Gujarat High Court
Ramesh Ramcharan Upadhyay vs The Ahmedabad Municipal ... on 13 October, 2022
Bench: Biren Vaishnav
C/SCA/1629/2022 CAV JUDGMENT DATED: 13/10/2022
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 1629 of 2022
With
R/SPECIAL CIVIL APPLICATION NO. 7769 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1667 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1664 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1641 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1640 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1666 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1668 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1654 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1637 of 2022
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CIVIL APPLICATION (FOR BRINGING HEIRS) NO. 1 of 2022
In R/SPECIAL CIVIL APPLICATION NO. 1637 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1638 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1657 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1670 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1686 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1642 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1685 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1630 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1671 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1639 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1689 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1687 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1631 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1635 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1673 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1636 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1644 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1682 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1684 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1645 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1681 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1650 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1656 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1633 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1634 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1661 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1674 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1660 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1663 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1659 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1652 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1678 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1648 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1680 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1677 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1655 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1632 of 2022
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R/SPECIAL CIVIL APPLICATION NO. 1675 of 2022
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE BIREN VAISHNAV
==========================================================
1 Whether Reporters of Local Papers may be allowed
to see the judgment ?
2 To be referred to the Reporter or not ?
3 Whether their Lordships wish to see the fair copy
of the judgment ?
4 Whether this case involves a substantial question
of law as to the interpretation of the Constitution
of India or any order made thereunder ?
==========================================================
RAMESH RAMCHARAN UPADHYAY
Versus
THE AHMEDABAD MUNICIPAL CORPORATION
==========================================================
Appearance:
MR.SHALIN MEHTA, LD. SENIOR ADVOCATE with MR.HEMANG SHAH,
ADVOCATE for the Petitioner(s) in SCA NO.7769 OF 2022
MR.PRABHAKAR UPADHYAY, ADVOCATE with MR.AAKASH D
MODI(7449) for the Petitioner(s) IN SCA NO.1629 of 2022 and allied matters
MR.KAMAL TRIVEDI, LD. SENIOR ADVOCATE, with MR ANUJ K TRIVEDI
with MR VAIBHAV GOSWAMI, (6251) for the Respondent(s) No. 1,2
MS E.SHAILAJA(2671) for the Respondent(s) No. 3
==========================================================
CORAM:HONOURABLE MR. JUSTICE BIREN VAISHNAV
Date : 13/10/2022
CAV JUDGMENT
C/SCA/1629/2022 CAV JUDGMENT DATED: 13/10/2022
1. All these petitions have been filed by the
employees working in the Central Workshop of
the Ahmedabad Municipal Corporation those
who joined service with the Corporation after
01.01.1983. They have been or they are the
employees of the Municipal Corporation.
2. Special Civil Application Nos.1629 of 2022 and
Special Civil Application Nos.7769 of 2022 were
argued as lead matters. The prayers in Special
Civil Application Nos.1629 of 2022 read as
under:
"(A) Your Lordships may kindly be
pleased to issue a Writ of Mandamus
and/or any other appropriate writ,
order or direction to direct the
respondents to grant the benefits of
General Provident Fund Scheme (Old
Pension Scheme) of the Ahmedabad
Municipal Corporation to the present
petitioner, which is at Annexure-E
(Colly.) to this petition.
(B) Your Lordships my kindly be
pleased to direct the present
C/SCA/1629/2022 CAV JUDGMENT DATED: 13/10/2022
respondent Corporation to complete all
administrative formalities in pursuance
to the judgment dated 17.10.2016
passed by this Hon'ble Court in Special
Civil Application No.3711 of 2014 and
other allied matters for completion of
the process required as per the
provisions of the EPF Act, 1952 and
EPF Scheme, 1952, for exemption from
applicability of the EPF Act, 1952."
3. The prayers in Special Civil Application Nos.7769
of 2022 read as under:
"(a) Your Lordships may be pleased to
issue a writ of mandamus commanding
respondent no. 1 to grant the benefit of
the pension scheme as framed by for
the petitioners;
(b) Your Lordships may be pleased to
issue a writ of mandamus commanding
respondents no. 1 and 2 to comply with
the directions issued by this Hon'ble
Court vide CAV judgment dated
17.10.2016 passed by this Hon'ble
Court in Special Civil Application
No.3711/14 and cognate matters
(c) Your Lordships may be pleased to
issue a writ of mandamus commanding
respondent's no. 1 and 2 to submit an
application to respondent no. 3 for
seeking exemption under section 16 or
17 of Employees Provident Fund &
C/SCA/1629/2022 CAV JUDGMENT DATED: 13/10/2022
Miscellaneous Provisions Act, 1952 and
thereby establish a "Trust" for
managing the funds of the petitioners
from which pension would be paid to
them;"
4. Facts in brief indicate that a central workshop of
the corporation existed under the Corporation
which was an independent and a distinct
establishment registered under the Factories
Act, 1948, dealing with activities of purchase,
repairs and maintenance of vehicles of the
corporation. The employees of the workshop
were governed by the Employees' Provident
Fund Scheme, 1952. The rest of the employees
of the corporation were governed by the
Contributory Provident Fund Scheme.
4.1 On 10.06.1983, a proposal was introduced
relating to the General Provident Fund Scheme
with effect from 01.01.1983 indicating that those
C/SCA/1629/2022 CAV JUDGMENT DATED: 13/10/2022
employees covered by the CPF scheme and who
are in employment with the Corporation with
effect from 01.01.1983 then opt for GPF scheme.
A resolution was passed by the Standing
Committee accepting the proposal to frame
regulations and implement the GPF scheme with
effect from 01.01.1983 and to give an option to
either avail the CPF scheme or the GPF scheme.
4.2 On 25.10.1983 the Commissioner of the
Corporation issued a circular conveying a
decision that with the introduction of the GPF
scheme with effect from 01.01.1983 for the
employees who are covered under the CPF
scheme, those employees who do not want to join
the GPF scheme but continue with the CPF
scheme should give an undertaking to the
concerned head clerk of the department latest by
02.11.1983.
C/SCA/1629/2022 CAV JUDGMENT DATED: 13/10/2022
4.3 On 02.02.1984, a circular was issued
providing that the GPF scheme would be
compulsory for those employees who have joined
the corporation on 01.01.1983 and thereafter
and those who have joined before 01.01.1983
and were in service were required to give an
option latest by 29.02.1984 as to which of the
two schemes i.e. the CPF and the GPF scheme
they would like to continue with.
4.4 On 28.03.1984 the scheme detail and the
benefits under differences between the two
schemes was made expressly available. The
Corporation on 31.05.1984 issued a clarification
to the effect that all employees who wish to join
GPF scheme in place of the CPF scheme must
inform the pension division of the Chief Accounts
department latest by 30.06.1984. In other
words, by the circular of May 1984, those who
C/SCA/1629/2022 CAV JUDGMENT DATED: 13/10/2022
wanted to opt out of the CPF scheme and come
over to GPF scheme were given a date of
exercising such option latest by 30.06.1984.
4.5 On 25.01.1985, the time limit of 30.06.1984
was extended to 31.03.1985. The Employees'
Provident Fund Organization on 06.01.1988
addressed a letter to the Central Workshop by
which 18 employees working under the EPF
scheme were given an exemption so as to enable
them to join GPF which was without requirement
for creation of any trust. A further circular on
25.01.1991 was issued declaring a procedure
that the employees who have retired from service
after 01.01.1983 and are alive and those working
with the Corporation must exercise their option
in writing to join GPF scheme from CPF scheme.
A request was made to each of the department to
circulate to each of the employees on
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11.02.1983, another circular reiterating the
information requesting the employees covered
under the CPF scheme to exercise the option.
