NATIONAL INSURANCE SPECIAL VOLUNTARY RETIRED/ RETIRED EMPLOYEES ASSOCIATION & ANR. versus UNITED INDIA INSURANCE CO. LTD. & ANR.

[2018] 12 S.C.R.

ANATIONAL INSURANCE SPECIAL VOLUNTARY RETIRED/RETIRED EMPLOYEES ASSOCIATION & ANR.

UNITED INDIA INSURANCE CO. LTD. & ANR.

B(Civil Appeal No. 10775 of 2018)

OCTOBER 26, 2018

[KURIAN JOSEPH AND SANJAY KISHAN KAUL, JJ.]

Service Law – Voluntary Retirement – Appellant-ex-employeesof the respondent Insurance Companies went out of service takingCadvantage of the General Insurance Employees’ Special VoluntaryRetirement Scheme, 2004 (SVRS-2004 Scheme) – Appellantscontended that they were also entitled to claim benefits under theearlier scheme known as the General Insurance (Employees)Pension Scheme, 1995, which inter alia provided that qualifyingDservice of an employee, retiring under 1995 scheme, would beincreased by period not exceeding 5 years, subject to certainconditions – Held: The SVRS-2004 Scheme specifically excludedthe benefit of additional 5 years’ service of the 1995 Scheme forpurpose of determining the quantum of pension and commutationof pension to such employees who availed retirement under the SVRS-E2004 Scheme – The SVRS scheme being Scheme u/s.17-A of theGeneral Insurance Business (Nationalisation) Act, 1972, it was notappropriate to add or subtract terms from the Scheme, which has astatutory flavour – Thus, such statutory or contractual voluntaryretirement schemes as the SVRS-2004 Scheme have to be strictlyFadhered to, and the very objective of having such Schemes wouldbe defeated, if parts of other schemes are sought to be importedinto such voluntary retirement schemes – General Insurance Business(Nationalisation) Act, 1972 – s.17-A.

Dismissing the appeals, the CourtG

HELD: 1. It is, thus, quite apparent that clause 6(c), of theGeneral Insurance Employees’ Special Voluntary RetirementScheme, 2004 (SVRS-2004 Scheme) as part of the overallpackage, clearly stated that the notional benefit of five (5) yearsof added service, as stipulated in para 30 of the General InsuranceH(Employees) Pension Scheme, 1995, would not be admissible for

purposes of determining the quantum of pension and commutationof pension to such employees who availed retirement under theSVRS-2004 Scheme. Suffice to say that the SVRS-2004 Schemeprovided for additional benefits beyond the 1995 Scheme, whilesimultaneously curtailing this aforesaid aspect, specifically.Despite this clear stipulation, the appellants sought the benefitof these very five (5) added notional years of service, forcalculation of their pension, under the SVRS-2004 Scheme, inaddition to the other benefits offered. This demand was declinedby the respondent Insurance Company. [Para 6] [647-C-D]

2. The question for consideration is whether thebeneficiaries under the SVRS-2004 Scheme, which specificallyexcludes the benefit of additional five (5) years’ service of the1995 Scheme, would still be entitled to claim the said amountcontrary to the explicit terms. The answer to this question is inthe negative. It has to be appreciated that the SVRS-2004 Schemeis statutory in character, being Scheme under Section 17-A ofthe General Insurance Business (Nationalisation) Act, 1972. Itwould not be appropriate to add or subtract terms from theScheme, which has statutory flavour. There could not havebeen any concession contrary to the terms of the Scheme, and ifsuch concession was to enure for the benefit of the retirees,then it had to go through the process of formal notification.[Paras 14, 15] [649-G; 650-A-B]

3. Statutory or contractual, such voluntary retirementschemes as the SVRS-2004 Scheme, thus, have to be strictlyadhered to, and the very objective of having such Schemes wouldbe defeated, if parts of other Schemes are sought to be importedinto such voluntary retirement schemes. What is offered by theemployer is package as contained in the Schemes of voluntaryretirement, and that alone would be admissible. [Para 20] [652-D-E]

