S.J.SENTHAMARAI KANNAN, vs LIFE INSURANCE CORPORATION
- Court
- Madras High Court
WP(MD) No. 16736 of 2018
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
Date of Reservation 25.09.2026
Date of Pronouncement 16.10.2026
CORAM
THE HON'BLE MR.JUSTICE RAJNISH PATHIYIL
WP(MD) No. 16736 of 2018
CNR:{HCMD010964002018}
and WMP(MD)No.14788 of 2018
S.J.Senthamarai Kannan,
S/o. E.Z.Sutharisanam,
D.No.9/107f, Nethaji Nagar,
Sholavandan Road,Urappanur Post,
Thirumangalam, Madurai-625 706.
..Petitioner(s)
Vs
1. Life Insurance Corporation
Of India, New Delhi.
2. The Zonal Manager,
Life Insurance Corporation Of India, Southern
Zonal Office, Chennai.
3. The Senior Divisional Manager, Life Insurance
Corporation Of India, Bridge Station Road,
Sellur, Madurai.
4. The Senior Manager,
Life Insurance Corporation Of India, Thiru
Nagar Branch, Madurai.
..Respondent(s)
PRAYER: To issue a Writ of Certiorarified Mandamus calling for the
rd
records of the 3 respondent termination order dated 14.06.2018 and
quash the same as illegal and direct the respondents to consider the
petition of the petitioner dated 21.12.2017 for his voluntary retirement.
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For Petitioner(s): M/s Chamundi Bose
For Respondent(s): G.Prabhu Rajadurai for R1 To R4
ORDER
This writ petition has been filed to quash the termination order
passed by the third respondent dated 14.06.2018 and to direct the
respondents to consider the petitioner's request dated 21.12.2017.
2. The petitioner is an ex-serviceman who retired from service in
the year 1999 after rendering approximately 19 years of service to the
nation, upon attaining the age prescribed for premature retirement, as is
evident from his Discharge Certificate. It is to be noted that there was no
restriction preventing him from seeking re-employment after his
discharge from the Armed Forces. The Defence Authorities had also
certified that the petitioner was “ very keen and energetic ” and possessed
a “ high sense of initiative and responsibility ”. The Discharge Certificate
specifically states that the petitioner was entitled to seek civilian
employment. Thereafter, the petitioner was appointed as a Development
Officer in the respondent Insurance Corporation on 20.12.2007.
3. It is the case of the petitioner that upon completion of 10 years
of service in the respondent Insurance Corporation and on attaining the
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rd
age of 55 years, he submitted a request dated 21.12.2017 to the 3
respondent seeking voluntary retirement with effect from the appropriate
rd
date. However, the 3 respondent, by letter dated 27.12.2017, rejected the
petitioner's request for voluntary retirement, citing the following
reason(s):-
“This is with reference to your letter dated 21.12.2017
[received by Bo on 21.12.2017], referring to Sub-rule
2(A)(a) of Rule 19 LIC of India Staff Regulations, 1960,
expression your preference to Voluntarily Retire from the
services of the Corporation. In the letter, you have stated
that your are personally tired due to some ailments and
accident and hence your are unable to work within the
prescribed expense limit, as the reasons for seeking
voluntary retirement.
Since your are a Pension optee and have completed only
10 years of service we regret to inform you that your
request for Voluntary Retirement cannot be considered
as per Sub-rule 2(A) (a) of Rule 19 of LIC of India Staff
Regulations, 1960.” (sic)
4. Therefore, the petitioner preferred an appeal to the 2nd
respondent on 19.05.2018. It is his case that the 2nd respondent informed
him that no such VRS was being offered to the employees on completion
of 55 years of age. The 2nd respondent cited sub-rule 2(A)(a) of Rule 19
LIC of India Staff Regulations, 1960, and stated that though it provides
for VRS, the same has not been granted by the respondent Insurance
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Corporation. The petitioner relied on Sub-rule 2(A)(a) of Rule 19 LIC of
India Staff Regulations, 1960, which reads as follows:-
“ 2(A)(a) of Rule 19 LIC of India Staff Regulations,
1960 :- “ Notwithstanding what is stated in sub-rules (1)
and (2) above, on employee may be permitted to retire at
any time on completion of the age 55 after giving three
months notice in writing to the appointing authority of
his intention to retire.
