THE HON’BLE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH.GIVEN ITS JUDGMENTS FAVOUR OF GRAMIN DAK SEVAKS Reg - Bonus Ceiling Rs. 2500/- to Rs. 3500/- from 2006/2007 to due Arrears Sought clarification from Ministry of Finance within a maximum period of two Months from the receipt of this order.
IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH.
Kang Gursharan Singh
Civil Writ Petition No. 13491 of 2009
DATE OF DECISION : JULY 10, 2014
Union of India and others
All India Postal ED Employees Union (Punjab Circle), Amritsar and others
CORAM : HON'BLE MR. JUSTICE SANJAY KISHAN KAUL, CHIEF JUSTICE
HON'BLE MR. JUSTICE AJAY TEWARI
PRESENT: Mr. Namit Kumar, Advocate, for the petitioners.
Mr. Madan Mohan, Advocate, for respondents No.1 to 4.
Respondent No.5 formal party.
SANJAY KISHAN KAUL, CJ. (Oral)
The controversy in the present case relates to the emoluments of the Extra Departmental Agents (EDAs) and Branch Post Masters under the Posts and Telegraphs Extra Departmental Agents (Conduct and Service) Rules, 1964, subsequently replaced by the Department of Posts, Gramin Dak Sewaks (Conduct and Employment) Rules, 2001. It is the case of the Gramin Dak Sewaks (hereinafter referred to as 'GDS') that they are entitled to a productivity linked bonus at par with other employees of the Postal Department and there cannot be a different ceiling limit for them.
In order to appreciate the controversy, we would first like to examine the status of the GDS. Fortunately, we can be conveniently guided by a judgment of the Hon'ble Supreme Court in Chet Ram vs. Jit Singh and a connected matter, 2009(1) RSJ 11. In the facts of that case, the controversy was whether such GDS were Government servants and, thus, disqualified from contesting the elections of the Nagar Panchayat. The plea of the GDS that they were not Government employees, having been working on a part time basis and were, thus, not disqualified in terms of Section 11(g) of the Punjab State Election Commission Act, 1994, was negatived. The rationale for the same was based on the terms and conditions of the GDS, the Rules having been framed in terms of proviso to Article 309 of the Constitution of India which, undisputedly, governs only the Government employees. The Supreme Court referred to its earlier views expressed in Union of India and others vs. Kameshwar Prasad, 1997(11) Supreme Court Cases 650, quoting the relevant paragraphs dealing with the status of the GDS. We find it convenient to reproduce the observations of Kameshwar Prasad's case (supra), as under:-
“2. The Extra Departmental Agents system in the Department of Posts and Telegraphs is in voguesince 1854. The object underlying it is to cater to postal needs of the rural communities dispersed in remote areas. The system avails of the services of schoolmasters, shopkeepers, landlords and such other persons in a village who have the faculty of reasonable standard of literacy and adequate means of livelihood and who, therefore, in their leisure can Civil Writ Petition No. 13491 of 2009 3 assist the Department by way of gainful avocation and social service in ministering to the rural communities in their postal needs, through maintenance of simple accounts and adherence to minimum procedural formalities, as prescribed by the Department for the purpose. [See: Swamy’s Compilation of Service Rules for Extra Departmental Staff in Postal Department p. 1.]
3. The Extra Departmental Agents are government servants holding a civil post and are entitled to the protection of Article 311(2) of the Constitution (See: Supdt. of Post Offices v. P.K. Rajamma). They are governed by separate set of rules, viz., the Posts and Telegraphs Extra Departmental Agents (Conduct and Service) Rules, 1964 (hereinafter referred to as “the Rules”). The Central Civil Services (Classification, Control and Appeal) Rules are not applicable to this category of employees in view of the notification dated 28-2-1957 issued by the Government of India under Rule 3(3) of the said Rules.”
In the context of the aforesaid observations, the Hon'ble Supreme Court in Chet Ram's case (supra) concluded that there was a disqualification incurred on account of the GDS, being a Government employee.
