Supreme Court of India
STATE OF ANDHRA PRADESH AND ORS. ETC. ETC.versusBOLLARPRAGADA SURYANARAYANA AND ORS. ETC. ETC.
- Citation
- [1997] SUPP. 2 S.C.R. 715
- Decided
- 15 July 1997
- Disposal
- Dismissed
Holding
The gratuity scheme does not apply when posts are abolished, and contributions under the Family Benefit Scheme must be refunded with interest.
Summary
The respondents were part‑time Village Officers in Andhra Pradesh whose posts were abolished by an Ordinance on 6 January 1984, later replaced by the Part‑time Village Officers Abolition Act, 1985 (sections 3 and 5). Prior to abolition they had contributed to a Family Benefit Scheme (G.O. No. 3420, 1 August 1980) and were covered by a gratuity scheme (G.O. No. 1772, 18 April 1980). After receiving compensation under section 5 of the Act, they filed writ petitions seeking gratuity and family‑benefit benefits; the High Court allowed the claims, later limiting benefits to those who had turned 58 on 6 January 1984. The State appealed, arguing that the schemes apply only when an officer voluntarily demits after notice, not when the post is abolished by legislation. The Supreme Court held that the gratuity scheme is inapplicable in the case of abolition and that contributions made under the Family Benefit Scheme must be refunded with interest at 6 % per annum. Consequently, the appeals were allowed, the High Court order set aside, and the respondents directed to receive refunds with interest.
Issues considered
- Whether the gratuity scheme under G.O. No. 1772 is payable to officers whose posts were abolished by legislation
- Whether the Family Benefit Scheme under G.O. No. 3420 is applicable to officers whose posts were abolished
- Whether contributions made under the Family Benefit Scheme should be refunded with interest
Subjects
service lawgratuityfamily benefit schemeabolition of postscompensationrefund of contributionsAndhra Pradeshpart-time village officers
Judgment
A
,. STATE OF ANDHRA PRADESH AND ORS. ETC. ETC.
v.
BOLLARPRAGADASURYANARAYANA
AND ORS. ETC. ETC.
JULY 15, 1997
B
[SUJATA V. MANOHAR AND G.B. PATTANAIK, JJ.)
Andhra Pradesh Abolitio11 of Posts of Pait Time Village Officers Act,
1985: Sections 3 a11d 5.
Service Law-GratuityFamily.
c
Be11efit Sche111e-E11titleme11t to-State of Andhra Pradesh-Posts of
parl Time Village Officers-Abolition with effect from 6.1.1984--Scheme for
gratuity and family benefit existing prior to abolition of posts-Respondents
holding post of parl time village Officers--On abolition of posts they were D
paid compensation-Writ filed by them claiming gratuity under G.O.Ms. No.
1772 dated 18.4.1980 and Family Benefit Scheme 1mder G.O.Ms. No. 3420
dated J.8.1980-Writ allowed by High Court-On appeal Division Bench
partly modified the order and the benefit of these Schemes was given to all
those Part-time Village Officers who had attained the age of 58 years on
7.1.1984--Appeal prefe"ed by State before Supreme Court--Collfention that E
the provisio11s of Scheme are applicable only when the office was demitted in
the manner set out in the schemes-These provisions were not applicable
when by legislation posts were abolished-Held the contributions actually
made by the concerned respondents under the Family Benefit Scheme should
be refunded to them with interest at 6% p.a.
F
CIVIL APPELLATE JURISDICTION : Civil Appeal Nos. 2762-
2788 of 1988.
From the Judgment and Order dated 25.8.87 of the Andhra Pradesh
High Court in W.A No. 142/85 and W.P. Nos. 7928-30, 6941, 6943/87, 7544,
7877, 7997, 8075, 8078, 8178, 8372, 8241, 8401, 12874, 12731185, 3674, 3670, G
3665, 3667, 3671/87, 16984/86, 13200,85, 493/87, 9785 and 9789 of 1987.
Smt. K. Amareshwari, K. Ram Kumar and V.R. Anumola, for the
Appellants.
S. Markandeya and Ms. C. Markandeya for the Respondents. H
715
716 SUPREME COURT REPORTS [1997] SUPP. 2 S.C.R.
A The following Order of the Court was delivered :
The respondents were holding the post of part-time Village Officers
in the State of Andhra Pradesh. Under an Ordinance dated 6.1.1984, the
posts of Part-time Village Officers in the State of Andhra Pradesh were
abolished. The Ordinance was replaced by the Part-time Village Officers
B Abolition Act being Act No. 8 of 1985. Sections 3 and 5 of the said Act
provide as follows :
"3. The posts of part-time Village Officers in the State of Andhra
Pradesh are hereby abolished with effect on and from the date of
c commencement of this Act, and every person who holds the post
of part-time Village Officer in any part of the State of Andhra
Pradesh shall, with effect on and from such date, cease to hold
such post".
"5. (1) Every person who ceases to hold post of part- time Village
D Officer by reason of section 3, shall be paid an amount for the
total service put in by him as part-time Village Officer and such
amount shall be determined in accordance with the provisions of
sub-section (2).
(2) The amount referred to in sub-section (1) shall be calculated
E at the rate of one-half of the monthly emoluments for every year
of total service put in by the person referred to in sub-section (1).
Explanation : For the purposes of this Section,
(a) Where the total service, --·
F
(i) includes a period which is a portion of a year; or
(ii) is a period less than a year; the amount payable for the period
referred to in sub-clause (i) or sub-clause (ii), as the case may be
shall be an amount bearing to the amount payable for one year of
G
total service, the same proportion as the said period bears to a
period of one year of total service."
