Full Judgment Text
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CASE NO.:
Appeal (civil) 3957 of 2006
PETITIONER:
Board of Trustees, Visakhapatnam Port Trust & Others
RESPONDENT:
T.S.N. Raju & Another
DATE OF JUDGMENT: 06/09/2006
BENCH:
Dr. AR. Lakshmanan & Tarun Chatterjee
JUDGMENT:
J U D G M E N T
(Arising out of SLP (C) Nos. 26322-26323/2005)
Dr. AR. Lakshmanan, J.
Leave granted.
The Board of Trustees, Visakhapatnam Port Trust and
others are the appellants before us and the respondents are
employees of the said Port Trust.
The matter arises out of an insistence of two employees of
the Visakhapatnam Port Trust (in short ’the VPT’) to seek
retirement under a voluntary retirement scheme, even though,
according to the employer Port Trust they are not entitled to
avail the benefit of the scheme because they have attained the
cut off age of 58 years before their cases could be considered.
The learned single Judge allowed the writ petition filed by
the respondents and directed the Port Trust to consider and
accept the voluntary retirement scheme (hereinafter called
’VRS’) of the respondents as on their date of application and
pass appropriate orders and pay all the benefits thereunder.
However, the learned single Judge held that the respondents
are not entitled for pension on the ground that they have
retired on attaining the age of superannuation at the age of 60
years and they shall be entitled for pension as per the date of
retirement under the VRS to be extended to the respondents.
The learned Single Judge further held that the salaries
received by the respondents till their age of superannuation
shall not be recovered if paid as they have worked. The
learned Judges of the Division Bench, by their order dated
21.11.2005 dismissed the appeal filed by the VPT and directed
the VPT to pass orders on the applications of the respondents
for voluntary retirement within a period of one month from the
date of judgment.
According to the VPT, both the learned single Judge and
the Judges of the Division Bench of the High Court have mis-
read the applicability of the Scheme and directed the VPT to
consider and accept the case of the respondents and that such
a direction is unsustainable in law and is likely to have a
cascading effect. Therefore, the VPT have come before this
Court through the above civil appeals arising out of Special
Leave Petition Nos. 26322-26323 of 2005.
The short facts relevant to the issue in dispute are as
follows:
With a view to reduce surplus manpower, the Union
Ministry of Surface Transport (now called the Ministry of
Shipping, Road Transport and Highways - Department of
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Shipping) came out with a scheme of voluntary retirement.
This was made applicable to all the Ports. The scheme of
voluntary retirement was introduced in the appellant-VPT
pursuant to the direction of the Ministry of Surface Transport
contained in its letter No. LB-16016/7/88-L.II dated
29.08.1991. The said scheme is annexed as Annexure-P1
which reads as under:
"GOVERNMENT OF INDIA
MINISTRY OF SURFACE TRANSPORT
(LABOUR DIVISION)
No. LB-16016/7/88-L.II New Delhi, 29th August, 1991
To
Shri P.V.R.K. Prasad
Chairman,
Vishakhapatnam Port Trust,
Vishakhapatnam-530035
Subject:- Voluntary Retirement Scheme for Port Trusts
and Dock Labour Boards
Sir,
I am directed to say that the matter regarding
introduction of a uniform Voluntary Retirement Scheme
for officers, employees and workers of Port Trusts and
Dock Labour Board has been under consideration of the
Government. After careful consideration it has been
decided that Port Trusts and Dock Labour Boards can
introduce Voluntary Retirement Scheme with a view to
reducing surplus manpower subject to the following
terms and conditions:-
2. (a) An employee who has completed 10 years’ of
services or completed 40 years’ of age may seek
voluntary retirement by a written request.
(b) The Port Trust and Dock Labour Board will have the
right not to grant voluntary retirement for reasons to be
recorded in writing.