Now, turning to the provisions of the Payment of Bonus Act, 1965 (for short 'the Act'), an employee is defined under clause (13) of Section 2, being the definition clause, as under:-
“(13) "employee" means any person (other than an apprentice) employed on a salary or wage not exceeding ten thousand rupees per mensem in any industry to do any skilled or unskilled manual, supervisory, managerial, administrative, technical or Civil Writ Petition No. 13491 of 2009 4 clerical work for hire or reward, whether the terms of employment be express or implied;”
The aforesaid definition has to be examined in the context of the Statements and Objects for the said Act, which shows that a Tripartite Commission was set up by the Government of India by their resolution dated 6.12.1961, to consider in a comprehensive manner, the question of payment of bonus based on profits to employees employed in establishments and to make the recommendations to the Government. The practice of paying bonus in India is stated to have originated during the First World War when certain textile mills granted 10% of wages as war bonus to their workers in 1917. Thus, the Act was enacted to provide for payment of bonus to persons in certain establishments on the basis of profits or on the basis of production or productivity and for matters connected therewith. Insofar as the aspect of ceiling limit is concerned, it is useful to reproduce Section 12 of the Act, which reads as under:-
“12. Calculation of bonus with respect to certain employees.- Where the salary or wage of anemployee exceeds three thousand and five hundred rupees per mensem, the bonus payable to such employee under section 10 or, as the case may be, under section 11, shall be calculated as if his salary or wage were three thousand and five hundred rupees per mensem.”
We may note that the ceiling limit was increased from Rs. 2,500/- to Rs. 3,500/-, as per Amending Act No.45 of 2007.
The said Act also introduced the concept of bonus Civil Writ Petition No. 13491 of 2009 5 linked with production or productivity by Amending Act No.23 of 1976. Thus, a concept of bonus based originally on profit alone was expanded by the said Amending Act, which also amended the recital to the said Act. Section 31A reads as under:-
“31A. Special provision with respect to payment of bonus linked with production or productivity.- Notwithstanding anything contained in this Act,-
(i) where an agreement or a settlement has been entered into by the
employees with their employer before the commencement of the Payment of Bonus (Amendment) Act, 1976 (23 of 1976), or
(ii) where the employees enter into any agreement or settlement with their employer after such commencement, for payment of an annual bonus linked with production or productivity in lieu of bonus based on profits payable under this Act, then, such employees shall be entitled to receive bonus due to them under such agreement or settlement, as the case may be:
Provided that any such agreement or settlement whereby the employees relinquish their right to receive the minimum bonus under section 10 shall be null and void in so far as it purports to deprive them of such right:
Provided further that such employees shall not be entitled to be paid such bonus in excess of twenty per cent. of the salary or wage earned by them during the relevant accounting year.”
The Ministry of Finance, Department of Expenditure, Government of India, issued an Office Memorandum dated 20.9.1995 qua grant of Productivity Linked Bonus and ad hoc Bonus to Central Government employees specifying the revision Civil Writ Petition No. 13491 of 2009 6 of eligibility and calculation ceilings, revising the ceiling from ` 1,600/- to ` 2,500/-. Thereafter, by another Office Memorandum dated 10.10.2008 qua the same subject matter, it was revised from ` 2,500/- to ` 3,500/-. The applicability of this Office Memorandum to the Postal Department is not in question.
It is from the very inception i.e. 1979-80 that payments were made to GDS on parity with regular employees of the productivity linked bonus. However, when the Office Memorandum of 10.10.2008 was issued, the Ministry of Communications and IT, Department of Posts, Government of India issued a communication dated 15.10.2008 stating that the ceiling for calculation of productivity linked bonus has been raised to ` 3,500/- from ` 2,500/- for regular Central Government employees only with effect from 1.4.2006. Thus, the situation which operated in the past was sought to be altered by not giving the benefit of the increase in the ceiling limit to the GDS on the specious plea that they were not "regular" Central Government employees, while no such phraseology was used in the Office Memorandum of the Ministry of Finance dated 10.10.2008.
It is the aforesaid which gave a cause of action to the private respondents before us to prefer an application before the Central Administrative Tribunal, Chandigarh Bench, which allowed the Original Application vide the impugned order dated 8.5.2009 holding that the private respondents before us are entitled to grant of ad hoc bonus at the revised calculation ceiling mentioned in the Office Memorandum dated 10.10.2008.
The fundamental plea of the learned counsel for the petitioners, initially, was that the nature of employment of the private respondents before us was different as they were not regular Government employees and they were not even paid bonus. He pleaded that there could not be parity with the regular Government employees. However, he could not dispute the position that in view of the pronouncement in Chet Ram's case (supra), these GDS had already been held to be Government employees.
The second limb of the submission of the learned counsel for the petitioners, based on the distinction of the private respondents not being "regular" Government employees, was that what was being paid to them was ad hoc payment on analogy of productivity linked bonus and not a productivity linked bonus. In this context, our attention has been invited to Swamy’s Compilation of Service Rules for Extra Departmental Staff, the relevant portion whereof is being extracted below:-
“(14) Ad hoc payment on the analogy of Productivity-Linked Bonus. - Consequent on the introduction of a scheme for the grant of Productivity-Linked Bonus to the regular P & T employees, the question of giving some incentive to the Extra-Departmental employees for increasing the productivity has been under consideration by the Government.