4. It is, thus, abundantly clear that nothing more would begiven than what is stated in the Scheme, and for that matter,nothing less. If the employees avail of the benefit of such aScheme with their eyes open, they cannot look here and there,under different schemes, to see what other benefits can beachieved by them, by seeking to take advantage of the more

Abeneficial schemes, while simultaneously enjoying the morebeneficial aspects of the SVRS-2004 Scheme. [Para 23] [653-C-D]

Manojbhai N. Shah & Ors. v. Union of India & Ors.(2015) 4 SCC 482; State of Maharashtra v. RamdasBShrinivas Nayak & Anr.(1982) 2 SCC 463 : [1983]1 SCR 8;Y. Sleebachen & Ors. v. State of Tamil Naduthrough Superintending Engineer Water ResourcesOrganisation/Public Works Department & Anr.(2015)5 SCC 747;Tripura Goods Transport Association &Anr. v. Commissioner of Taxes & Ors.(1998) 2 SCCC264; New India Assurance Company Limited v. RaghuvirSingh Narang & Anr. (2010) 5 SCC 335 : [2010] 4SCR 299;Bank of India & Ors. v. O. P. Swarnakar &Ors.(2003) 2 SCC 721 : [2002] 5 Suppl. SCR 438;HEC Voluntary Retired Employees Welfare Society &DAnr. v. Heavy Engineering Corporation Ltd. & Ors.(2006) 3 SCC 708 : [2006] 2 SCR 678 - referred to.

From the Judgment and Order dated 17.07.2017 of the HighCourt of Judicature at Madras, Madurai Bench in W.A.MD. No. 1228of 2016.G

WITH

Civil Appeal No. 10776, 10777, 10778 of 2018.

Mr. Guru Krishna Kumar, Sr. Adv., Gautam Narayan, Ms. AsmitaSingh, Abhinav Goyal, Advs. for the appellants.

NATIONAL INSURANCE SPECIAL VOLUNTARY RETIRED/RETIREDEMPLOYEES ASSN. v. UNITED INDIA INSURANCE

Rakesh Dwivedi, Jaideep Gupta, Sr. Adv., Vivek Kishore, Mrs.Rajya Lakshmi, Advs. for the respondents.

The Judgment of the Court was delivered by

SANJAY KISHAN KAUL, J. 1. Leave granted.

2. The appellants are ex-employees of the respondent InsuranceCompanies, who initially joined as Assistants, between 1972 to 1980,andwent out of service taking advantage of the General Insurance Employees’Special Voluntary Retirement Scheme, 2004 (for short ‘SVRS-2004Scheme’). The bone of contention is the plea of these appellants, thatthey are also entitled to certain benefits arising under the earlier schemeknown as The General Insurance (Employees) Pension Scheme, 1995(for short ‘1995 Scheme’), which inter alia provided that the qualifyingservice of an employee, retiring under that1995Scheme, would beincreased by period not exceeding five (5) years, subject to certainconditions.

3. The concept of providing pension to the employees of therespondent Insurance Companies was introduced for the first time bythe 1995 Scheme, which was notified in the Gazette of India on 28.6.1995,but was brought into force from 1.11.1993. The relevant para 30 of the1995Scheme, which is of concern to the present dispute, is as under:

“30. Pension on voluntary retirement -

(1) At any time after an employee has completed twenty yearsof qualifying service, he may, by giving notice of not less thanninety days, in writing to the appointing authority, retire fromservice:…………”

xxxxxxxxxxxxxxxxxxxx

“(5) The qualifying service of an employee retiring voluntarilyunder this paragraph shall be increased by period notexceeding five years, subject to the condition that the totalqualifying service rendered by such employee shall not in anycase exceed thirty three years and it does not take him beyondthe date of retirement.”

