Judgment & Order (Cav )

Ashutosh Kumar, C.J.

1. We have heard Ms. Geeta Luthra, Senior Advocate assisted by Ms. S. Das, Advocate for the petitioners; Mr. K.K. Parasar, Central Government Counsel for respondent Nos.1 & 2 and Mr. S. Dutta, Senior Advocate assisted by Mr. S. Choudhury, Advocate for the respondent Nos.3 to 55/private respondents.

2. The petitioners/Employees State Insurance Corporation (hereinafter to be referred as the ‘ESIC’) is a Government of India undertaking, which has its Head Office at New Delhi and one of its Regional Offices at Guwahati.

3. The respondent Nos.3 to 55 herein were initially working in different capacities in a Hospital at Beltola, Guwahati, on regular basis under the Government of Assam, Department of Labour. The said Hospital was taken over by the petitioners/ESIC with all its assets and liabilities. Thus, the respondents as erstwhile employees of the hospital were absorbed on permanent basis in different category of posts like Pharmacists, Staff Nurses, Laboratory Technicians, UDCs, LDCs, Radiographers, OT Assistants, Dressers, Peon/Multi Tasking Staff, Nursing Orderlies in that taken over hospital known as ‘ESIC Model Hospital, Beltola’.

4. At the time of absorption of the respondents in the ESIC, it was made clear to them that in the event of their not getting any promotion or any Assured Career Progression (ACP) benefits in the State Government, they would be given one ACP as on 01.01.2006, if they completed 12 years of service as on 01.01.2006 and further, the benefit of first and second ACP would be regulated and extended as per the norms of the ACP scheme adopted by the ESIC.

Later, as per the norms of Modified Assured Career Progression (MACP) Scheme, the benefit was further modified and the financial upgradation granted on completion of 10, 20 and 30 years in the absence of availing any promotional benefit during the aforesaid period.

It was categorically intimated that for the purpose of granting the benefit of MACP, the date of actual joining in the entry grade would be liable to be taken into consideration.

5. Some of the private respondents were granted first ACP and some of them were given second ACP on completion of 10 and 24 years of service. Most of them had not received any promotion before their absorption in the ESIC as on 01.01.2006 while serving under the Government of Assam. Later, while the private respondents were continuing in their services under the ESIC after their permanent absorption, a communication dated 19/25.10.2012 was exchanged between the authorities in the ESIC on the subject of grant of ACP benefit from the date of taking over the ESIC Model Hospital.

6. In fact, a difference in the pay-scale in the post of Pharmacist under the State Government and under the ESIC was noticed. A Pharmacist under the State Government was given the pay scale of Rs.3490-8,100/- whereas the same Pharmacist, after absorption in the ESIC, was given the pay-scale of Rs.4500-7,000/-.

7. In that view, a clarification was provided to Query Nos. 6 and 29 by the Office Memorandum dated 10.02.2000 issued by Government of India, Ministry of Personnel, Public Grievances and Pensions (Department of Personnel and Training) [in short, DoPT], which made it clear that if any absorption was made with a higher scale, then such appointment was to be treated as direct recruitment and in that case, such employees’ past services shall not be counted for grant of benefits under the ACP Scheme after absorption.

8. There was yet another communication dated 08.07.2015 wherein it was indicated that in case where the entry pay-scale in a particular cadre in the ESIC was higher than the pay-scale drawn by an employee under the State Government, then the employee would be granted the entry grade as per the ESIC norms. In such cases, the service in the pay-scale would commence from the date of absorption for grant of benefit under the ACP/MACP scheme.

With this observation, an exercise was made for identifying the case of employees having received ACP/MACP benefits to which they were not entitled to, as at the time of their absorption in the ESIC, they were given higher pay scale even though the absorption was on analogous posts.

9. Such exercise was challenged by the private respondents before the Central Administrative Tribunal (hereinafter to be referred as the “Tribunal”), Guwahati Bench by filing O.A. No.040/00290/2015 questioning the communication dated 19/25.10.2012 and 08.07.2015, referred to above; apprehending that they would be asked to refund the benefits which had been given to them after nine years from the date of their absorption in the ESIC.

10. The primary contention of the private respondents before the Tribunal was that the ESIC, being a Government of India undertaking cannot apply the DoPT’s OM dated 10.02.2000 after a lapse of nine years from the date of absorption of the private respondents; ignoring and overlooking the valid terms and conditions of absorption offered by the ESIC immediately before their absorption.

11. Conversely, the ESIC had argued before the Tribunal, that the private respondents were absorbed in the ESIC on analogous posts but some of them were granted higher entry pay-scale than what they had drawn under the State Government as on 01.01.2006. This would disentitle them from getting ACP/MACP after counting their past services rendered in the State Government.

12. The rationale behind giving ACP/MACP is to avoid stagnation and grant a kind of in situ promotion with financial upgradation. The terms and conditions of the absorption for extending the benefit of ACP/MACP has never been overlooked by the ESIC nor have the terms been ever altered. All that the ESIC had been contemplating, was to remedy the situation where excess payments had been made beyond their entitlement.

13. However, the Tribunal after noting the arguments, drew parallel with the facts of the case of Kusal Kumar Sarma & Anr. –vs- Union of India & Ors. [O.A. Nos.278 & 279/2008], wherein according to the Tribunal, the DoPT’s OM dated 10.02.2000 had been quashed.

