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IN THE HIGH COURT OF BOMBAY
G.R. Majithia D.K. Trivedi, JJ.
Life Insurance Corporation of India.... Petitioner.
Versus
John Anton D’Souza and another.... Respondents.
Writ Petition No. 2354 of 1989, decided on 22-1-1996.
Advocates appeared :
R.A. Dada with Ms. S. Paranjpe i/b Little and Company, for the petitioner.
M.S. Ramamurthy with Ramesh Ramamurthy and Ms. A.S. Kaushik, for the respondent No. 1.
Sub-section (2) of Section 33-C took within its purview the benefit under an award or decision of an industrial Court to which an employee was entitled to receive from the employer and which benefit was capable of being computed in terms of money. It presupposes that the entitlement is already determined and what to be determined is the benefit which accrues from that entitlement in terms of money. The Labour Court is not competent to determine the question of entitlement under Section 33-C(2).
Section 105-See Life Insurance Corporation Act, 1956-Sections 43(2), 49(1)(2)(b) and (bb).
Sections 43(2), 49 (1) (2) (b) and (bb)-Insurance Act, 1938, Section 105-Scope of.
Section 43(2) of the L.I.C. Act entitled the Central Government to apply certain provisions of the Insurance Act to the Corporation subject to such conditions and modifications as may be specified in the notification by which those provisions have been applied. The Central Government, by Notification No. G.S.R. 734, dated 23.8.1958 apart from other sections, applied the provisions of Sections 102 to 106 of the Insurance Act to the Corporation, Section 105 of the Insurance Act deals with wrongfully obtaining or withholding of the property of the insurer by any director, managing agent, manager or other officer or employee of an insurer. This section further says that if any employee having obtained possession of the property of the insurer wrongfully withholds it, the insurer can file a complaint against the guilty person and the Court could give such punishment as is provided thereunder. Section 49(1) of the L.I.C. Act contains general provisions for framing of regulation by the Corporation which are not inconsistent with the provisions of the Act to give effect to the provisions of the Act with the previous approval of the Central Government. The regulation can provide for an action akin to the one provided for under Section 105 of the Insurance Act but with lesser penalty. Regulation can provide for retention of Corporations contribution towards the provident fund in case the past employee fails to deliver possession of staff quarter on superannuation and when called upon to do so. Till such time the regulations are framed, there is no bar for the corporation to issue instructions for the purpose of giving effect to the provision of the Act. The Act provides for resorting to criminal action against an employee who illegally retains possession of the property of the Corporation. The Corporation could under the instructions provide for lesser penalty than the one contained in Section 105 of the Insurance Act which has been made applicable to the Corporation by Notification dated August 23, 1958.
If the Corporation can frame regulations regulating recruitment of employees and their service conditions, it can issue administrative instructions with reference to the same where on any particular aspect these are silent. The regulations are silent in so far as these relate to the misconduct of a past employee for retaining possession the service quarters after retirement and not surrendering the same when called upon to do so. These administrative instructions are those within the competence of the corporation and are issued in exercise of power conferred by Section 49(1) of the Act read with Clauses (b) and (bb) of sub-section (2) of Section 49.
Sections 49(1), (2) (b) and (bb)-See Industrial Disputes Act, 1947 - Section 33-C (1) and (2).
2. The facts as gathered from the pleadings of the parties and the list of events and dates filed by the petitioner in Court and not disputed by the Counsel for respondent No. 1, briefly put, are as under :---
Respondent No. 1 (hereinafter referred to as "the employee") joined service of the petitioner on February 9, 1949. He applied for allotment of staff quarters on April 14, 1960. He was allotted staff quarters on July 4, 1960. The petitioner issued a circular dated June 20, 1985 authorising withholding of Provident Fund and Gratuity in the event of any employee not vacating staff quarters on retirement. The petitioner issued another circular dated September 4, 1985 endorsing the action authorised by Circular dated, June 20, 1985. The employee retired from service on June 20, 1987 on reaching the age of superannuation. He did not surrender possession of the staff quarters necessitating the withholding of the retirement benefits pursuant to circulars dated June 20, 1985 and September 4, 1985. The employee filed an application dated September 30, 1987 under section 33-C(2) of the Industrial Disputes Act, 1947 (for short "the I.D. Act") claiming Rs. 99, 295/- from the petitioner which had been withheld. The petitioner paid Rs. 32,000/- by way of gratuity to the employee during the pendency of the application under section 33 C (2) of the I.D. Act. The application was allowed by respondent No. 2 by order dated June 15, 1989 directing the petitioner to pay a sum of Rs. 67, 295.85 with 9% interest from July 1, 1989 till the date of actual payment. Respondent No. 2 issued these directions after holding that the administrative instructions dated June 20, 1985 and September 4, 1985 cannot replace or modify the rules and regulations governing the rules of pensionary benefits to retiring employees and that these Circulars do not have a binding effect under the provisions of the Life Insurance Corporation of India Act (for short "the L.I.C. Act") or any statutory rules framed by the Central Government. On September 6, 1990, this Court stayed the operation of the order under challenge on the condition that the petitioner paid a sum of Rs. 50,000/- to the employee by September 30, 1990. This amount was paid before this date. On March 30, 1991, an order of eviction was passed against the employee under the Public Premises (Eviction of Unauthorised Occupants) Act, 1971 and damages were also awarded against him. This order was not challenged and it has attained finality.
3. Mr. R.A. Dada, Senior Advocate, learned Counsel for the petitioner, raised the following contentions:-
(i) The Circulars dated June 20, 1985 and September 4, 1985 providing for withholding of Provident Fund and gratuity in the event the employee refuses to vacate staff quarters on superannuation are valid at law and are enforceable.
(ii) The Labour Court has no jurisdiction to decide a question of entitlement of applicant employee to a sum claimed in an application under section 33-C(2) of the I.D. Act.
4. The Leave and Licence Agreement dated July 4, 1960 was executed by the employee in favour of the petitioner. In the preamble to this document it is recited that the employee being in the service of the Life Insurance Corporation (petitioner) has been allotted as a licensee and service occupant, by way of leave and licence, the use and occupation as a residence for himself and his family members only, of premises being Chawl T. No. C-5 on t
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