4. The aforesaid 1995 Scheme, thus, envisaged an additionalnotional benefit of five (5) years’ service for employees retiring voluntarilyunder it, with the limitation that the qualifying service rendered by such

Aemployees: (i) shall not, in any case, exceed 33 years; and (ii) does nottake them beyond the date of retirement.

5. The insurance companies were faced with excess manpower,and, thus, to prune the manpower size, special scheme, being the SVRS-2004 Scheme, was introduced for limited period of sixty (60) daysBfrom the date of its notification, that is 1.1.2004. The Scheme was madeapplicable to permanent, full-time employees eligible to seek specialvoluntary retirement, provided that they had attained the age of 40 yearsand had completed the minimum qualifying service of ten (10) years, ason the date of notification. The relevant clauses 5 & 6 read as under:

C“5. Amount of ex-gratia:-

(1) An employee seeking Special Voluntary Retirement underthis Scheme shall been (sic.)[1] entitled to lower of the ex-gratiaamount as given below, namely: sixty days salary for eachcompleted year of service, OR, salary for the number of monthsof remaining service.

(2) The ex-gratia shall be computed on the basis of his/her salaryas on the date of relieving. In case, wage revision is effectedfrom date prior to the date of this notification in the OfficialGazette, the benefit of revised pay for the purpose of paymentof ex-gratia will be allowed.

6. Other Benefits

(1) An employee opting for the Scheme shall also be eligiblefor the following benefits in addition to the ex-gratia amountmentioned in para5, namely:

(a)Provident Fund;

(b)Gratuity as per Payment of Gratuity Act, 1972 (39 of 1972)or gratuity; payable under the Rationalisation scheme, asthe case may be;

(c)Pension (including commuted value of pension) as perGeneral Insurance (Employees’) Pension Scheme,1995, if eligible. However, the additional notional benefitof five years of added service as stipulated in para 30of the said pension scheme shall not be admissible for

1 To be read as ‘be’.H

the purpose of determining the quantum of pension andcommutation of pension;

(d) Leave encashment.

(2) An employee who is opting for the scheme shall not beentitled to avail Leave Travel Subsidy and also encashment ofleave while in service during the period of sixty days from thedate of notification of this scheme.”

(emphasis supplied)

6. It is, thus, quite apparent that clause (c),as part of the overallpackage, clearly stated that the notional benefit of five (5) years of addedservice, as stipulated in para 30 of the 1995 Scheme, would not beadmissible for purposes of determining the quantum of pension andcommutation of pension to such employees who availed retirement underthe SVRS-2004 Scheme. Suffice to say that the SVRS-2004 Schemeprovided for additional benefits beyond the 1995 Scheme, whilesimultaneously curtailing this aforesaid aspect, specifically. Despite thisclear stipulation, the appellants sought the benefit of these very five (5)added notional years of service, for calculation of their pension, underthe SVRS-2004 Scheme, in addition to the other benefits offered. Thisdemand was declined by the respondent Insurance Company.7. There is background to this lis inter se the parties. On anearlier occasion, the employees availing of the SVRS-2004 Scheme,sought to take advantage of the revision of pay-scales, as provided forunder the notification dated 21.12.2005, which had retrospective effectfrom 1.8.2002. This benefit was denied on the ground that such of thepersons who had availed voluntary retirement under the SVRS-2004Scheme had ceased to be employees of the respondent InsuranceCompany and were, thus, not entitled to the benefit of revision of pay-scales, retrospectively.[2] In coming to the conclusion, various clauses ofthe benefits given under the SVRS-2004 Scheme were taken note of,including sub-clause (c) of clause 6(1) reproduced hereinabove.However, what was sought to be taken advantage of was sub-clause(2) of Clause 5 of the SVRS-2004 Scheme, providing for ex-gratia tobe computed on the basis of salary received as on the date of retirement,but also providing that in case of wage revision being effected from adate prior to the date of notification of the SVRS-2004 Scheme in the

