Bombay High Court
Shri. Gajanan Dhotre vs Bank Of India And 2 Os on 27 October, 2016
Bench: Anoop V. Mohta
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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
WRIT PETITION NO. 1804 OF 2014
Shri Gajanan Dahotre
34, Pasarani, SBI Colony,
Patwardhan Baug, Erandawane,
Pune 411 004 .... Petitioner
vs
1 Bank of India,
Star House, C-5, "G"-Block,
Bandra-Kurla Complex,
Bandra (East), Mumbai 400 051
2 Dena Bank,
G Block, Bandra Kurla Complex,
Bandra East, C-10,
Mumbai 400 051
3 The Government of India,
Ministry of Finance,
Department of Financial Services
Banking Division,
3rd Floor, Jeevan Deep Building,
Sansad Marg,
New Delhi 110 001 .... Respondents
Mr. Sanjay Kher i/by Mr. Amit Ashok Gharte for the petitioner.
Lancy D'souza with Vishwambhar Mahadev Parkar for respondents 1
and 2.
Mr. H. V. Mehta with Mr. Ashok R. Varma for respondent No.3.
1/22
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CORAM: ANOOP V. MOHTA AND
G. S. KULKARNI, JJ.
CLOSED FOR ORDERS ON : October 20, 2016
PRONOUNCED ON : October 27, 2016
JUDGMENT (Per Anoop V. Mohta, J.):-
The Petitioner, who retired as Chairman and Managing
Director of Respondent No.1 Bank of India, has challenged impugned
order dated 7 January 2014, passed by Respondent No.1-Bank and
also seeks to quash and set aside Regulation 14 of the Bank of India
(Employees) Pension Regulations, 1995 and also prays for directions
to Respondent Nos. 1 and 3 to pay enhanced all pensionary benefits,
along with accrued interest in accordance with law.
2 The brief facts are as under:-
The Petitioner began his career as a Probationary Assistant
in the State Bank of India with effect from 1st July 1957. The
Petitioner thereafter served in various capacities with the State Bank
of India during the period June 1957 to December 1976. Whilst being
so employed with the State Bank of India (SBI), the Petitioner's rise in
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SBI was steady and rapid. By 1976, the Petitioner was the Chief
Officer (Merchant Banking Division) at SBI. The Petitioner joined
Respondent No. 1 bank in 1976. The Petitioner's rise in Respondent
No. 1 bank is stated as under:
On 19.03.1977, the Petitioner joined Respondent No. 1
bank as Chief Manager in its Merchant Banking Division. On
19.09.1978, Respondent No. 1 promoted the Petitioner as its Regional
Manager, Maharashtra Region (Pune). On 09.04.1979, Respondent
No. 1 promoted the Petitioner as its Assistant General Manager
(A.G.M). On 10.11.1980, Respondent No. 1 promoted the Petitioner
as its Deputy General Manager (D.G.M). On 19.06.1984, Respondent
No. 1 promoted the Petitioner as its General Manager. On 21.02.1986,
After serving at the post of General Manager for a period of 1 year and
6 months, the Petitioner was ordered by Respondent No. 3 to move
from his 'Career-Level' post and to assume 'Board-Level' charge as the
Whole Time Director of Respondent No. 2 Bank. On the day he was
promoted, Petitioner had served 8 years and 11 months in Respondent
No.1 bank, and was only 51 years old and still had another 7 years to
retire.
However, Respondent No.3 (despite being aware of the 10-years
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service eligibility requirement for payment of PF, Gratuity and Pension
exercised its Executive Powers over public sector banks, and ordered
the Petitioner to assume higher responsibility of a Director, in 'National
Interest'.
