Gramm Baak Award Staff Union v. State Baak of India and aaother

Judgment

1. STATE BANK OF INDIA Regional Rural Banks Department, National Bahking Group^ PostBoxno. 12, Mumbai- 400021, Through:- ^ChiefGeneral Manager (Development Banking) Bilaspur - Raipur Kshetriya Gr< 7 2. Head Office -situated at Vikas Bhawan, Tehsil Chowk, Bilaspur (Chhattisgarh) |Through- it's Chairman. ....RESPONDENTS EPETITION UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA FOR ITHE ISSUANCE OF ORDER/DIRECTION AND WRIT IN THE NATURE OF IMANDAMUS, PROHIBITION, CERTIORARI ETC. ;^^ 4^^ HIGH COURT OF CHHATTISGARH AT BILASPUR ^ Writ Petition No. 2522 of 2001 Petitioner Gramm Bank Award Staff Umon aad aaother Versus Respondente State Bank oflndia aad another .fc.. '.^.^. Post for order on ^.4 March, 2006. ^. Sd/- Satish K. Agnihotri Judge i;<r" Y-. :^. ^^.- —/~ HIGH COURT OF CHHATTISGARH AT BILASPUR WntPetitionNo. 2522 of 2001 Petitioner Gramm Baak Award Staff Union and aaother Respondents State Baak of India and aaother Versus Sin^e Bench : Hon'ble Mr. Justice Stotish K. Apiihotri.

Shri P, S. Koshy, counsel for fhe petitioner. Shri Pritinkar Diwakar, Serdor coiinsel wifh Shri Kunal Das^ counsel for fhe respondents, ORDER ( March, 2006) l The foUowiag order offhe Courtwas passed by Satish K. A^iihotri, J. The present petition mipugns fhe recommendation dated 25€b October 2001 (Aanexure A/7) of fhe conimittee constituted by fhe spoiisor Bank i.e. Respondent No.l revision of allowance naaiely cyclostyluig machiae operator aUowaace, driver allowance, cashier ia charge of cash at Bran.ch aUowance aad daftari aUowance w.e.f.

1.4.2000 and the order dated 3.12.2001 (Aimexurc A/9), revisu^ fhe allowaaces, as stated above w.e.f. 1,4.2000 aad for recoveiy of fhe excess paymentw.eJ. 1.4.2000. The undisputed facts in nutsheH are fhat fhe members of fhe petitioner-Union were granted special aUowance as per tihie order dated 20.6.2001(Annexure A/4)W.e.f. 1.4.2000, mteralia (^ Cashier- m-Charge AUowaace (Key AUowance) @ Rs. 750/", (ii) Daftari AUowance @ Rs, 371/-, (ui) CyclostyUng AUowance @ Rs, 184/- aiid (iv) Driver ABowance @ Rs. 932/-, which were sought to be revised by fhe impugned recominendation dated 25.10.2001 aad order dated

3.12.2001 by reducing to Rs. 351/-, Rs. 352/-, Rs. 145 and Rs. 923/- respectively, w.e.f. 1.4.2000 aad the excess payiaeut was sought to be recovercd from fhe concerued employees. The petitioner-Union has filed fhis ^tition seeking awrit/direction to quash fhe impugned recoiainendation as well as fhe impugned order which adversely afifects the seryice conditions of the members of the petitioner-Union and further recoveiy fhercof by way of deduction ia pay be also quashed. 1 Shri P, S, Koshy, learaed counsel appeanng for the petitioner-Uaiion submitted fhat fhe basic pay aad dearaess atlowance as nien.fk>aed ni ftie order dated 11th Apnl, 2001 (Annexure A/2) has been clarified by circular dated 25th April, 2001(Annexiire A/3) of fhe Mixdstry of Finaace, Goveninient of India that basic pay aad deamess aUowaace meaas basic pay, deaniess pay, deaaiess atlowaace, additional D.A., iiiterixn reUef or aay other allowaD.ee which form part of fhe pay or deamess aUowance. The special atlowaace conies under aD.y other aUowances aad fonii part of pay. It is clear froni fhe order dated