2 See Manojbhai N. Shah &Ors. v. Union of India &Ors.(2015) 4 SCC 482.

AOfficial Gazette, the benefit of revised pay for purposes of payment ofex-gratia would be allowed. It appears that in the course of justifyingtheir actions, an argument was sought to be advanced on behalf of theinsurance company, that apart from the objective of reduction of man-force, the employees were given ex-gratia payment which they wereotherwise not entitled to, and were also given an additional amount ofBpension because notional period of five (5) years had been added tothe number of years served by them (It may be noted, however, that thisis contrary to the clear stipulation in the SVRS-2004Scheme). This Courtopined in favour of the insurance companies, specifically noticing thatretrospective rise in salary is only given to those employees who are inCservice at the relevant point in time or to those who retired in normalcircumstances, and not to those employees opting under such specialschemes, like the SVRS 2004 Scheme. No doubt the plea of five (5)years addition for calculation of pension was noticed in the judgement,however, no further discussion of the same formed part of the reasoning.

D8. The beneficiaries of the SVRS-2004 Scheme sought reviewof the judgment predicated on plea that this Court had incorrectlyrecorded that persons retiring under the SVRS-2004 Scheme would begiven the benefit of five (5) years of extra service for calculation ofpension, while actually the same had been specifically excluded. However,

such endeavour proved to be fruitless and the review application wasEdismissed on 7.4.2015.

9. That ought to have put the issue at rest, but the insurancecompanies in their wisdom made belated attempt to once again urgethat issue, by seeking to plead that those observations were only obiterin nature and were factually contrary to the scheme. This application forFmodification/clarification was, however, refused to be listed by theRegistrar as it was found to be belated endeavour at review. Thebeneficiaries then filed Miscellaneous Application which was listedbefore the Court, but was later withdrawn.

10. We have set out the aforesaid controversy because the realGsubstantive ground forming the basis of the plea of the appellants beforeus is that what was recorded in the judgment in the Manojbhai N. Shah& Ors case[3] amounted to concession on the part of the insurancecompanies, which concession in turn resulted in finding against themto the effect that, the, insurance companies are bound to give the benefit

3 HSupra.

of additional five (5) years’ service, as per the 1995 Scheme, even tothose persons who have opted for voluntary retirement under the SVRS-2004 Scheme.

11. The aforesaid controversy, after an initial direction to theinsurance companies to examine the demands of the retired employeessubstantively, was examined by the learned Single Judge, when the formercame to be rejected by the insurance companies, by the judgment inWP(MD) No.19431/2015 and connected matters dated 8.6.2016.In thisjudgement, it was opined that in view of the judgment of the SupremeCourt in Manojbhai N. Shah &Ors.,[4] this benefit of additional five (5)years’ service, as per the 1995 Scheme was admissible despite the clearterms of clause 6(1)(c) of the SVRS-2004 Scheme. The learned SingleJudge also opined that since clause 6(1)(c) of the SVRS-2004 Schemedid not specifically exclude the benefits under para 30(5) of the 1995Scheme, there was no reason to deny the same to the beneficiaries ofthe SVRS-2004 Scheme.

12. The aforesaid judgment was assailed before the learnedDivision Bench, which, however, opined to the contrary and dismissedthe original writ petition filed by the appellants vide judgment dated17.7.2017 in WA (MD) Nos.1228-1231/2016. It is this judgment whichhas been assailed before us.

13. We have examined the impassioned plea made on behalf ofthe employees by Mr. Guru Krishna Kumar, learned Senior Advocateand the defence put up by the insurance companies through Mr. RakeshDwivedi, Senior Advocate and Mr. Jaideep Gupta, Senior Advocate.