Prior to the abolition of the posts of Village Officers, under G.O.
Ms. No. 1772 dated 18.4.1980, the Government of Andhra Pradesh had
H framed a scheme for gratuity which was applicable to the Village Officers
STATE v. B. SURYANARAYANA 717
and the Village servants. The Scheme inter alia, provides as follows : A
f
(i) Gratuity shall be paid at the rate of one months pay
(honorarium) for every completed year of service to the Village
Officers and Village servants subject to a maximum of 20 months
pay.
B
(ii) The gratuity is payable in the event of death, there being no
age of superannuation in respect of these categories or at the time
of demitting officer after attaining the age of 58 years in the case
of Village Officers and 60 years in the case of Village Servants
after giving a notice to the appointing authority." C
By another G.O.Ms. No. 3420 dt. 1.8.1980, the Government of
Andhra Pradesh had formulated a Family Benefit Scheme for Village
Officers which, inter alia, provides as follows :
"1. (i) Every Village Officer shall be required to pay a contribution D
of Rs. 5 per month till he attains the age of 58 years.
(ii) Every Village Servants shall pay a contribution of Rs. 3 per
month till he attains the age of 58 years.
2(i) In the case of death of Village Officer while in service and E
before he attains the age of 58 years a sum of Rs. 7500 (Rupees
Seven thousand five hundred only) shall be paid to the nominee
of the deceased as specified in the said scheme;
• (ii) In the case of death of a Village Servant while in service and
before attaining the age of 58 years a sum of Rs. 5000 shall be paid F
to the nominee of the deceased as specified in the said scheme;
(iii) In the case of any Village Officer or Village servant demitting
office on attaining the age of 58 years by giving a notice to the
competent authority the actual amount of contribution repre- G
senting interest shall be paid to him or his nominee in the event
of death."
On the abolition of the posts of Part-time Village Officers, the
respondents were paid compensation calculated in the manner provided
under section 5 of the said Act. The respondents filed a writ petition before H
718 SUPREME COURT REPORTS [1997] SUPP. 2 S.C.R.
A the Andhra: Pradesh High Court claiming gratuity under G.O.Ms. dated
18.4.1980 and the benefit of the Family Benefit Scheme under G.0.Ms. No.
3420 dated 1.8.1980 in addition to the compensation already received by
them under the said Act. The writ petition was allowed by the Andhra
Pradesh High Court. In appeal before the Division Bench of the High
B Court, the order was partly modified and the benefit of these Schemes was
given to all those part-time Village Officers who had attained the age of
58 years on 6.1.1984, that is to say, the date of the commencement of the
Ordinance. The State has filed the present appeal.
It is contended by the State that the respondents are not entitled to
C gratuity or the benefit of the Family Benefit Scheme because the posts of
part -time Village Officers have been abolished under the said Act. The
Gratuity Scheme under G.O.Ms. dated 18.4.1980 provides inter alia, for
payment of gratuity to the Village Officer at the time of demitting office
after attaining the age of 58 years after giving notice to the appointing
D authority. Therefore, the gratuity Scheme expressly provides for the man-
I,
ner of demitting office on attaining the age of 58 years or 60 yeas, as the
case may be. It is only when the office is demitted in the manner set out
in the Scheme that gratuity under the said G.O.Ms. becomes payable. The
office is required to be demitted by the concerned holder after giving a
notice to the appointing authority. This clearly contemplates a voluntary
E relinquishment of office on attaining the specified age. There is no retire-
ment age for this office. This provision would not apply when, by legisla-
tion, the posts are abolished. In such a situation there is no question of
voluntary demitting of office after notice. The provisions of the said
G.O.Ms., therefore, cannot be attracted when the posts are abolished by
F legislation. This is precisely the reason why under section 5 of the said Act,
a provision for compensation has been made, which the respondents have
received.
Under the Family Benefit Scheme framed by the G.O. Ms. No. 3420
dated 1.8.1980, certain amounts are required to be paid in case of a Village
G Officer or Village Servant demitting office on attaining the age of 58 years
by giving notice. For the same reasons, as in the case of the gratuity scheme
this provision is not attracted when the office is not demitted voluntarily
by giving notice but the post is abolished.
H The Family Benefit Scheme, however, requires every Village Officer
STATEv. B.SURYANARAYANA 719
to pay a contribution of Rs. 5 per month and every Village Servant to pay A
a contribution of Rs. 3 per month till he attains the age of 58 years. It was
on payment of these contributions that the Village Officer or the Village
Servant has been given certain benefit as specified in the said Scheme. By
reason of the abolition of the posts, this scheme has come to an end. The
contributions which have been paid by the Village OfficersNillage Servants
under the Scheme should, therefore, in all fairness, have been refunded to B
them since they will not be entitled to claim any benefit under the Scheme
by the reason of the Scheme having come to an end by abolition of the
part-time Village Officers.
We, therefore, direct that the contributions actually made by the
~-
concerned respondents under the Family Benefit Scheme should be
refunded to the concerned respondents with interest at 6% p.a. C
The judgment of the High Court is set aside. The appeals are allowed
with the above direction. There shall be no order as to costs.
In CA. No. 4398 of 1988
For the reasons set out in C.A. Nos. 2762-2788 of 1988, C.A. No. D
4398 of 1988 is dismissed. There shall be no order as to costs.
T.N.A. Appeals dismissed.
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