On 09.07.1999 a letter was written to the Central
Workshop requesting them to submit GPF
scheme and examine the possibility of exclusion
of establishment under the EPF Act. In view of
the demand of the Ahmedabad Municipal
Corporation Trade Union, the Director (Solid
Waste Management and Services) and Joint
Director (Mechanical) made a proposal to the
Municipal Commissioner recommending for
covering the employees of the Central Workshop
under the purview of the GPF scheme by seeking
appropriate exemption under the Employees'
Provident Fund and Miscellaneous Provisions
Act, 1952. On 29.05.2001, the Corporation
issued a circular reiterating the procedure for
exercising the required option to join the GPF
C/SCA/1629/2022 CAV JUDGMENT DATED: 13/10/2022
scheme, providing that those employees who are
currently on duty and covered under the CPF
scheme and in case of those employees whose
monies are being deposited in the Government
Provident Fund as per the Factories Act and who
are desirous to shift from CPF Scheme to GPF
Scheme need to get an exemption permission
from the PF Commissioner by 30.06.2001. A
petition being Special Civil Application No.4861
of 2002 was filed by the Gujarat Jan Vadi
Karmachari Union seeking directions from the
Court to extend the benefits of the GPF scheme
to the employees working in the Central
Workshop of the Corporation and were covered
under the EPF Scheme. The petition was
disposed of on 18.06.2003 asking the petitioners
to make a representation. The union made a
representation on 09.07.2003. On 14.08.2003
the Corporation informed the employees that
C/SCA/1629/2022 CAV JUDGMENT DATED: 13/10/2022
sufficient opportunities were given to leave CPF
and join GPF and the policy of exercising option
was discontinued. Accordingly, the corporation
rejected the representation of the employees of
the workshop on 15.03.2004. The rejection of
the representation on 15.03.2004 became a
subject matter of challenge by filing Special Civil
Application No.4356 of 2004 which on
09.04.2004 was rejected. Some of the employees
in the year 2007 filed Special Civil Application
Nos.15511 of 2007 and allied petitions. All these
employees were covered under the CPF asking
for a direction to give another chance to exercise
an option to come over to GPF scheme. That
representation was rejected by the Corporation
on 20.10.2007. The order of rejection of the
petition on 09.04.2004 in Special Civil
Application No.4356 of 2004 became a subject
matter of an appeal before the Division Bench.
C/SCA/1629/2022 CAV JUDGMENT DATED: 13/10/2022
By an order dated 01.07.2010, the Division
Bench remanded the matter back for
reconsideration of the learned Single Judge. The
learned Single Judge on remand passed a
detailed order on 04.02.2011, by which Special
Civil Application No.4356 of 2004 was dismissed.
An appeal filed viz. Letters Patent Appeal No.573
of 2007 was also dismissed on 22.04.2011. The
petitioners approached the Supreme Court. On
03.12.2013, the Supreme Court while dismissing
the Special Leave Petition, observed that there
was no reason to interfere with the judgment of
the High Court but also indicated that if any
proceedings are initiated by individual members
seeking redressal of their grievances before an
appropriate forum, the same be disposed of
accordingly. In light of the order of the Supreme
Court, the petitioners filed Writ Petitions in this
Court being Special Civil Application No.3711 of
C/SCA/1629/2022 CAV JUDGMENT DATED: 13/10/2022
2014 and allied petitions. By a common
judgment dated 17.10.2016, it is the case of the
petitioners that the High Court issued directions
to the Corporation, by which, it was directed that
the respondents should consider the case of the
petitioners for coming over to the GPF scheme.
Pursuant to the directions so issued, the EPFO
addressed a letter to the Corporation on
08.03.2017 that the application submitted by the
petitioners to the EPFO was incomplete.
Correspondences ensued between EPFO and the
Municipal Corporation and since there was some
delay in taking a decision, the petitioners
approached this Court by filing MCA No.1689 of
2017 and other contempt petitions in the year
2017. This Court on 06.05.2019 disposed of the
contempt with a liberty to the petitioners to take
appropriate action in accordance with law. In
the year 2019 the petitioners filed Special Civil
C/SCA/1629/2022 CAV JUDGMENT DATED: 13/10/2022
Application No.1071 of 2019 which by an order
dated 03.09.2021, were disposed of where the
Court directed the respondent Ahmedabad
Municipal Corporation to forward the
applications of the petitioners after due
attestation to the Regional Commissioner,
Provident Fund Commissioner, Regional
Provident Fund Commissioner who will then
decide the entitlement of the petitioners for GPF
scheme in accordance with law. On 03.12.2021,
in pursuance to the order passed on 30.09.2021,
the Regional Provident Fund Commissioner, after
hearing all the concerned parties held that the
petitioners are otherwise eligible to get any
other more beneficial social security benefits
including GPF subject to the fulfillment of the
conditions of grant of exemptions as envisaged
under the the Employees' Provident Funds and
Miscellaneous Provisions Act, 1952 and if the
C/SCA/1629/2022 CAV JUDGMENT DATED: 13/10/2022
establishment decides to extend such benefits to
its employees. A writ of mandamus is sought
seeking the grant of benefits of the GPF Scheme
as opined by the Regional Provident Fund
Commissioner by order dated 03.12.2021 and a
prayer is made that the petitioners are entitled to
be granted the benefits of the CPF scheme.
5. Mr.Prabhakar Upadhyay and Mr.Aakash Modi
appearing for some of the petitioners submitted
as under:
5.1 They submitted that the pension scheme of
the Ahmedabad Municipal Corporation was
sanctioned by the Government of Gujarat. It was
clear from reading the pension scheme that all
those employees who have been appointed on or
after 01.01.1983, the applicability of the pension
scheme was automatic and compulsory. Such
C/SCA/1629/2022 CAV JUDGMENT DATED: 13/10/2022
employees were not required to give any option.
The Corporation being a statutory authority, it
was under a statutory obligation to extend the
benefits of the pension scheme to those
appointed after 01.01.1983. Admittedly all the
petitioners were appointed after 01.01.1983.
Since this was the case, the petitioners were not
required to give any option to opt for the GPF
scheme and they were automatically entitled to
be considered for the GPF scheme.
5.2 Mr.Prabhakar Upadhyay and Mr.Aakash
Modi would submit that it was clear from the
proposal dated 20.03.2001 written by the
Director, Solid Waste Management to the
Assistant Municipal Commissioner which was a
proposal for pending exemption under the EPF
scheme that the applicability of the GPF scheme
for the 1001 employees of the Central Workshop
C/SCA/1629/2022 CAV JUDGMENT DATED: 13/10/2022
had given option to join the GPF scheme.
5.3 Mr.Upadhyay and Mr.Modi in support of
their submissions would rely on the decision in
the case of State of Gujarat v. Talhans Harilal
Patel in Letters Patent Appeal Nos.2259 of
2017 and other allied matters by a judgement
dated 02.05.2019. He would submit that in the
relevant paragraphs of the judgment it was
categorically held by the Division Bench of this
Court that in those cases the coming over of the
employees to the pension scheme was automatic
and therefore the State was obliged to extend
such benefits. Financial implications or financial
burden was no ground to deny the benefits
arising from the pension scheme.
5.4 Mr.Upadhyay and Mr.Modi would submit
that the Corporation has adopted a
C/SCA/1629/2022 CAV JUDGMENT DATED: 13/10/2022
discriminatory attitude inasmuch as, the benefits
of the pension scheme has been extended only to
168 employees of the Central Workshop of the
Corporation and similar benefits have not been
extended to the petitioners. He would submit
that this therefore violates Articles 14 and 16 of
the Constitution of India. In support of his
submissions, he would rely on the decision in
case of Mohammad Sujat Ali v. Union of
India reported in 1975 (3) SCC 76. He would
rely on paras 23 to 25 of the judgment. Reliance
was also placed on the decision in case of All
Manipur Pensioners Association v. State of
Manipur reported in AIR 2019 SC 3338. Para
8 of the judgment was pressed into service.
5.5 Mr.Upadhyay and Mr.Modi would submit
that pursuant to the order passed by this Court
in Special Civil Application No.10044 of 2019
C/SCA/1629/2022 CAV JUDGMENT DATED: 13/10/2022
and allied matters on 30.09.2021, applications in
the prescribed forms were made to the Provident
Fund Authorities. Reading the order dated
03.12.2021 of the Provident Fund Authorities
would make it clear that the authorities has
decided that the entitlement of the pension
scheme of the Corporation in case of the present
petitioners.
5.6 Mr.Upadhyay and Mr.Modi would submit
that as per Section 16(1)(b) of the Employees
Provident Funds and Misc. Provisions Act, 1952,
the Act will not apply to any establishment in
control of the State Government whose
employees are entitled to the benefits of the CPF
or pension scheme. The circulars were read
indicate that the Corporation had decided to
implement the pension scheme with effect from
01.01.1983. Once that pension scheme was
C/SCA/1629/2022 CAV JUDGMENT DATED: 13/10/2022
introduced and which was sanctioned by the
State Government under Section 16(1)(b) of the
EPF and MP Act, 1952, the Act would not
applicable to the Corporation.
5.7 It was the case of the petitioners according
to Mr.Upadhyay and Mr.Modi that the contention
of the respondents that the Central Workshop of
the Corporation was registered under the
Factories Act and therefore the benefits of the
EPF scheme were extended is not correct. In
accordance with the provisions of Section 86 of
the Factories Act, unless the State Government
grants exemption, such workshop shall be
considered as a factory. The perusal of the
pension scheme indicates that the employees of
the workshops were not excluded from the
applicability of the scheme. The Ahmedabad
Municipal Transport Service, Sewerage
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Treatment Plant and the light department of the
Corporation though registered under the
Factories Act, were given the benefits of the GPF
scheme of the Corporation, even in the Central
Workshop, benefits of the GPF scheme were
given in all the 168 employees, the contention
therefore that merely because the Factories Act
became applicable and therefore the EPF and
MP Act applies is misconceived.