20.6.2001 (Annexure A/4) fhat (i) Cashier-m-Charge AUowance (Key AUowaace) (ii) Daftad AUowance (iii) CyclostyUng AUowance aiid (iv) Driver AUowance form part of pay. Thus, fhe members of fhe petitioner-Union are entitied to padty as per the sixfh bipartite setfleiaent aiid fhereafter sevenfh bipardte setflenient ia accordaiice wifh fhe Justice Obul Reddy Award, judgnient and order of fhe Supreme Court m the case ofSouth Mafeibar Gramiii Baak Vs. Co" ordination Ck>mmittee Soug^ht Malabar Gramin Bank Bmployees> Unioa aiid South Malabar Grainiii Bank OflRcers^ Federation fite others { (2001) 4 SC 101} and fm-ther judgment aud order ia AU India Re^onal Rural Bank Officers Federation and others Vs. Oo^t. of India and others { (2002) 3 SCC 554} as weU as r' the circulars dated 11.4.2001 aad 25.4.2001 issued by the Miaistiy of Fiaaace, Goverainent of India, It was furfher submitted by leamed counsel for fhe petitioaers fhat ia tfae similar facts where fhe allowaaces of Rs. 380/- paid to ffae cashiers incharge ofthe Palamau Kshetriya Gramin Bank, Daltonguuj was reduced to Rs. 189/- by the Chauinaa of Palamau Kshetriya GraniiDi Barik and recoveiy of fhe excess amount was ordered, the Pataa High Court at Raachi Bench in Palamau Kshetriya Gramin Baak Workers Or^misation aad others Vs. Palamau Kshetriya Gramia Bank and others by order dated 27th Januaiy, 1992 m Civil Writ Jurisdiction Case No. 2006 of 1991 (R) held that fhe special aUowances was fixed on the basis of fhe awanl of fhe Natioual ludustrial Tribunal, coustituted by the onler of fhe Supreme Court, unless fhe award is modi&ed, therc is dtG&culty to fhe RRB to reduce allowaace of Rs. 380/- per month to Rs. 189/- per lEioafh. It was next contended fhat clause 7 of the Sixth Bipartite agrcement (Annexure P/13) pay has been defined as under;- "7. DEFINITION OF "PAV Vay' for fhe purpose of Dearaess AUowaace, House Rent AUowance and Superaanuation Benefits shaU Dieaa Basic Pay, Stagnation Increnients, Special AUowaace, Ofl5ciatiiig AUowaace, ifany^ Thus, the special aUowaaces which are uxider consideration in this petition form part of tiie pay and the members of the petitiouer-Urdon are entitied to panty with the ofScers aad eniployees of fhe sponsor nationaUzed aad cojaixiiercial Bank Le. Respoudent No,l. Sixfh bipartite settleinent clearly dtfferentiates special aUowaDice and other aUowarices.

8. Similarly, fhe 7th bipartite settiement also m its paragraph of the setflement specificaUy holds fhat special aUowaace and special pay ./<M^J are one aad fhe saine aad few of fhe said aUowaaces are part of pay and fhere are xnany aUowaaces also, which do not form part of pay. The definition of pay as per 7th bipartite setdeiaent also can be ^een, which reads as under:- Definition of pav i, AUowaaces hifherto teraaed as Special AUowaace, AUowaiice, Giuduation Professional Qualfc&cation AUowance and Officiatmg Allowaace, which are ia fhe nature of <<Pay5?, attracting Dearaess AUowaxice nd raiikiag for superaanuation beuefits shall henceforfh be tenned as Special Pay, Graduation Pay, Professional Quali&cation Pay aixd Ofl&ciatmg Pay, respectivefy, "Pay^ H.R.A. of D.A. purpose u. shall Diean Basic Superannuation beaefits Sta^nation mcrcments, special pay, Graduation Pay, Professional QuaUfication Pay and OfSciatm.g Pay, aay. Pay,

9. It was further contended by learaed couusel for fhe ^titioners that fhe Central Govemnient ia its circular dated 17th April, 2002 (Annexure P/15) has agam reiterated fhe definition of basic pay aad D.A, and dirccted fhe Chairman of aU RRBs to pass appropriate orders accordiagly,