(b) (i)Notwithstanding the provisions of Clause (a), an
employee governed by the Life Insurance Corporation of
India (Employees) Pension Rules, 1995, may be
permitted to retire at any time after he has completed
twenty years of qualifying, service, by giving notice of not
less than 90 days, in writing, to the appointing authority:
Provided that this sub-clause shall not apply to an
employee who is on deputation unless after having been
transferred or having return to India, he has resumed
charge on the post in India and has served for a period of
not less than one year:” (sic)
5. The learned counsel for the petitioner would submit that the
request for VRS cannot be turned down as there is no such power vested
with the respondent Insurance Corporation. When the option is left to the
employee concerned on attaining the age of 55, with regard to the issue
of pension and qualifying service, the petitioner would submit that, in
any event, being an optee after being discharged from the Army, he
would even otherwise never complete 20 years of service, as he joined
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the respondent Insurance Corporation only after the age of 45 and
normally he would retire by the age of 60 as the same is stipulated in the
Rules. Hence, he would never be able to comply with the requirement of
pensionable service, as has been set out in the letter dated 27.12.2017.
The petitioner further contends that, after his efforts to convince the
respondents to accept his VRS went in vain, he specifically informed
them that he had various medical ailments because of which he was
unable to perform his duties as Development Officer. He would also cite
that apart from having suffered a heart attack, he also met with an
accident which required surgery, and he also took leave. Therefore, he
contends that the denial of VRS is contrary to the regulations as he has
attained the qualifying age, i.e., 55 years of age.
6. It is the case of the petitioner that thereafter, on 02.05.2018, he
was issued a show-cause notice to submit a reply within 30 days as to
why he should not be terminated under sub-rule (8) of Rule 6 read with
Rule 7 of the Life Insurance Corporation of India Development Officers
(Revision of Certain Terms and Conditions of Service) Rules, 2009
(hereinafter referred to as the Rules) as amended by the Life Insurance
Corporation of India Development Officers (Revision of Certain Terms
and Conditions of Service) Rules, 2016. In the said show-cause notice,
the respondent Insurance Corporation had contended that the petitioner's
performance as a Development Officer was not in terms of the aforesaid
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regulations and that, if his explanation was not found to be satisfactory,
the petitioner would be terminated. The Rules governing the termination
of Development Officers are set out in a special set of Rules, namely,
sub-rule (8) of Rule 6 read with Rule 7 of the Rules, as amended by the
Life Insurance Corporation of India Development Officers (Revision of
Certain Terms and Conditions of Service) Rules, 2016. The Rules
prescribe “Cost Ratio” as the basis for determining whether the
Development Officer should be continued in service or not. For the said
purpose, every calendar year is taken as the appraisal year. The
remuneration that has been paid to the Development Officer and the
eligible premium that he has generated as business through the agents
under him are considered for determining the eligible premium.
Therefore, a Cost Ratio is arrived at. The portion of the order impugned
is extracted hereunder:
“ Your performance for the appraisal year ended on
31.12.2017 has been assessed as under:-
“ (A) (i) Expense Limit … … … 19%
(ii) Prescribed Expense Limit … … … 19%
(iii) Eligible Premium … … … 1,21,498.00
(iv) Annual Remuneration: … … … 5,03,411.00
(B) Cost Ratio for the relevant appraisal year on the
basis of the Annual Remuneration: 414.33%
(C) It is observed that our annual remuneration for
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the appraisal year ended on 31.12.2017 exceeds 50% of
the eligible premium of that year. It is also observed that
your cost ratio for the immediately preceding appraisal
year which ended on 31.12.2016 were 89.85% and
36.51% respectively and the aggregate of the annual
remuneration in the relevant year and the two appraisal
years immediately preceding the relevant appraisal year
exceeds 50% of the aggregate of the eligible premium in
these three years.
As a consequence your service are liable to be terminated
in accordance with sub-rule (8) of Rule 6 read with Rule
7 of the Life Insurance Corporation of India Development
Officers (Revision of Certain Terms and Conditions of
Service) Rules, 2009 amended as Life Insurance
Corporation of India Development Officers (Revision of
Certain Terms and Conditions of Service) Rules, 2016”
(sic).
