Writ jurisdiction cannot enforce non-statutory VRS benefits arising from a private employment contract lacking public law elements.

The petitioner, a retired employee of the Indian Institute of Social Welfare and Business Management (“Institute”), joined service as a Steno Typist in 1999 and was subsequently promoted to Personal Assistant and Secretary to the Directorate.

The Institute’s Board of Governors allegedly introduced a Voluntary Retirement Scheme (“VRS”) on 5 April 2023, under which the petitioner applied for voluntary retirement on medical grounds.

Her application was approved by the Board of Governors on 28 February 2024, and the Board subsequently resolved on 9 July 2024 to settle her dues under the VRS by 31 July 2024.

The Institute later released the petitioner from service and paid her gratuity, provident fund and leave-encashment dues, but did not pay the alleged VRS benefits.

In response to her demand, the Institute denied the existence of any applicable VRS and contended that the petitioner had only received ordinary retirement benefits under the Institute’s norms.

The petitioner invoked promissory estoppel and Article 300A, asserting that she had relinquished continued employment in reliance on the VRS and sought payment of the promised benefits with interest.

The respondents raised a preliminary objection that the dispute concerned a non-statutory contractual VRS and lacked any public-law element.

Whether the writ petition under Article 226 was maintainable for enforcing the petitioner’s claimed benefits under a disputed, non-statutory VRS?

Whether the dispute involved a public-law element or was merely a private contractual dispute between the Institute and its employee?

Whether the petitioner could invoke promissory estoppel and Article 300A to obtain VRS benefits in writ jurisdiction?

The Court applied the principle that the maintainability of a writ petition depends not merely on whether the respondent is “State” under Article 12, but on whether the impugned action contains a public-law element; purely private contractual rights ordinarily cannot be enforced under Article 226.

Relying on HEC Voluntary Retired Employees Welfare Society v. Heavy Engineering Corporation Ltd., the Court held that acceptance of an offer for voluntary retirement creates a contractual relationship, and that a non-statutory VRS is governed by ordinary contract law.

Under K.K. Saksena v. International Commission of Irrigation and Drainage, writ jurisdiction does not lie to enforce private-law rights, even against an Article 12 authority, unless the challenged action has a public element.

Joshi Technologies International Inc. v. Union of India was relied upon for the principle that contractual disputes may be reviewed in writ jurisdiction only where a public-law character, arbitrariness, illegality or other recognised ground is established.

The Court also relied on Army Welfare Education Society v. Sunil Kumar Sharma, St. Mary’s Education Society v. Rajendra Prasad Bhargava, and related decisions holding that employment disputes arising from non-statutory service contracts are ordinarily outside Article 226.

Although State of Himachal Pradesh v. Oasys Cybernatics Pvt. Ltd. recognises that State action must be rational and fair, judicial review does not authorise adjudication of disputed private contractual claims or judicial micro-management of contractual matters.

The Court held that the very existence and legal validity of the alleged VRS were disputed.

The Institute maintained that no VRS formed part of the petitioner’s service conditions, that no such scheme had been implemented for any employee, and that the Board of Governors lacked authority to approve a scheme involving the Institute’s financial obligations.

Since the petitioner’s claim depended entirely on proving the existence, approval and enforceability of the alleged scheme, its adjudication would require determination of disputed facts and contractual rights.

The claimed VRS benefits were not statutory dues, and the alleged breach did not involve violation of any statutory service rule or constitutional obligation.

The Court therefore found that the dispute was individual and private, notwithstanding the Institute’s alleged governmental affiliation, receipt of grants, or performance of an educational/public function.

Promissory estoppel could not be enforced in the writ proceeding because the writ court was not the competent forum to determine whether a binding VRS had been offered and accepted.

The writ petition was therefore held not maintainable and was dismissed.

The dismissal was expressly made without prejudice to the petitioner’s right to approach the competent forum for an appropriate remedy in accordance with law.