10. The Central Goveniiaent consequent upon the revision of fhe wages/pay structure of fhe workmen/officers of fhe siationaUzed commercial banks m terms offhe 8th bipartite settlement directed fhe Chairmaa of atl RRBs by circular dated 6th October, 2005 (Annexure D/l) as under:- <<(1) Pav Scales & Dearaess AUowances: Pay scales & Dearaess AUowance of each RRB employee as on 1-11-2002 would be equal to ffae correspondiag categories ofeiaployees offhe nationatized coinniercial baaks. (2) House Rent Allowaace (HRAl and City Compensator^ AUowaace fCCAl: HRA aad CCA woiild be payable at applicable io. fhe correspondiag categones of eiaployees ia the saicie rate as the nationaUzed commereial baiiks w.e.f 1-11-2002. As far as ofher allowaace are concemed, the individual sponsor baak shall negotiate fhe saxae wifh fhe RRBs sponsored by ftieni. The current payment m the iacrease in fhe salaiy should be niade effective ia fhe salarvr for tiie raonth of OctQber^ 2QQ5. The arrear shaU be paid ia two iastaUmients. One hatf should (3) (4) fc be paid iinniediately and fhe second halfon 01 Apritl 2006. (5) The RRBs inay issue a conipreheusive order indicatiag fhe ^ ^ , revised pay scales ia respect of each category of employees after seekmg the approval offheir Board of Directors,"

11. The Central Govemment by aaother circular dated 25A October, 2005 (Anuexure D/2) issued to the Chairman ofAU Regional Rural Baaks clarified fhat the pay includes s^cial pay also, ifaay, as uiider:- ^l) "Basic Pay and Deamess AUowarice" as nientioned ia order dated 06-10-2005 meaiis Basic Pay, Deamess Pay^ Deamess AUowaaces, adhoc or additional DA, mterbn rcUef r any ofher aUowance which fomi part ofpay or DA. 2) Pay iacludes Special Pav also, ifany,^ ^12. Shn P, Diwakar, leamed serdor counsel wifh Shri Kiinal Das, learaed couusel appearing for bofh the rcspondents Le. State Baak of India and Bilaspur-Raipiir Kshetriya Gramm Bank, per contra, submitted that fhe above stated aUowances which arc subject matter of dispute faUs m the categoiy of functional aUowaaces or ofher aUowaiices which have to be revised by respective sponsor Baiik after negotiations wifh the RRB employees and would be payable w.e.f.

1.4.2000 as per fhe circular dated 24.1.2001 issued by fhe Miaistxy of Fiaaace, Govt. oflndia. The Respondent No. 1 constituted a committee vide its order dated 23.7.2001 to study aU fhe relevaat details aod make suggestions on modalities for paynient of ofher aUowaaces (Revised) for RRBs sponsored baak by Respondent No. 1. It was farther contended fhat fhe Respondent No.2 had righfly detennined fhe special aUowaaces/pay from fhe pay aad allowaaces for the category under para 7 of fhe pay revision pay circular dated

20.6.2001.

13. Learaed counsel for fhe respondents fiirther subxnitted that titie payDient of ofher aUowaiices has to be decided by fhe sponsor Bank after negotiation wifh fhe RRB eiaployees. The pay has been defined m Regulation 2 (0) of fhe BHaspur Raipur Kshetriya Gramia Baak StafFService Regulations, 1980 is as under:- "2(0) "Pay" means Basic Pay drawn per monfh by fhe officers or employee m a pay scale mcludiag stagnation, mcremeat aad amy part of fhe eraolumLents which xaay specificaUy be classified as pay uuder fhese regulation."

14. The Cashier iacharge aBowaD.ee, cyclostylmg miachine aUowance, driver atlowance and fhe stenographer atlowaaces have been marked as fiuinctioEial allowaaces and as such said aUowaaces are not fhe special atlowances but other aUowances aad do not fona part ofpay.

15. The Govemment of India, Mmistry of Fmaace vide its letter dated 1,1.1992 directed National Bank for Agricultare and Rural Development (NABARD) to constltute a workiag group m respect of other rcsidual matters adsing out of implementatk>n of fhe Justice Obul Reddy award. The equation committee recommendation read wifh Justice Obul Reddy award make it clear that fhe disputed atlowaiices are functlonal allowaaces. Annexure VI to fhe circiilar dated 22.2.1991 (Annexure R-2/4) rcads as under:- "8. Special AIlowances (Functional) : (i) SubStafF : a) C^clostyUng machine operator. b) Watchman/Watehman-ciun-Peon. c) d) Anaed Guard, Driver.

