2001 Supreme(SC) 172

2001(1) Supreme 528
Supreme Court of India
(From Kerala High Court)
G.B. Pattanaik & B.N. Agrawal, JJ.
South Malabar Gramin Bank —Appellant
versus
Co-ordinate Committee of South Malabar Gramin Bank Employees Union & South Malabar Gramin Bank Officers Federation & Ors. —Respondents
Civil Appeal No. 2218 of 1999
With
C.A. No. 2219/1999 and
T.P. (Civil) No. 403/1999
Decided on 31-1-2001
Counsel for the Parties :
For the Appearing Parties : H.N. Salve, Solicitor General, P.P. Rao, S.K. Dholakia, Jitendra Sharma, D.A. Dave, D.D. Thakur, (Rakesh Dwivedi) Sr. Advocate (NP), G.L. Sanghi, Sr. Advocates, T.V. Ratnam C.L. Narasimhan, A.K. Srivastava, Ms. Sushma Suri, R. Vasudevan, D.S. Chahar, Ms. Beena Pandey, B.K. Pal, P.N. Jha, K.K. Rai, K.T. Anantharaman, C.K. Sasi, N. Manoj Kumar, Rajiv Mehta, P.V. Dinesh, K.M.K., Nair, Ms. Malini Poduval, (Yash Pal Dhingra) Advocate (N.P.) B.K. Sinha, B.K. Satija, Advocates.

Headnote:(i) Regional Rural Banks Act, 1976—Section 17—Constitution of India—Articles 14 and 16—Fixation of pay structure of employees of Regional Rural Banks—Powers of Central Government—Proviso 2 to Section 17(1) does not offend Articles 14 and 16. (Para 10)

       (ii) Regional Rural Banks Act, 1976—Section 17—Fixation of pay structure of employees and officers—Claim for pay scale on par with employees of Nationalised Commercial Banks (NCB)—Reference of dispute to National Industrial Tribunal—Justice Obul Reddy s award that RRB s employees and officers entitled to parity with officers and employees of NCB—Subsequent implementation of award and revision of pay on par with NCB when their pay got revised on basis of 5th Bipartite Settlement—Subsequent 6th and 7th Bipartite Settlement between NCB and their employees—Revision of pay of NCB employees—Non-revision of pay of RRB employees—Writ petition claiming revision on parity with NCB employees—Claim that award of Justice Obul Reddy became final and implemented and failure to revise pay unjustified—Unacceptable—Power conferred under Section 17 on Central Government for determining remuneration of employees of RRBs—Power cannot be taken away by an award of Tribunal Constituted by Central Government—Revision of pay structure could be made only after Central Government exercise its ­powers under Section 17 and determines same—If power not exercised mandamus could be issued to Central Government and it would be bound to perform its duties—Pay scale and other emoluments of RRBs employees would not automatically stand altered as and when pay structure of employees of NCBs gets revised--Central Government is bound to maintain parity with pay structure of employees of NCBs in same sense and spirit in award of Justice Obul Reddy—Power under Section 17 has to be exercised by Central Government soon after any pay revision of employees of NCBs—Financial condition of RRBs cannot be a vital factor for Central Government in deciding pay structure of employees of RRBs.

       On the contentions raised by the learned counsel for the parties, the first question that arises for consideration is whether the award given by Justice Obul Reddi and accepted by the State Government and given effect to, can be construed to mean that the pay scales and other emoluments of the Regional Rural Bank employees would stand automatically altered, as and when the pay structure of the employees of the commercial banks get revised, on the basis of the so-called bipartite settlement between the employer and the employees of those commercial baanks? The award no where indicated this course of action nor could it have indicated so, in view of the provisions of the Regional Rural Banks Act, conferring specific power on the Central Government to decide the pay structure of the employees of the Regional Rural Banks. The second proviso to Section 17(1) of the Regional Rural Banks Act, 1976 conferred power on the Central Government for determining the remuneration of the officers and employees appointed by the Regional Rural Banks and that power conferred upon the Central Government by the legislature cannot be taken away by an award of a tribunal, constituted by the Central Government for redressing the grievances of the employees, which were pending before a Court of law. Even the prayer in the writ petition that had been filed in the Supreme Court was not for a declaration and mandamus that the employees of the Regional Rural Banks would be entitled to the same scale of pay as and when the pay structure of their counterparts in the nationalised commercial banks get revised. To construe the award of Justice Obul Reddi in the manner as was contended by the counsel, appearing for the employees of the bank would tantamount to making the second proviso to Section 17(1) of the Act nugatory, redundant and otiose and by no stretch of imagination the duties and powers conferred on the Central Government under the Act could be made nugatory by interpreting an award of a tribunal. The disputes raised before the Court being disputes on several questions of facts, the Court and the Union Government thought it fit to be adjudicated upon by a tribunal and the tribunal on discussion on materials, gave its award. The relevant findings of the tribunal which we have quoted earlier in this judgment does not in any manner even contemplate that the power and jurisdiction of the Central Government under the second proviso to Sub-section (1) of Section 17 would become redundant and the pay structure as decided in 1987, pursuant to the award of the tribunal in respect of the employees of the Regional Rural Bank would automatically get revised as and when the pay structure of the employees of the commercial banks get revised. On the construction of the award of Justice Obul Reddi and the provisions of the second proviso to Section 17(1) of the Act, we have no hesitation to hold that the revision of pay structure of the employees of the Regional Rural Banks could be made, only after the Central Government exercises its power under the provisions of the Act and determines the same. If however, the Central Government fails to discharge its obligation as in the case in hand, which would result in gross disparity between the pay-scales of the commercial banks and the Regional Rural Banks, then a mandamus could be issued to the Central Government for performance of its duties and the Central Government would be bound to perform its duties, taking into account all germane factors, including the factor of the subsequent pay revision of the employees of the Nationalised Commercial Banks. (Para 11)