(c) The terminal payments available to an employee who
seeks voluntary retirement would be:-
i. the balance in his Provident Fund Account
payable as per the GPF/CPF regulations
applicable to him;
ii. cash equivalent of accumulated earned leave as
per the rules of the Port Trust/Dock Labour
Board;
iii. gratuity as per Gratuity Act or the Gratuity
Scheme applicable to the employees;
iv. one month’s/three month’s notice pay (as per the
conditions of service applicable to him).
v. pension as per the rule Port Trust/Dock Labour
Board.
(d) In addition, an employee whose request for
Voluntary Retirements is accepted would also be
entitled to an ex-gratia payment equivalent to 1=
months emoluments (Pay+ D.A) for each completed year
of service or the discounted value of the emoluments (at
12% rate of discount) that would have become payable
for the balance months of service left, whichever is less.
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For example, an employee who has put in 24 years of
service and has got only one year of service for normal
retirement, he will get ex-gratia payment of only 12
months emoluments (pay+DA) discounted at 12% per
annum and not 36 months emoluments.
(e) In addition, the employee and his family would also
be entitled to travel by entitled class to the place where
he intends settling down.
3. While introducing the voluntary retirement
scheme, Port Trusts and Dock Labour Boards will make
an assessment of surplus man-power taking into
account the present and future operational
requirements. While accepting the Voluntary Retirement
of the employee, the Port Trust/Dock Labour Board will
also issue an order to the vacancy caused by the
Voluntary retirement would not be filled up and the post
is abolished.
4. No claim of the dependents of the employees going
on voluntary retirements for any compassionate
appointment under the Port Trust/Dock Labour Board
will be entertained.
5. The Voluntary Retirement Scheme would be
financed by the Port Trusts/ Dock Labour Boards from
their own resources and no budgetary support in the
form of loans will be granted by the Government, after
seeking approval of the Ministry.
6. Port Trusts and Dock Labour Boards can
introduce an Voluntary Retirement Scheme on the
above parameters, after seeking approval of the
Ministry.
Yours faithfully
Sd/-
(P.K.MISHRA)
Director"
On 30.10.1991, the approval of the Board of Trustees of
the appellant was sought for introducing the scheme of
voluntary retirement. The terms and conditions of the scheme
and its applicability were detailed therein. The scheme is
annexed along with this appeal and marked as Annexure-P2
which is reproduced hereunder:
"VISHAKHAPATNAM PORT TRUST
MEETING NO.4 OF 1991-92 OF THE BOARD OF
TRUSTEES TO BE HELD
ON 30.10.1991
AGENDA ITEM NO. 36
Sub: Voluntary Retirement Scheme for the Port Trusts
and Dock Labour Boards.
The Ministry has decided that Port Trusts and
Dock Labour Boards can introduce Voluntary
Retirement Scheme for its officers, Employees and
Workers with a view to reduce the surplus manpower
subject to following terms and conditions:
(a) An employee who has completed 10 years of
service or completed 40 years of age may seek
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Voluntary Retirement by a written request.
(b) The Port Trust and Dock Labour Boards will have
the right not to grant Voluntary Retirement for
reasons to be recorded in writing.
(c) The terminal payments available to an employee
who seeks Voluntary Retirement would be:-
(i) The balance in his Provident Fund Account
payable as per the GPF/CPF Regulations
applicable to him;
(ii) Cash equivalent of accumulated earned leave
as per the rules of the Port Trust/Dock
Labour Board;
(iii) Gratuity as per Gratuity Act or the Gratuity
Scheme applicable to the employee;
(iv) One month’s/ Three month’s Notice Pay (as
per the conditions of service applicable to
him);
(v) Pension as per the rules of the Port Trust/
Dock Labour Board.
(d) In addition, an employee whose request for
Voluntary Retirement is accepted would also be
entitled to an ex-gratia payment equivalent to 1=
months emoluments (Pay + D.A) for each
completed year of service or the discounted value
of the emoluments (at 12% rate of discount) that
would have become payable for the balance
months of service left, whichever is less.