5. (i^ Clerical StafF : a) b) Stenographer. Cashier-in-Charge ia Braxich.^

16. Learaed counsel for fhe respondents next subinitted fhat fhe power to determiae the pay scales rests wifh fhe Central Goveniment ia rcspect of tihe Officers aad Eiaployees of the Regional Rural Baaks as contemplated under Section 17 (1) of the Regional Rural Baiiks Act, 1976 (for short 'the Act, 1976'). The power ofthe Central Govemment under Section 17 (1) ofthe Act 1976 to detenxune fhe pay stnicture for the ofiScers aiid eDiployees of fhc Regional Rui^l Baaks has been upheld by fhe Hon'ble Apex Court ia the case of 8outh Malabar Gramitt Baak(supra). In exercise ofpowers conferred by proviso to (1) of Section 17 of fhe Act, 1976, fhe Central Govemraent determiaed fhe new basic pay aad fhe Deamess AUowaaces of Regional Rural Baak employees as on 1.4.2000 grantmg fhe benefit of 6th and 7th Bipartite Settlenient and ofi5cers wage revision wifh effect froia

1.11.1992 aad 1.4,1998 rcspectively, As far as ofher aUowances are concenied, fhe mdMdual sponsor Banka werc given fhe Uberty to negotiate fhe sanie wifh fhe respective Regional Riiral Banks. It was directed fhat fhe revised aUowaaces shaU be paid wifh eflTect fxoia

1.4,2000. It appears fhat some reprcsentations were made by some of fhe sponsor baaks, R,R.B., NABARD as also the eniployees of fhe RRBs seekiag certaia clarifications. The Goverament of India issued clarification vide order dated 25.4.2001. It was rciterated that all ofher allowances will be revised by the respondent sponsor banks aad would be payable wifh effect from 1,4.2000. Pursuaat to the directives issued by fhe Govenunent of India, fhe respondent State Bank of India constituted a committee to go iato fhe question ofdetermination of various aUowacices. On receipt of fhe recomiiiendations of fhe Comimittee, fhe State Bank of India decided to graat various allowaiices as contamed m fhe ktter dated 25.10.2001. 17, I have heard learaed counsel for the parties and have perused fhe documente appended to fhe petition and rctura. 18, In fhe year 1987 a dispute arose in all fhe Regional Rural Banks (for 'R.R.&') claimmg parity on fhe payment of salary aad aUowances at par wifh the einployees of the sponsored nationalized banks on the priaciples of equal pay for equal work. Two writ petitions were filed by fhe AU India Graiain Baak Workers Associatioa aad All } India Rural Baak Eraployees Associatton, praying that they are eatifled to get ftie sarae scale of pay as is avaUable to fhe eniployees of the different nationaUzed commercial baiiks, During fhe pendency of the wnt petitions ia fhe Supreane Court, fhe Govt, of India agreed to appomt a National Industrial Tribunal to decide fhe question relatmg to pay salaiy and ofher aUowaaces and other benefits payable to the eraployees of fhe regional rural baaaks, constituted under fhe Act,

1976. Accordmgly, fhe Suprenie Court directed the Central Govenunent to rcfer fhe dispute to the Tribunal. Justice S. Obul Reddy, retired Chief Justice of fhe Andhra Pradesh High Court was appoiated as Chamnaa of fhe National Industrial Tribunal. It was stated ia the notification appointbig fhe Tribunal fhat the decision of the Tribiinal will be final and bindmg. The Tribunal so ap^x>mted passed an award after elaborate consultatious and discussions on fhe basis of fhe materials placed beforc it The Tribunal ultimately held fhat fhe officers and employees of fhe RRB would be entitied to claim parily with fhe olGBcers and ofher eniployees of fhe s{x>n^)r Baaks ia fhe matter of pay scale, aflowances and other benefits. It was further directed fhat fhe said award should be given effect to w.e.f, 1.9.1987. In paragraphs 4.25, 4.27, 4.28 aad 4.29 of the award it was categoricaUy held fhat fhe deraaad of fhe pstitioners beforc ftie Tribunal were justiified in demandiag fhe equation to com.parable posts in fhe comiiaercial baaks and the salary structure should have been so related as to be ia confonaity wifh ftie salary structure ia the NationaUzed Bank, aad fiirfher held fliat it was unjust aad unreasonable to deny the Regional Rural Baiik employees padty m scales of pay wifbi the employees ia sponsor baak, ia coniparable posts, in regard to similarity in the nature of duties, fiinctioas aad N-- ,1 respoasibilities. It was held in paragraph 4.425 of the award fhat <£what flows froDi ray findiags is fhat fhe ofiicers and other eiaployees of Regional Rural Bank wfll be entitied to claun parity wifh fhe ojGBcers and employees of fhe sponsor banks iu the matter of pay-scales, aUowances and ofher benefits."