5.8 Learned counsels would submit that as per
Section 16(A) read with Section 17(1-A)(a) of the
EPF Act, the provident fund trust is required to
be established only in a case where the
establishment seeks exemption with a view to
maintain the provident fund account of the
employees. The Corporation has not created any
Trust for extending the benefits of the GPF
Scheme.
C/SCA/1629/2022 CAV JUDGMENT DATED: 13/10/2022
5.9 The contention of the Corporation in the
respectful submission of the advocates that the
Corporation will have to incur a huge liability of
Rs.1000 crores is misconceived. The
Corporation has the statutory obligation to
extend the benefits flowing from the pension
scheme once it has been extended to several
employees of the Corporation. Mr.Upadhyay
would rely on the decision of the Supreme Court
in case of the State of Rajasthan v. Mahendra
Nath Sharma reported in (2015) 9 SCC 540.
He would rely on paras 20 and 21 of the
decision. Reliance was also placed in the
decision in case of Devkinandan Prasad v.
State of Bihar reported in 1971 (2) SCC 330.
Paras 16 and 34 of the judgment were relied.
5.10 Mr.Upadhyay and Mr.Modi would therefore
submit that the Municipal Corporation has not
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completed the formalities which were required to
be completed and the petitioners have been
fighting for their rights for 20 years is not
extending such benefits despite the order of the
EPFO Authorities and therefore the petitions
ought to be allowed.
6. Mr.Shalin Mehta learned Senior Advocate
appearing with Mr.Hemang Shah learned
advocate for the petitioners would take the Court
through the resolutions of the Corporation dated
10.06.1983 and subsequent resolutions and
circulars of the Corporation and submit that it
has to be noted that the applicability of the
pension scheme for the Corporation was
compulsory for the employees who have been
appointed on or after 01.01.1983 and it is
nobody's case that all the petitioners are not so
appointed. All the petitioners have been
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appointed with the Corporation after 01.01.1983.
6.1 He would submit that by an order dated
06.01.1988, the Regional Provident Fund
Organization issued an order whereby,
exemption was granted in respect of 18
employees under the Act. He would take the
Court through the various orders passed in
Special Civil Application No.4861 of 2002 and
the orders passed in Special Civil Application
No.4356 of 2004, wherein, the request of the
Union to extend the benefits of the pension
scheme were rejected by an order dated
15.03.2004, the orders of the Division Bench in
the Letters Patent Appeal No.573 of 2011 which
was carried to the Supreme Court and submit
that in light of the decision of the Supreme
Court, the petitioners had approached this Court
by filing Special Civil Application No.3711 of
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2014 and allied matters wherein clarifications
and directions were issued in para 30 of the
petition which were extensively read by the
learned Senior Counsel to submit that a
categorical positive findings was recorded by the
Court that the petitioners are entitled to the
benefits of the GPF scheme.
6.2 He would also take the Court to the letters
dated 08.03.2017, 17.03.2017 and 31.03.2017
and submit that the Assistant Provident Fund
Commissioner had addressed a letter to the
Corporation instructing the Corporation to
submit documents after complying with the
requisition made on 08.03.2017. The letter of
30.03.2017 also indicate that the Corporation
can be granted exemption under Para 27 of the
Act. An option was left open for the Corporation
to pursue the case under Section 60 of the EPF
C/SCA/1629/2022 CAV JUDGMENT DATED: 13/10/2022
and MP Act 1952. A comparative chart was
made available to the Corporation by the
authorities which explained the benefits of the
GPF scheme.
6.3 In contempt petitions, the petitioners were
compelled to approach the Court inasmuch as
the directions issued by this Court were not
complied despite such directions and a positive
opinion of the Regional Provident Authorities, the
petitioners still were not being extended the
benefits of the scheme.
6.4 Mr.Shalin Mehta learned Senior Advocate
would submit that the Corporation being a
statutory authority, it is under the statutory
obligation to extend the benefits of the pension
scheme to those employees who have been
appointed after 01.01.1983 which is the case of
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the Corporation. Reading the judgement in
Special Civil Application No.3711 of 2014 and
connected matters, it was evident that the Court
had issued specific directions in para 13 and
when it was an admitted position that all the
three schemes were applicable to the
Corporation and the circulars which were only
for coming over from CPF to the GPF, the
petitioners were entitled to be considered for
opting over from the EPF to GPF scheme. He
would submit that none of the circulars gave an
option to the EPF beneficiaries to come over to
the GPF and therefore the contention made by
the Corporation that the time limit for switching
over to the GPF was over was not applicable to
the beneficiaries of the EPF scheme.
6.5 Mr.Shalin Mehta would further submit that
the Corporation has adopted a discriminatory
C/SCA/1629/2022 CAV JUDGMENT DATED: 13/10/2022
attitude by adopting a pick and choose method
for extending the benefits of the PF scheme to
168 employees of the Central Workshop. Such
action would amount to create a class within a
class which even deprecated by several decisions
of the Supreme Court.
6.6 Mr.Mehta learned Senior Advocate referring
to the decision in Special Civil Application
No.3711 of 2014 and to the order dated
30.07.2021 rendered in Special Civil Application
No.144 of 2019 dated 30.07.2021 indicated that
the petitioners had submitted their application in
the prescribed form, all documentary evidences
were submitted and therefore, looking to the
provisions of Sections 15 of the EPF and MP Act
1952, the pension scheme was applicable to the
petitioners as provided in the resolution dated
16.01.1984 and therefore, it was in light of this
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that the Regional Provident Fund Commissioner
had opined as to the entitlement of the
petitioners vide order dated 03.12.2021.
6.7 Admittedly, the GPF scheme was more
beneficiary to the petitioners than the EPF
scheme and therefore, in light of the directions
issued in paras 6 in the case of Special Civil
Application No.10044 of 2019 a decision was
taken and mandamus therefore was required to
be issued to the Corporation to implement the
orders. Mr.Mehta would read the relevant
paragraphs of the decision rendered by this
Court on 17.10.2016 and submit that the
language indicated that there was no scope for
the Corporation to take a decision otherwise as
the Court had specifically directed that the
Corporation shall pay and take a decision with
regard to the availability of the pension scheme
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to the employees of the Central Workshop. In
support of his submissions, Mr.Mehta learned
Senior Advocate relied upon a decision in the
case of University of Delhi v. Smt. Shashi
Kiran and others of the Supreme Court dated
10.05.2022 wherein, the Court has held that a
direction can be issued to shift the employees to
the pension scheme and the stand of the
respondents that would be a financial strain on
the corporation is misconceived.
7. Mr.Kamal Trivedi learned Senior Advocate for
the respondent Corporation taking the Court
through the contents of the affidavit in reply
would submit that three different schemes were
prevalent in the respondent Corporation. Under
the EPF Scheme, the employees of the Central
Workshop had a deduction of 12% of basic wage
+ DA from their salary. Combined with the
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employer share, the PF account was maintained
by the Regional Provident fund Commissioner
and on retirement, the employee gets the
accumulated amount of the provident fund with
interest along with monthly pension etc.
7.1 Under the CPF scheme, applicable to the
employees of the rest of the departments of the
corporation, a same procedure is followed except
that the percentage deduction is 8.33% of the
basic wage.
7.2 Under the General Provident Fund Scheme
('GPF Scheme' for short), every month only the
employee's share i.e. 10% of the basic wage gets
deducted and deposited with the State
Government and on retirement it gets
accumulated with interest from the State
Government. The retired employee in addition to
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also gets 50% of the last basic pay every month
as pension from the corporation during his or her
lifetime and the nominee gets 50% every month
as family pension.
7.3 With effect from 1.4.2005 a new pension
scheme has been introduced by the Corporation
where the corporation deducts 10% of the basic
pay plus grade pay payable by way of salaries as
the employees share and combines the same with
matching amount of employer's share and
deposits the same in the national securities
deposit scheme.
7.4 Mr.Kamal Trivedi learned Senior Advocate
would take the Court through the relevant
circulars of the Corporation and submit as under:
(I) There are two sets of Circulars issued by the
Respondent Corporation from time to time. In
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the first set of the following four Circulars, there
was a policy in existence right from 1983,
relating to automatic application of GPF Scheme,
in the event of an employee covered by CPF
Scheme / EPF Scheme not exercising the option,
in contrast to the requirement of exercising the
option in case of the employees who wanted to
continue to be covered by CPF Scheme / EPF
Scheme.
(II) After 31.05.1984, the aforesaid policy which
was in vogue by virtue of the 4 Communications /
Circular referred to above, came to be given a
go-bye, vide the following 6 subsequent Circulars
starting from Circular No.10, dated 31.05.1984
(pg.229), under which, it was incumbent for all
the employees to exercise the option to shift from
CPF Scheme / EPF Scheme to GPF Scheme
before the stipulated time limit.
