Madrasdated High Court · 2025

W.P.No.29465 of 2022direct the respondents to settle the petitioner the gratuity, PF, the amounts payable under the Voluntary Retirement Scheme, the amounts payable under Social Security Scheme and Family Benefit Scheme, the IRT Contribution and the monthly pension with effect from 21.09.2020 with arrears, together with interest at the rate of 12% per annum, without any recovery or adjustment towards the monetary value of the unimplemented portion of the punishment in any manner, within a specified time as may be fixed by this Court, award costs and thus render justice. For Petitioner: Mr.G.Vijay Priyan for Mr.V.Ajoy KhoseFor Respondents : Mr.K.Raja, Standing Counsel* * * * *O R D E RThis Writ Petition is filed to quash the order dated 19.10.2020, passed by the third respondent in Memo No.E10/2483/TNSTC (Salem)/2020, and consequently direct the respondents to settle the petitioner the terminal benefits payable under the VRS scheme, the IRT Contribution and the monthly pension with effect from 21.09.2020 with arrears, together with 2/16 https://www.mhc.tn.gov.in/judis W.P.No.29465 of 2022interest at the rate of 12% per annum, without any recovery or adjustment towards the monetary value of the unimplemented portion of the punishment in any manner, within a specified time as may be fixed by this Court.2. The petitioner joined the services of the first respondent Corporation on 01.02.1989. The petitioner's services were made permanent with effect from 01.02.1990. While so, due to COVID-19 pandemic, the age of retirement was increased from 58 years to 60 years, but as the petitioner did not want to continue his service, he submitted an application to the first respondent on22.05.2020, seeking permission to retire under Voluntary Retirement Scheme (hereinafter referred to as VRS). The petitioner's application was accepted by the respondents and the petitioner was permitted to retire under VRS vide order dated 18.09.2020, with effect from 20.09.2020. Though the petitioner was permitted to retire on VRS, the petitioner was not settled his retirement amount and terminal benefits. When the petitioner approached the respondents for settlement, the respondents directed him to remit a sum of Rs.8,23,200/- towards the monetary value of the unimplemented punishment, which was imposed on him during his services. When the petitioner expressed his inability to remit the said amount, the respondents as a condition precedent for considering his claim, insisted 3/16 https://www.mhc.tn.gov.in/judis W.P.No.29465 of 2022the petitioner to submit a letter of undertaking agreeing for deduction an adjustment of the above amount from his terminal benefits. The petitioner was unquivocally informed that unless he submitted the undertaking letter his claim would not be considered and so the petitioner submitted the undertaking letter. The respondents despite the undertaking letter did not settle the petitioner's terminal benefits and therefore, the petitioner submitted a representation on 24.06.2021, seeking settlement of h is terminal benefits, for which there was no written reply. However, the respondents orally informed the petitioner that even after adjustment of the aforesaid amount from the terminal benefits payable to the petitioner, a huge amount was payable hy him. The respondents directed the petitioner to remit the balance amount in order to initiate the process for sanctioning the monthly pension. The petitioner, hence submitted a representation to the first respondent on 19.07.2021, requesting him to settle his terminal benefits without reference to the order dated 19.10.2020 and not to adjust the amount referred to therein. In the said representation, the petitioner also informed that he was withdrawing his earlier undertaking letter dated 24.06.2021. As there was no response, the petitioner left with no other remedy filed the above writ petition for the aforesaid relief.4/16 https://www.mhc.tn.gov.in/judis W.P.No.29465 of 20223. The respondents filed a counter affidavit denying all the averments and contentions raised in the writ petition. According to the respondents during the petitioner's service, he had committed several misconducts and therefore was imposed with numerous punishments. The respondents relying on Rule 4(1)(e) of Discipline and Appeal Rules of Common Service Rule and Clause 8 of the 13th Wage Settlement arrived between the management and the representatives of Trade Unions Under Section 12(3) of the Industrial Disputes Act, 1947, stated that the impugned order was valid and legal. According to the respondents, the petitioner at the time of seeking permission for retirement under VRS, was informed that he had to remit a sum of Rs.8,23,200/- towards unimplemented punishment to the corporation and thereafter only the impugned order dated 19.10.2020 was issued. According to the respondents, the petitioner had also agreed for the recovery of the said amount from his retirement benefits in his undertaking letters dated 01.02.2021, 23.02.2021 and 02.03.2021. The respondents further submitted that a sum of Rs.7,23,200/- was deducted from the petitioner's retirement benefits towards the unimplemented punishments and the balance amount of Rs.97,309/- was paid in two installments through ECS, on 15.06.2023 and 25.07.2023. The petitioner was receiving monthly pension of Rs.10,801/-. The respondents therefore submitted that there were no merits in the writ 5/16 https://www.mhc.tn.gov.in/judis W.P.No.29465 of 2022petition and the same deserved to be dismissed. 