19. Consequent thereupon, fhe Miaisfary of Fmance, Department of Economic Affau-s, Govenanient of India by its circular dated 22.2. 1991 (Annexure P/10) provided equation of fhe post and held fhat <The aUowaaces/special allowaaces and other benefits which are provided ia Bipartite settiements aiid fhe Service Regulations of fhe concemed sponsor baaks be extended to fhe employees/officera of RRBs, respectively. The allowances aad ofher benefits which will have retrospective and prospective efifects are detaUed in Axinexure VI, ^

20. The respondent No.2 pursuant to the circular dated 22.2.1991, adopted fhe same order by passiag fhe order dated 7.3,1991 (Annexure P/11), graatiag parity to fhe officers and ofher employees of fhe RRB at par wifh fhe ofRcers aad exaployees of fhe sponsored baaks/rcspondent No,l iu respect of pay, salaxy, aUowaaces aad other benefits.

21. Thereafter sixfh bipartite settteiDient was entered iato between AU India Baak Emiployees Association and fhe nienibers of fhe Indiaa 10 Baak Association, which was made appUcable to aU fhe Nationalized Comxaercial Banks ia India. The niaDagenient of aBl fhe R.R.B. did not give efFect to the beuefits of fhe Sixfh Bipartite settlement to fheir employecs. A writ petition was filed in fhe High Court of Kerala by fhe employees of South Malabar Gramia Bank. The matter ultimately reached to the Supreme Court and the Supreiae Court ia its judgment and order passed ia tiie case of Soutli Malabar Chramin Bank (Supra), in para 13 held as under:- ^ 13. The next question fh.at arises for consideration is^ what is fhe meaiiiag of the expression <<padty" used by fhe Tribunal m givmg its award aad indicatmg "fhat fhe officers aad ofher eniployees of the regional rural baxiks wiU be entiUed to claiai parity wifh fhe ofiBcers aad oflier employees of fhe sponsor baaks ia ftie matter of pay scales, atlowances and ofher benefits^ in paxa 4^425 of fhe award of fhe Tribunal. It may be noticed at fh.is stage fhat on behalf of fhe employees, a claioi had been made beforc fhe <<equal reasoniiig. Com.prehensive Dictionary, siinilarily (as) by parity of pay for equal work^ Tribunal for appUcation of fhe principle aad that was negatlved by the Tribunal, but all fhe same the Tribunal directed to xaamtaia. a parity. The iiieaniag of fhe word ^parity^' ia fhe Concise Oxford Dictionaiy is equality; beiag at par; tihie word fact of behig even or odd. In Law Lexicon Dictionary, <<pasityyf has been deJSaed to iiiean beiag on a par wifh; analogy; Ixi Webster^s ftie expression <<parityJ? has been defined to niean equality, as of coadition or raak; equivalent position; equal value; close resemblaace. In Words and Phrases, fhe word aparity^ meaxis aa act providiag for road Vol. 31, construction to bring each county ia the State to <<parityy, required aU counties to be brought ia fhe saiae condition regardiag aid ia road bufldmg, "parity^ meamng equalily. In view ofthe defmition of the aforesaid expression aparitya? and ia fhe context iii which the Tribuiial came to hold ftiat the employees of the regional rural baiiks woiild be entifled to claioi a parity wifh fhe eiaployees of fhe fhe Union Govenunent, whfle uationaMsed commercial bairks, exercisiag its power under fhe proviso to sub-section (1) of Section 11 17 woiild be guided by fhe aforesaid conclusion of the Tribunal and wiU not be justfc&ed ui decidiag fhe pay structurc for fhe eDiployees of fhe rcgional rural baaks, which would bring ia dispadty between fhe two groups of exaployees, even fhough fhere inay be a sUght vadation ia fh.e pay stnActure. As has been stated earlier, fhe aforesaid direction to maintain parity was duly given effect to aad fhe employees of the regional rural baaJss were given ia the fhe pay structure appUcable to fheir counterparts nationalized conunercial banks w.e.f. 1987, fhough subsequently ia 1992 aad 1997, fhere had been revision io. fhe pay sfaracture of fhe einployees of fhe nationalized comiaercial baaks, Though, we have upheld fhe contention of fhe appellaat wifh regard to fhe power of fhe Central Goverainent to decide fhe pay storucture of fhe eiaployees of fhe regional rural banks, yet fhere caanot be aiiy doubt fhat in so decidmg, fhe Centoral Govemment would be duty- bound to inaiatam. fhe parity with fhe pay structare of fhe eiaployees of fhe nationalized commercial baiiks ia fhe saaie sense aad spidt as Justice Obul Reddi decided aad as was given effect to by fhe Union Govermnent in the year 1987".