14. In the afore-noted case of Kusal Kumar Sarma (Supra), the applicant was appointed as Typist on regular basis in the office of the Registrar of Gauhati High Court on 07.12.1976. While working as such, the applicant had joined the CAT, Guwahati Bench on deputation w.e.f. 01.07.1986 on the analogous post of LDC. However, he was absorbed in the office of CAT on regular basis w.e.f. 01.11.1989 in the post of LDC.

15. For the purpose of grant of ACP, it was held by the Tribunal that the services reckonable for the purpose would include the period during which the applicant was working with the State Government. Accordingly, the DoPT’s OM dated 10.02.2000, referred to above, was set aside and quashed and the respondents therein were directed to grant second financial upgradation to the applicant including the arrears of monetary benefits.

16. For a proper understanding of the contents of the DoPT’s Office Memorandum dated 10.02.2000, especially Query No.6, the same is being extracted herein in a talublar form:

                  

17. The afore-noted order of the Tribunal directing counting of the earlier service of Kusal Kumar Sarma was approved and not interfered with by the High Court.

18. The Tribunal, therefore, held that the private respondents would be liable to be paid the benefits of ACP/MACP Scheme, by counting their services under the State Government.

19. This decision of the Tribunal was questioned by the petitioners/ESIC before this Court vide WP(C) No.2905/2019 but the challenge failed and the writ petition was dismissed by this Court vide order dated 13.09.2019.

20. In the Review Petition [Review Pet. No.113/2020], preferred by the ESIC, a Bench of this Court took note of the fact that the DoPT’s Office Memorandum of 2000 clearly specified that service in the erstwhile Organization or State would be counted for the purposes of ACP/MACP only if the absorption was on analogous post with equal pay, which was drawn by the employees and not otherwise.

In the case of Kusal Kumar Sarma (supra), which was relied upon by the Tribunal, there was no indication that he had joined the CAT from the service of the State under the High Court on a higher scale of pay.

The afore-noted issue, not having been addressed by the High Court in its judgment dated 13.09.2019, the Bench allowed the review petition and revived the writ petition [WP(C) No.2905/2019], preferred by the ESIC.

21. A plain reading of the DoPT’s Office Memorandum dated 10.02.2000 and the internal communication of the Corporation dated 08.07.2015 would make it clear that the past services of the private respondents could have been counted only if the absorption was on the same post with the same pay-scale.

22. Factually speaking, it has been argued on behalf of the ESIC that though most of the respondents were absorbed on analogous posts, but on a higher pay scale, which disentitled them for any financial upgradation by counting their erstwhile services.

Thus, the parallel made with the facts of the case of Kusal Kumar Sarma (supra) was not at all justified.

23. It was also submitted on behalf of the ESIC that any wrong concession by an employer would never constitute a just ground for a binding precedent. [refer to Uptron India Limited –vs- Shammi Bhan & Anr. :: (1998) 6 SCC 538 and Central Council for Research in Ayurveda & Siddha & Anr. –vs- Dr. K. Santhakumari :: (2001) 5 SCC 60]

24. However, during the course of arguments, Ms. Luthra, learned Senior Advocate for the petitioners informed this Court that only 53 of such employees were wrongly given the benefit of ACP/MACP and out of them, 29 persons had already retired. She also categorically stated that in view of the judgment of the Supreme Court in State of Punjab & Ors. –vs- Rafiq Masih (White Washer) & Ors. :: (2015) 4 SCC 334, a decision has been taken by the Corporation that it shall not recover from such retired employees any excess payment made because of the mistake.

25. So far as the rest 24 employees are concerned, the stand of the ESIC, as disclosed by Ms. Luthra, is that whatever has been paid to them, shall not be recovered but necessary correctional course shall be undertaken so that they do not get excess payment henceforth.

Out of the 24 serving employees/private respondents, 3 are reported to have left the world of living. Ms. Luthra submitted that nothing shall be done with regard to their cases.

So far as the correctional course is concerned, it was further submitted that it shall be only with respect to the respondents who do not belong to Class III and Class IV groups.

26. Mr. S. Dutta, learned Senior Advocate for private respondents has submitted that the scales in which the private respondents were absorbed in the ESIC from the State Government were not higher. The pay-scales in which the respondents were working in the State Government are not even available in the ESIC.

27. Some information was furnished by Mr. Dutta, on the basis of the instructions/information given by the private respondents, which was required to be confirmed.

28. Now, on a careful analysis of the facts and the stand taken by the ESIC, we are of the considered view that the judgment dated 27.09.2016 passed by the Tribunal in OA. No.040/00290/2015 is required to be interfered with and thus, we set aside the same.

29. The grant of ACP/MACP benefits to such of the private respondents who had been absorbed on higher scale, even though on an analogous post, was not justified.

30. However, in view of the stand taken by the Corporation of not recovering any such excess payments from the respondents, who have retired and those we are serving on Class III and Class IV posts in view of the judgment of the Supreme Court in Rafiq Masih (supra), we conclude this writ petition with the following directions:

                   (I) The correctional course be made by the ESIC for future but without any recovery from the employees, who have retired or those who are serving on Class III and Class IV posts.

                   (ii) Such exercise shall be carried out by the Corporation and only thereafter, the sequel action shall be taken.

31. With the afore-noted directions, this writ petition stands disposed off.