the fitment provided under the above said paragraphs 4 (iii) (a) in the letter, dated 22.02.1991, was inclusive of the increment due on the appointed date i.e., 01.09.1987. Therefore, there is no more scope to award a further increment on 01.10.1987. It is not known from where the respondent association has drawn the date of 01.10.1987. Probably, it might have been under the impression that prior to constitution of NIT, pursuant to the recommendations of IV Pay Commission, constituted by the State Government, the cut-off date was 01.10.1984, from when the recommendations were proposed to be implemented.

12. On a conspectus of all the materials placed before us, we are of the considered opinion that after the award of NIT, there is no concept of awarding increment, fixing the date as 1st October of every year. It is not the case of the respondent that the fitments contained in the recommendations of the Equation Committee were improper. In other words, the respondent has not assailed the propriety of the award, recommendations and clarifications, as adverted to supra. After due consideration, the aforesaid fitments were brought to force and all the beneficiaries, including the members of the respondent association and the staff of all RRBs concerned, derived the benefits. Hence, the request of the respondent association will not stand for a minute's scrutiny.

13. The next limb of contention of the management is that the writ petition suffers on the ground of laches. One of the points raised in the counter was that the pay of the clerks of RRBs were reworked as per the award of NIT and the revised fitment and the date of increment were advised to the said members of the respondent association on 22.04.1991 itself, but none of them moved their little finger to assail or object the fitment or equation of posts before any forum till 1999, when the writ petition was filed and, after a lapse of 8 years, the writ petition came to be filed. The said contention, in our view, merits consideration. Hence, the writ petition has to suffer dismissal, on the ground of laches.

14. In the affidavit of the respondent, it was stated that several representations, inclusive of the one dated 16.04.1999, were made to the management, but, nothing transpired, despite the assurance given by the brass of the management. However, the appellant management denies of having received any representation. The respondent association had not produced any copy of the alleged representation. The said association had been very well apprised of the contents of the letter, dated 22.02.1991, issued by the Ministry of Finance, with reference to the procedure to be adopted by the management when any representation was received. Para 17 of the said letter goes thus :

"If any representation is received from staff regarding refixation, the same may be referred to Government of India with full facts of the case and the comments of the RRB thereon in due course."

15. It is incumbent upon the management to refer any representation received from any staff to the Government of India, had it received the same. But, in this case, there is nothing to show that the respondent association had submitted a representation to the management.

16. In the light of the discussion made above, the appellant succeeds and the request of the respondent association deserves rejection. The finding of the learned single Judge that though the pay commission recommendation was adopted on 1st September,1987, the next annual increment would fall on 1st October,1987, and not on 1st September,1988, in our view, is not correct.

17. Writ Appeal is allowed and the order of the learned single Judge is set aside. No costs. Consequently, the connected W.A.M.P.No.977 of 2005 is closed. dixit


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