Supreme Court of India
NATIONAL TEXTILE CORPORATION (M.P.) LTD.versusM.R. JHADAV
- Citation
- 2008 INSC 517
- Decided
- 24 April 2008
- Disposal
- Case Allowed
- Bench
- S B SINHA
Holding
In the absence of a communicated acceptance of the employee’s offer under the VRS, no legal right to the scheme’s benefits accrues; the VRS is an invitation to treat, and the employee’s continued service and superannuation constitute a waiver of any such right.
Summary
The National Textile Corporation (M.P.) Ltd. issued a Voluntary Retirement Scheme (VRS) effective 31 July 2000. M.R. Jadhav applied for the scheme on 16 May 2000 and obtained administrative clearance, but the corporation never communicated a final decision or acceptance, citing lack of funds. Jadhav continued in service, drew salary, and retired upon reaching the superannuation age after the retirement age was reduced to 58. He filed writ petitions seeking VRS benefits; the High Court granted relief, but the Supreme Court allowed the corporation’s appeal, holding that the VRS is merely an invitation to treat, not an offer, and that acceptance must be communicated. Since no acceptance was communicated and Jadhav remained in service until superannuation, he waived any right to VRS benefits. The Supreme Court set aside the High Court order and dismissed the employee’s claim.
Issues considered
- Whether a Voluntary Retirement Scheme constitutes an offer or merely an invitation to treat
- Whether an employee’s application under a VRS creates a legal right to benefits in the absence of acceptance
- Whether acceptance of a VRS must be communicated to the employee for a contract to arise
- Whether continued service and attainment of superannuation amounts to a waiver of any VRS rights
Legislation cited
Subjects
Voluntary Retirement Schemeoffer and acceptancecontract lawemployee rightssuperannuationwaiverpublic sector undertakingadministrative approvalemployment law
Judgment
[2008] 6 S.C.R. 1040
-' ~
A NATIONAL TEXTILE CORPORATION (M.P.) LTD.
v.
M.R. JHADAV
(Civil Appeal No. 2957 of 2008)
APRIL 24, 2008
B •.
[S.B. SINHA AND V.S. SIRPURKAR, JJ.)
·1-
Service Law:
Retirement - Voluntary Retirement Scheme - Employee
c opting for VR Scheme - Employer informing that although
administrative approval granted but no final decision taken -
Proposal of Voluntary Retirement not accepted - Meanwhile
employee retired - Writ petition by employee claiming that
legal right accrued in his favour to obtain benefits of VR
D Scheme - Dismissed - On appeal, Held: In absence of
communication of offer of employer, employee did not derive
any legal right to obtain benefits of VR Scheme - VR Scheme +'
constitutes offer to treat and is not offer stricto sensu - Only
when pursuant to said invitation to treat, employee opts for
E such scheme, it constitutes offer- When such offer is made, it
is required to be accepted - Unless offer is accepted, binding
contract does not come into being - Rights and obligations of
parties thereto would become enforceable only on completion
of contract - Unless such stage is reached, no valid contract
F can be said to have come into force -An offer for VR Scheme
must be made and accepted so long as relationship of
employer and employee continues - Such relationship come
to an end on the date on which the employee reaches his age
of superannuation - Since employee drew salary for entire
period during which he was in service and reached age of
G
superannuation, he is held to have waived his right to VR
Scheme
A voluntary retirement Scheme was floated by the
appellant-Corporation. Respondent working in appellant-
H 1040
NATIONAL TEXTILE CORPORATION (M.P.) LTD. v. 1041
M.R. JHADAV
Corporation opted for the said Scheme on 16.5.2000, w.e.f. A
31.7.2000.
An administrative clearance in relation thereto was
made but no decision taken by a competent authority in
that behalf was communicated to respondent.
; Respondent on expiry of the said date, i.e., 31.07.2000, 8
~ requested the appellant for being relieved from his post
by a letter dated 19.09.2000.
The General Manager by letter dated 26.9:2000
intimated respondent about the administrative approval c
and that the VRS was prepared and sent to Head Office
for funds and that Head Office informed that funds for VRS
was not available and thus Head Office directed not to
relieve respondent on relieving date till further orders.
Respondent filed writ petition in High Court, which D
was disposed of, with directions to appellant-Corporation
to pass appropriate orders.