(e) In addition, the employee and his family would
also be entitled to travel by the entitled class to
the place where he intends setting down.
Under the above scheme while accepting the
Voluntary Retirement of the employee, the Port
Trust/Dock Labour Board will also issue an order that
the vacancy caused by the Voluntary Retirement would
not be filled up and the post is abolished and also that
no claim of the dependents of the employee going on
Voluntary Retirement for any compassionate
appointments under the Port Trust and Dock Labour
Boards will be entertained. The above scheme has to be
financed by the Port Trust/ Dock Labour Board from
their own resources and no budgetary support would be
granted by the Government.
The Ministry while communicating the above
scheme, has stated that the Port Trust and Dock Labour
Boards can introduce a voluntary Retirement Scheme
on the above parameters, after making an assessment of
surplus man power taking into account the present and
future operational requirement, subject to approval of
the Government.
A copy of the Ministry’s letter No. LB-16016/7/88-
L.II, dt. 29.08.1991 on the above subject is enclosed for
reference.
In view of the Ministry’s instructions, it is
proposed to introduce a Voluntary Retirement Scheme
on the above parameters, in our Port also.
Board’s approval is, therefore, requested to
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introduce a Voluntary Retirement Scheme in our Port
on the parameters prescribed by the Ministry of Surface
Transport in its letter No. LB;16016/7/88-L.II,
dt.29.08.1991 subject to approval of the Ministry.
Encl.: As above."
Respondent No.1 T.S.N. Raju applied for voluntary
retirement on 16.08.1999 but withdrew his application for
VRS on 06.04.2000. He again applied for VRS on 27.04.2000.
He averred in his writ petition that the application was made
on the basis that Port has informally alerted that Management
is serious about considering the request of the employees
seeking VRS. In the counter affidavit filed by the VPT, it was
categorically stated that the Management had issued no letter
or circular to such effect. On 26.07.2000, respondent No.1
was promoted as Assistant Engineer (Civil) on ad hoc basis but
he did not renew his application.
Respondent No.2 - R. Rama Rao applied for VRS on
28.04.2000. In a meeting of the Heads of Department of the
VPT, the concern expressed by the Secretary, Department of
Shipping, Ministry of Surface Transport about the VRS was
discussed. It was decided by the Chairman that the VRS
should be considered in the cases of those employees who are
below the age of 58 years. The said decision is annexed along
with the appeal as Annexure-P3 which reads as under:
"VISHAKHAPATNAM PORT TRUST
ADMINISTRATION DEPARTMENT
No. ADMN/VRS/2000
Date: 23.08.2000
C.E./C.M.E./D.C./T.M./F.A.&C.A.O
C.M.O/C.M.M./DIRECTOR (R&P)
MANAGER (OP)
ORDER
Sub: Grant of Voluntary Retirement under V.R. Scheme
to the employees- M.O.S.T. Letter No. LB-
16016/7/94-L-II, dt.29.08.1991-Reg.
During the daily HODs Meeting held on
23.08.2000, keeping in view the concern expressed by
the Secretary (Dept. of Shipping), M.O.S.T, Govt of
India, a review has been made by the Chairman on the
implementation of voluntary retirement under the
scheme to the employees of V.P.T. and it has been
decided that the Voluntary Retirement Scheme should
be considered in the case of those employees who are
below the age of 58 years.
All the HODs are, therefore, requested to forward
the V.R.S. cases of only those employees who have not
attained the age of 58 years.
This issues with the approval of the Chairman.
SECRETARY
VISHAKHAPATNAM PORT TRUST"
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On 29.08.2000, respondent No.1 made a representation
to the Chairman of the VPT to consider his application dated
27.04.2000 which he had made before being promoted as
Assistant Engineer. However, his case could not be
considered for VRS because there were several applications
pending and he was very junior in rank of A.E.(C). By the time
the application of senior A.E.s were processed, the required
number had already been arrived at and the case of
respondent No.1 could not be considered.
