Important POINTS
Policy of merger having been chalked out in conformity with the principles of law, functional similarity in the posts of two organisations and was a well thought out policy avoiding undue advantage to some and undue hardship to others, there is no discrimination.
When the high and responsible officials after lengthy deliberations spending their valuable time to frame policy regarding fusion of the two organisations, Court should be slow to interfere with such policy.

Headnote:Administrative Law – Merger of State Corporations – Central Government deciding to merge Vayudoot with Indian Airlines was taken as back as 25.5.1993 by a policy decision followed by definite steps were taken in pursuance thereof – Merely because there was no formal merger between the two, that by itself will not invalidate the decisions taken on 16.3.2000 or 5.2.2001 – The facts indicate that after the said policy decision the existence of Vayudoot was a mere formality – Existence of a separate procedure and that, other legal formalities not being yet over, by itself would not have the effect of wiping out the decision taken on 16.3.2000 or the notification dated 5.2.2001. (Para 23)
       Administrative Law – The cases of absorption of Vayudoot employees in Air India and that of merger of Vayudoot in the Indian Airlines are entirely different and not comparable – While the first was a case of absorption, the latter was a case of merger – Terms and conditions for both had to be different – More over, while in first case, only about 300 employees were affected, more than thrice that number had to be adjusted in the latter case – Therefore nothing wrong was done in adopting two different methodologies in the two cases. (Para 26)
       Administrative Law – Merger of Vayudoot and Indian Airlines – Merely because some of the employees of Indian Airlines would suffer in terms of seniority and ultimately in terms of their further chances of promotion, the whole scheme cannot be rejected as discriminatory or arbitrary – Policy of merger having been chalked out in conformity with the principles of law, functional similarity in the posts of two organisations and was a well thought out policy avoiding undue advantage to some and undue hardship to others, there is no discrimination. (Paras 28 and 30)
       (1980) 3 SCC 97 – Relied upon.
       Administrative Law – Merger of Vayudoot and Indian Airlines – Cut-off date – There was nothing wrong in fixing 10.03.1998 as the cut-off date when broadly the principles of merger were arrived at for the first time – It balanced the equities between the erstwhile Vayudoot employees and the present Indian Airlines employees, inasmuch as though the merger was five years old by then, the Indian Airlines employees got five years advantage whereas the Vayudoot employees had to sacrifice those five years in lieu of the better deal of the service they got because of the merger. (Para 31)
       Administrative Law – Estoppel – Joining Indian Airlines was optional for SHOD employees and on declared condition of the cut-of date of 10.3.1998 – When almost all of them joined Indian Airlines fully knowing the condition of cut-off date, they cannot be permitted to turn back and raise a plea that injustice is caused to them by fixing a cut off date of 10.3.1998 instead of 25.5.1993 or as the case may be, 10th April, 1994. (Para 32)
       (1992) 2 SCC 119 – Distinguished.
       Administrative Law – Merger of Vayudoot and Indian Airlines – Policy decision – The argument that not involving the Officers/employees of Indian Airlines in the policy decision of merger of Vayudoot is violation of principles of natural justice not tenable – The employees of Indian Airlines did not and could not have any say in the policy making. (Para 34)
       (2002) 2 SCC 333 – Relied upon.
       (1981) 4 SCC 130; (1991) 1 SCC 505; (1998) 4 SCC 598 – Distinguished.
       Judicial Review–When the high and responsible officials after lengthy deliberations spending their valuable time to frame policy regarding fusion of the two organisations, Court should be slow to interfere with such policy. (Para 37)
       (2003) 5 SCC 437 – Relied upon.
       Facts of the case :
       Indian Airlines Ltd. and Air India came to be established under the Air Corporations Act, 1953.
       Vayudoot Pvt. Ltd. was incorporated in 1982.
       Vayudoot was converted into a Public Ltd. Company in 1983 and its shares were held by Indian Airlines and Air India jointly.
       The Government of India took a decision on 25th May, 1993 to merge Vayudoot with Indian Airlines.
       A circular dated 25.05.1994 was issued whereby a separate department was created in Indian Airlines called Short Haul Operations Department for absorption of erstwhile Vayudoot employees.
       Accordingly, the appointment orders were issued in favour of the erstwhile Vayudoot employees appointing them in SHOD on and around 29.11.1994.
       *A notification was published earlier to that on 2.2.1998 whereby only few Deputy Managers (Commercial) of Northern Region of Indian Airlines were to appear for personal interview for the post of Manager (Commercial) thereby excluding some of the Deputy Managers (Commercial) working in SHOD. This was challenged by Writ Petitions which were eventually dismissed by Delhi High Court on 12.07.1999. The LPA No.388 of 1999 against which was also disposed of by the impugned judgment.
       Findings of the Court :
       Policy of merger having been chalked out in conformity with the principles of law, functional similarity in the posts of two organisations and was a well thought out policy avoiding undue advantage to some and undue hardship to others, there is no discrimination.
       There was nothing wrong in fixing 10.03.1998 as the cut-off date when broadly the principles of merger were arrived at for the first time.
       When almost all of employees of SHOD joined Indian Airlines fully knowing the condition of cut-off date, they cannot be permitted to turn back and raise a plea that injustice is caused to them by fixing a cut off date of 10.3.1998 instead of 25.5.1993 or as the case may be, 10th April, 1994.
       The employees of Indian Airlines did not and could not have any say in the policy making.
       Result : Appeals dismissed with cost.