14. One of the aspects emphasised by learned counsel for theappellants was that the financial impact would not be huge, as was soughtto be contended by the insurance companies, as it would be in the rangeof Rs.388 to Rs.1477, per beneficiary, per month. We, however, findthat this would neither be here nor there, as that cannot be the basis forgrant or refusal of the relief. The question for consideration is whetherthe beneficiaries under theSVRS-2004 Scheme, which specificallyexcludes the benefit of additional five (5) years’ service of the 1995Scheme, would still be entitled to claim the said amount contrary to theexplicit terms. We are of the view that the answer to this question mustbe in the negative.

4 Supra.

A15. It has to be appreciated that the SVRS-2004 Scheme isstatutory in character, being Scheme under Section 17-A of the GeneralInsurance Business (Nationalisation) Act, 1972. It would not beappropriate to add or subtract terms from the Scheme, which has astatutory flavour. There could not have been any concession contraryto the terms of the Scheme, and if such concession was to ensure forBthe benefit of the retirees, then it had to go through the process of aformal notification. In fact, post the decision in Manojbhai N. Shah&Ors.,[5 ]both the parties also understood that there was really no questionof availing the benefit, contrary to clause 6(1)(c) of the SVRS-2004Scheme. This is what resulted in the review application, the clarificationCand modification application, etc. The rejection of the review applicationfiled by the beneficiaries itself shows that post the judgment, clause6(1)(c) was once again highlighted before the Bench. Despite this, thereview application was dismissed, which clearly shows that this factwas not important for finally coming to the conclusion that the salaryrevision was not applicable to those who had already retired. LearnedDsenior counsel for the appellant himself acknowledged that in the absenceof any specific direction in this behalf, they could not have even filed acontempt petition and thus the fresh round of litigation began.16. Learned senior counsel for the appellants, however, sought topersuade us by referring to the judgment of this Court in State ofEMaharashtra v. Ramdas Shrinivas Nayak & Anr.[6 ]where, in para 4,a question arose qua concession made in the High Court, whilecontending the matter before this Court. It is in that context that it wasobserved that this Court would not launch into an inquiry as to whattranspired in the High Court:F“4. .........It is simply not done. Public Policy bars us. Judicialdecorum restrains us. Matters of judicial record areunquestionable. They are not open to doubt. Judges cannot bedragged into the arena. “Judgments cannot be treated as merecounters in the game of litigation” (Per Lord Atkinson inGSomasundaram Chetty v. Subramanian Chetty, AIR 1926 PC136). We are bound to accept the statement of the Judgesrecorded in their judgment, as to what transpired in court. Wecannot allow the statement of the judges to be contradicted by

5 Supra.H6 (1982) 2 SCC 463

statements at the Bar or by affidavit and other evidence. If thejudges say in their judgment that something was done, said oradmitted before them, that has to be the last word on the subject.The principle is well settled that statements of fact as to whattranspired at the hearing, recorded in the judgment of the court,are conclusive of the facts so stated and no one can contradictsuch statements by affidavit or other evidence. If party thinksthat the happenings in court have been wrongly recorded in ajudgment, it is incumbent upon the party, while the matter is stillfresh in the minds of the judges, to call attention of the veryjudges who have made the record to the fact that the statementmade with regard to his conduct was statement that had beenmade in error (Per Lord Buckmaster in Madhu Sudan Chowdhriv. Chandrabati Chowdhrain, AIR 1917 PC 30). That is theonly way to have the record corrected. If no such step is taken,the matter must necessarily end there. Of course party mayresile and an Appellate Court may permit him in rare andappropriate cases to resile from concession on the ground thatthe concession was made on wrong appreciation of the lawand had led to gross injustice; but, he may not call in question thevery fact of making the concession as recorded in the judgment.”