Being aggrieved by non-consideration of his case,
respondent No.1 filed Writ Petition No. 17697 of 2000 before
the High Court of Andhra Pradesh on 03.09.2000 with the
following prayers:
"For the reasons and in the circumstances stated in the
accompanying affidavit, the petitioners herein pray that
this Hon’ble Court in the interest of justice be pleased to
issue a writ or direction more particularly one in the
nature of writ of Mandamus
i. declaring the action of the respondents in not
accepting the offer of the writ petitioner to retire
from the service of the Vishakhapatnam Port Trust
on Voluntary retirement basis as unjust and
illegal; and
ii. consequently direct the respondents to treat the
writ petitioner to have retired from its service on
voluntary retirement basis with immediate effect
by extending all the terminal benefits that flow
there from and pass such order or further order or
orders as are deemed fit and proper in the
circumstances of the case."
Being aggrieved by non-consideration of his case,
respondent No.2 Rama Rao filed Writ Petition No. 23543 of
2000 before the High Court on 18.09.2000 with the following
prayers:
(i) declaring the action of the respondents in not
accepting the offer of the writ petitioner to retire from
the service of the Vishakhapatnam Port Trust on
Voluntary retirement basis as unjust and illegal; and
(ii) consequently direct the respondents to treat the
writ petitioner to have retired from its service on
voluntary retirement basis with immediate effect by
extending all the terminal benefits that flow there from
and pass such order or further order or orders as are
deemed fit and proper in the circumstances of the case."
Both these writ petitions were heard together. The VPT
filed a detailed counter affidavit denying the allegations of the
respondents that cases of others similarly situate had been
considered and they had been discriminated against by the
VPT.
The retirement age of the employees of the VPT was rolled
back from 60 years to 58 years. Respondent No. 1 (Born on
01.08.1942) and Respondent No. 2 (Born on 23.09.1941) were
superannuated from service on 30.11.2000. The learned
single Judge passed a common judgment and allowed both the
writ petitions and directed the VPT to consider and accept the
VRS of the respondents herein with certain other directions.
Being aggrieved, the VPT preferred two separate Letter Patent
Appeals being Writ Appeal Nos. 2105 and 1558 of 2005. By
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the impugned common final judgment, both the appeals had
been dismissed with a direction to the VPT to pass orders on
the applications of the respondents within a period of one
month. Aggrieved by the above common judgment, the VPT
has come before us by filing the above civil appeals.
We heard Mr. Kailash Vasudev, learned senior counsel
assisted by Mr. Gopal Singh, learned counsel for the
appellants and Mr. L.N. Rao, learned senior counsel assisted
by Mr. G.Ramakrishna Prasad, learned counsel for the
respondents.
Mr. Kailash Vasudev, learned senior counsel has
submitted that the Division Bench has not appreciated the
contentions of the VPT against the order of the learned single
Judge. According to him, it was specifically argued that
undeniably it is not mandatory for any organization to accept
every application that is received from the employees seeking
voluntary retirement and that the VPT was authorized to take
a decision on 23.08.2000 to consider applications of only
those employees who have not crossed 58 years of age. It is
further submitted that the learned single Judge and of the
Division Bench of the High Court have failed to appreciate that
the scheme clearly stipulates of basic condition that voluntary
retirement under a scheme cannot be sought for as a matter of
right. The factual position with regard to the other employees
whose cases for voluntary retirement were considered had
been placed by filing a counter affidavit but has been
overlooked by the High Court. Learned senior counsel further
submits that the High Court has erred in directing that even
though the writ petitioners had continued in service beyond 58
years till their superannuation and had received salary they
would not be required to refund the excess amount received
and that they shall be extended benefits under the VRS as on
the date of their applications. It is further urged that a person
who has crossed the age of 58 years is not eligible to be
considered for retirement under the VRS. Respondent No.2
had in fact completed the age of 58 years by 23.09.1999.