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(III) All the employees of the Respondent
Corporation, whether recruited prior or
subsequent to 01.01.1983, were supposed to
exercise their option in writing for shifting from
CPF Scheme / EPF Scheme to GPF Scheme.
earlier policy relating to automatic application of
GPF Scheme, which was brought in force by
virtue of the aforesaid first 4 Circulars, had not
remained the same under the subsequent 6
Circulars, whereby, while providing so, the time
limit for exercising the said option, was extended
from time to time.
(IV) The Petitioners are not entitled to claim the
benefit of GPF Scheme at present, more
particularly when, as aforesaid, the policy of
exercising the option for joining GPF Scheme has
been discontinued w.e.f. 14.08.2003, vide
Circular No.27 dated 14.08.2003 (pg.237) and
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since 01.04.2005, what is compulsorily made
applicable is NP Scheme.
7.5 Mr.Kamal Trivedi learned Senior Advocate
would further extensively read the relevant
paragraphs of the oral judgement dated
17.10.2016 and submit that it would be
worthwhile to read the relevant observations of
the judgement which would indicate that the
petitioners did not press the demand for issuance
for any directions to the respondent corporation
in the Writ Petitions viz. Special Civil Application
No.3711 of 2014. Secondly the petitions were
disposed of on the basis of the statement and
submissions made on behalf of the petitioners
and there were only observations and
clarifications made by the learned Judge and
there were no positive directions issued to the
respondent corporation to shift the petitioners
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from the EPF Scheme to the GPF Scheme as a
matter of right. The only recommendation was
that it was open for the petitioners to seek an
option to submit applications to the EPF, seeking
exemption from the provisions.
7.6 Mr.Trivedi learned Senior Advocate would
submit that the petitioners after the decision
dated 17.10.2016 in a fourth round of litigation,
filed a contempt petition being Misc. Civil
Application No.1689 of 2017, reading the order
of the Division Bench in the contempt
application, Mr.Trivedi would submit that there
was a serious disinclination on the part of the
Court in initiating any contempt proceedings and
therefore, the contempt proceedings were
withdrawn and accordingly disposed of. Not
being satisfied with these, the petitioners again
in a fifth round, filed Special Civil Application
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No.10042 and 10713 of 2019 and a decision was
rendered on 30.09.2021 and the only direction
that was issued was that the respondent no.3
should decide the entitlement of the petitioner
for the GPF scheme in accordance with law.
7.7 Mr.Trivedi learned Senior Advocate would
submit that on reading the order dated
03.12.2021, passed by the RPFC-respondent no.3
would indicate that no where is it decided that
the petitioners are entitled to the GPF scheme. It
has merely observed that the petitioners are
eligible for getting benefits of the said scheme.
This too subject to the condition precedent that
the Corporation agrees to allow them to join the
GPF scheme. He would submit that the
Corporation cannot be compelled to extend the
benefits of the GPF scheme to the petitioners as
there is a clear observation in the order that
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such extension of the benefits can be only if the
Corporation is ready and willing to extend such
benefits.
7.8 Mr.Trivedi would invite the Court's attention
to the affidavit in reply filed on behalf of the
Corporation to submit that even the GPF scheme
is now discontinued. What has come into play is
new pension scheme with effect from
01.01.2005. If the request of the petitioners will
be accepted, the Corporation will have to incur a
huge liability running in terms of more than
Rs.1000/- crores. Several employees were
presently governed by the EPF scheme, CPF
scheme and the new pension scheme would
claim parity with the petitioners and therefore
despite the fact that the time limit for exercising
the option as handed, the Corporation would be
compelled to do so against the provisions and
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financial constraints which it could face.
7.9 Mr.Trivedi would invite the Court's attention
to the prayers made in the petition and submit
that the petitioners have engaged into 6 th round
of litigation and they cannot claim parity to the
employees who has sought extension on
16.01.1988 because at the relevant time the GPF
scheme was in existence and they had so made
their willingness expressly available before the
cut off date of 14th of August 2003.
7.10 Mr.Trivedi would invite the Court's attention
to a speaking order passed by the Corporation on
20.10.2007. In response to the order passed by
this Court dated 18.06.2003 in Special Civil
Application No.15511 to 15331 of 2007, rejecting
the representations made on behalf of the
similarly situated employees. The said order has
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attained finality since it was not challenged. He
would submit that the present petitions have
been filed on behalf of 147 employees of whom
three have been passed, 61 have already been
retired and 83 employees are still with the
Corporation and if a mandamus in the nature
sought for is given, it would result in a huge
financial liability of the Corporation.
7.11 Mr.Trivedi in support of his submissions,
would rely on the following decisions:
Sr. Citation Particulars
No
1. (1996) 10 SCC 73 V.K. Ramamurthy vs. Union of India
2. (2010) 2 SCC 59 Union of India vs. M.K. Sarkar
3. (2003) 5 SCC 437 Union of India vs. International
Trading Co.
4. (2012) 11 SCC Rajasthan State Road Transport
561 Corporation vs. President, Rajasthan
Roadways Union
5. (2015) 12 SCC 51 Rajasthan Rajya Vidyut Vitran Nigam
Ltd. vs. Dwarka Prasad Koolwal
6. (1998) 4 SCC 117 State of Punjab vs. Ram Lubhaya
Bagga
7. (2007) 4 SCC 737 Directorate of Film Destivals vs.
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Gaurav Ashwin Jain
8. SCA No.5799 of Karl Marx General Labour Union
2011 (Ahmedabad Municipal Corporation)
vs. Ahmedabad Municipal Corporation
9. LPA No.1245 of Karl Marx General Labour Union
2014 (Ahmedabad Municipal Corporation)
in vs. Ahmedabad Municipal Corporation
SCA No.5799 of
2018 Ahmedabad Municipal Corporation
11 LPA No.736 of Ahmedabad Municipal Corporation vs.
2020 Mamta Anjan Mazmudar
In
SCA No.132 of
12 SCA No.23407 of Jayashreeben Kiranbhai Gandhi vs.
2017 Ahmedabad Municipal Corporation
13 LPA No.760 of Ahmedabad Municipal Corporation vs.
2020 Jayashreeben Kiranbhai Gandhi
In
SCA No.23407 of
14 SCA No.8735 of B.D.Christian vs. State of Gujarat.
15 SCA No.4869 of G.A.Shete vs. State of Gujarat
16 SCA No.19056 of Ahmedabad Municipal Transport
2019 Service vs. V.S.Maheriya
7.12 As far as the decisions relied upon by the
learned Senior Advocate, he would submit that
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all these decisions indicate that the Courts did
not allow the relief of switching over to the
pension scheme in light of they being structurally
different and particularly when the Court found
that the employees had not exercised the option
despite having granted six opportunities. Merely
because some of the employees have been
extended the benefits, wrongly, cannot be cited
as a precedent.
7.13 Mr.Trivedi would submit that the decisions
further indicated that the jurisdiction of a Court
in interfering with the policy decisions is
restricted and it is not within the domain of any
Court to weigh the pros and cons of the policy or
to scrutinize it and test the degree of its
beneficial and equitable disposition and vary the
same. Several decisions rendered by this Court
considering the same scheme have also been
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relied upon which are part of the citations
supplied in the separate paper book.
7.14 Mr.Trivedi would submit that the judgement
in the case of Mahendranath Sharma (supra)
referred to by the petitioner would not be
applicable to the case. Even the case of
Shashikaran (supra) relied upon by Mr.Shalin
Mehta learned Senior Advocate indicated that in
the facts of that case, the University had
specifically amended the statute by adding
Section 28A. He would submit that the
employees therein were the deemed to be
members of the GPF scheme whereas, in the
case of the present Corporation, despite
opportunities and extension of cut off dates,
options were not exercised, the petitioners sat on
the fence for the period of nine years as observed
by the order of this Court. The judgement
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therefore would not be applicable. Mr.Trivedi
would further submit that even the decision in
the case of Kalhans Patel (supra) was not
applicable to the case of the petitioners. As far
as decisions in case of Mohammad Sujad Ali and
All Manipur's Pensioners' Association (supra),
they were in context of the reasonableness of the
cut off dates and creation of two classes, so also
was the case in the judgement of Devkinandan
Prasad where the facts of the present case are
absolutely different. He would therefore submit
that the petition deserves to be dismissed.
8. Having considered the submissions made by the
learned counsels for the respective parties, the
following undisputed propositions on assessment
of facts emerged.
(I) The employees, the petitioners of the
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present petition were engaged in the Central
Workshop of the Corporation which was an
independent and a distinct establishment
registered under the Factories Act, 1948. The
employees working under the workshop were
governed by the EPF scheme. Admittedly for the
other departments the scheme that governed
them was 'CPF Scheme'.