4.The learned counsel for the petitioner submitted that the impugned order was illegal and liable to be set aside, as the same was against the settled law laid down by this Court in its judgments in (i) W.A.(MD).No.1270 of 2020 dated 15.06.2021 (The State Express Transport Corporation Vs. G.Senthil), (ii). W.A.(MD).No.886 and 887 of 2017 dated 12.07.2017 (Tamil Nadu State Transport Corporation (Kumbakonam) Vs. S.R.Viswanathan) and (iii) W.A.No.2549 of 2013 dated 19.03.2018 (P.Ramasamy Vs. Tamil Nadu State Transport Corporation (Coimbatore) Ltd). The learned counsel further submitted that the impugned recovery order based on Clause 9 of the settlement dated 04.01.2018, was unsustainable because under the said clause, recovery was conditional and subject to the Common Service Rules. The learned counsel submitted that admittedly, the Common Service Rules were not applicable to the petitioner, as he was a workman and governed by the Certified Standing Orders. According to the counsel, there was no provision in the Certified Standing Orders, either for monetising the punishment or for recovery of the monetary value of the unimplemented portion of the punishments, post retirement from any of the terminal benefits. The learned counsel further submitted that reliance placed by the respondents on the 6/16 https://www.mhc.tn.gov.in/judis W.P.No.29465 of 2022undertaking letters was erroneous because the recovery order was itself against law. The counsel hence prayed to allow the writ petition.5.The respondents reiterated the submissions made in the counter affidavit. 6.Heard both the learned counsels and perused the materials placed on record. 7.The law on recovery of the monetised value of the un-implemented punishment from a retired employee is no longer res-integra. The Hon'ble Division Bench of this Court in W.A.(MD).No.1270 of 2020 dated 15.06.2021, in the case of The State Express Transport Corporation Vs. G.Senthil, while considering an identical issue, held that Clause 8 of the 12 (3) Settlement, disputed therein, could not be used as a tool or a source of power to recover money from the workman, especially, when the Settlement only stated that it could be done so, if there was a provision under the Common Service Rules or the Standing Orders. The relevant portion of the Judgment reads as follows: 7/16 https://www.mhc.tn.gov.in/judis W.P.No.29465 of 2022“5.First issue to be considered in this appeal is whether the judgment rendered by the Court can be settled or not by entering into the settlement under Section 12(3) or 18(1) of the Industrial Dispute Act, 1947. The Settlement signed between the employer and the employee can at best have the binding inter-partly qua the claims made by the workmen against the management. No settlement can be entered into between the parties to nullify a judgment which has been rendered interpreting the Statutory Rules and Regulations, which are applicable to the Organisation. Therefore, the argument of the appellant that the settlement would supersede the decision on the legal issue is not acceptable and it is rejected. 6.Be that as it may, if we examine the condition No.8 of the 12(3) of the Industrial Dispute Act 1947 Settlement, we find that there is no such leverage given to the appellant-Management. The said Clause 8 reads as follows: 8/16 https://www.mhc.tn.gov.in/judis W.P.No.29465 of 2022@gzpXa;tpd; bghGJ Vw;fdnt tH';fg;gl;l Increment Postponement nghd;w jz;lidfs; eilKiwg;gLj;jg;gl ,ayhj epiyapy; bghJ tpjpfs; kw;Wk; epiyahiz tpjpfs; mog;gilapy; Increment bjhiff;F <lhd bjhif kl;Lnk gpoj;jk; bra;ag;gLk;/ ,we;j bjhHpyhsh;fisg; bghWj;jtiuapy; nkw;brhd;d gpoj;jk; bra;ag;glkhl;lhJ/@ 7.The above condition states that the increment postponement orders which could not be implemented prior to the superannuation of the employee can be implemented, but only in accordance with the Common Service Rules and the Standing Orders which are applicable to the organisation. This question was considered in the case of J.Arumugam (supra), as first among the several issues and it was held that there is no provision in the Certified Standing Orders enabling the Management to pass orders of recovery as passed in the instant case. In fact, the Court held that the Common Service Rules are not applicable to the workmen and there is no Standing Order framed by the Management and 9/16 https://www.mhc.tn.gov.in/judis W.P.No.29465 of 2022only Certified Standing Orders are in vogue and the Certified Standing Orders do not provide for any such recovery. The operative portion of the judgment reads as follows: "5.Before deciding the merits of the case, firstly, it has to be seen, as to, under which Rule, the workmen of the Management are governed by. It is admitted by the Management that the workmen are governed by Certified Standing Orders, framed for the employees of the Management/Corporation by the Appellate Authority under the Industrial Employment (Standing Orders) Act 1946 (supra), but, contrary to the same, the impugned orders of recovery were passed by the Management, by following the provisions of the Common Service Rules, viz., Rule 4 (1) (e). Pitted with this position, the