It is submitted that in accordance with Respondent No. 1's
Provident Fund, Gratuity and Pension Rules, upon being promoted to
'Board-level' position, an employee is 'deemed to have retired' from his
'career-level' post Respondent No. 1 bank. The Provident Fund,
Gratuity and Pension Rules further mandate that to qualify for
Provident Fund, Gratuity and Pension, an employee would have to
render a minimum of 10 years service in the bank as on the date of
retirement (the term retirement includes 'deemed retirement'). It is
submitted that on the date the Petitioner was 'deemed retired' from
Respondent No. 1 bank, the Petitioner had completed 8 years and 11
months in Respondent No. 1 bank and being only 51 years of age, still
had another 7 years to serve in Respondent No. 1 bank. However, it
was on the orders of Respondent No. 3 that the Petitioner was not
allowed to complete his 10 years eligibility requirement for Provident
Fund, Gratuity and Pension, and was asked to join Respondent No. 2
as its Whole Time Director in 'National Interest'. It is submitted that
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since Respondent No. 3 did not permit Petitioner to complete his 10-
year eligibility requirement for PR and Gratuity payment (Pension
scheme came later in 1995), Respondent No. 3 immediately waived
the 'deemed requirement' clause by condoning the short-fall and
ordering Respondent No. 1 to pay Provident Fund and Gratuity dues
to the Petitioner. Accordingly, Respondent No. 1, in June 1986, paid
Petitioner's PF and Gratuity.
As mentioned hereinabove, from 19.03.1977 till
21.02.1986, the Petitioner served with Respondent No. 1 at a 'Career-
Level' post. From 21.02.1986, the Petitioner was elevated to 'Board-
Level' post on the orders of Respondent No. 3 and his service record at
the 'Board-Level' post is as follows:-
On 03.03.1988, The Union Cabinet issued a notification
and approved the proposal to appoint the Petitioner as the Chairman
and Managing Director of Respondent No. 2. On 09.06.1988,
Respondent No. 3 issued a notification in the Official Gazette and
appointed the Petitioner as the Managing Director of the Respondent
No. 2 for a period of five years from his taking charge. On
09.06.1988, On the same date, Respondent No. 3 issued another
notification in the Official Gazette and appointed the Petitioner as
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Chairman of Respondent No. 2 for a period of five years from his
taking charge. On 15.01.1992, Respondent No. 3 appointed the
Petitioner as the Chairman and Managing Director of Respondent No.
1 bank. On 31.01.1995, Petitioner retired as Chairman and Managing
Director of Respondent No. 1 bank. On 31.01.1995, On the
Petitioner's retirement, Respondent No. 1 addressed a letter of
appreciation. On 02.02.1995, Respondent No. 3's Secretary addressed
a letter of appreciation to the Petitioner. Hence once again it can be
observed that the Petitioner's rise at the 'Board Level Posts' also
remained steady and constant.
3 A brief summary of the Petitioner's total service with
Respondent No. 3's public sector banks is as follows:-
Sr. Period of Bank Length of
No. Service service
1. July 1957 to State Bank of India About 20 years
December 1976 (Career level post)
2. March 1977 to Respondent No. 1 8 years and 11
February 1986 (Career level post) months
3. February 1986 Respondent No. 2 6 years
to February (Board level post)
4. February 1992 Respondent No. 1 2 years and 11
to January 1995 (Board level post) months
Total Service in Public Sector Banks 38 years
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On 29th September 1995 (notified date), The Bank of
India (Employees) Pension Regulations, 1995 (hereinafter referred to
as the said pension regulations) came into effect. These regulations
contained the same 10-year employment clause as in the Provident
Fund and Gratuity Rules. The Petitioner was not informed of these
Rules by Respondent No.2 bank.
4 On or around 24th August 2010, Respondent No. 1 issued a
circular stating that the option to join the Employees Pension Scheme
was extended to certain categories of employees. It is however
submitted that the Petitioner was not eligible to apply under the said
option.