(II) On 10.06.1983 the Municipal Commissioner
of the Corporation addressed a letter to the
standing committee proposing introduction of
the GPF Scheme with effect from 01.01.1983 for
those employees who were covered under the
CPF scheme. The standing committee accepted
the proposal after resolving to frame regulations
as required under Section 465 of the BPMC Act.
(III) Circular no.36 was issued on 25.10.1983.
C/SCA/1629/2022 CAV JUDGMENT DATED: 13/10/2022
Reading the circular indicates that the
Corporation took a decision for introduction of
the GPF scheme with effect from 01.01.1983 for
the employees covered under the CPF scheme
with a specific intention that those employees
who do not want to join the GPF scheme and
what to continue under the CPF will have to give
their names latest by 02.11.1983.
(IV) On 02.02.1984, circular No.52 was issued by
which calculations were provided and also
indicated that the GPF scheme would joined the
corporation after 01.01.1983 and for those who
joined before 01.01.1983 and are presently in
service were expected to give their options latest
by 29.02.1984 to the effect as to which of the two
streams they would like to continue with. Till
that date, till the circular no.71 was issued on
28.03.1984, the policy in vogue was that if the
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employees failed to give any option for the
schemes, they would automatically be considered
as beneficiaries of the GPF scheme.
9. The contention of the learned counsels for the
petitioners therefore that all employees
appointed after 01.01.1983 would automatically
governed by the pension scheme, cannot be read
in isolation of the circulars herein below referred
to, because on and from 31.05.1984, when the
Corporation issued circular no.10 a clarification
was issued that all the employees who wish to
join the GPF scheme in place of the CPF scheme,
must inform the pension division in the accounts
department latest by 30.06.1984, failing which
they would not be allowed to join GPF. Since the
employees made a request for extending the time
limit, circular no.65 dated 25.01.1985 was issued
extending the time limit for the employees to
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switch over to GPF scheme to 31.03.1985.
10.The letter dated 06.01.1988 pressed into service
by the petitioners indicating the fact that the
benefit of the GPF scheme was in fact given to
the 18 employees of the Corporation working in
the Central Workshop has to be read in light of
the circular dated 25.01.1991. It is not the case
of the petitioners that they too had exercised the
option. Subsequent circulars of 25.01.1991,
11.02.1983 and 18.08.1988 indicated that the
Corporation reiterated its stand that the
employees who have retired from service after
01.01.1983 and allied and those employees who
are working with the Corporation have to
exercise their option in writing to join the GPF
scheme from the pension scheme. The
contention of the petitioners that these circulars
were only effectively for the CPF optees to come
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over to the GPF and not for the petitioners under
the EPF is also a submission which is
misconceived. In pursuance of the demand made
by the trade union, the Joint Director made a
proposal to the Municipal Commissioner on
20.03.2001 recommending that the employees of
the Central Workshop be also brought under the
purview of the GPF scheme by seeking
appropriate exemption. In light of this, the
Corporation issued a circular dated 29.05.2001
requesting and reiterating the procedure of
exercising the option specifically provided that
even those employees who are currently on duty
in whose case monies are being deposited in the
Government Provident Fund as per the Factories
Act and who are desirous to shift from the CPF
scheme to the GPF scheme, must give options by
the 30.06.2021.
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11.It is in light of this outer time limit which expired
on 30.06.2021 that the Gujarat Janvadi
Karmachari Union filed Special Civil Application
No.4861 of 2002, seeking a direction to extend
the benefits of the EPF scheme to the employees
of the Central Workshop of the Corporation. The
petition was disposed on 18.06.2003 directing
the petitioners to make a representation. The
union made a representation on 09.07.2003. On
14.08.2003, the Corporation by a circular
specifically informed the employees that the time
limit for exercising options to turn over to the
pension scheme had been discontinued.
Accordingly, on 15.03.2004 the Corporation
rejected the request of the Union to come over to
the GPF. Aggrieved by this, the Union once
again filed Special Civil Application No.4356 of
2004 which came to be rejected by an order
dated 09.04.2004. That order of 09.04.2004 by
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which the petitions were rejected was a subject
matter of challenge in Letters Patent Appeal
No.1376 of 2004. The Division Bench remanded
the matter to the Single Bench to reconsider the
issue on remand on 04.02.2011 by a detailed
order passed in Special Civil Application
No.4356 of 2004, the petitions were dismissed.
12.It will be apt to reproduce relevant portions of
the orders passed by this Court while dismissing
the petition which was filed by the same
petitioner as of Special Civil Application No.1629
of 2022, this Court while dismissing the petition
observed as under:
"8. Upon the query put by the Court, the
learned Counsel appearing for the
petitioner, at the initial stage, during the
course of submission, had declared that the
employees in question are early 1996
appointees, whereas during the course of
dictation of the order, the learned Counsel
altered the statement and stated that some
members are also appointed in the years
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1983 to 1989. As such the statement is as
vague as anything, without putting material
on record and such type of argument,
without any support of authenticated
evidence cannot be considered. Further, if
the correspondence upon which the reliance
placed is considered, it appears that they
were relating to certain employees, who
demanded for shifting of the scheme and
the same came to be considered on
25.1.1991. If the employees, who are
appointees of 1996 onwards are to be
considered, they cannot be said to be
similarly situated. Therefore, the alleged
ground of discrimination would not be
available at all. ...
...
10. Mr.Upadyay, learned Counsel had
attempted to contend that as per the
circular of the Corporation those employees,
who have joined service after 1983 were
compulsorily to join GPF and not EPF
Scheme and, therefore, the contention is
that if any mistake has been committed by
the Corporation, the same is required to be
rectified.
11. It appears that it is not a policy, which
was not known to the petitioners. Even if
such policy exists, however, the petitioners,
by their own volition, have become members
of EPF and has continued for a long period,
thereafter the members of the petitioner
Union cannot be heard to say that now
another Scheme of GPF is more beneficial,
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they should be allowed to shift the Scheme.
No right cannot be allowed on the ground as
sought to be canvassed, more particularly
on account of the conduct with open hands
throughout by the members of the petitioner
Union.
12. The additional aspects in the present
case is that the petitioners themselves have
allowed being Members of EPF Scheme and
deduction from the salary has been made as
if the members of EPF Scheme all
throughout and once a person is admitted as
Member of EPF Scheme, no right is said to
have vested in him for shifting of the PF
Scheme and more particularly because, at a
late stage, one finds another GPF Scheme is
to endure better benefits. Once the party
has altered his position, he cannot be heard
to shifting of the scheme as of right as
sought to be canvassed."
13.What is evident from reading these paragraphs
that the Court categorically observed as under:
"Further, even if it is considered that some
of the employees were of 1983 to 1989
onwards, no material is produced on record
to show that those employees, whose
grievance is sought to be canvassed at any
point of time, during that period of 1991
made any application for shifting of the
scheme. If the employee concerned at the
relevant point of time had not applied for
shifting of the PF scheme and thereafter has
allowed themselves to be as members of the
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EPF Scheme for a long time i.e. roughly
about 14 years if considered from filing of
the petition and now about 20 years it
cannot be said that they are similarly
situated. If the employees concerned are
not similarly situated, the ground of
discrimination can be said as of non-
existence premise."
14.The Court further observed that it is not
believable that the petitioners were not aware of
the policy. The petitioners, by their own volition.
became members of the EPF scheme and
continued for a long period and therefore the
members of the Union cannot be heard to say
that now another scheme of GPF is more
beneficial and therefore they should be allowed
to shift to such scheme. No right can be allowed
on the ground as sought to be canvassed.
Reading paras 8 to 12 therefore indicates that at
that first point when the petitioners approached
this Court, the Court had positively observed that
having not opted for the GPF at the relevant
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point of time, though being informed, it is not
open for them and no right is vested in them
from shifting to the GPF scheme at a late stage.
The Court particularly observed that once the
party has altered his position, he cannot be
heard or to shifting of the scheme as of right as
sought to be canvassed. The Supreme Court
when the decision of the Division Bench a
subject matter of scrutiny of the decision of the
Single Judge which appeal was dismissed also by
the order of the 03.12.2013 while dismissing the
SLP observed that there was no reason to
interfere with the judgement of the High Court
but left it open for the individual members to
seek redress before any appropriate forum.
15.It was in light of these facts that Special Civil
Application No.3711 of 2014 and allied matters
were filed which were disposed of by a common
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judgement dated 17.10.2016. It will be apt to
reproduce paras 27.4 to 27.9 (pages 113) of
Special Civil Application No.1629 of 2022 which
read as under:
"27.4 So far as the petitioners contention to
the effect that the scheme was made
compulsory for employees employed after
1.1.1983, the corporation has tried to
counter the said contention on the ground
that the said provision was with regard to
the employees who are not covered /
governed by the Factories Act and the
Provident Fund Act whereas the petitioners
are governed by the provisions under the
Factories Act and the Provident Fund Act
and therefore, they were covered under the
statutory scheme and consequently, the
option was offered.