JUDGMENT

V.S. SIRPURKAR, J.—

1.This Judgment will dispose of Civil Appeal Nos. 1269, 1270, 1271 and 1272 of 2007. Civil Appeal No. 1269 of 2007 is preferred by Officers’ Association of Indian Airlines; the representative body of the Indian Airlines employees. The Civil Appeal No. 1270 of 2007 is preferred by Indian Airlines Cabin Crew Association while Civil Appeal No. 1271 of 2007 is preferred by Vayudoot Karamchari Sangh and Civil Appeal No. 1272 of 2007 by Indian Airlines Officers’ Welfare Forum respectively. All these appeals challenge a common judgment passed by the Division Bench of the Delhi High Court whereby the Division Bench has set aside the common judgment passed by the Ld. Single Judge of that Court which had allowed the four Writ petitions filed by the Officers’ Association of the Indian Airlines and the employees of the Vayudoot Limited.

2.The learned Single Judge in his judgment had dealt with four writ petitions filed and had granted the relief in the following terms :

“Rule is made absolute. Decision of the respondents to offer merger to SHOD employees by placing them at the bottom of the seniority list of the post held by them after the existing employees of Indian Airlines is quashed. Notification dated 05.02.2001 is quashed. Notification dated 05.02.2001 requiring SHOD employees to exercise option in terms of the first notification dated 05.02.2001 is also quashed. Directions are issued to Indian Airlines and the Union of India to re-frame the policy of cadre merger by assessing and determining the equation of posts by taking into consideration the four guiding factors laid down by the Supreme Court in Chanderkant Anant Kulkarni’s case and in light of the observations made by me in the present decision.”

3.This direction was upset by the impugned judgment of the Division Bench whereby the Division Bench has set aside the whole judgment and allowed LPA nos. 646 to 649 of 2004, all writ appeals were filed by Indian Airlines Corporation. The Division Bench by the same judgment also dismissed one LPA No. 382 of 1999 filed by the Vayudoot employees.

FACTS :

*Indian Airlines Ltd. and Air India came to be established under the Air Corporations Act, 1953.

*Vayudoot Pvt. Ltd. was incorporated in 1982.

*Vayudoot was converted into a Public Ltd. Company in 1983 and its shares were held by Indian Airlines and Air India jointly.

*The Government of India took a decision on 25th May, 1993 to merge Vayudoot with Indian Airlines. Some salient features of that decision were :

(i)Vayudoot should be merged with Indian Airlines instead of retaining the present form of joint ownership by Indian Airlines and Air India.

(ii)The dues owed by Vayudoot to creditors in the public sector on the date of take-over by Indian Airlines would remain frozen for five years. There will thus be a moratorium for five years on repayment and servicing of the dues; thereafter the liabilities will be discharged by Indian Airlines in 10 annual instalments.

(iii)Equity shares of Vayudoot Limited held by Air India will be transferred in favour of Indian Airlines on a token consideration.

(iv)Vayudoot will be retained as a clearly identifiable separate Division of Indian Airlines.

4.Keeping with these principles, there came a circular dated 25.05.1994 whereby a separate department was created in Indian Airlines called Short Haul Operations Department (hereinafter called ‘SHOD’ in short) for absorption of erstwhile Vayudoot employees. The features of the absorption are as follows :

(1)By this circular, the employees so absorbed in SHOD were given the Indian Airlines pay scales and other benefits enjoyed by the Indian Airlines employees.

(2)There were no inter-departmental transfer in between SHOD employees and Indian Airlines.

(3)The Indian Airlines Recruitment and Promotion Rules as well as service conditions were made applicable to the employees of SHOD.

(4)On absorption of employees of Vayudoot in SHOD, the basic pay drawn by the employees was to be at approp

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2007 Supreme(SC) 1012

Cases Referred (6)