However upon receiving a copy of the said circular, the
Petitioner began a correspondence with Respondent No. 1 in relation
to the release of his pension benefits. The Petitioner's efforts to secure
Pension are summarised hereunder:
5 On 14.03.2011, Petitioner addressed a letter to
Respondent no. 3, requesting for relaxation of the '10-years service'
requirement, as was earlier relaxed in 1986. Respondent No. 3 failed
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and neglected to give any reply. On 31.10.2011, Petitioner filed an
RTI application seeking a status on his pension payment issue. On
03.01.2012, Petitioner wrote to Respondent no. 3 requesting release of
pension. Respondent No. 3 failed and neglected to give any reply. On
07.01.2012, Respondent no. 1 replied to the RTI application and
reiterated the 10-year service rule, and further stated that the
Petitioner's case was recommended to Respondent no. 3 for their
decision. Respondent No. 3 failed and neglected to give any reply. On
23.01.2012, Respondent no. 1 wrote to Respondent No. 3
recommending payment of pension to Petitioner. Respondent No. 3
failed and neglected to give any reply. On 11.04.2012, Petitioner
received a letter from Respondent no. 1 informing him that
Respondent no.3 had extended pensionary benefits to whole-time
directors of nationalized bank ; however, the said benefit was
applicable only if "the whole-time Directors were otherwise eligible for
pension in their 'career post'. On 14.05.2012, Petitioner filed a formal
application exercising his right of pension, and requested Respondent
no. 1 that its Chairman and Managing Director was fully entitled to
pay the Petitioner's pension dues with approval of the Bank's Board of
Directors. Respondent No. 1 bank did not take any action to release
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Pension to the Petitioner. On 13.07.2012, Respondent no. 1 forwarded
the Petitioner's aforesaid application to the Reserve Bank of India.
Respondent No.1 requested the Reserve Bank to use their good offices
in extending the pension benefits to the Petitioner. It is submitted that
Respondent No. 1 has all along supported the Petitioner's stand until
issuance of the impugned letter. On 29.07.2012, The Petitioner once
again wrote to Respondent no.3 requesting release of pension
payment. Respondent No. 3 failed and neglected to give any reply. On
07.08.2012, Respondent No. 1 recommended to Respondent No. 3
that Petitioner's request for pensionary benefits should be considered
favorably. On 03.01.2013, The Petitioner addressed a letter to the
new chairman of Respondent No. 1 and requested her to look into the
issue of pension. On 09.01.2013, Respondent no. 1 informed the
Petitioner that his letter dated 22.09.2012 had been forwarded to
Respondent no.3 for favourable consideration. Respondent No. 3
failed and neglected to give any reply. On 29.01.2013, Respondent
no. 3 issued a departmental order extending the benefits of pension
for the combined service to officers of nationalized banks. On
22.10.2013, Petitioner once again wrote to Respondent no.1
requesting for release of pension. On 07.01.2014, Respondent No. 1
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issued the impugned letter and reiterated that the Petitioner was
ineligible for pension on account of the 10-year service rule. These
are the facts that have led to the filing of the present petition.
6 The Bank of India (Employees) Pension Regulations, 1995
made under the Banking Companies (Acquisition and Transfer of
Undertakings) Act, 1970 (for short, "the Banking Companies Act")
(clause (f) of subsection (2) of Section 19) govern the issue in
question. These Regulations are applicable to the employees who
were in service of the Bank on or after the first days of January 1986
but who had retired before the first day of November 1993, subject to
the condition for retired employees of refund within sixty days one
who exercise an option in writing within 120 days from the notified
date to become member of the Fund. The Regulations for qualifying
service for the benefits of this Pension Scheme are provided in Chapter
IV, clause 14.2 to 27. The basic clause is clause 14 which is
reproduced as under :
"14 Qualifying Service :-
Subject to the other conditions contained in these
regulations, an employee who has rendered a minimum
of ten years of service in the Bank on the date of his
retirement or the date on which he is deemed to have
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retired shall qualify for pension."