27.5 Be that as it may, the fact remains that
the petitioners remained silent and inactive
for almost 9 years and during that period of
9 years, they continued to be the member of
statutory scheme. The petitioners have
relied on the instances where the Provident
Fund Organization granted exemption to
about 18 employees of Workshop
Department.
27.6 However, in that context, the
petitioners conveniently overlook the fact
that when the said 18 employees applied for
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exemption and when P.F. Organization
granted exemption, the petitioners did not
submit individual applications seeking
exemption from statutory scheme and
shifting to the corporations scheme.
27.7 Another relevant aspect which emerges
from the corporations reply and submission
is that the corporation itself was never
opposed to extending the benefit of the
scheme to the petitioners. The corporation
claims that actually, it was the corporation
who thought of framing its own pension
scheme and made it available to its
employees and that, therefore, there could
not be any reason for corporation to not
grant / extend the benefit to its own
employees in the Workshop Department,
however, despite the opportunity to exercise
option, the petitioners did not opt for
corporations scheme and that, therefore,
any fault cannot be found with the
corporation. There is some substance and
justification in the corporations contention.
27.8 Even if it is assumed that in view of the
provisions under the corporations scheme,
there was no need to offer opportunity to
exercise option (to the employees appointed
after 1.1.1983) then also there was nothing
in the scheme or in the conduct of the
corporation or in the intimation / offer of the
corporation which restrained the petitioners
from exercising option for the corporations
scheme or from intimating the corporation
that in view of the provisions under the
scheme, it is compulsory for them to the
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members of the corporations scheme and
that, therefore, they need not exercise
option and they should be treated as
member of corporations scheme. However,
on each occasion (when the corporation
offered the opportunity to exercise option),
the petitioners remained silent and inactive
which amounts to their tacit will to continue
with such scheme. The petitioners initiated
action after almost 9 years.
27.9 All these aspects would arise for
consideration if the petitioners press their
demand for direction to the corporation."
16.Reading the decision which is so vociferously
pressed into service by the petitioners as a
positive mandate for grant of the benefits of the
GPF scheme would indicate that the petitioners
therein had approached the Court which was a
third round. The Court had observed in paras
27.5 that the petitioners had remained silent and
inactive for almost nine years and during that
period of nine years, they continued to be
members of the statutory scheme. The Court
further observed that even if the stand of the
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petitioners that 18 employees were granted
exemption is accepted, there was nothing in the
scheme or in the conduct of the Corporation or in
the intimation/offer of the Corporation which
restrained the petitioners from exercising option
for the Corporation scheme or from intimating
the Corporation that in view of the provisions of
the scheme, it is compulsory for them to be
members of the scheme and they need not
exercise option. In light of this, it was
specifically observed that the petitioners did not
press their demand for directions to the
Corporation. The directions in para 30 of the
decision therefore, and the observations made
were to be appreciated in light of these
observations and clarifications. The stand of the
petitioners therefore that these are directions
which are mandatory and positive for the
corporation to extend the benefit of the scheme
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are misconceived. The petitions were only
disposed of on the basis of the statement and
submissions with observations and clarifications.
No direction was issued to the Corporation to
shift the petitioner from the EPF scheme to the
GPF scheme as a matter of rule. It was only for
the petitioners to submit an option to the
Commissioner who would decide accordingly. It
is in light of these observations of the coordinate
bench that the order of 03.12.2021 has to be
read. Admittedly, as contended by the parties
that the order need not be read as statute.
Reading the order indicates that it was left
completely to the discretion of the Corporation to
decide whether the option needs to be given to
the petitioners to come over to the GPF scheme.
It was only the establishment desired to do so
and wishes to do so and therefore in light of this
that the observation was made that either the
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Corporation seek exemption under Section 17 or,
it was treated to be exempt under Section 16 of
the Act. It is in light of this that the relevant
portions of the order which indicate that no
positive direction was issued needs to be
reproduced. The relevant observations in the
order dated 03.12.2021 read as under:
"If the Municipal Corporation decides
to confer benefits of GPF to the
petitioners it would place the
Petitioners at par with such other
regular employees of the Corporation.
... ... ..."
"... ... ... if any establishment desires to
extend such social security benefits
which are more beneficial than those
available under the EPF and MP Act,
1992 and related Schemes, Regional
Provident Fund Commissioner cannot
deny extension of such benefits to the
employees. "
"Therefore it is ordered accordingly that
in case the establishment wishes to
seek exemption under Section 17, it
shall apply to the Competent Authority
... ... ... Otherwise, if the establishment
wishes to extend benefits of GPF to the
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Petitioners, the establishment shall first
decide to extend GPF benefits to the
Petitioners. .... ... ... ... This is once
again reiterated that the Petitioners are
otherwise eligible to get any other and
more beneficial social security benefits
including GPF subject to the
fulfilment of conditions. ... .... and if
the establishment decides to extend
such benefits to its employees."
17.The present petitioners have indulged into 6 th
round in the petition in context of the prayers
made in the petition and in light of the huge
liability if the corporation would be compelled to
undertake. Admittedly when no options were
exercised at the relevant point of time when
specifically made available to the employees
even of the EPF, no further time can be given to
the petitioners to switch over to the pension
scheme. Admittedly that time limit has expired
long back. Even the decisions of this Court in
the context of the employees which have been
reproduced herein above extensively indicates
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that the petitioner has silently accepted to
continue under the EPF scheme and therefore in
light of this that even a speaking order was
passed on 20.10.2007 has become final and was
not challenged by the petitioners at any point of
time which indicated that the representations
made by the similarly situated employees like the
petitioner was rejected.
18.The decisions cited by Shri Trivedi learned
Senior Advocate in light of the observations
made herein above need to be considered.
19.The decisions in the case of V.K.Ramamurthy
v. Union of India reported in (1996) 10 SCC
73, wherein paras 1 to 5 of the decision read as
under:
"1. This petition under Article 32 of the
Constitution is by a superannuated railway
employee seeking a mandamus from this
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Court to the railway administration
directing them to allow the petitioner to
switch over from the Provident Fund
Scheme to the Pension Scheme and for a
further direction that the petitioner should
be granted the pensionary benefits w.e.f.
the date of his superannuation i.e.
14.7.1972.
2. The undisputed facts are that the
petitioner started his career as an
employee under Madras and Southern
Maharata Railway on 23rd of July, 1938.
The said Railway later on became the
Southern Railway. On attaining the age of
superannuation, after rendering 34 years
of service the petitioner retired on 14th
July, 1972. The railway administration had
sought for the option from the petition as
to whether he would remain in
Contributory Provident Fund Scheme or
would switch over to the Pension Scheme.
The petitioner, however, opted to continue
in the Contributory Provident Fund
Scheme and according on his
superannuation the entire dues which he
was entitled to from the Provident Fund
Scheme was paid to him. The further case
of the petitioner is that since the railway
administration had allowed some of its
employees in the year 1984 to opt for the
Pension Scheme even though earlier they
had retired on receiving the provident fund
dues, the petitioner also filed a
representation to the General Manager,
Southern Railway as well as to the
Chairman, Railway Board. Not being
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favoured with any reply the petitioner filed
a representation to the Hon'ble Minister
for Railways. The petitioner also filed a
representation in August, 1986 to the
Pension Adalat but the said Adalat gave
the reply that his case could not come
within the purview of Pension Adalat.
Petitioner, thereafter, made one or two
further representations to different
authorities. Meanwhile, a retired employee
had approached the Central Administrative
Tribunal, Bombay Bench and the Tribunal
granted the benefit of coming to the
Pension Scheme to the said applicant -
Ghansham Das. The petitioner also came
to know that this Court in R. Subramanian
v. C.P. Order had allowed a retired
employee to come over to the Pension
Scheme who had earlier opted for
Provident Fund Scheme. The petitioner,
therefore, finally approached this Court for
the relief as already stated. The
Respondents filed a counter affidavit
taking the stand that in view of
Constitution Bench decision in Krishena
Kumar v. Union of India and Ors. , which
has been followed in several other cases,
the petitioner having opted to remain in
the Provident Fund Scheme and having
withdrawn the entire dues which he was
entitled to under Provident Fund Scheme
cannot be allowed to switch over to the
pension Scheme after lapse of 24 years. It
has also been stated in the said counter
affidavit that prior to petitioner's
retirement on 14th July, 1972 as many as
six options had been given to him to
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choose whether he would remain in the
Provident Fund Scheme or would switch
over to the Pension Scheme and the
petitioner consistently and deliberately
chose to continue in the Provident Fund
Scheme and received all his dues from the
said scheme and, therefore, he cannot be
allowed now to switch over to the Pension
Scheme after this length of time. The short
question that arises for consideration,
therefore, is whether the Pension Scheme
though was in operation while the
petitioner was in service and option was
sought for but the petitioner never opted
for the same and on the other hand
deliberately opted for Provident Fund
Scheme, will he be entitled to come over
the Pension Scheme after 24 years of his
retirement? The main plank of the
argument advanced by the learned
Counsel for the petitioner is the decision of
this Court in R. Subramanian's case (Writ
Petition (Civil) No. 881 of 1993) as well as
the decision of the Central Administrative
Tribunal, Bombay Bench in Ghansham Das
case against which decision the Railways
had approached this Court in Special
Leave Petition (Civil) No. 5973 of 1988 but
the same was dismissed on 5.9.1988. Mr.