7. The Rules permitted a Cost Ratio of 38% up to 2015.
Thereafter, the Cost Ratio was revised to 50%. On the aforesaid basis, the
show-cause notice came to be issued. The petitioner submitted a
representation dated 16.05.2018, reiterating his request for VRS and, at
the same time, also submitting a reply to the show-cause notice dated
02.05.2018. Thereafter, he challenged the show-cause notice before this
Court.
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8. While the challenge was pending, the respondent Insurance
th
Corporation passed the order of termination dated 14 June 2018. It is
pertinent to mention that in the interregnum, the petitioner had earlier
filed a writ petition in W.P. (MD) No. 12666 of 2018 before this Court,
with a prayer to set aside the show-cause notice dated 02.05.2018 and
direct the respondents to consider the petition of the petitioner dated
21.12.2017 for his voluntary retirement which had been rejected.
However, when the matter was taken up for final hearing on 03.09.2024,
the fact that the petitioner had been terminated vide order dated
14.06.2018 was brought to the notice of this Court, and this Court,
therefore, was inclined to record the fact that the writ petition had
become infructuous and passed the following order:
“2. A connected writ petition in WP(MD)No.16736 of 2018 has
been filed by the very same petitioner challenging the termination
order, which has been issued against the petitioner, pursuant to the
issuance of show cause notice, which has been challenged in this writ
petition. Therefore, this writ petition in WP(MD)No.12666 of 2018 has
now become infructuous, due to the passing of the termination order
against the petitioner, which is challenged in WP(MD)No.16736 of
2018. Accordingly, this writ petition is dismissed as infructuous.”
The petition was thus dismissed not on merits, but upon recording the
fact that the prayer had become infructuous in the light of the termination
order dated 14.06.2018, which the petitioner has separately challenged in
the present writ petition.
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9. The learned counsel appearing for the respondent Insurance
Corporation has filed a counter-affidavit dated 23.02.2019 and submitted
that the petitioner is covered by sub-rule (8) of Rule 6 read with Rule 7 of
the Rules, as amended in the year 2016. Being an Insurance Corporation,
the business is stiff, and they have to meet the challenges of emerging
markets and competitors. Therefore, the aforesaid Rules were framed
under the LIC Act, and, being a Development Officer, the petitioner is
bound to achieve targets and show continued performance in the
business. The appraisal of the petitioner for the year ending on
31.12.2017 was done, and the aggregate annual remuneration for the
relevant year and the two appraisal years immediately preceding the
relevant year exceeded 50% of the aggregate eligible premium in the
three years considered for target achievement. Therefore, the Rules
provide for the initiation of proceedings, and accordingly, the respondents
had resorted to the issuance of the aforesaid show-cause notice dated
02.05.2018. It is set out in the counter at paragraphs Nos. 4 and 5 that his
Cost Ratio for the years ending in December 2016 and December 2017
was absolutely high, while in the preceding years, the Cost Ratio was
within the norms.
10. The learned counsel for the respondents has also submitted that
the petitioner was issued a warning that his Cost Ratio was exceeding the
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prescribed limit, since there was no improvement in his performance and
there was consistent non-performance. The termination envisaged under
the aforesaid Rules was effected, and accordingly, the petitioner was
terminated.
11. The respondents have also averred in paragraph No. 7 of the
counter that there is no nexus between the rejection of the petitioner's
request for VRS and his termination and that both are separate actions.
They would also state that there is no invocation of the deemed
resignation provision, as the petitioner's request for VRS was rejected on
27.12.2017 and that the same has become final on the above contentions.
12. The learned counsel appearing for the petitioner would submit
that the petitioner had submitted a representation dated 15.07.2017
[However, the respondent Insurance Corporation would submit that it is
dated 18.07.2017]. In the said representation, the petitioner had requested
that he may at least be posted to the Administration Department on health
grounds as he had not been able to perform the duty of Development
Officer in his field area. The petitioner submitted that he suffered a heart
th th
attack on 14 August 2012 and underwent bypass surgery on 17
September 2012, and thereafter, due to surgery complications he had a
severe infection in the leg, where his vein was removed. Therefore, he
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was unable to walk due to his knee problems. He also stated in the said
letter that he met with an accident on 18th March 2016, which resulted in
a severe injury to the leg and knee, and he had suffered a fracture/ injury.