7 The Ministry of Finance, by communication dated 4 June
1986, on the request of the Petitioner regarding the payment of his
provident fund and gratuity dues from the Bank of India for the
service by him, has observed as under:-
"2. Government have examined the request of Shri
Dahotre as you are aware, Shri Dahotre has been
appointed as Executive Director of Dena Bank with affect
from 22.2.86 in public interest and his resignation from
Bank of India is therefore only technical in nature. It can
be safely assumed Shri Dahote would have continued to
serve Bank of India but his appointment as Executive
Director, Dena Bank. It would not therefore, be fair to
apply rigidly the norms in Bank of India in respect of
payment of provident fund dues and gratuity to Shri
Dahotre. Bank of India may therefore condone the
shortfall in the period of service put by Shri Dahotre in
the Bank of India and pay, provident fund and gratuity
dues at furates for the period of service of 8 years and 11
months rent by him in Bank of India. These dues may
however he paid to Shri. Dahotre in March, 1987, when
he would have completed 10 in Bank of India had be
continued in service in the bank, subject to the condition
that he does not cease to serve in a public sector bank till
that date."
8 The Respondent-Bank recommended the case of the
Petitioner favourably by recording in communication/letter dated
23.01.2012 as under :
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"4 Unfortunately, his request has been examined
technically by applying the rules prevailing at the
various Banks he served, instead of taking a broader
view about his service at the various Public Sector
Banks he served. He was denied pension by State
Bank of India as he had not served for a continuous
period of 30 years there. Similarly, in Bank of India,
where he joined laterally at a higher grade, he was
again denied retirement benefits as he served
continuously for eight years ten months and twenty
five days only, which incidentally is less than 10 years
of service required for being eligible for Provident
Fund as per Bank of India Provident Fund Regulation
(Pension was not applicable in Bank of India at that
time).
7 I understand that Government of India is
modifying the pension rules for Government
appointees, viz. Executive Directors and Chairman &
Managing Director of Public Sector Banks. I feel that
as Shri Dahotre had served the Public Sector Banks all
along and then retired as Chairman & Managing
Director of Bank of India after serving a total number
of about nine years as Executive Director and
Chairman, his representation for pension, as applicable
to Chairman & Managing Director, merits special
consideration.
8 I would, therefore, kindly request you that the
Government may kindly examine Shri Dahotre's
request in the right perspective to give him all the
pension benefits as applicable to Chairman of Public
Sector Banks. He may, therefore be allo0wed to
exercise the option of pension."
9 It is relevant to note that pursuant to the representation of
the Petitioner, the Respondent-Bank as in fact, by communication
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dated 7.8.2012 recommended the case of the Petitioner and in the
alternative sought permission so as to enable them to take suitable
decision. Para 6 of the communication is as under:-
"6 In the light of the aforesaid facts, it will be in all
fairness that Shri Dahotre's request for pensionary
benefits is considered favourably. However, if it is not
considered at the level of Ministry of Finance, I request
you to, please, permit the Board of Bank of India to
take a suitable decision in the matter."
10 The Petitioner is otherwise eligible for the qualifying
pension and all other related benefits, but denied for want of stated
minimum 10 years of service in the Bank. The regulation covers the
case of the Petitioner, but the Respondents, specifically Respondent
No.3, not accepting even the recommendations with justification
forwarded by the Respondent-Bank. The Petitioner was promoted to
the board level of Respondent No.3, since February 1986 till January
1995. The regulations in question were not in existence, earlier.
Now, in view of this, the objection and/or requirement of not
completing 10 years of service in career level post, the Petitioner has
been denied such benefits, even though he retired at board level post.
By this way, the Petitioner is not able to get any pension though he
opted in time as per the scheme, even after the retirement from the
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board level post. The situation so created was not taken care of by the
Respondents concerned, though provided all the retirement benefits
prior to 1995 itself. The Petitioner is not in position to change the
facts and those circumstances, when he was promoted and that
resulted into the denial of his pensionery benefits, though he worked
in all 38 years in these respective banks, since the year 1977 till
January 1995, for more than 18 years at both level. The earlier
service of 20 years at career level for 1977 to 1996 in erstwhile bank
is also relevant factor, which was overlooked. It is relevant to note
that the regulations in question are statutory regulations made under
the Banking Companies Act. The similar regulations are applicable
and/or made compulsory in all the banks. The Petitioner, though has
completed more than 10 years service in erstwhile bank, is not
entitled to get these benefits. The Petitioner, who has completed more
than 18 years of service in the Bank of India is also not entitled to get
the said benefits, though other similarly situated persons are getting
all the benefits.