Goswami, the learned senior counsel
appearing for the railway administration
on the other hand contended that neither
in Ghansham Das case nor in R.
Subramanian case the Constitution Bench
decision of this Court in Krishena Kumar's
case has been noticed. On the other hand
in Ghansham Das the Tribunal relied upon
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the decision of this Court in D.S. Nakara v.
Union of India , which decision has been
noticed and explained away and not
followed in the Constitution Bench
decision in Krishena Kumar's case and,
therefore, dismissal of Special Leave
Petition against the Judgment of the
Central Administrative Tribunal, Bombay
bench cannot have a binding precedent.
After Considering the rival submissions
and after going through the Constitution
Bench decision of this Court in Krishena
Kumar's case referred to supra, we find
much force in the contention raised by
Shri Goswami the learned senior counsel
for the railway administration.
3. That the pension Scheme was
introduced by the Railway Board since
16th November, 1957 while the petitioner
was still in service is not disputed. Further,
the assertion of the railway administration
that prior to the superannuation of the
petitioner on 14th July, 1972 as many as
six options had been given to the petitioner
to come over to the Pension Scheme and
yet he did not choose to come over to the
Pension Scheme and on the other hand
deliberately chose to continue in the
Provident Fund Scheme is also not
disputed. The question that arises for
consideration, therefore, is whether still
the petitioner can be allowed an option to
go back to the Pension Scheme? In the
Constitution Bench decision in Krishna
Kumar's case this Court was also
considering an identical case of a retired
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railway employee who had opted for the
contributory Provident Fund Scheme but
after his retirement wanted to switch over
to the Pension Scheme. This Court did not
allow the relief of switching over to the
Pension Scheme on a conclusion that the
Pension Scheme and the provident Fund
Schemes are structurally different and
they do not belong to one class. It was also
observed that in the matter of expenditure
includible in the Annual Financial
Statement, this Court has to be loath to
pass any order or give any direction,
because of the division of functions
between the three co-equal organs of the
government under the Constitution.
Referring to the earlier decision of the
court in Nakara's case, it was observed
that in the Nakara it was never held that
both the pension retirees and the
provident fund retirees from a
homogeneous class and further in Nakara
it was never required to be decided that all
the retirees form a class. It was also
observed that while deciding the case of
pension retirees in Nakara's case the
provident fund retirees were not in mind.
This Court also further held in Krishena
Kumar's case :
"The Railway Contributory Provident Fund
is by definition a fund. Besides, the
government's obligation towards an
employee under CPF scheme to give the
matching contribution begins as soon as
his account is opened and ends with his
retirement when his rights qua the
C/SCA/1629/2022 CAV JUDGMENT DATED: 13/10/2022
government in respect of the Provident
Fund is finally crystallized and thereafter
no statutory obligation continues. Whether
there still remained a moral obligation is a
different matter. On the other hand under
the Pension Scheme the government's
obligation does not begin until the
employees retires when only it begins and
it continues till the death of the employee.
Thus, on the retirement of an employee
government's legal obligation under the
Provident Fund Account ends while under
the Pension Scheme it begins. The rules
governing the Provident fund and its
contribution are entirely different from the
rules governing pension. It would not,
therefore, be reasonable to argue that
what is applicable to the pension retirees
must also equally be applicable to PF
retirees. This being the legal position the
rights of each individual PF retirees finally
crystallized on his retirement where after
no continuing obligation remained while,
on the other hand, as regard Pension
retirees, the obligation continued till their
death. The continuing obligation of the
State in respect of pension retirees is
adversely affected by fall in rupee value
and rising prices which, considering the
corpus already received by the PF retirees
they would not be so adversely affected
ipso facto. It cannot therefore, be said that
it was the ratio decidendi in Nakara that
the State's obligation towards its PF
retirees must be the same as that towards
the pension retirees."
4. In State of Rajasthan v. Rajasthan
Pensioner Samaj [1991] Supp 2 SCC 141,
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this Court also came to hold that the
contributory provident fund retirees form a
different class from those who had opted
for Pension Scheme according to the
decision in Krishena Kumar's case and as
such they are not entitled to claim as of
right to switch over from Provident Fund
scheme to Pension Scheme and
consequently the Contributory Provident
Fund Scheme retirees are not entitled to
the benefits granted to the Pension
Retirees. In yet another case of All India
Reserve Bank Retired Officers Association
and Ors. v. Union of India and Anr. [1992]
Supp 1 SCC 664, the Court was also
considering the case of the Pension
Scheme and Contributory Provident Fund
Scheme and held that in the case of an
employee governed by the Contributory
Provident Fund Scheme his relations with
the employer come to an end on his
retirement and receipt of the contributory
provident fund amount but in the case of
an employee governed under the Pension
Scheme his relations with the employer
merely undergo a change but do not snap
altogether. It is for this reason in case of
pensioners it is necessary to revise the
pension periodically as the continuous fall
in the rupee value and the rise in prices of
essential commodities necessitates an
adjustment of the pension amount but that
is not the case of employees governed
under the Contributory Provident Fund
Scheme, since they had received the lump
sum payment which they were at liberty to
invest in a manner that would yield
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optimum return which would take care of
the inflationary trends and this distinction
between those belonging to the pension
scheme and those belonging to the
Contributory Provident Fund Scheme has
been rightly emphasised by this Court in
Krishena Kumar's case.
5. In view of the aforesaid series of
decisions of this Court explaining and
distinguishing Nakara's case the
conclusion is irresistible that the petitioner
who retired in the year 1972 and did not
exercise his option to come over to the
Pension Scheme even though he was
granted six opportunities is not entitled to
opt for Pension Scheme at this length of
time. The decision of Ghansham Das case
on which the learned Counsel for the
petitioner placed reliance, the Tribunal
relied upon Nakara's case and granted the
relief without considering that Nakara's
decision has been distinguished in the
Constitution Bench case of Krishena
Kumar and other cases referred to supra.
Therefore, dismissal of the Special Leave
Petition against the said Judgment of the
Tribunal cannot be held to be law laid
down by this Court, in view of what has
been stated in Krishena Kumar's case. The
other decision of this Court, in the case of
R. Subramanian (Writ Petition (Civil) No.
881 of 1993) the Court merely relied upon
the dismissal of Special leave Petition
against the judgment of Tribunal in
Ghansham Das case and disposed of the
matter and, therefore, the same also
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cannot be held to be a decision on any
question of law. In the aforesaid premises
and in view of the legal position as
discussed above the writ petition is
dismissed but in the circumstances without
any order as to costs."
20.In the case of M.K.Sarkar (supra) paras 8, 9, 12
and 25 of which read as under:
"8. The appellants challenged the order of
the Tribunal in WP (CT) No.467/2005. The
High Court dismissed the writ petition by
order dated 25.1.2006. The said order of the
High Court is challenged in this appeal by
special leave. The question for consideration
is whether the respondent was entitled to
exercise an option to switch over pension
scheme, beyond the stipulated last date,
that too twenty two years after retirement
and receipt of the retirement dues under the
Contributory Provident Fund Scheme
9. When a scheme extending the benefit of
option for switch-over, stipulates that the
benefit will be available only to those who
exercise the option within a specified time,
the option should obviously be exercised
within such time. The option scheme made
it clear that no option could be exercised
after the last date. In this case, the
respondent chose not to exercise the option
and continued to remain under the
Contributory Provident Fund Scheme, and
more important, received the entire PF
amount on his retirement.
C/SCA/1629/2022 CAV JUDGMENT DATED: 13/10/2022
...
12. From 1980 onwards, gradually the
pension scheme became more and more
attractive as compared to the Contributory
Provident Scheme, on account of various
factors, like dearness allowance being
included in the pay for computing pension,
ceiling on pension being removed and
liberalisation of family pension etc. But the
respondent was well aware that not having
opted for pension scheme and having
received the PF amount on retirement, he
was not entitled to seek switch over to
pension scheme. But in 1996, when the
respondent learnt that some others who had
retired in and around 1973 to 1976 had
been permitted to exercise the option in
1993-94 on the ground that they had not
been notified about the option, he decided
to take a chance and gave a representation
seeking an option to switch over to pension
scheme.
...