Pursuant thereto, an office order dated 7.08.2001 was
passed by the appellant rejecting the said proposal,
stating that application of respondent for Voluntary E
Retirement made could not have been sanctioned in view
of the VRS not being in vogue and respondent was
accordingly retired on 31.1.2001 in accordance with the
orders dated 20.11.2000 whereunder the age of retirement
was rolled back to 58 years and he stood retired . F
Respondent filed another writ petition before the High
Court which was allowed. Hence the present appeal.
Allowing the appeal, the Court
G
HELD: 1. When a scheme is floated for voluntary
retirement, it constitutes an offer to treat. It is not an offer
stricto sensu. Only when pursuant to the said invitation
to treat, an employee opts for such a scheme, it
constitutes an offer. When such an offer is made, it is H
1042 SUPREME COURT REPORTS [2008] 6 S.C.R.
.J.,
A required to be accepted. The matter relating to
implementation of the said offer would indisputably be
governed by the terms and conditions of the scheme.
[Para 17) [1048-A-B)
Tek Chand v. Dile Ram (2001) 3 SCC 290; State of
B Haryana v. S.K. Singhal (1994) 4 SCC 293 - referred to. \
-f
Manjushree Pathak v. Assam Industrial Development
Corpn. Ltd. and Ors. (2000) 7 SCC 390 - held inapplicable.
2. Subject, of course, to the terms of "invitation to
c treat" as also those of the offer as envisaged under the
Indian Contract Act, an offer has to be accepted. Unless
an offer is accepted, a binding contract does not come
into being. A Voluntary Retirement Scheme contemplates
cessation of the relationship of master and servant. The
D rights and obligations of the parties thereto shall become
enforceable only on completion of the contract. Unless .,... .
such a stage is reached, no valid contract can be said to
have come into force. Acceptance of an offer must,
therefore, be communicated. [Para 20) [1051-B-C)
E State of Punjab v. Amar Singh Harika AIR 1966 SC 1313;
BSNL v. Subash Chandra Kanchan (2006) 8 SCC 279; State
of Punjab v. Khemi Ram AIR 1970 SC 214; - relied on.
Bank of India v. 0. P Swarnakar (2003) 2 SCC 721; MCD
F v. Qimat Rai Gupta (2007) 7 SCC 309 - referred to.
-~· 'i
3. If for good and sufficient reasons, the competent
authority did not communicate its decision, the
respondent did not derive any legal right. Such a legal
right cannot be claimed only on the basis of the letter of
G the General Manager dated 26.09.2000. What was
communicated there was the administrative approval.
However, it was also categorically stated therein that the
Head Office had not sanctioned the funds for payment of
VRS. It is in that situation, the request of the respondent
H to relieve him from his duties was not acceded to.
NATIONAL TEXTILE CORPORATION (M.P.) LTD. v. 1043
M.R. JHADAV [S.B. SINHA, J.]
,4-
Respondent continued in his service after 1.08.2000. He A
had been drawing his salary and other perks. There is
nothing on record to show that he drew his salaries
without prejudice to his rights and contentions. If he had
drawn his salary for the entire period during which he was
in service and reached the age of superannuation, by B
f I
reason thereof, he must be held to have waived his right,
~· if any. An offer for voluntary retirement must be made and
accepted so long the relationship of an employer and
employee continues, subject of course to the rules to the
contrary. Such relationship would come to an end on the c
date on which the employee reaches his age of
superannuation. [Paras 25, 26] [1052-E-H; 1053-A]
CIVILAPPELLATE JURISDICTION: Civil Appeal No. 2957
of 2008.
D
From the Judgment and Order dated 10.1.2006 of the High
i .J, Court of Madhya Pradesh, Indore in WP No. 2623/2001.
Sanjoy Ghose and Anitha Shenoy for the Appellant.
Meera Mathur for the Respondent.
E
The Judgment of the Court was delivered by
S.B. SINHA, J. 1. Leave granted.
2. Interpretation of a Voluntary Retirement Scheme (VRS)
floated by the appellant- Corporation is in question in this appeal F
I i which arises out of a judgment and order dated 10.01.2006
passed by the High Court of Madhya Pradesh at Indore in Writ
Petition No. 2623 of 2001.
3. Respondent at all material times was working as an
Assistant Spinning Master. A Voluntary Retirement Scheme was G
floated by the appellant.