11 The Petitioner has raised challenge to these relevant
regulations also. However, we are not touching the same, as in the
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peculiar facts and circumstances, we are of the view that the service of
erstwhile bank read with the service of the Petitioner at career level in
the bank in question, apart from the service at board level from the
year 1986 to 1995, in our view, need to be calculated for competing
minimum 10 years service at the stated career level post. The term
"deemed to have retired" may not be read in the facts and
circumstances to mean that the Petitioner has completed 8 years and
11 months service only in Bank of India. The rules, which are
applicable to the bank employees, who have completed more than 10
years service at the career level post, in the present facts and
circumstances, need to be extended to the Petitioner also. There is no
specific bar to overlook the career level post service, including of
erstwhile career level post. Even if there is some issue, still in the
peculiar facts and circumstances, we are inclined to observe that the
Petitioner is entitled to all the pensionary benefits by treating the
career level post service, which he has rendered, is admittedly more
than 10 years.
12 A person like the Petitioner, cannot be denied his
pensionary and all related benefits, though he has rendered 38 years
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service in the bank. The regulations in question, therefore, has
brought into force in the year 1995 and may be applicable to the
persons like the Petitioner who retired in 1995 by putting the rider
and/or denying the benefits to the person like the Petitioner, on the
ground of not completing 10 years of qualifying service, in the present
facts and circumstances, in our view, definitely cause great injustice
and hardship to the Petitioner. This amounts to denying the
pensionary beneifts, which conferred upon on the employee for his
unblemished career, such rights in our view, cannot be taken away by
such technicality by overlooking the totality of the facts and
circumstances of the case. The recommendations of the Respondent-
bank and the earlier benefits so granted to the Petitioner after his
retirement, in our view, Respondent No.3 ought to have accepted and
extended the benefits as asked for. If not, could have permitted the
Respondent Bank to take suitable decision in the matter. We have
noted that the bank, by communication dated 7 August 2012, itself
sought such permission. The Respondent bank, who is the employer
itself, has no objection to grant such benefits and extension of such
pensionary reliefs, in the facts and circumstances of the case and/or
could have grant any other similar benefits. The Respondent has
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denied the same, though the regulations of pension scheme applicable
to the Bank of India, at that time when he retired by completing 38
years of service in the Banking Industries.
13 We may note that the facts of the case clearly go to show
that in the nature of the appointment, which are made, all are in the
public sector banks. There is no dispute that the appointment of the
petitioner of February 1986 is at the instance of Respondent no.3. It
also cannot be denied that the appointment was in public interest and
for the national benefit. In this situation, it can be safely concluded
that the petitioner was not out of public service. The concept of public
service in the present context cannot be considered so narrowly so as
to mean service with Respondent No.1 of 8 years 11 months, when
the Petitioner had risen to the call of duty for the benefit of the
Government of India and termed with another nationalized bank.
Such public service in fact needs to be recognized than considered to
the disadvantage of the Petitioner in denying pension. If the
Petitioner was not to be appointed in February 1986 by Respondent
No.3, he would have continued in the service of Respondent No.3 and
would have become eligible for pension. In fact, when Respondent
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No.2 recommended to the Government of India that the Petitioner be
granted pension, it is this position of public service of the Petitioner
which is recognized. We are completely in agreement with the stand
of Respondent No.1. The undisputed finding in communication dated
4 June 1986 of Respondent No.3 regarding the provident fund and
gratuity further crystalized the case of the Petitioner, even for the
claim made in this Petition.