He also cited in the representation that he had to take sick leave as well
as privileged leave for nearly seven months. Along with the said letter, he
also enclosed the history of his medical treatment and medical
certificates issued by Meenakshi Mission Hospital and Research Centre,
Madurai as well as Preethi Hospitals Pvt. Ltd., K. Pudur, Madurai, to
substantiate his claim of surgery and injury. It is the petitioner's case that,
due to medical reasons, he was unable to discharge his duties as a
Development Officer and that, in the last two years, namely, 2016 and
2017, the Cost Ratio had exceeded the prescribed limit not because of
any other reason, but because the petitioner's health was the sole reason.
13. The learned counsel appearing for the respondents had
submitted that the petitioner received the letter from the respondents
dated 24.09.2018, in which the details of the leave availed by the
petitioner in the years 2015, 2016, and 2017 have been set out. This
would show that the petitioner had, for a large part of the year, been on
sick leave or on other leave because of medical conditions. A person who
has suffered medical conditions cannot be expected to meet the targets,
and he himself had voluntarily come forward and submitted a letter
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seeking VRS. The petitioner would submit that the regulations which
determine the discontinuance of the petitioner cannot be read in such a
manner that persons who have suffered medical issues or accidents, etc.,
can be punished by dismissal, especially when the petitioner himself had
sought VRS, which was rejected for unfair reasons and without even
understanding the provisions governing such retirement.
14. The learned counsel for the respondents referred to paragraph
No. 4 of the counter and the tabular column showing the Cost Ratio from
the year 2013 to 2017, which is extracted hereunder:
“ Cost Ratio = [Annual Remuneration (Salary + DA + HRA + Other
Allowance etc.) ÷ Eligible Premium] 100*
Appraisal
Annual
Eligible
Cost Ratio
Disincentive
Year
Remunerati
Premium
(2)/(3)*
imposed
Ending
on (2)
100 (4)
(3)
(5)
(1)
Date-2013 4,14,573.08 15,31,534.15 27.06% No Increment
Dec 2014 4,08,665.79 15,39,777.85 26.54% No Increment
Dec 2015 4,89,123.22 11,80,342.37 41.43% 80% cut in Fixed
Conveyance allowance + No
Increment + One Decrement
Dec 2016 4,82,310.44 5,36,777.95 89.85% No Fixed Conveyance
allowance + No Increment
+ One Decrement
Dec 2017 5,03,411.77 1,21,498.00 414.33%
Termination
”
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15. In the above factual background, the issues to be determined are:
(i) whether the termination of the petitioner warrants interference?
(ii) whether the petitioner would be entitled to VRS, as sought for by him
vide his letter dated 21.12.2017?
(iii) and whether the rejection of the VRS application by the respondent
is justified in terms of the regulations governing the same?
16. Considering the contentions raised by the learned counsel for
the respondents, and in light of the tabular column which exhibited the
Cost Ratio from 2013 to 2017, this Court had directed the petitioner to
also submit the Cost Ratio tabulated by him which would reflect his
performance right from 2009 until 2017 and the same is extracted
hereunder:-
S.No APPRAISAL PERIOD ELIGIBLE PREMIUM COST RATIO IN %
1 JAN 2009 TO DEC 2009 17,76,651.95 14.5
2 JAN 2010 TO DEC 2010 21,87,321.15 13.9
3 JAN 2011 TO DEC 2011 18,54,326.10 19.21
4 JAN 2012 TO DEC 2012 18,66,714.35 20.67
5 JAN 2013 TO DEC 2013 15,31,534.15 27.08
6 JAN 2014 TO DEC 2014 15,39,777.85 26.54
7 JAN 2015 TO DEC 2015 11,80,342.37 41.43
8 JAN 2016 TO DEC 2016 5,36,777.95 89.85
JAN 2016 TO DEC 2017 1,21,498.00 414.33%
9
*To be noted that up to the year 2015, the permissible Cost Ratio was
38% and it was revised to 50% from 2016 onwards.
The figures for the appraisal year 2017 do not form part of the table
furnished by the petitioner and have been taken from the show cause notice
02.05.2018.