-":
4. Respondent, on or about 16.05.2000 opted for the said
Scheme with effect from 31.07.2000. The said application was
in a prescribed proforma, the relevant portion of which reads
H
1044 SUPREME COURT REPORTS [2008] 6 S.C.R.
A as under:
·"With reference to your circular/ Notice No ..... dated ... ./
Memorandum of Settlement dated .... containing details of
N.T.C. Scheme of Voluntary Retirement, I hereby tender
my unconditional resignation from my post and service of
B your mills/ office with effect from .... I hereby opt for Voluntary
Retirement in terms of above said Scheme of Voluntary
Retirement which I have carefully read and understood.
2. I hereby undertake that I shall not claim any payments
c from your management/ mills/ company on account of my
Voluntary resignation consequent on my Voluntary
Retirement other than those admissible under the aforesaid
scheme of Voluntary Retirement.
3. I also undertake that I shall not at all withdraw resignation
D herein tendered by me from your service. I have furnished
the required particulars in the Appendix enclosed."
5. Indisputably, administrative clearance in relation thereto
was made but no decision taken by a competent committee in
E that behalf was communicated to the respondent. Indisputably,
he at the material time was aged over 57 years.
6. Respondent on expiry of the said date, i.e., 31.07.2000,
requested the appellant for being relieved from his post by a
letter dated 19.09.2000.
F 7. According to the appellant, sufficient fund was not
available with it for implementation of the scheme and to • •
proceed with the request of the respondent for his offer to retire
voluntarily in terms of the said Scheme. The General Manager
in his letter dated 26.09.2000 addressed to the respondent,
G stated:
"In reference to your VRS proposal dated 16.5.2000, we
have received the administrative approval from HO vide
letter of IR/ VRS/NBT/99/980 dated 24.5.2000. Accordingly,
your VRS was prepared and sent to HO for funds. HO has
H
NATIONAL TEXTILE CORPORATION (M.P.) LTD. v. 1045
M.R. JHADAV [S.B. SINHA, J.]
~~-
informed us that the funds for payment of VRS are not A
forthcoming hence do not relieve the employees on
relieving date till further orders.
Therefore, we are not in a position to relieve you as
requested by you, which you please note."
B
I 8. Respondent issued a legal notice upon the appellant
....- contending that it had not been acting to effectuate his
application under VRS on the ground of non-availability of funds.
9. Indisputably, however, the retirement age of the
employees of the appellant~ corporation was rolled back from c
60 years to 58 years. The decision was taken by the CMD of
the Holding Company which was approved by the Board of
Directors of the Corporation; the procedures wherefor were
specified as under:
D
"(a) The employees who have already attained the age of
f .... 58 years or shall attain the same by 31st December 2000
will retire on the close of office hours on 31st January,
2001.
(b) The employees who would attain the age of 58 years E
in January, 2001 or thereafter will retire in the month in
which they attain the age of 58 years in the normal course."
10. Respondent filed a writ petition in the High Court of
Madhya Pradesh at Indore inter alia praying for issuance of a
writ of or in the nature of mandamus directing the appellant to F
I -f effectuate his VRS application on and from 1.08.2000 upon
making payment of admissible dues.
The said writ petition was disposed of by a learned Single
Judge of the said Court, by an order dated 8.03.2001, stating: G
"2. In the situation of this nature, the only direction at this
stage that this Court can give is to decide the application
of the petitioner by the respondent within a period of six
months from today.
H
1046 SUPREME COURT REPORTS (2008] 6 S.C.R.
.l.~
A 3. This Court does not give any opinion at this stage except
to direct the respondent to pass appropriate orders on
the application which the petitioner has claimed to have
made under the VRS scheme. On such decision being
taken, the petitioner is always free to raise any other
B grievances depending upon the orders passed by the
respondents." 'I.
11. Pursuant thereto or in furtherance of the said direction, ~
an office order dated 7.08.2001 was passed by the appellant
herein rejecting the said proposal, stating:
c
"6. Under these circumstances, the application of Shri
M. R. Jadhav for Voluntary Retirement made on 16 .5.2000,
which was not sanctioned, could not have been sanctioned
in view of the VRS not being in vogue. Shri M.R. Jadhav
was accordingly retired on 31.1.2001 in accordance with
D
the orders dated 20.11.2000 whereunder the age of
retirement was rolled back to 58 years and he stood retired
as aforesaid.
... '
7. In view of the position indicated in para 6 above an
E amount of Rs. 1,53, 743/- being the amount of gratuity
admissible under the Payment of Gratuity Act, 1972 was
deposited with the Controlling Authority (Payment of
Gratuity Act, 1972), Bhopal as Shri M.R. Jadhav did not
turn up to collect this amount though offered to him and
F other dues viz Leave Encashment etc. (if payable)."