17. The aforesaid paragraph was, once again, extracted withapproval in Y. Sleebachen & Ors. v. State of Tamil Nadu throughSuperintending Engineer Water Resources Organisation/PublicWorks Department & Anr.[7]

18. On the other hand, it was canvassed by the insurancecompanies that there could be no concession against law [Tripura GoodsTransport Association & Anr. v. Commissioner of Taxes &Ors.[8]].Learned counsel also referred to New India AssuranceCompany Limited v. Raghuvir Singh Narang & Anr.[9 ]to buttress theplea that if there is scheme which has statutory character, then therecould not be any contention which could be permissibly raised, contraryto the Scheme. Even qua contractual schemes, if one has availed of thebenefits, it would not be open to raise pleas and seek benefits beyondwhat is stipulated in the Scheme.

7 (2015) 5 SCC 747

8 (1998) 2 SCC 264 para 9

9 (2010) 5 SCC 335

A19. The earlier judgments in Bank of India & Ors. v. O.P.Swarnakar & Ors.[10 ]And HEC Voluntary Retired Employees WelfareSociety & Anr. v. Heavy Engineering Corporation Ltd. &Ors.,[11]dealing with voluntary retirement schemes have been taken note of inthe impugned judgment, to come to the conclusion that the terms of suchschemes must be strictly followed, and the contract cannot be varied.BWe may add here that apparently there are certain observations in paras33 and 34 of the impugned order, which may also run contrary to clause5(1) of the SVRS-2004 Scheme, insofar as the Division Bench has opinedthat the words “whichever is less” have been excluded from clause 5 ofthe SVRS-2004 Scheme. It may be noted that such is not the case, forCclause 5 of the SVRS-2004 Scheme, as extracted above, explicitlyprovides, in clause 5(1), that an employee seeking special voluntaryretirement, under the Scheme shall be entitled to the lower of the ex-gratia amounts as mentioned thereunder. We feel it suffice to clarifythat what is binding between the parties is the statutory scheme itself, asper its terms.D

20. We have, thus, no hesitation in coming to the conclusion thatstatutory or contractual, such voluntary retirement schemes as the SVRS-2004 Scheme have to be strictly adhered to, and the very objective ofhaving such Schemes would be defeated, if parts of other Schemes aresought to be imported into such voluntary retirement schemes. What isEoffered by the employer is package as contained in the Schemes ofvoluntary retirement, and that alone would be admissible.

21. The issue which arose in Manojbhai N. Shah &Ors.[12 ]Wasqua the revision of pay, with retrospective effect. That was the onlyissue. That issue was decided against the beneficiaries of the SVRS-F2004 Scheme. If there are certain observations made by that Benchwhile deciding so, qua aspects which are not forming the subject matterof that dispute, the same cannot be read to amount to grant of relief/benefits, contrary to the terms of the Scheme, and that too, in the absenceof any specific directions.G22. The intent of the SVRS-2004 Scheme was made even moreexplicitly clear by clause 8 specifying the general conditions in sub-clause(xiv), which reads as under:

10 (2003) 2 SCC 72111 (2006) 3 SCC 70812 HSupra.

“8. General conditions:

xxxxxxxxxxxxxxxxxxxx

(xiv) Save as provided in para 5(2) the benefits payable underthis scheme shall be in full and final settlement of all claims ofwhatsoever nature, whether arising under the regulation orotherwise to the employee (or to the nominee in case of death).An employee who voluntarily retires under this Scheme shall nothave any claims against the Company for re-employment orcompensation or employment of any of his or her relative oncompassionate grounds in the service of the company or for anyother like benefits.”

23. It is, thus, abundantly clear that nothing more would be giventhan what is stated in the Scheme, and for that matter, nothing less. Ifthe employees avail of the benefit of such Scheme with their eyesopen, they cannot look here and there, under different schemes, to seewhat other benefits can be achieved by them, by seeking to take advantageof the more beneficial schemes, while simultaneously enjoying the morebeneficial aspects of the SVRS-2004 Scheme.

24. We, thus, find no reason to interfere with the impugned order,except with regards to observations made in paras 33and 34 of theimpugned order, and consequently, the appeals are dismissed leaving theparties to bear their own costs.

Ankit Gyan Appeals dismissed.