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17. As can be seen from the aforesaid table, the Cost Ratio for the
initial years, from 2009 up to 2014, was well within the prescribed limits,
in fact several notches below the permissible limits. The Rules stipulate
that the Cost Ratio should not exceed 38% in the relevant year. In fact up
to December 2014, it never exceeded 30% in any given instance. While
the Cost Ratio was fixed at 38% under sub-rule (8) of Rule 6, read with
Rule 7, of the Rules, an amendment to the Rules was issued in 2016
whereby the Cost Ratio was increased up to 50%, as is found in Clause 6
(2) where it is mentioned that the cost ratio in the relevant year should
not exceed 50%. The petitioner has exceeded the said limit only in the
years 2015, 2016 and 2017, principally for the reason that the petitioner
had suffered a heart attack and later also an accident. This fact cannot be
denied by the respondent, for the reason that the petitioner had set out
these facts in his letter dated 15.07.2017, enclosing copies of all the
certificates relating to the treatment that he had undergone and in fact he
was granted some reimbursement of medical bills.
18. A perusal of the same would indicate that the petitioner had
undergone a coronary artery bypass as early as 23.09.2012 at Meenakshi
Mission Hospital and Research Centre, Madurai, and thereafter had also
undergone other treatments for complications arising out of the surgery,
which extended up to 2015. Thereafter, in the year 2016, he met with a
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road accident, and the same is also apparent from the discharge summary
dated 29.03.2016 issued by Preethi Hospitals Private Limited, K. Pudur,
Madurai. This would indicate that, for most parts of 2016, the petitioner
was undergoing treatment for the injuries that he had suffered in the road
accident.
19. The leave statement, which has been provided by the
respondent would indicate that, in the year 2016, the petitioner was
hardly working, except for a few days, i.e., he was consistently on leave
for a total of 172 days. Details of the leave taken in the years 2015, 2016
and 2017 are tabulated hereunder:
2015
21.04.2015 - 05.05.2015 15 days Privilege leave
25.07.2015 - 29.07.2015 5 days Sick Leave
05.10.2015 - 17.10.2015 13 days Privilege Leave
Total number of days 33 days
2016
18.03.2016 - 16.04.2016 30 days Sick Leave
20.04.2016 - 19.05.2016 30 days Sick Leave
21.05.2016 -30.05.2016 10 days Sick Leave
31.05.2016-18.06.2016 19 days Converted Sick Leave
21.06.2016-30.06.2016 10 days Converted Sick Leave
01.07.2016 - 20.07.2016 20 days Converted Sick Leave
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22.07.2016 - 20.08.2016 30 days Privilege Leave
23.08.2016-31.08.2016 9 days Converted Sick Leave
08.09.2016-21.09.2016 14 days Privilege Leave
Total number of days 172 days
2017
06.09.2017- 12.09.2017 7 days Privilege Leave
19.10.2017 - 25.10.2017 7 days Privilege Leave
29.11.2017- 05.12.2017 7 days Privilege Leave
06.12.2017- 07.12.2017 2 days Privilege Leave
Total number of days 23 days
The medical condition of the petitioner was therefore so precarious that
he could not attend to his work and therefore, by his letter dated
21.12.2017, the petitioner came forward with a request for voluntary
retirement, citing his health condition, and also produced medical
certificates to show that, for the most part of 2016, he was unable to carry
out his duties.
20. The respondents have summarily rejected the same by citing
that the petitioner had only completed 10 years of service. A perusal of
the regulations governing voluntary retirement, as set out in the LIC of
India Staff Regulations, 1960, specifically at page 52 under the heading
“Superannuation and Retirement,” Regulation 19(2A)(a), reads as under:
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“(2A) (a) Notwithstanding what is stated in sub-rules
(1) and (2) above, an employee may be permitted to
retire at any time on completion of the age 55 after
giving three months notice in writing to the
appointing authority of his intention to retire.
(b) (i) Notwithstanding the provisions of clause (a), an
employee governed by the Life Insurance Corporation
of India (Employees) Pension Rules, 1995, may be
permitted to retire at any time after he has completed
twenty years of qualifying service, by giving notice of
not less than ninety days in writing, to the appointing
authority.”
21. As can be seen, an employee may be permitted to retire at any
time on completion of the age of 55 years after giving three months'
notice in writing to the appointing authority. In the rejection letter dated
27.12.2017, the respondents have cited sub-rule 2(A)(a) of Rule 19 of the
LIC of India Staff Regulations, 1960, and contended that, since the
petitioner is a pension optee and had only completed 10 years of service,
he would not be entitled to seek voluntary retirement.
