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2000 Supreme(Cal) 273
High Court Of Calcutta
Kalyan Jyoti Sengupta
PRADIP KUMAR BANERJEE - Appellant
Versus
UNION OF INDIA - Respondent
W. P. 6418 Of 2000
Decided On : 05/19/2000
ANVARI QUARESHI, B.R.GUPTA, LAXMIKANT PAL, P.K.ROY, R.N.MAJUMDAR, SUMITA PAL, SUNDARANANDA PAL, SUSANTA PAL
A policy decision taken in the larger interest of the public can be reasonably changed, even if it defeats the claim of substantive legitimate expectation.
Headnote:
INDIAN AIRLINES CORPORATION - RETIREMENT AGE - ROLLBACK - VALIDITY - CHALLENGE - CENTRAL GOVERNMENT EXEMPTION - VALIDITY - CLASS LEGISLATION - LEGITIMATE EXPECTATION - PUBLIC INTEREST - EMPLOYEES' INTERESTS. 1. The resolution of the 50th Board Meeting of the Indian Airlines Corporation (IAC) rolling back the retirement age of employees below the board level from 60 years to 58 years was challenged on grounds of arbitrariness, illegality, and discrimination. 2. The Central Government's subsequent notification granting exemption from the earlier directive to increase retirement age to 60 years was also challenged. 3. The court held that the IAC was justified in applying for the exemption considering its financial stringency and decreasing revenue-profit ratio. 4. The court also held that the Memorandum providing for the exemption was not invalid for lack of guidelines, as it was a policy decision taken in the larger interest of the public. 5. The court further held that the Memorandum did not create class legislation or subject employees to hostile discrimination, as the IAC's unique circumstances justified a different approach. 6. The court rejected the argument of legitimate expectation, as the policy decision to enhance retirement age was taken in the public interest and could be reasonably changed. 7. The court dismissed the petition, finding it to be filed by a small section of employees without authority from the majority. 8. The court also relied on a Supreme Court decision holding that a bipartite settlement cannot be considered unreasonable due to the grievance of a small section of workmen.
Fact of the Case:
The Indian Airlines Corporation (IAC) had initially increased the retirement age of employees below the board level from 58 years to 60 years pursuant to a Central Government directive. However, the IAC subsequently applied for an exemption from this directive due to financial difficulties and decreasing revenue-profit ratio. The Central Government granted the exemption, and the IAC rolled back the retirement age to 58 years. A group of employees challenged this decision, arguing that it was arbitrary, illegal, discriminatory, and violated their legitimate expectations.
Finding of the Court:
The court found that the IAC's decision to roll back the retirement age was justified considering its financial stringency and decreasing revenue-profit ratio. The court also held that the Central Government's Memorandum providing for the exemption was not invalid for lack of guidelines, as it was a policy decision taken in the larger interest of the public. Furthermore, the court held that the Memorandum did not create class legislation or subject employees to hostile discrimination, as the IAC's unique circumstances justified a different approach. The court also rejected the argument of legitimate expectation, as the policy decision to enhance retirement age was taken in the public interest and could be reasonably changed.
Issues: 1. Whether the IAC's decision to roll back the retirement age was arbitrary, illegal, and discriminatory. 2. Whether the Central Government's Memorandum providing for the exemption was invalid for lack of guidelines. 3. Whether the Memorandum created class legislation or subjected employees to hostile discrimination. 4. Whether the employees had a legitimate expectation that the enhanced retirement age would continue.
Ratio Decidendi: 1. The court held that the IAC's decision to roll back the retirement age was justified considering its financial stringency and decreasing revenue-profit ratio. 2. The court also held that the Central Government's Memorandum providing for the exemption was not invalid for lack of guidelines, as it was a policy decision taken in the larger interest of the public. 3. Furthermore, the court held that the Memorandum did not create class legislation or subject employees to hostile discrimination, as the IAC's unique circumstances justified a different approach. 4. The court also rejected the argument of legitimate expectation, as the policy decision to enhance retirement age was taken in the public interest and could be reasonably changed.
Final Decision: The court dismissed the petition, finding it to be filed by a small section of employees without authority from the majority.
( 1 ) IN this writ petition the petitioners have challenged the Resolution of 50th Board Meeting of the respondent company circulated by the reference being No. GS-I/ial/ (50)/99 dated 6th January, 2000 whereby the respondent company has rolled back the retirement age of the employees below the board level from 60 years to 58 years. Incidentally it is mentioned that on or about 27th May, 1998 in its 39th Board Meeting pursuant to the direction given by the Central Government the respondent Corporation decided to fix the retirement age of the employees below the board level at 60 years in place of 58 years. Accordingly necessary amendment in the service regulation was incorporated and has been acted upon. The decision of rolling back with regard to retirement age has been taken pursuant to an exemption granted by the Central Government in terms of subsequent notification dated 21st August 1998.
( 2 ) MR. Saktinath Mukherjee, learned senior advocate appearing on behalf of the petitioners submits that this decisions is wholly arbitrary, illegal and discriminatory in nature. The Central Government has taken a decision allowing all the Government of India undertakings and all Central Government organizations to fix the retirement age of the employees at 60 years from 58 years. This is policy decision of Government of India.
( 3 ) HE contends subsequent Memorandum dated August 21, 1998 is only an enabling provision for seeking exemption from operation of the earlier decision cannot be public policy of any kind. The said memorandum suffers from infirmities in absence of any guideline and/or criteria and/or norms laid down the Government of India under which circumstances such exemption can be granted. So this right of having exemption ultra vires Article 14 and 16 of the Constitution of India. In support of his submission he relies on the following decisions of Supreme Court reported in, as follows: (i) AIR 1981 SC 1829, (ii) AIR 1980 SC 1801, (iii) AIR 1994 SC 988, (iv) AIR 1993 SC 142 and (v) AIR 1997 SC 2758.
( 4 ) IN this case the respondent corporation being a Central Government undertaking after having taken decision earlier raising retirement age to 60 years has illegally rolled back to age of 58 years. The earlier decision for raising retirement age to 60 years is a national policy and it is allowed to be followed and in fact being followed in all public sector undertakings. So there should not be and cannot be any departure in the establishment of the respondent corporation, as it is results in hostile discrimination as regard the retirement age of the employees is concerned. In fact there is no justification and/or basis and/or material for taking such decision of reversion. The purported reason for rolling back is given as being financial stringency. He argues that the purported reason is absolutely baseless and absurd as admittedly the Indian Airlines Corporation unlike other public sector undertakings has not suffered any loss in the last financial year rather has earned profit. So this decision is motivated, whimsical and capricious.
( 5 ) MR. Mukherjee's next contention is that the office Memorandum dated August 21, 1998 enabling to grant exemption, purports to make a class legislation amongst the employees of the central public enterprises. Such class legislation ultra vires the Articles 14 and 16 of the Constitution of India. In support of his contention he relies on decision of Supreme Court reported in AIR 1999 SC 1412. Under the national policy a right of the employee had been created by increasing retirement age. By the subsequent memo of August 21, 1998 such right has been taken away without affording any opportunity being heard as such on this ground it is ultra vires and void.
( 6 ) MR. Mukherjee pointing out to the allegation contained in paragraphs 32 and 37 of the petition contends the whole legislation dated 20th December,1999 is invalid as no quorum was formed for taking decision