25. There is another angle to the issue. If
someone has been wrongly extended a
benefit, that cannot be cited as a precedent
for claiming similar benefit by others. This
court in a series of decisions has held that
guarantee of equality before law under
Article 14 is a positive concept and cannot
be enforced in a negative manner; and that
if any illegality or irregularity is committed
in favour of any individual or group of
individuals, others cannot invoke the
jurisdiction on courts for perpetuating the
same irregularity or illegality in their favour
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also, on the reasoning that they have been
denied the benefits which have been illegaly
extended to others. See : Chandigarh
Administration vs. Jagdish Singh - 1995 (1)
SCC 745; Gursharan Singh & Ors. vs. New
Delhi Municipal Committee & Ors. - 1996
(2) SCC 459; Faridabad C.T. Scan Centre vs.
Director General, Health Services - 1997 (7)
SCC 752; State of Haryana vs. Ram Kumar
Mann - 1997 (3) SCC 321, State of Bihar &
Ors. vs. Kameshwar Prasad Singh & Anr. -
2000 (9) SCC 94 and Union of India vs.
International Trading Company."
21.In the case of Rajasthan State Road Transport
Corporation (supra), paras 2 and 14 read as
under:
"2. We are, in this case, concerned with the
question whether the widow of an employee
is entitled to get family pension under the
Employees Family Pension Scheme, 1971
(for short 'Scheme'), on the failure of the
employer to exercise his option under the
scheme, especially when the claimant has
already received the entire Provident Fund
amount, from the Fund maintained by the
Corporation.
...
14. When we read the notification dated
9.4.1971 issued by the Regional Provident
Fund Commissioner along with the
communication letter dated 30.7.1971
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issued by the appellant-Corporation, it is
evident that the Regional Provident Fund
Commissioner as well as appellant-
Corporation had informed all the
departments/unions, as well as employees
working under the Corporation to exercise
their necessary option if they wanted to get
the benefit of the Family Pension. Facts
would indicate that several employees at
that time had opted and few of them did not
opt for that, since they were interested to
get provident fund under the CPF Scheme
and not the family pension under the
Scheme, after the death of the employee.
We have no reason to think that the
employees were unaware of the notification
issued by the Regional Provident Fund
Commissioner as well as the Corporation.
Facts would also indicate that the wife of
Hari Singh had already received the entire
provident fund amount and, since Hari
Singh had not opted under the Scheme.
However, after nine years, respondent
Union is raising a dispute which, in our
view, in absolutely untenable. The Tribunal
as well as Courts below have committed a
grave error in not properly appreciating the
facts of the case and rendered a perverse
finding which necessarily calls for
interference.
22.In the case of Rajasthan Rajya Vidyut Vitran
Nigam Limited v. Dwarka Prasad Koolwal
reported in 2015 12 SCC, paras 58 to 61 read
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as under:
"58. When the Pension Regulations and the
GPF Regulations are read together, the
necessary conclusion is that an employee
must give his option for either continuing to
be a member of the CPF Scheme or to
switch over to the Pension and GPF
Regulations. This option has to be exercised
within a period of 90 days from the cut-off
date, that is, 28th November, 1988. But the
RSEB, in its wisdom, chose to extend the
time for exercising the switch- over option
over a period of 8 years by giving several
opportunities to the employees through its
notices. The right of an employee to switch
over was, therefore, limited in time by the
Pension and GPF Regulations. However,
administrative orders issued by the RSEB
from time to time extended the period for
exercising the option. No employee had any
inherent right to either demand an
extension of the period for exercising the
switch-over option or claim a right to
exercise the switch-over option at any time
prior to his retirement, and no such right
has been shown to us.
59. But, learned counsel for the respondents
finally submitted that pension is not a
charity or a bounty and an employee is
entitled to earn his pension. There can be no
doubt about this proposition but when two
schemes are available to an employee, one
being the CPF Scheme and the other being
the Pension Scheme, it is for the employee
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to choose the scheme that he feels more
comfortable with and appropriate for his
purposes. No employee can switch over
back and forth from one scheme to another
as per his convenience. Once an employee
has chosen to be a part of a particular
scheme, he continues to remain a member
of that scheme unless an option to switch
over to another scheme is given to him.
60. Insofar as the present appeals are
concerned, the respondents who are
members of the CPF Scheme were given
several opportunities of switching over to
the Pension Scheme and the GPF Scheme
under the Pension Regulations and the GPF
Regulations respectively but they chose not
to do so. The question whether under these
circumstances pension is a bounty or a
charity becomes completely irrelevant. The
entitlement to pension was available to the
respondents but they chose not to avail the
entitlement for reasons personal to them.
Having taken a decision in this regard the
respondents cannot now raise an argument
of pension not being a bounty and therefore
requiring the RSEB to give them another
option to switch over to the Pension and
GPF Regulations.
61. Under the circumstances, we find no
merit in the contentions urged by the
respondents and consequently, the appeals
of the RSEB deserve to be allowed."
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23.In the case of State of Punjab v. Ram Dubaya
Bagga (supra) 1998 4 scc 117 para 25 reads as
under:
"25. Now we revert to the last submission,
whether the new State policy is justified in
not reimbursing an employee, his full
medical expenses incurred on such
treatment, if incurred in any hospital in
India not being a Government hospital in
Punjab. Question is whether the new policy
which is restricted by the financial
constraints of the State to the rates in
AIIMS would be in violation of Article 21 of
the Constitution of India. so far as
questioning the validity of governmental
policy is concerned in our view it is not
normally within the domain of any court, to
weigh the pros and cons of the policy or to
scrutinize it and test the degree of its
beneficial or equitable disposition for the
purpose of varying modifying or annulling it,
based on however sound and good
reasoning, except where it is arbitrary or
violative of any constitutional, statutory or
any other provision of law. When
Government forms its policy, it is based on
number of circumstances on facts, law
including constraints based on its resources.
It is also based on expert opinion. it would
be dangerous if court is asked to test the
utility, beneficial effect of the policy or its
appraisal based on facts set out on
affidavits. The Court would dissuade itself
from entering into this realm which belongs
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to the executive. It is within this matrix that
it is to be seen whether the new policy
violates Article 21 When it restricts
reimbursement on account of its financial
constraints."
24.In the case of Directorate of Film Festivals
reported in 2007 4 SCC 737, para 16 read as
under:
"14. The scope of judicial review of
governmental policy is now well defined.
Courts do not and cannot act as Appellate
Authorities examining the correctness,
suitability and appropriateness of a policy.
Nor are courts Advisors to the executive on
matters of policy which the executive is
entitled to formulate. The scope of judicial
review when examining a policy of the
government is to check whether it violates
the fundamental rights of the citizens or is
opposed to the provisions of the
Constitution, or opposed to any statutory
provision or manifestly arbitrary. Courts
cannot interfere with policy either on the
ground that it is erroneous or on the ground
that a better, fairer or wiser alternative is
available. Legality of the policy, and not the
wisdom or soundness of the policy, is the
subject of judicial review [vide : Asif
Hameed v. State of J&K - 1989 Supp (2)
SCC 364; Shri Sitaram Sugar Co. Ltd., v.
Union of India - 1990 (3) SCC 223; Khoday
Distilleries v. State of Karnataka - 1996 (10)
C/SCA/1629/2022 CAV JUDGMENT DATED: 13/10/2022
SCC 304, Balco Employees Union v. Union
of India - 2002 (2) SCC 333), State of Orissa
vs. Gopinath Dash - 2005 (13) SCC 495 and
Akhil Bharat Goseva Sangh vs. State of
Andhra Pradesh - 2006 (4) SCC 162]."
25.A coextensive reading of these judgements would
indicate that there is no right of an employee to
ask for an option to switch over to a pension
scheme once the limited time for such option has
expired. Even otherwise what is found is that
having sat silent over a period of years and not
exercised the option which was specifically given
to even the EPF scheme beneficiaries, the
petitioners, in this 6th round of litigation continue
to re-agitate the issue which cannot be so done.
The decision in case of Shashikaran (supra), is a
case where Section 28A was amended permitting
the employees to avail the benefits of the GPF
scheme and therefore, for all these reasons, the
petitions deserve to be dismissed.
C/SCA/1629/2022 CAV JUDGMENT DATED: 13/10/2022
26.Accordingly, the petitions are dismissed.
27.So far as Civil Application (for bringing heirs)
No.1 of 2022 in Special Civil Application
No.1637 of 2022 is concerned, the same is
preferred as the petitioner died on 18.05.2022.
28.In view of the averments made in the memo of
the application, the application is allowed.
29.The heirs of the petitioner being 1.1 to 1.3 as
shown in the cause title of this application be
brought on record as heirs of the petitioner in
the main petition. Registry to amend the cause
title accordingly.
(BIREN VAISHNAV, J)
ANKIT SHAH