22. A perusal of the aforesaid provisions would indicate that there
is no such restriction. Regulation 19(2A) provides two distinct avenues
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for voluntary retirement. Clause (a) permits an employee to retire at any
time on completion of 55 years of age, after giving three months’ notice
in writing to the appointing authority. It does not prescribe any minimum
period of service. Clause (b)(i), which opens with the words
“Notwithstanding the provisions of clause (a)”, is an additional avenue
available to an employee governed by the Pension Rules. Under it, an
employee who has completed twenty years of qualifying service may
retire even before attaining the age of 55 years. The requirement of
twenty years of qualifying service is thus a condition of clause (b)(i)
alone, and it cannot be read into clause (a). The petitioner, having
attained the age of 55 years and given notice, squarely fell within
clause (a).
23. In the present case, the petitioner was appointed in the year
2007 after being discharged from military service, and he was, by then,
already 45 years of age. Even assuming that the Life Insurance
Corporation of India (Employees) Pension Rules, 1995 , provide that the
qualifying service prescribed for the grant of pension is 20 years, the
petitioner would, in any event, not satisfy the said condition, as he was a
military retiree who was discharged from the military on completion of
the requisite number of years. Therefore, in my opinion, the rejection of
his voluntary retirement at the first instance appears to be totally illogical
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and rather illegal, and contrary to the regulations contained in Rule 19 of
the LIC of India Staff Regulations, 1960.
24. The petitioner had further submitted a representation dated
15.07.2017, which is not denied by the respondents. In fact, from the
instructions received from the counsel for the respondents, it is admitted
that the representation was received on 18.07.2017. The difference in
dates is immaterial, as the relief that is sought for in the representation is
one and the same; perhaps the date of receipt of the representation
appears to be 18.07.2017. Nevertheless, in the said letter, the petitioner
has made a request for being transferred from the Marketing Department
to the Administration Department. However, there was no response from
the respondents. Thereafter, when the petitioner came forward and sought
voluntary retirement, instead of granting voluntary retirement, an opaque
view was taken by the respondent, as if the services of the petitioner were
indispensable, and his request for voluntary retirement was rejected.
25. Turning to the order of termination, Rule 6(8) read with Rule
7(1) of the Rules does not mandate termination merely because the cost
ratio exceeds the prescribed limit. The authority is bound to consider the
cause shown by the Development Officer before taking that step. This
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view is fortified by the judgment of an Hon’ble Division Bench of the
High Court of Kerala in Life Insurance Corporation of India v. Sonia
Bhaskar , 2015 SCC OnLine Ker 23029 . In that case, a Development
Officer of the respondent Insurance Corporation exceeded the prescribed
Cost Ratio during an appraisal year in which she had been on maternity
leave for six months. Her services were terminated under Rule 6(8) read
with Rule 7(1) of the very same Rules. The Hon’ble Division Bench read
down the word "shall" in Rule 6(8) as "may" and held as follows:
"51. … This statutory Scheme indicates that in so far as the expense
limit is concerned, any cause such as accident or sickness can be
raised and action can be avoided. … But when the proviso to Rule 7(1)
uses the words that the Development Officer shall be given an
opportunity to show cause against the proposed termination, he is free
to submit any valid cause and it cannot be read in a manner that
consideration of any valid cause is excluded. … In the event
interpretation to Rule 6(8) is accepted to be mandatory termination,
the provision contemplated under Rule 7(1) becomes an empty
formality and useless. …
53. …non-consideration of any genuine cause given by the
Development Officer in reply to the notice of termination violates the
principle of natural justice and fair play … and in any event if valid
cause is shown, the termination notice has to be dropped.
*
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60. … The absence of work for six months in performing the duty shall
definitely have an adverse effect on her performance … Issue No. IV. It
is obligatory for the Zonal Manager to consider the explanation given
by the Development Officer and take a decision and in the event there is
any valid explanation for not achieving the cost ratio, the termination
notice can be validly dropped." (emphasis supplied)
26. The above judgment was carried on appeal by the LIC by filing
a Special Leave Petition in SLP Diary No. 14393/2016 and the same
came to be dismissed by the Hon’ble Supreme Court vide Order dated
12.11.2024. In the present case, the petitioner was on leave for 172 days
in 2016, of which 128 days were sick leave, and for a further 23 days in
2017. This was on account of the after-effects of his bypass surgery and
the injuries suffered in the road accident of 18.03.2016. These are causes
beyond his control and the same is contemplated under Rule 6(5)(b) of
the Rules. It is not in dispute that the petitioner’s cost ratio exceeded the
prescribed limit in 2016 and 2017. The question, however, is not whether
the limit was exceeded, but whether the cause for the same was
considered. The order of termination dated 14.06.2018 proceeds solely on
the arithmetic of the cost ratio and does not advert to any of these
circumstances. It is reiterated that as early as 15.07.2017, the petitioner
had sought to be posted to the Administration Department on health
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grounds, and the record shows that there was no response from the
respondent. Had that representation been considered, the question of his
cost ratio for the appraisal year 2017 may not have arisen at all.