Therefore, learned senior counsel would submit that the
orders of the learned single Judge as well as the Division
Bench are arbitrary and have been passed without taking into
consideration these vital facts.
Learned senior counsel appearing for the
respondents/writ petitioners submitted that the Port Trust
has no discretion to refuse the offer to go on retirement under
the voluntary retirement scheme except in cases of the
exigencies of service or the compelling necessity or the
indispensability of the employees concerned.
The Port Trust having accepted the offer of similarly
placed employees who have also completed 57 years of age and
also 58 years of age to go on voluntary basis, declining to
permit the respondents to retire on voluntary retirement basis
is clearly discriminatory.
The Port Trust has committed illegality in not passing
any orders on the application dated 13.9.2000 to retire from
its service on voluntary retirement basis though the
application has been forwarded for acceptance by the Head of
the Department, Financial Advisor & Chief Accounts Officer
and the Vigilance Department. It is, therefore, contended that
the Port Trust has not acted fairly and justly in the case of
respondent \026 Sri Rama Rao.
In Bank of India & Ors. Vs. O.P. Swarnakar & Ors.,
(2003) 2 SCC 721, the moot question posed and answered by
this judgment was whether the VRS is an offer/proposal or
merely an invitation to offer. The question was whether the
Banks intended to make an offer or merely issued an
invitation to treat is essentially a question of fact. In
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paragraph 49, this Court held as under:
"49. An offer indisputably can be made to a group of persons
collectively which is capable of being accepted individually
but the question which has to be posed and answered is as
to whether having regard to the service jurisprudence: the
principles of Indian Contract Act would be applicable in the
instant case. It is the specific case of the "Banks" that the
schemes had been floated by way of contract. It does not
have any statutory flavour. Reference to the pension scheme
framed under the regulations was made for computation of
the pension."
The learned Judges of the Bench have also elaborately
discussed the use of the term "offer" or "proposal" and held in
paragraphs 59, 60, 61, 62 and 74 as under:
"59. The request of employees seeking voluntary retirement
was not to take effect until and unless it was accepted in
writing by the competent authority. The Competent
Authority had the absolute discretion whether to accept or
reject the request of the employee seeking voluntary
retirement under the scheme. A procedure has been laid
down for considering the provisions of the said scheme to the
effect that an employee who intends to seek voluntary
retirement would submit duly completed application in
duplicate in the prescribed form marked "offer to seek
voluntary retirement" and the application so received would
be considered by the competent authority on first come first
serve basis. The procedure laid down therefor suggests that
the applications of the employee would be an offer which
could be considered by the bank in terms of the procedure
laid down therefor. There is no assurance that such an
application would be accepted without any consideration."
"60. Acceptance or otherwise of the request of an employee
seeking voluntary retirement is required to be communicated
to him in writing. This clause is crucial in view of the fact
that therein the acceptance or rejection of such request has
been provided. The decision of the authority rejecting the
request is applicable to the Appellate authority. The
application made by an employee as an offer as well as the
decision of the bank thereupon would be communicated to
the respective General Managers. The decisions making
process shall take place at various levels of the banks."
"61. The following, therefore, can be deduced:
(i) The banks treated the application from the employees as
an offer which could be accepted or rejected.
(ii) Acceptance of such an offer is required to be
communicated in writing.
(iii) The decision making process involved application of
mind on the part of several authorities.
(iv) Decision making process was to be formed at various
levels.
(v) The process of acceptance of an offer made by an
employee was in the discretion of competent authority.
(vi) The request of voluntary retirement would not take effect
in praesenti but in future.
(vii) The Bank reserved its right to alter/rescind the
conditions of the scheme."