12. Questioning the validity of the said order, the \ I
respondent filed another writ petition before the Indore Bench
of the Madhya Pradesh High Court praying inter alia for the
following relief:
G
"The Respondent Employer be commanded through a Writ
of Mandamus to effectuate acceptance ofVRS by making
payment of admissible dues without further delay together
with interest as may be deemed proper."
H 13. By reason of the impugned judgment, a learned Single
NATIONAL TEXTILE CORPORATION (M.P.) LTD. v. 1047
M.R. JHADAV [S.B. SINHA, J.]
,....-f
Judge of the said Court has allowed the said writ application A
upon following the decisions of this Court in Tek Chand v Dile
Ram ((2001) 3 SCC 290] and State of Haryana v S.K. Singhal
((1994) 4 sec293], stating:
"6. From the above principle of law and in the facts and
circumstances of the case, in my opinion, the petitioner is B
;.
entitled to get the benefits of voluntary retirement scheme.
~
Consequently, petition of the petitioner is allowed. The
respondents are directed to grant benefits of the voluntary
retirement scheme to the petitioner. Necessary payments
be made to the petitioner within a period of three months c
from the date of receipt of copy of this order. No order as
to cost."
14. Mr. Sanjay Ghose, learned counsel appearing on
behalf of the appellant, in support of this appeal, inter alia would
D
submit that having regard to the fact that the offer of the
respondent was not accepted, the impugned judgment cannot
I~
be sustained.
15. Ms. Meera Mathur, learned counsel appearing on
behalf of the respondent, on the other hand, would urge: E
(i) Appellant being a 'State' within the meaning of Article
12 of the Constitution of India was bound to act fairly
and reasonably.
(ii) Having regard to the scope and purport of the F
Voluntary Retirement Scheme floated by it as also
) "f.
the fact that the respondent had applied pursuant
thereto in time which was one of the relevant factors
which having been approved by the competent
authority, a legal right accrued in favour of the
G
respondent.
16. Indisputably, Appellant is a public sector undertaking.
It, however, at the relevant time was a sick company. A financial
burden was cast on it in meeting the aforementioned Scheme.
H
1048 SUPREME COURT REPORTS [2008] 6 S.C.R.
.l_
A 17. When a scheme is floated for voluntary retirement, it
constitutes an offer to treat. It is not an offer stricto sensu. Only
when pursuant to the said invitation to treat, an employee opts
for such a scheme, it constitutes an offer. When such an offer is
made, it is required to be accepted.
8 The matter relating to implementation of the said offer
would indisputably be governed by the terms and conditions of '
the scheme. Does it contain any provision for automatic approval f.
of an offer made by the employee is the question? The High
Court has proceeded to hold in view of the decision of this Court
c in S.K. Singhal (supra) that there was no requirement of an order
of acceptance of the notice to be communicated to the employee
nor non-communication thereof should be treated as amounting
to withholding of permission.
18. The High Court, however, with respect, failed to read
D
the decision in the factual matrix obtaining therein. It was a case
where construction of Sub-Rule (1) of Rule 5.32(8) of the Punjab ,__ 1
Civil Services Rules was in question. What was, therefore,
necessary in terms of the said Rule was a notice to retire and
not a request seeking permission to retire. What was
E contemplated was seeking exemption for the three months
period. In terms thereof, failure to refuse to grant permission
attracted the acceptance clause from the date of expiry of the
said period. In the light of the aforementioned facet of the
Scheme, it was held:
F
"18. In the case before us sub-rule (1) of Rule 5.32(8)
~ '
contemplates a "notice to retire" and not a request seeking
permission to retire. The further "request" contemplated
by the sub-rule is only for seeking exemption from the 3
months' period. The proviso to sub-rule (2) makes a
G
positive provision that "where the appointing authority does
not refuse to grant the permission for retirement before
the expiry of the period specified in sub-rule (1 ), the
retirement shall become et.<ective from the date of expiry
of the said period. The case before us stands on a stronger
H
NATIONAL TEXTILE CORPORATION (M.P.) LTD. v. 1049
M.R. JHADAV [S.B. SINHA, J.]
,..,/--
footing than Dinesh Chandra Sangma cas~ so far as the A
employee is concerned. As already stated Rule 2.2 of the
Punjab Civil Services Rules Vol. II only deals with a situation
of withholding or withdrawing pension to a person who
has already retired."