22. Pursuaat to fhe decision of fhe Suprcme Court ia fhe case of South Malabaar Gramia Bsmk (Supra) the Goverament of India, Miaistory of Fiaance Departuient, vide notification dated 11.4.2001 deteraadned fhe pay scales offhe employees offhe RRB as follows :- RRB employee "i) The new basic pay aad dearaess allowaoice of each as on 01.04.2000 would be determined by notionaUy grantmg fhe benefit of 6A aad 7th bipartite settlement aad officers' wage revision w.e.f.

01.11.1992

01.04.1998 respectively. The fonaula for fitoaient of salary in vadous scales inay also reniaui fhe satxie as was adopted for conuaercial bank emiployees. Thus, as on 01.04.2000, the pay scales of fhe RRB exnployees would become equal to fhat of fheir counterparts ia coiuxaercial banks. The cun-ent payinent of iacrease ia fhe salaiy due to graat of new pay scales shaU be inade ia such a raaoiier that the cash oufi&ow ia a particular year ii) 12 on this account is not niore fhaii 50% of fhe operating profit of fhe eoncemed RRB as per fhe previous year's pubUshed balance sheet The RRBs who have iacurred operating losses in fhe previous year would not be able to make cun'ent payment of iacreased portion of fhe rcvised salary aad fhe amount due on account of iricrease ia salaiy shall be transferred to fhe arrears accoimt Siaiilarly, if anticipated cash out flow on account of the increase ia fhe salary is exceeduig 50% of fhe operating profit ia tiie last year, the current payixiexit may be restdcted only to 50% of fhe o^ratiag profit aad fhe rest shaU be traasferred to arrears account which is to be treated ia the maaner stated hercunder. There shaU be a two year moratorium on the paynient ofarrears i.e. upto 31.3.2002; and during fhis period no arrears shatl be payable by any RRB. After fhe mLoratoriuni period, fhe arrears niay be paid ui such a nianner fhat fhe cash outflow on fhat account aad fhe increase ia wages durmg fhe current year on account of implementation of fhis package do not exceed 50% of fhe operatmg profit of fhe respective RRB for fhe miinediate previous year. Arrears would xneaii iiicrease ia salaiy i.e. basic pay & DA due to fhe RRB eiaployees by notionaUy grantiag to theni wage revision w.e.f 1.11.1992 and 01.04.1998 at par wifh commercial bank employees aad rcsidual amount, if aay, ansiag out of clause (ii) above, The House Rent AUowaace aiid City Coiapensatory AUowance (CCA) would be payable at to comparable appUcable (HRA) iii) iv) eiaployees ia fhe sponsor baoJcs and would be given prospective effect i.e. date of issue of these orders QS is done ia Commercial Banks. v) As far as ofher aUowaaces concenied, iadividual sp^nsor banks shall negotiate fhe same ^ii%^%BBtf1gI®iJIji 13 wifh fhe respective RRB, The i-evised atlowaaces shaU be paid w.e.f. 1.4.2000. The ceiling on the payiaent shaU, however, be as per fhe formula stated on (iii) above.