This Court, in Ramesh Gajanan Nigudkar Vs. Bank of
Baroda, Mumbai1, while considering the provisions of Articles 14 and
21 of the Constitution of India and the rights of pension, after
considering the Supreme Court Judgments, has observed as under:-
"29. In our above view, we find ourselves
supported by the decision of the Supreme Court in the
case of "Sashikala A. Devi v. Central Bank of India "
wherein in the context of entitlement of pension to a
bank employee who had voluntarily retired and was
entitled for pension, the Court held that pension not
being the bounty is a right acquired by an employee on
account of long years of sincere and good work. The
Court would be slow in presuming that the employee who
had assiduously acquired such a right to pension has
really given up the right. The intention can be
meticulously gathered from the various letters of the
petitioner seeking pension. The significance being
beneficial provision of a pension scheme/regulations are
1 2016(5) ABR 533
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required to be interpreted liberally so as to further the
object underlying such facility rather than denying the
benefits to the beneficiary. In para 17 and 18 the Court
thus observes:
........"
"33 Now coming to the next contention as urged
on behalf of the 1st respondent that the petition is barred
by delay or laches, we are not persuaded to accept the
same. Admittedly this is a case where after initial
rejection the petitioner had made representations. In the
facts and circumstances of the case the petitioner
expected that the 1st respondent would consider the
detailed representations as made by the petitioner. There
was a ray of hope in the heart of the petitioner that
fairness would prevail with the 1st respondent and
representations would bear fruits. It cannot be expected
that in each and every case a citizen and more
particularly a senior citizen and a pensioner should
resort to a legal action. The petitioner has approached
this Court after exhausting all remedies of
representations and after all his hopes stood frustrated
on account of his representations being mechanically
turned down by the 1st respondent and finally in March
2013. The petition was immediately filed thereafter. It is
settled principle of law that the issue of delay and laches
is required to be considered in the facts and
circumstances of each case. Considering the facts of the
present case the 1st respondent is not correct in asserting
that the petition is delayed or barred by laches."
14 Therefore, taking over all view of the matter, we are
inclined to observe that the case is made out by the Petitioner to grant
all the pensionary benefits, being otherwise eligible as per the
regulations and has already completed more than 10 years of service
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at career level post and also in view of the recommendations
forwarded/sent by Respondent No.1 bank to Respondent No.3. The
action of Respondent No.3, in our view, in the facts and
circumstances, is arbitrary, reflects non-application of mind to the
facts and circumstances of the case, apart from the law laid down by
the Hon'ble Supreme Court and this Court, so recorded above. The
Petitioner, in our view, is entitled for the pensionary and all related
reliefs as opted.
15 Resultantly, we pass the following order:-
ORDER
(a) The Writ Petition is allowed in terms of prayer (A),
except bracketed portion, which now would read
thus:-
"That this Hon'ble Court be pleased to issue a writ of
Certiorari or any other appropriate writ or order or
direction under Article 226 of the Constitution of India
and to call for the records of the entire matter vide
which the Petitioner has been denied his pension dues
and to go into the legality and propriety thereof and to
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(a) quash and set aside the said Impugned Order dated
7th January 2014 issued by Respondent No.1."
(b) The Writ Petition is also allowed in terms of prayer
(B), except bracketed portion, which now would read
thus:-
"That this Hon'ble Court be pleased to issue a writ of
mandamus or a writ in the nature of mandamus or any
other appropriate writ directing Respondent Nos. 1 and
3 to pay the Petitioner his pension (along with accrued
interest thereon) under the Bank of India (Employees)
Pension Regulations, 1995.
(c) Respondent Nos. 1 and 3 are directed to pay the
Petitioner his entire pension along with accrued
interest thereon under the Bank of India (Employees)
Pension Regulations, 1995 as the Petitioner is entitled
to the pension as claimed with all the related benefits
as per the regulations as treated to have completed
more than 10 years of service at requisite level.
(d) The Respondents are directed to grant pension and all
related benefits within two months from today with
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simple interest at the rate of 9 per cent per annum.
(e) There shall be no order as to costs.
The learned counsel appearing for Respondent No.3
submitted to stay the effect and operation of the order so pronounced
in the Court today. For the reasons already recorded, we are not
inclined to accept the said submission. The request for stay is
rejected.
(G. S. KULKARNI, J.) (ANOOP V. MOHTA, J.)