19. Our attention has also been drawn to a decision of this B
Court in Manjushree Pathak v. Assam Industrial Development
~
Corpn. Ltd. and Others [(2000) 7 SCC 390] wherein although
Clause 8.1 of the Scheme provided for a discretion on the part
of the Management to accept or reject the request from any
employee for voluntary retirement viewing the organizational c
requirements and any other relevant factors, para 2 of the
prescribed application form was to the following effect:
"I, of my own accord and without any external pressure
and coercion, am opting for voluntary retirement under the
D
said Scheme. I shall be obliged if you kindly accept my
I -t option for voluntary retirement with immediate effect."
Appellant therein, thus, made a request in the said form
for its acceptance with immediate effect. For a period of 10
days, no response thereto was made. On that date, no vigilance E
enquiry or any disciplinary proceeding was pending against him.
It was in the aforementioned situation, this Court observed:
" ... We are unable to understand why the Managing Director
of the respondent Corporation did not accept the same
although it was required to be accepted with immediate F
I f effect as per para 2 of the prescribed application form.
No doubt, as per clause 8.1 of the Scheme extracted
above, the management had discretion to accept or reject
the request from any employee for voluntary retirement
viewing the organisational requirement and any other G
relevant facts but that does not mean that the respondent
Corporation being an authority coming within the purview
__..., of Article 12 of the Constitution can abdicate its duty to act
reasonably and fairly in exercise of discretion. It is strange
as to why the Managing Director of the respondent H
1050 SUPREME COURT REPORTS [2008] 6 S.C.R.
A Corporation, the competent authority to accept the ""-
application made for the voluntary retirement, did not act
on it at all till 17-2-1996. He ought to have exercised his
discretion as per clause 8.1 if not immediately at least
within a reasonable time. The last para of Memorandum
B No. Al DC/Estt./1485/93/746-51 dated 20-5-1993/21-5-
1993 issued by the respondent Corporation reads thus:
"The Corporation has thus offered a unique opportunity. It '""
is now for all eligible and interested employees of the
Corporation to avail of this golden opportunity in a big
c way."
13. As per sub-clause (1) of clause 5 of the Scheme, once
an employee applied for voluntary retirement it could not
be withdrawn. The appellant wanted to avail this golden
opportunity. With this background it is not known as to why
D
her application was not accepted. From the letter of the
appellant dated 23-1-1996, it is clear that she informed + 1
the Managing Director of the respondent Corporation that
there was no need to place her application before the
Board and he himself was competent to accept it. The
E non-response of the respondent Corporation to the letters
of the appellant dated 23-1-1996, 14-2-1996 and 15-2-
1996 and issuing of show-cause notice by the respondent
Corporation subsequently, clearly indicate that all was not
well with the respondent Corporation in dealing with her
F application seeking voluntary retirement. A subsequent
complaint alleging indulgence of the appellant in political t .
activities was not germane to the consideration of the
application of the appellant, having regard to the relevant
factors mentioned in clause 8.1 of the Scheme particularly
G when there was no infirmity or impediment in terms of the
Scheme in considering and accepting the application of
the appellant for voluntary retirement, having regard to the
._
fact that the appellant on :ier part did what all was required
to be done."
H
NATIONAL TEXTILE CORPORATION (MP.) LTD. v. 1051
M.R. JHADAV [S.B. SINHA, J.]
1--+
The said decision also cannot be said to have any A
application whatsoever in the instant case.
20. Subject, of course, to the terms of "invitation to treat"
as also those of the offer as envisaged under the Indian Contract
Act, an offer has to be accepted. Unless an offer is accepted, a
binding contract does not come into being. A Voluntary B
Retirement Scheme contemplates cessation of the relationship
of master and servant. The rights and obligations of the parties
thereto shall become enforceable only on completion of the
contract. Unless such a stage is reached, no valid contract can
be said to have come into force. Acceptance of an offer must, c
therefore, be communicated.
21. In Bank of India v. O.P Swamakar[(2003) 2 SCC 721],
this court held:
"60. Acceptance or otherwise of the request of an D
) -+- employee seeking voluntary retirement is required to be
communicated to him in writing ... "
22. What is the meaning of the word "communication" has
been noticed by this Court in State of Punjab v. Amar Singh
Harika [AIR 1966 SC 1313] in the following terms:
E
"It is plain that the mere passing of an order of dismissal
would not be effective unless it is published and
communicated to the officer concerned. If the appointing
authority passed an order of dismissal, but does not F
) j
communicate it to the officer concerned, theoretically it is
possible that unlike in the case of a judicial order
pronounced in Court, the authority may change its mind
and decide to modify its order."