"62. From what has been noticed before, it is apparent that
the Nationalized banks in terms of the scheme had secured
for themselves an unfettered and unguided right to deal with
the jural relationship between themselves and their
employees"
"74. We, therefore, have no hesitation in coming to the
conclusion that the voluntary scheme was not a proposal or
an offer but merely an invitation to treat and the
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applications filed by the employees constituted an ’offer’."
In HEC Voluntary Retd. Employees Welfare Society &
anr. Vs. Heavy Engineering Corpn. Ltd. & Ors., (2006) 3
SCC 708, this Court in paragraph 11 held as under:
"11.An offer for voluntary retirement in terms of a scheme,
when accepted, leads to a concluded contract between the
employer and the employee. In terms of such a scheme, an
employee has an option either to accept or not to opt
therefor. The scheme is purely voluntary, in terms whereof
the tenure of service is curtailed, which is permissible in law.
Such a scheme is ordinarily floated with a purpose of
downsizing the employees. It is beneficial both to the
employees as well as to the employer. Such a scheme is
issued for effective functioning of the industrial
undertakings. Although the Company is "State" within the
meaning of Article 12 of the Constitution, the terms and
conditions of service would be governed by the contract are
employment. Thus, unless the terms and conditions of such
a contract are governed by a statute or statutory rules, the
provisions of the Contract Act would be applicable both at
the formulation of the contract as also the determination
thereof. By reason of such a scheme only is an invitation of
offer floated. When pursuant to or in furtherance of such a
Voluntary Retirement Scheme an employee opts therefore, he
makes an offer which upon acceptance by the employer gives
rise to a contract. Thus, as the matter relating to voluntary
retirement is not governed by any statute, the provisions of
the Contract Act, 1872, therefore, would be applicable too.
(See Bank of India v. O.P.Swarnakar (2003) 2 SCC 721.)"
We have carefully considered the rival submissions made
by the respective parties. We have also perused the pleadings,
judgments delivered by the learned single Judge and the
Division Bench, voluntary retirement scheme, annexures and
documents.
In our opinion, under the Scheme, the Chairman of the
Port Trust has an absolute right either to accept or not to
accept the applications filed by the employees for retirement
under the voluntary retirement scheme. We have already
reproduced the entire scheme dated 29.8.1991 of the
Government of India, Ministry of Surface Transport. The
Government of India has decided that Port Trust and Dock
Labour Board can introduce voluntary retirement scheme with
a view to reduce surplus manpower subject to the terms and
conditions set out in the voluntary retirement scheme.
Clauses 2(a) and 2(b) of the Scheme are very relevant for the
present purpose. Clause 2(a) clearly stipulates that an
employee who has completed ten years of service or completed
40 years of age may seek voluntary retirement by a written
request. Clause 2(b) clearly stipulates that the Port Trust and
Dock Labour Board will have a right not to grant voluntary
retirement for reasons to be recorded in writing. Clause 6 of
the said Scheme provides that the Port Trust and Dock Labour
Board can introduce a voluntary retirement scheme on the
parameters mentioned in the scheme framed by the
Government of India after seeking approval of the Ministry.
A meeting of the Board of Trustees of the VPT was held
on 30.10.1991. In the said meeting, the Trustees considered
the VRS formulated by the Government of India and decided to
introduce the voluntary retirement scheme on the parameters
suggested by the Government of India in VPT also. Board’s
approval was, therefore, sought to introduce the VRS in the
VPT on the parameters prescribed by the Ministry of Surface
Transport in its letter No. LB-16016/7/88-L.II, dated
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29.8.1991 subject to approval of the Ministry.