27. It is to be noted that by the time the show-cause notice dated
02.05.2018 was issued, the respondents already had before them the
petitioner’s medical history, supported by certificates, his request for a
posting that is more suitable to his condition, and his request for
voluntary retirement. The opportunity contemplated under the proviso to
Rule 7(1) is not an empty formality. It obliges the authority to consider
the cause that is shown and to decide whether termination is warranted at
all. In the present case, the respondents have not done so and therefore,
the order of termination dated 14.06.2018 cannot be sustained.
28. No doubt, the petitioner had filed a writ petition earlier
challenging the show-cause notice and, incidentally, the rejection of the
voluntary retirement request. But it is to be noted that the said writ
petition came to be closed on account of it being infructuous, as by then,
the order impugned in the present writ petition had been passed.
Therefore, no occasion arose for this Court to examine the correctness of
the decision of the respondent in rejecting the request for VRS. As held
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WP(MD) No. 16736 of 2018
in the foregoing paragraphs, the rejection by letter dated 27.12.2017 was
itself contrary to Rule 19(2A)(a) of the LIC of India Staff Regulations,
1960. It applied the requirement of twenty years of qualifying service,
which pertains only to Rule 19(2A)(b)(i) enabling an employee to
voluntarily retire even without attaining the age of 55 years. Had the
request been considered in the light of the regulations of the respondent
Insurance Corporation, more particularly the LIC of India Staff
Regulations, 1960, this issue of termination and the consequential
challenge to the impugned order dated 14.06.2018 may not even have
arisen as the petitioner would have stood retired well before the show-
cause notice dated 02.05.2018 came to be issued.
29. The facts of this case are peculiar in nature. The petitioner is an
ex-serviceman who, after his discharge from the Army, served the
respondent Corporation for nearly a decade with a cost ratio well within
the norms. His performance declined only after he suffered a heart attack,
underwent bypass surgery and met with a road traffic accident. Rather
than continuing in a post he could no longer discharge, he came forward
of his own accord, first seeking a less demanding posting and thereafter
voluntary retirement. In these peculiar facts, this Court is of the view that
the petitioner ought not to have been visited with the extreme step of
termination, and that his request for voluntary retirement ought to have
been accepted.
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30. In fine, the writ petition is allowed. The order of termination
passed by the third respondent dated 14.06.2018 is set aside. The
rejection of the petitioner’s request for voluntary retirement, by letter
dated 27.12.2017, is also set aside. The petitioner shall be treated as
having voluntarily retired from service under Rule 19(2A)(a) of the LIC
of India Staff Regulations, 1960, with effect from 21.03.2018, being the
date of expiry of three months from his notice dated 21.12.2017. All
terminal benefits due to him on that footing, including any benefits
withheld consequent upon his termination, shall be computed and
disbursed within a period of eight weeks from the date of receipt of a
copy of this order. No costs. Consequently, the connected miscellaneous
petition is closed.
16.10.2026
Index: Yes/No
Speaking/Non-speaking order
Neutral Citation: Yes/No
DSS
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WP(MD) No. 16736 of 2018
To
1. Life Insurance Corporation
Of India, New Delhi.
2. The Zonal Manager,
Life Insurance Corporation Of India, Southern Zonal Office,
Chennai.
3. The Senior Divisional
Manager, Life Insurance Corporation Of India, Bridge Station Road,
Sellur, Madurai.
4. The Senior Manager,
Life Insurance Corporation Of India, Thiru Nagar Branch, Madurai.
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WP(MD) No. 16736 of 2018
RAJNISH PATHIYIL, J.
DSS
WP(MD) No. 16736 of 2018
and WMP(MD)No.14788 of 201818
16.10.2026
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