[See also BSNL v. Subash Chandra Kanchan (2006) 8 G
sec 2791
A distinction, however, has always been made by this Court
as to cessation of a contract of service by way of punishment
vis-a-vis an order of suspension which does not bring about
H
1052 SUPREME COURT REPORTS [2008] 6 S.C.R.
_,._
'
A such a cessation, as for example suspension. [See State of
Punjab v. Khemi Ram AIR 1970 SC 214]
23. In MCD v. Qimat Rai Gupta [(2007) 7 SCC 309], this
Court opined:
s "27. An order passed by a competent authority dismissing
a government servant from services requires *
communication thereof as has been held in State of Punjab
v. Amar Singh Harika but an order placing a government
seNant on suspension does not require communication
c of that order. (See State of Punjab v. Khemi Ram)"
24. Therefore, there cannot be any doubt whatsoever that
communication of the acceptance of offer was necessary. An
internal noting does not constitute a communication. Even in a
case of order of suspension, bnly when the case goes out of the
D control of the appropriate authority, actual communication may
not be necessary.
25. If for good and sufficient reasons, the competent
authority did not communicate its decision, in our opinion, the
E respondent did not derive any legal right. Such ~ legal right
cannot be claimed only on the basis of the letter of the General
Manager dated 26.09.2000. What was communicated there
was the administrative approval. However, it was also
categorically stated therein that the Head Office had not
sanctioned the funds for payment of VRS. It is in that situation,
F the request of the respondent to relieve him from his duties was t '
not acceded to. Respondent continued in his seNice after
1.08.2000. He had been drawing his salary and other perks.
There is nothing on record to show that he drew his salaries
without prejudice to his rights and contentions. If he had drawn
G his salary for the entire period during which he was in seNice
and reached the age of superannuation, by reason thereof, he
must be held to have waived his right, if any.
26. An offer for voluntary retirement must be made and
H accepted so long the relationship of an employer and employee
NATIONAL TEXTILE CORPORATION (MP.) LTD. v. 1053
M.R. JHADAV [S.B. SINHA, J.]
continues, subject of course to the rules to the contrary. Such A
relationship would come to an end on the da.te on which the
employee reaches his age of superannuation.
27. The contents of the letter dated 26.09.2000, therefore,
indicate that although administrative approval had been granted
but no final decision had been taken. B
-+ 28. We, therefore, are of the opinion that in absence of the
communication of the offer of the respondent, the respondent
derived no legal right to obtain the benefits of the voluntary
retirement scheme. c
29. It was submitted by Ms. Mathur that by asking the
respondent to continue in service, the appellant has taken away
the right of an employee to continus in service.
We are unable to accept the said contention. By reason of
D
a mere offer to retire voluntarily, in terms whereof employee was
) -+ to get some more monetary benefits by itself, did not confer any
legal right on him.
30. For the said purpose, it is of some significance to
notice that Clause 3.1 of the Scheme provides for acceptance E
of an employee's offer for voluntary retirement. The scheme
postulates that the appointing authority concerned would be
competent not to accept the offer.
By reason of Clause 3.2 of the Scheme, the management
reserved a right to accept or reject an employee's offer under F
i ~-
the Scheme. The said right is absolute and is not hedged by
any condition whatsoever. The procedure provided for
acceptance also postulates that not only the offer has to be
accepted, an order is required to be issued that the post falling
vacant in all cases shall stand abolished simultaneously. G
Issuance of such an order, simultaneously with acceptance of
resignation, therefore, plays an important role. Admittedly, no
~.
such order was also issued by the appellant.
31. Clause 4 of the Scheme provides for the grant of
H
1054 SUPREME COURT REPORTS [2008] 6 S.C.R.
A benefits under the Scheme. Respondent has been paid his
provident fund dues, accumulated earned leave as also gratuity.
What has not been paid to him is the 'ex gratia payment'.
However, such ex gratia payment was to be made equivalent to
one and a half month's emoluments for each completed year of
B service or the monthly emoluments at the time of voluntary
retirement multiplied by the remaining months of service before
normal date of retirement, whichever is lower. Thus, even the
said provision contemplates that some service should remain.
If no period of service remained, even ex gratia payment could
c not be made.
32. For the reasons aforementioned, we are of the opinion
that the impugned judgment cannot be sustained and is set aside
accordingly. The appeal is allowed. No costs.
D.G. Appeal allowed.
0
'f .
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