       The next question that arises for consideration is whether the financial condition of the Regional Rural Banks could be a vital consideration for the Central Government in determining the pay structure of the employees of the Regional Rural Banks? Under the Regional Rural Banks Act, while conferring power upon the Central Government to determine the pay structure of the employees of the Regional Rural Banks, there has been no whisper that the financial condition of the bank or capacity of the employer to pay, would be a germane consideration. Justice Obul Reddi tribunal, unhesitatingly negatived the aforesaid stand of the employer and came to the positive conclusion after elaborate discussions of the purpose for which these banks were established and how a case of very special nature concerning the employees of a banking industry, claiming parity with the salary structure of the employees of a sister banking industry is being considered and ultimately, the tribunal had observed that the Act has been enacted in fulfillment of the hopes and aspirations aroused in the preamble and the Directive Principles of the Constitution and, therefore, the performance of such institutions in furtherance of those principles is not required to be judged from the curved angle of viability or from the point of view of a private money lender or businessman or from mere profit and loss statement. At any rate, the aforesaid decision of the tribunal in the form of an award was implemented by the Central Government and, therefore, having implemented the same, it would not be permissible for the employer-bank or the Union of India to take such a plea in the present proceedings. It is a futile attempt on the part of the employer as well as the Union of India to re-agitate the dispute, which has already been resolved and has been given effect to. In our considered opinion, therefore, the aforesaid contention on behalf of the appellant cannot be sustained and it would no longer be open, either for the bank or the Union of India to raise a contention that in determining the wage structure of the employees of the RRBs, the financial condition would be a relevant factor. (Para 12)

       The next question that arises for consideration is, what is the meaning of the expression “parity” used by the tribunal in giving its award and indicating “that the officers and other employees of the Regional Rural Banks will be entitled to claim parity with the officers and other employees of the sponsor banks in the matter of pay-scales, allowances and other benefits” in paragraph 4.425 of the award of the tribunal. It may be noticed at this stage that on behalf of the employees, a claim had been made before the tribunal for application of the principle “equal pay for equal work” and that was negatived by the tribunal, but all the same the tribunal directed to maintain a parity. The meaning of the word “parity” in the Concise Oxford Dictionary is equality; being at par; fact of being even or odd. In Law Lexicon Dictionary, the word “parity” has been defined to mean being on a par with; analogy; close similarity (as) by party of reasoning. In Webster Comprehensive Dictionary, the expression “parity” has been defined to mean equality, as of condition or rank; equivalent position; equal value; close resemblance. In the ‘Words and Phrases’ Volume 31, the word “parity” means act providing for road construction to bring each country in state to “parity” required all counties to be brought in same condition regarding aid in road building, “parity” meaning equality. In view of the definition of the aforesaid expression “parity” and in the context in which the tribunal came to hold that the employees of the Regional Rural Banks would be entitled to claim a parity with the employees of the Nationalised Commercial Banks, the Union Government, while exercising its power under the proviso to sub-section (1) of Section 17 would be guided by the aforesaid conclusion of the tribunal and will not be justified in deciding the pay structure for the employees of the Regional Rural Banks, which would bring in disparity between the two groups of employees, even though there may be a slight variation in the pay structure. As has been stated earlier, the aforesaid direction to maintain parity was duly given effect to and the employees of the Regional Rural banks were given the pay structure applicable to their counter parts in the Nationalised Commercial Banks w.e.f. 1987, though subsequently in 1992 and 1997, there had been revision in the pay structure of the employees of the Nationalised Commercial Banks. Though, we have upheld the contention of the appellant with regard to the power of the Central Government to decide the pay structure of the employees of the Regional Rural Banks, yet there cannot be any doubt that in so deciding, the Central Government would be duty bound to maintain the parity with the pay structure of the employees of the Nationalised Commercial Banks in the same sense and spirit as Justice Obul Reddi decided and as was given effect to by the Union Government in the year 1987. (Para 13)

       Though, we have no hesitation in coming to a conclusion that the Union Government possesses the power to determine the pay structure in accordance with the second proviso to sub-section (1) of Section 17 and, therefore, that power has to be exercised soon after any pay revision of the employees of the Nationalised Commercial Banks is effected and while exercising that power, the Union Government should try to maintain the parity between the pay structure of the employees of the Regional Rural Banks and the employees of the Nationalised Commercial Banks. (Para 14)

       In view of the aforesaid conclusions of ours on the different contentions raised and in view of the fact that the Union of India in its Interlocutory Application had already indicated that the employees of the RRBs will be granted the new scales w.e.f. 1.4.2000 in the line with scales granted to commercial bank employees of equivalent level, we direct that the said determination be a determination under the second proviso to Sub-section (1) of Section 17 of the RRB Act and as such the salary of the employees of the Regional Rural bank w.e.f. 1.4.2000 be determined accordingly. We also further direct that for maintaining the parity between the employees of the commercial banks and the employees of the Regional Rural Banks, the said Union Government shall decide the question as to what would be the salary of the employees of the RRBs subsequent to the 6th Bipartite settlement having been given effect to, in case of employees of the commercial banks and with effect from what date and the benefit flowing from such decision be given to the RRB employees. The decision in question shall be taken within a period of six months from today. Hereafter, as and when the pay structure of the employees of the nationalised commercial banks get revised on the basis of any bipartite settlement, the Union Government should take a decision so far as the employees of the Regional Rural Banks are concerned, within a reasonable time and bearing in mind the conclusions, we have already arrived at, so that the so-called parity could be maintained. (Paras 15, 16 & 17)