1997 JTR(SC) 385
1997 2 AllCJ 920 ; 1997 2 CLT(SC) 175 ; 1997 76 FLR 311 ; 1997 3 JT 715 ; 1998 2 LLJ 28 ; 1997 2 RSJ 523 ; 1997 3 Scale 585 ; 1997 3 Scale 78 ; 1997 4 SCC 252 ; 1997 SCC(L&S) 893 ; 1997 1 SCJ 614 ; 1997 2 SCT 501 ; 1997 2 SLJ 113 ; 1997 2 SLR 394 ; 1997 KHC 3593 ; 1997 3 Supreme 402
1997(3) Supreme 402
SUPREME COURT OF INDIA
K. Ramaswamy and Sujata V. Manohar, JJ.
Sh. Rabindranath Mukhopadhyay & Anr. -Petitioners
versus
Coal India Ltd. & Anr. -Respondents
Special Leave Petition (C) No. 3664 of 1997
Decided on 28-2-1997
Act
Referred
:CONSTITUTION OF INDIA : Art.16, Art.14
SERVICE LAW : .
(A) The referred Service Law and the Constitution of India Articles 14 and 16 govern this case concerning the legality of revised Leave Travel Concession (LTC) rules for executive cadre employees. The rules, last amended in 1989, were interpreted alongside a 1996 resolution providing a one-time option from January 1, 1997, to either avail LTC for travel once every four calendar years or encash it subject to railway fare limits, replacing the prior requirement for actual travel certificate production. The constitutional provisions ensure that any classification made under these rules must withstand scrutiny under Articles 14 (equality) and 16 (non-discrimination in public employment) when fixing the effective date of the new regime.
(B) Key legal principles include the validity of policy decisions by management, the permissibility of alternative benefits without travel certification, the non-retroactive application of revised timelines, and the absence of arbitrariness when uniform rules are applied to all employees of a class. The court emphasized that an option to encash benefits does not constitute denial of the underlying concession.
Facts of the case:
The respondent management evolved LTC rules for its executive cadre, allowing travel once every four years or encashment up to a defined railway fare limit, effective January 1, 1997, without requiring a travel certificate. The fixation of this date and the scope of benefits were challenged as arbitrary and discriminatory.
Findings of Court:
The court found no arbitrariness in fixing the date, noting that the block of four years commenced as originally intended and was not shifted. It held that employees retiring before the effective date were not denied the facility, as the alternative encashment option was available, and the policy was uniformly applicable without discrimination.
Issues:
Whether the fixation of the effective date as January 1, 1997, was arbitrary; whether the classification between employees retiring before and after the date resulted in unconstitutional discrimination; and whether the substitution of actual travel with encashment violated the LTC entitlement.
Ratio Decidendi:
A management decision to offer a one-time option between actual travel once in four years or encashment, uniformly applied from a fixed date without shifting the running block period, is not arbitrary or discriminatory and does not deny the essential benefit to employees, warranting non-interference by the court.
Result:
The special leave petition is dismissed.
(A) The referred Service Law and the Constitution of India Articles 14 and 16 govern this case concerning the legality of revised Leave Travel Concession (LTC) rules for executive cadre employees. The rules, last amended in 1989, were interpreted alongside a 1996 resolution providing a one-time option from January 1, 1997, to either avail LTC for travel once every four calendar years or encash it subject to railway fare limits, replacing the prior requirement for actual travel certificate production. The constitutional provisions ensure that any classification made under these rules must withstand scrutiny under Articles 14 (equality) and 16 (non-discrimination in public employment) when fixing the effective date of the new regime.
(B) Key legal principles include the validity of policy decisions by management, the permissibility of alternative benefits without travel certification, the non-retroactive application of revised timelines, and the absence of arbitrariness when uniform rules are applied to all employees of a class. The court emphasized that an option to encash benefits does not constitute denial of the underlying concession.
Facts of the case:
The respondent management evolved LTC rules for its executive cadre, allowing travel once every four years or encashment up to a defined railway fare limit, effective January 1, 1997, without requiring a travel certificate. The fixation of this date and the scope of benefits were challenged as arbitrary and discriminatory.
Findings of Court:
The court found no arbitrariness in fixing the date, noting that the block of four years commenced as originally intended and was not shifted. It held that employees retiring before the effective date were not denied the facility, as the alternative encashment option was available, and the policy was uniformly applicable without discrimination.