23. The notification dated 11.4.2001 (Annexure A/2) did not fuUy compfy wifh the direction of fhe Supreme Court passed ia the case of South Malabar Gramin Bank (Supra). Several mterlocutoiy applications and contemLpt petitions were filed, The Supreine Court ia fhe case of AU India Reg^loaal Rural Bank Ofllcers Federatioa and others (Supra), ia para -4 passed fhe foUowing oider :- a4..............Eveu fhough fhe finaiicial p^sition of fhe Banks may not be disputed, but havmg regard to fhe directions issued by this Court, whUe disposing of fhe civU appeal aad having reganl to the circuiastances zinder which such directions had been given, would be difficult for us to sustam the plea of fhe Union fhe noti&cation is ia coiapliaace wifh the Goverainent fhat a ground cannot be judgment axid directions offhis Court. The fmaacial capacity offhe for non- Goverainent pleaded iiaplenientation of fhe directions of tiie Court iaasinuch as even ia ftie caatter of determinatioxi of the pay scale of the exaployees of the Regional Rural Banks aad maiatenance of panty wifh fheir couiiterparts, serviag under fhe sponsorer cominercial baaks, Justice Obul Reddi had not accepted fhe said plea and that award rcached its fmality. Siace fhe fmaacial capacity of the employer caanot be held to be a germaae coasideration for detenxiination of fhe wage structure of the eniployees aad ParUaxaent enacted fhe Act for biiaging iato existence tiiese Regional Rural Banks wifh fhe idea of helpiiig the rural mass of fhe country, fhe emiployees of such rural baoks caaiiot sziffer on account of finaacial mcapacity of fhe einployer. We have no hesitation ia comiag to fhe conclusion the issuance of notiffcation dated 1-4-2001, by fhe Govemment of India caanot be held to be m compUance with the judgxaent aiid directions offhis Court in. S,M.G. Baak. .we dircct fhat fhe employees of fhe Regional Rural Baaks should be paid fheu' currcnt salaries on fhe basis of detemimation xaade iiiider the notification dated 11-4-2001, the new basic pay 14 haviag been arrived at, as on 1-4-2000 forfhwifh. Paiagraph (i) of the aforesaid notfc&cation dated 11-4-2001 should be inmiediately impleiaented aad fhe emiployees should be paid accordingly. Paragraphs (il) aad (ui) of fhe notification are quashed aad fhe Central Goverainent is directed to issue a frcsh notification for proper UD.pleinentation of fhe judgiaent of fhis court. We miake it clear fhat the period of moratorium wifh regard to the payment of arrears, siace is goiag to be over on 31-3-2002, the arrear salaiy accniing to fhe employees be paid to them ia three equal aiiaual itistaUuieuts, the first beiag on 30-4-2002, fhe second on 30-4- 2003 and fhe third on 30-4-2004. This payment has to be made as aforesaid wifhout beiag ia any way dependant upon any ofher considerations aad tihLerc caanot be aay distmctlon between fh.e Regional Rural Banlcs nicurring loss aad fhe Regional Rural Baaks, makiag profit. Further, the question of aaticipated cash outflow on account of incrcase in salaiy if exceeds 50% of fhe operatiag profit, fhen the current payment would be restricted ooly upto 50%, is absolutely ofno relevance, which was iadicated ia fhe impugned notfc&cation dated 11-4-2001, Haviag regard to the fiiiaacial condition of fhe Goveniiaent as weU as these banks, fhe iastaUment to be paid on 30-4-2002, pursuaiit to fhis oider of ours, fh.e saiae Diay be deposited ia fhe eiaployees? provident fund accouat. But aU ofher instaUments wUl have to be paid ia cash/' Aceordiagly, pursuaat to fhe circular of the Govt. of India fhe

24. respondent No.2 vide oider dated 20.6.2001 (Aruiexure A/4) graated the beuejSts of 6th/7th Bipartite Settlement giving parity wifh the officers/employees of fhe respondent No.l sponsor Bank w.e.f.

1.4,2000. According to fhe petitioner-Union the Respondent No.2 Baak did not make payinent of arrears of fhe special allowance ie. special pay even after judgmeat of fhe Supreme Court in fhe case of AU India Reg^onal Rural Bank OfficCTS Pederation aad others (supra),