learned counsel for the Management submitted that the Management has no option, except, to opt for Rule 4 (1) (e) of the Common Service Rules, for, the workmen suffered punishment of withholding of increment, which could not be given effect to, as the workmen did not have the requisite remaining years of service. That apart, such a remedy is not found in the Certified Standing Orders. This submission is untenable, for the reason that, when the Management has admitted that the workmen are governed by the Rules framed under the Certified Standing Orders, in violation to the same, it cannot follow Rule 4 (1) (e) of the Common Service Rules, by invoking Clause 25 (1) 10/16 https://www.mhc.tn.gov.in/judis W.P.No.29465 of 2022(iv) (b) of the Certified Standing Orders. Therefore, we have no hesitation to hold that the orders passed by the Management, recovering three times the monetary value equivalent to the amount of increment, are without jurisdiction, as there is no such provision in the Certified Standing Orders, enabling the Management to pass such orders. Therefore, on that ground, the impugned orders are required to be set aside." 8.Therefore, the contention of the appellant-Management that Clause 8 of the 12(3) Settlement provides for passing such an order in an Organisation, is stated to be rejected. Clause 8 cannot be used as a tool or a source of power to recover money from the workman, especially, when the Settlement only states that it can be done so, if there is a provision under the Common Service Rules or the Standing Orders.” 9.Furthermore, the question as to whether the Management would be entitled to implement orders of postponement of increment, which was not implemented during the period when the workman was in service, was also considered in the case of J.Arumugam (supra) and it was held that the same cannot be done and it will be without jurisdiction. The 11/16 https://www.mhc.tn.gov.in/judis W.P.No.29465 of 2022operative portion of the judgment reads as follows: "37. One more important aspect, which we wish to point out is that, the Management cannot plead ignorance of the fact that, on the date, when punishment was imposed on the workmen, the punishment was not capable of being implemented as workmen did not have the required remaining years of service. If that is so, the Management cannot take shelter under the explanation contained Clause 4 (1) (e) to suit its own convenience, and the workmen cannot be put in a disadvantageous position. In such circumstances, the Management cannot rely on the decision of the Hon'ble Supreme Court in Kshetrabasi Mohanti (supra) where, the Hon'ble Supreme Court considered the correctness of the order by substituting the punishment for a candidate, who was still in service. There, it was a case, where, it was not possible for the Corporation to implement the punishment, but, the case on hand, is a case, where, the Corporation was fully aware of remaining years of service in respect of each of the workmen, yet, chose to pass such orders of recovery. Thus, the Management, having failed to convert the punishment of stoppage of increment to that of order of recovery of monetary value, when the workmen were in service, it cannot turn around and say that those orders could be implemented by invoking Clause 25 (iv) (b) of the Certified Standing Orders."12/16 https://www.mhc.tn.gov.in/judis W.P.No.29465 of 20228. It is seen that all the contentions raised by the respondents in their counter affidavit in the present writ petition were considered and rejected by the Hon'ble Division Bench. It is pertinent to note that the clause 9 of the 12(3) Settlement relied on by the respondents herein is verbatim, the same as Clause 8 of the 12(3) Settlement, referred to in the Division Bench Judgment. In view of the identity of facts and law, I am of the view that the judgments of the Hon'ble Division Bench of this Court squarely apply to this case and hence, I find that the impugned order cannot be sustained and deserves to be set aside. 9. The respondents relying on the undertaking letters of the petitioner, contended that the petitioner was bound to remit the monetised value of the unimplemented punishment. In my view, when the recovery itself is found to be illegal, the undertaking letters can in no way aid the respondents to sustain the illegal recovery. Therefore, the said contention is rejected. 10. Under the facts and circumstance of the case and in view of the settled law of this Court, I find merit in the writ petition and hence the same is 13/16 https://www.mhc.tn.gov.in/judis W.P.No.29465 of 2022allowed as prayed for. 11. Accordingly, this writ petition stands allowed. However, there shall be no order as to costs. 23.04.2025Index: Yes / NoInternet: Yes / NoSpeaking order/Non-speaking orderah To1.Tamil Nadu State Transport Corporation (Salem) Ltd., Rep. by its Managing Director, 12, Ramakrishna Salai, Salem – 7.2.Tamil Nadu State Transport Corporations' Employees' Pension Fund trust, Rep. by its Administrator, Thiruvalluvar Illam, Pallavan Salai, Chennai – 600 002.14/16 https://www.mhc.tn.gov.in/judis W.P.No.29465 of 20223.Section In-charge (Personnel), Tamil Nadu State Transport Corporation (Salem) Ltd., 12, Ramakrishna Salai, Salem. 15/16 https://www.mhc.tn.gov.in/judis W.P.No.29465 of 2022N.MALA, J.ahW.P.No.29465 of 202223.04.202516/16