Annexure P-3 is relevant to be considered in the present
context. By the said order, VPT, Administration Department,
passed an order stating that a review has been made by the
Chairman on the implementation of voluntary retirement
under the scheme to the employees of VPT and that it has
been decided that the voluntary retirement scheme should be
considered in the cases of those employees who are below the
age of 58 years. In view of the said decision, the Heads of the
Department were requested to forward the voluntary
retirement scheme cases of only those employees who have not
attained the age of 58 years. Though it is contended that the
Port Trust had no authority to modify the voluntary retirement
scheme, we are unable to accept the said submission made by
the respondent in view of clause 2(b) of the Scheme which
enable the Port Trust and Dock Labour Board to alter the
scheme and also have a right not to grant voluntary retirement
for the reasons to be recorded in writing.
We have perused the order passed by the learned single
Judge. In our view, the order of the learned single Judge is
without jurisdiction and beset with material irregularities. The
learned single Judge ought to have seen that under the
scheme the Chairman of VPT has absolute right either to
accept or not to accept the applications filed by the employees
for retirement under the voluntary retirement scheme. The
learned single Judge also did not mention how there was
discrimination between those who have been granted
voluntary retirement and those who have not. The learned
single Judge in the case of Sri Rama Rao (respondent No.2
herein) has not noticed that he had made a representation on
29.8.2000 addresssed to the Chairman while he was in the
category of CTOW and his application was not considered as
he was the junior most Assistant Engineer. The learned single
Judge ought to have considered his application dated
27.4.2000 by which he applied while he was in the cadre of
C.T.O.W. (Class-III) to go on voluntary retirement. But by this
time, the applications of other A.Es who are senior in the order
of receiving, were considered and therefore, his application at
this stage could not be considered as Sri Rama Rao being the
junior most A.E. among the V.R.S. applied A.Es and his
application dated 29.8.2000 is least in the order of seniority of
application received for V.R.S. In any event, the learned single
Judge ought not to have issued the direction to the
Department to accept the voluntary retirement of the
respondent as on the date of their application and pass
appropriate order. The learned Judge at any rate can only
direct the Port Trust to consider their applications for
voluntary retirement and pass appropriate orders. The order
passed by the learned single Judge is, therefore, beyond the
jurisdiction of the Court in issuing such direction. Likewise,
the Division Bench also committed the same error in issuing
the directions.
Respondent No.1 T.S.N. Raju applied for voluntary
retirement on 16.08.1999 but withdrew his application for
VRS on 06.04.2000. He again applied for VRS on 27.04.2000.
He averred in his writ petition that the application was made
on the basis that Port has informally alerted that Management
is serious about considering the request of the employees
seeking VRS. In the counter affidavit filed by the VPT, it was
categorically stated that the Management had issued no letter
or circular to such effect. On 26.07.2000, respondent No.1
was promoted as Assistant Engineer (Civil) on ad hoc basis but
he did not renew his application.
On 29.8.2000, respondent No.1 made a representation to
the Chairman of the VPT to consider his application dated
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27.4.2000 which he had made before being promoted as A.E.
However, his case could not be considered for VRS because
several applications were pending and he was very junior in
the rank of A.E. By the time, the application of senior A.Es
were processed, the required number had already been arrived
at and the case of respondent No.1 could not be considered.
As already noticed, Sri Rama Rao (respondent No.2) was
appointed as sub-overseer on 2.1.1969 in the Civil
Engineering Department of VPT and completed about 31 years
of service as on date of his retirement on superannuation by
30.11.2000 A/N. He has been promoted as Assistant
Engineer initially on ad hoc basis and subsequently
regularized as A.E. w.e.f. 17.1.2000. The Scheme of VRS has
been introduced in VPT as per Ministry of Surface and
Transport (Labour Division) letter No. L.B. 16016/7/88-L.II
dated 29.08.1991 with a view to reduce surplus manpower
subject to sustain condition specified therein.
It is true that Sri Rama Rao (respondent No.2 herein) has
applied for retirement under the voluntary retirement scheme
vide his application dated 28.4.2000 seeking retirement w.e.f.