25. The Respondeat No.2 Bank wifhout foUowmg the prmciples ofnataral justice wifhdrew the benefits of special aUowance gianted earlier as 15 stated above, by order dated 3.12.2001 which is in total disregard of the Justice Obul Reddy Award, fhe judgxnents of fhe Suprcme Court and also fhe circulars issued by fhe Ministiy of Piuance, Goverament of India. 26, It is clear fhat fhe above stated aUowances namely Cashier incharge allowaace, cyclostyling machiae aUowance, driver allowaace and fhe stenographer aUowaaces, have been defined by fhe Central Goverciment also, as special pay in its circular dated 25th October, 2005 (Annexurc D/2). The submission of lear&ed coimsel for fhe \ respondents fhat the disputed atlowances are functional aUowaaces have no basis, except nientiomng fhese atlowaaces as functional aUowances in Annexure VI to the circular dated 22.2.1991. The circular dated 22.2.1991 does not support the contention of fhe respondents as ia Annexure VI, cyclostyluig machuie operator aUowaace, stenographer allowaD.ee, Cashier incharge aUowaace have been put tinder special allowaaces (functional) aad professional ) quaUfication allowaaces have been niarked separately. In the said Annexure ia Part-B i.e. allowaaces aiid other benefits iaclude Travelliag aUowaace/Diem. allowance, deputatiou allowance, niid- acadeoiic year traiisfer aUowaace, closiag aUowance^ rcmibursement of medical expenses/hospitalization expenses as per hospitalization scheme, rcimbursemexit ofexpenses on travel, leave tonavel concession, festival advaace, overtiiae aUowaace, The circiilar dated 20.6,2001, issued by fhe Central Goveninient, has categonzed the above stated disputed allowaaces as special aUowances. Subsequenfly, also by circular dated 25.10.2005 issued by fhe Central Goveraiaent to fhe Chairman of afl the RRBs (Annexure D/2) special pay which are special aUowaiices have been included ia pay. It is, fherefore, clearly estabUshed fhat fhe disputed aUowaaces are special aUowaiices i.e. I" 16 special pay, as defined ia 7th bipartite settlenient. In fhe letter issued by fhe Ceutral Baak of India to aU braaches/offices in circular (Annexure P/14) it has been clearly stated as under:- aln fhis connection, we have to advise fhat a Setflement has been signed by fhe Bank wifh AU India State Baiik of India Staff Federation on the 11th May 2000 on fhe rates of Special Pay for various positions canyiag such pay (presently known as Special AUowarice), Fixed Personal Pay, Special Pay for Graduation aad Professional Qualification and otihier aUowaaces.^

27. Clause 1 ofthe Circular dated 11th April, 2001 (Annexurc A/2) issued ^ v by fhe Govt. of India, Mio^istiy of FiEiaace pursuaat to fhe decision of the Supreme Cx>urt m the case of South Malabar Graaniii Battk (Supra) aad Justice Obul Reddy Award, has clearly stated fhat on

1.4.2000 the pay scales ofRRB employees would become equal to that of their counterparts in fhe comiiiercial baolss.

28. Hence, in view of fhe Justice Obul Reddy Award, decisions of the Suprcme Court in the case of South Malabar €bramin Bank (Supra) and further judgment and order iu AU India Regional Rural Bank Officers Federation and others^ case (supra), read wifti several circulars issued by the Govt, of India, it is clearly estabUshed that fhe officers/eraployees of fhe RRB are entifled to fhe padly with fhe oiSScei^ and einployees of fhe sponsored baaks ia case of pay, salaiy and other allowaaces which fonti part of fhe pay. The above stated disputed allowauces which are accordmg to fhe 7th bipardte settleinent are special pay, a part of pay, as has been held by the Govt. oflndia ia its circular dated 25th October, 2005.

29. The circular dated 22.2.1991 cited by learaed counsel respondents does not rcflect fhe correct position of the special disputed aUowaaces as the subsequent circxilars dated 11,4.2001 (Annexure A/2) aad 25.4.2001 (Annexure A/3), 20.6.2001 (Aimexurc r ~^^^^ Thakur 17 3^ A/4) aad 25.10.2005 (Aimexure D/2) make it clear fhat the disputed allowances are a part of pay.

30. In view ofthe foregoin^g, fhe petition is aUowed. The special allowaace graated to fhe nienibers offhe petitioner-Union as per fhe order dated

20.6.200 l(Annexure A/4) w.e.f. 1.4.2000, iuteralia (i) Cashier-iu- Chm'ge AUowance (Key AUowaace) @ Rs. 750/-, (ii) Daftad AUowance @ Rs. 371/-, (iii) Cyclostyling AUowaace @ Rs. 184/- aad (iv) Driver AUowance @ Rs. 932/- legal aad vaUd. The inipugned recomuiendation dated 25.10.2001 and order dated 3.12.2001 ^ revismg fhe abovestated aUowaaces by reducitig to Rs. 351/-, Rs. 352/-, Rs. 145 aad Rs. 923/- rcspectively, with retorospective effect from 1.4,2000 aad recoveiy offhe excess payment, m regard to fhe abovestated atlowaaces, are quashed and set-aside. No order as to costs. 1 Sd/- Satish K. Agnihotri Judge