Issues:
Whether the fixation of the effective date as January 1, 1997, was arbitrary; whether the classification between employees retiring before and after the date resulted in unconstitutional discrimination; and whether the substitution of actual travel with encashment violated the LTC entitlement.
Ratio Decidendi:
A management decision to offer a one-time option between actual travel once in four years or encashment, uniformly applied from a fixed date without shifting the running block period, is not arbitrary or discriminatory and does not deny the essential benefit to employees, warranting non-interference by the court.
Result:
The special leave petition is dismissed.
ORDER
This special leave petition arises from the judgment of the Division Bench of the Madhya Pradesh High Court, made on January 15, 1997 in LPA No. 255/96. The first respondent had evolved the LTC Rules for its executive cadre employees and the same were last revised on May 15, 1989. Therefore Clause 1(b)(ii) postulates that:
"Once in a block of 4 calender years commencing from the 1st January, 1976 the executive cadre employees will be entitled to the concession under these rules for journeys to any place in India. This concession will, however, be in lieu of LTC entitlement of that year to travel to home town and back. This facility of availing LTC for journeys to any place in India once in 4 years will also be available to employees whose home towns are either the same or very close to their places of posting and so are not entitled to LTC for home town.
The employees and/or members of the family may avail of LTC facilities for travel to the same place or to different places of their choice in respect of the facility available to visit any place in India in a block of 4 years."
2. Subsequently, by the Resolution No. 159 dated September 14, 1996, the respondent had given option in respect of the benefit of the LTC, to the Executives of the company or its subsidiary companies without production of certificate, as detailed hereunder :
"The executives would have the option to choose any one of the following alternatives w.e.f. 01.01.1997.
(a) The existing facilities of LTC i.e. the executive with entitled family members may visit any place of India by entitled class of journey once in a Block of Four years.
Or
(b) Encash the facility of LTC subject to the limit of Railway fare in the entitled class upto 1700 k.m. each way for the employee and entitled family members.
(ii) The one time option has to be exercised before 31.12.1996.
(iii) Taxes as applicable has to be paid by the executives.
This will take effect on and from 01.01.1997."
3. Consequently, the facility of LTC for travelling to home town was also extended to travelling any place in India as per the above resolution dated September 14, 1996. Instead of production of the certificate of the actual travel, the Executive have also been given an option either to avail of the facility or encash the LTC facility, subject to the limit of Railway fare of the entitled class upto a maximum distance of 1700 k.ms. each way for the employee and entitled family members. But the above decision has been given effect to from January 1, 1997. The petitioner appearing in person has contended in the High Court as well as before us that the fixation of the date is arbitrary. We find no force in the contention. It is seen that the aforesaid Resolution communicated by proceedings dated October 10, 1996, postulates an employee who is entitled to avail of the facility of LTC, instead of executive class, had been given two options, viz., of actual performance of the travel once in a block of four years which would be normal one and a salutory policy to enable the employee to broaden his vision of thought and action, and to encash the same, instead of actually travelling, which is an exception and proof of production of the travel certificate and the expenses incurred therefore has been dispensed with. It being a policy decision taken by the respondent-Management, the policy was given effect to from January 1, 1997, obviously the beginning of the calender year. It is uniformly applicable to all employees of that class. Under those circumstances, we do not think that there is any arbitrariness in fixation of the date.
4. It is then contended that by fixing the date as 1.1.1997, discrimination has been meted out between all the classes of the employees who retired before and those who would retire subsequent to 1.1.1997. It may be fortuitous stand for the employees who would be retiring on or before 31st December, 1996 without availment of the encashment of LTC but nonetheless he has not been denied the facility of the actual travel by virtue of the alternative option given. The option is only of encashment and imposed no prohibition on the travel. It is then contended that the four years block starting from 1.1.1996 would be postponed by fixing the four years block in the present proceedings and an employee would be deprived of an availment of the two benefits. We find no force in this contention too. They have not shifted the commencement of the block year, for availment purpose and it remains operation as originally started to operate. It is only a specification that once in a block of four years, the availment of the LTC or encashment of LTC would be available. It does not have the effect of the shifting of the running of the block period. Under these circumstances, we do not find any illegality in the decision of the High Court warranting interference.
5. The special leave petition is dismissed.
Petition dismissed.
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Parallel Citations of other Jouranals :
Sh. Rabindranath Mukhopadhyay v. Coal India Ltd., 1997(3) Supreme 402 : JT 1997(3) SC 715
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