2. The Government have since decided that incentive to the Extra-Departmental employees shall be made subject to the following conditions:-
(1) The Scheme will be applicable to the ED Civil Writ Petition No. 13491 of 2009 8 Agents during the years when regular employees in the P & T Department become entitled to bonus on the basis of productivity achieved during any particular year.
(2) A flat rate monthly wage of Rs.75 will be assumed for all ED Agents irrespective of their actual employment and the quantum of ad hoc payment for each year will be based on wages for the same number of days as announced for regular employees during that year. If the regular departmental employees are entitled for 25 days' wages, the ED Agents will earn ad hoc payment of Rs. [75 x 25] / 30 = Rs.62.50.
(3) The formula for determining the number of days' wages with reference to the productivity achieved will be same as for regular departmental employees.
(4) The Scheme for making ex gratia payment shall commence with reference to the performance in the financial year 1979-80 and will be reviewed after observing its working for three years as in the case of regular employees. [D.G., P & T, Letter No.37-1/79-PAP (i), dated the 17th March, 1980]”
It is, thus, his contention that the Office Memorandum dated 10.10.2008 will not ipso facto apply to the private respondents as it relates to the calculation of ceiling for payment of productivity linked bonus and ad hoc bonus to Central Government employees while what was being paid to the private respondents was an ex-gratia payment which was neither a productivity linked bonus nor an ad hoc bonus . It is, Civil Writ Petition No. 13491 of 2009 9 however, not disputed that this ex-gratia payment was at parity with the productivity linked bonus from 1988-89 to 20.5.2006. The dispute is relatable to the years 2006-07 and 2007-08.
We also posed a query to the learned counsel for the petitioners as to how were the provisions of the said Act excluded from application to the GDS keeping in mind the expansive definition of an employee which clearly covers them. We, once again, do not have a satisfactory answer but, on the other hand, on perusal of the written statement, we find an admission of the respondents before the Tribunal (petitioners herein) in para-1, on merits, to the effect that "They are paid bonus in the shape of Ex-gratia". Thus, it is quite clear to us that the petitioners themselves perceive that what is being paid to the GDS is actually bonus but under the nomenclature of exgratia.
Learned counsel for the petitioners submits that the matter in issue, really, does not pertain only to the private respondents before us but would affect about 3,50,000 such GDS all over the country and separate petitions have been filed. It is, however, quite plausible that a number of them may not be covered under the Scheme. We do not have the exact number of people who will be covered under the Scheme.
In the conspectus of the aforesaid legal position, the only question to be examined will be as to what is the meaning and interpretation of the Office Memorandum dated 10.10.2008 of the Ministry of Finance which appears to be a consequence of the amendments carried out to the said Act while increasing the Civil Writ Petition No. 13491 of 2009 10 ceiling under Section 12 of that Act from ` 2,500/- to ` 3,500/- per mensem. This is in the context of the earlier Office Memorandum dated 20.9.1995 when the ceiling limit was raised from ` 1,600/- to ` 2,500/- per mensem. We may also note that the Office Memorandum dated 10.10.2008 itself states that it is being issued consequent upon recent amendments to Section 2 (13) and Section 12 of the said Act enhancing the calculation ceiling effective from 1.4.2006.
We, thus, call upon the Department of Expenditure, Ministry of Finance, to clarify the aforesaid aspect arising from the Office Memorandum dated 10.10.2008 qua its applicability to the GDS who are being paid "bonus in the shape of ex-gratia payment". This is so as the phraseology used in that Circular is of productivity linked bonus and ad hoc bonus. Once such a clarification is issued, naturally, the Postal Department will be bound by the same and the fate of its stand qua the amount payable to the GDS would, thus, depend on the clarification to be made by the Ministry of Finance.
In the end, we must clarify that the petitioners not only sought to deprive the GDS of the benefits but also sought to make recovery for the payments already made in two Divisions in the Punjab Circle for the two years in question i.e. 2006-07 and 2007-08. The amount having been paid by the petitioners themselves and not based on any misrepresentation by the private respondents, in our opinion, is not recoverable in view of the pronouncement of the Hon'ble Supreme Court in Chandi Prasad Uniyal and others vs. State of Uttrakhand and sothers, (2012) 8 Supreme Court Cases 417.
The exercise be carried out by the Ministry of Finance within a maximum period of two months from the receipt of this order.
The petition is, accordingly, disposed of in terms of our above directions, leaving the parties to bear their own costs.
( SANJAY KISHAN KAUL )
July 10, 2014
( AJAY TEWARI )