30.11.2000. Sri Rama Rao was posted as A.E. for the
maintenance section of C.I.S.F. residential colony consisting
maintenance repairs, drains etc., including water supply to
entire colony, thus his services are very much essential to the
department, therefore, his application dated 28.4.2000 has
not been considered favourable keeping in view the exigencies
of work essentially of cadre, feasibility of surrendering the post
etc., since as per Government guidelines V.P.T. has to show
appropriate surplus in the manpower in the cadre without
causing hindrance to the normal operations of the
department. Further as per the above circular while accepting
V.R.S., the Port Trust has to ensure to surrender the vacancy
caused due to retirement of the incumbent on V.R.S.
This apart, the V.R.S. accepted by the Chairman, VPT to
some of the employees of the VPT who have completed 58
years of age is only prior to 23.8.2000 by which time the
retirement age limit of 60 years was in force and the same is
not relevant to the case on hand as in the case of the
respondent, he was holding important works under his control
and his continuance was considered necessary in VPT service
and thereby VRS was not granted to him. In the respondent’s
case, no such decision has been taken even on his application
dated 13.9.2000 addressed by him direct to Deputy Chairman.
The Circular dated 29.8.2000 that the employee who was
desirous to apply for retirement under voluntary retirement
scheme may apply direct to Dy. Chairman was only to
consolidate such applications at administrative level before
arriving at a decision, but it does not ensure ready acceptance
as alleged by the respondents. We have already reproduced
the prayers made in the writ petition of both the respondents.
The prayer was to declare the inaction on the part of the Port
Trust in not accepting the offer of the respondents to retire
from service of the Port Trust on voluntary retirement basis as
unjust and illegal. A further prayer was also made to direct
the Port Trust to treat the respondent to have retired from its
service on voluntary retirement basis with immediate effect by
extending all the terminal benefits that flow therefrom and
pass such other or further order or orders as are deemed fit
and proper in the circumstances of the case.
The respondents have not questioned the validity and
correctness of the voluntary retirement scheme introduced by
the Government of India and the decision taken by the Port
Trust in its meeting of the Board of Trustees held on
30.10.1991 pursuant to the decision of the Ministry in terms
of which Port Trust and Dock Labour Board are not to grant
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voluntary retirement to everyone. It is not in dispute that
beneficial scheme was introduced with a view to reduction of
surplus manpower.
The High Court, in our opinion, could not entertain
grievance of the respondents even on their own showing. It
was based merely on a presumption that applications for VRS,
if filed before April, 2000, would be considered by July, 2000
when no such circular or letter had been issued by the Port
Trust. The Scheme also provides that the Port Trust and Dock
Labour Board will have a right not to grant voluntary
retirement for the reasons recorded in writing. Such a right
given to the Port Trust was not questioned in the writ petition.
In our opinion, the Chairman is competent to frame the
Scheme having regard to the exigencies of work and no one
can claim voluntary retirement as of right. The learned
Judges of the High Court have also not seen that the
respondent’s application for voluntary retirement cannot be
considered in view of the seniority of service of the employees
concerned.
In our opinion, the request of the employees seeking
voluntary retirement was not to take effect until and unless it
was accepted in writing by the Port Trust Authorities. The
Port Trust Authorities had the absolute discretion whether to
accept or reject the request of the employee seeking voluntary
retirement under the scheme. There is no assurance that
such an application would be accepted without any
consideration. The process of acceptance of an offer made by
an employee was in the discretion of the Port Trust. We,
therefore, have no hesitation in coming to the conclusion that
the VRS was not a proposal or an offer but merely an
invitation to treat and the applications filed by the employees
constituted an offer.
The reasons assigned by the learned single Judge and
the learned Judges of the Division Bench in the orders are
erroneous and unsound and, therefore, they are set aside.
For the foregoing reasons, we allow the appeals and set
aside the order passed by the Division Bench affirming the
order of the learned single Judge. However, there shall be no
order as to costs.