Service Law – Resignation – When not conditional – Modified Voluntary Retirement Scheme – Respondent submitted resignation under the Scheme vide letter dtd. 12.07.02 – On 03.03.2003, the respondent requested that his application under the Scheme be kept suspended – Vide letter dtd. 01.07.03, the respondent requested that his letter dtd.12.07.02 be treated as having been cancelled because he had changed his mind about submitting resignation under the Scheme – However, the resignation was accepted and the respondent was to be relieved accordingly – Challenged by respondent – Single Judge ruled in favour of the respondent – Order upheld by Division Bench – On appeal, held: Resignation of the respondent had already been accepted on 28.05.03 before he endeavoured to withdraw the same – Right of a person whose resignation has been accepted was to receive inter alia the benefit of the provident fund amount as one of the terminal benefits under the Scheme – The fact that there was some discrepancy on account of the description of the name in the account for which there was some prior communication also, will not imply that any delay in disbursement of the provident fund amount would entitle the respondent to withdraw his resignation – Resignation was not a conditional resignation – Letter dtd.03.03.2003 cannot be construed as a letter of withdrawal of resignation – All that it stated was that the resignation be “kept suspended” till the amount is deposited in his provident fund account – Further, acceptance of resignation and the abolition of the post were simultaneous exercises – Once the letter of resignation was accepted on 28.05.03, the post stood abolished – Respondent cannot take advantage of the postponement of the cut-off date by a few days – Also, mere delay in relieving the respondent from duties would not impact the acceptance of his resignation – Impugned order set aside.
Allowing the appeal, the Court
HELD: 1.1 The respondent filed the application under the Scheme. If the letter dated 12.07.2002 is looked at closely, the intent of the respondent was clear, i.e., to submit his resignation. It is not a resignation operative from a future date but one which would operate as per the Scheme. It is also not a conditional resignation as was sought to be canvassed by the respondent. The mere assertion that all benefits arising out of the service period of the applicant would be paid to him is a natural corollary of their resignation. Such a resignation can hardly be called conditional. If this resignation letter under the Scheme is looked at, no doubt in terms of Clause 1.6 of the MVRS, the option lay with the management to decline an application without assigning any reasons. That again will not make the resignation conditional. In a contractual context, it would be an offer made by an employee under the Scheme which may or may not be accepted by the appellant-management. Once the acceptance takes place, the contract stands concluded. Such acceptance has to be in terms of the Scheme. Thus, the crucial question is whether the subsequent communications of the respondent could give the resignation letter a colour of a conditional resignation and whether the withdrawal was prior to its acceptance. [Paras 30, 31][765-F-H; 766-A-B]
1.2 The MVRS, more specifically Clause 4.0, provides for terminal benefits payable under the Scheme. Clause 4.1 requires the balance in the provident fund account to be paid as per the Employees Provident Fund Act. Thus, the right of a person whose resignation has been accepted is to receive inter alia the benefit of the provident fund amount as one of the terminal benefits under the Scheme. The fact that there was some discrepancy on account of the description of the name in the account for which there was some prior communication itself, will not imply that any delay in disbursement of the provident fund amount would entitle the respondent to withdraw his resignation. If there is any unreasonable delay, the amount may carry interest. In the given facts of the case, it appears that the account was credited to an account number where it ought to have been credited, but there was some problem in the name/description of the beneficiary which had caused some confusion/delay. The appellant-management ought to have taken better care of this but then the appellant had pointed out that the problem arose on account of the management by the concerned authority of the provident fund account, and not the appellant. [Para 32][766-B-F]
1.3 Another significant aspect is the terms of the Scheme as per Clause 5.0. Clause 5.1 required the post to be abolished simultaneously with the request of voluntary retirement being accepted. This had to be done before disbursing retirement benefits to the employee under the Scheme. There was a specific stipulation that no person would be engaged in his/her place. The objective was clear, that it should not be that on the one hand, manpower is reduced by giving the benefit of MVRS to an employee and on the other, some other person is deployed in the post. That would be, in a sense, destructive of the very objective of why the Scheme was propounded, i.e., on account of the precarious financial condition of appellant No.1. [Para 33][766-F-G]
1.4 The next communication addressed by the respondent is the letter dated 03.03.2003. The respondent did not withdraw his resignation, which he could have done at that stage. He seeks to refer to the aspect of the non-correction of the provident fund account and inaction with respect to his earlier communications, which were almost three years old. Actually, the amount was deposited in the relevant account but, there was some confusion about the beneficiary of the account, which was clearly to be the respondent. All that the respondent’s letter states is that his resignation be “kept suspended” till the amount is deposited in his provident fund account. The rationale for the same is set out in the very next sentence, i.e., if the resignation is accepted the receipt of the amount will not only be difficult but rather it will be impossible. [Para 34][766-H; 767-A, B-D]
1.5 On 28.05.2003, a letter was issued by appellant No.1 accepting the resignation of four persons including the respondent. Once the resignation letter had been accepted, the chapter was over. The respondent was to retire from the services with effect from 01.06.2003 in terms of the said letter. The respondent, however, seeks to take advantage of the letter dated 02.06.2003 of appellant No.1, which extended the cut-off date already fixed for 01.06.2003. The respondent, thus, seeks to plead that once the date from which he was to be relieved was extended, it would amount to non-acceptance of his resignation. The respondent, taking advantage of the aforesaid, ad- dressed a letter on 01.07.2003 claiming that his resignation had not been accepted till that date, and his letter of resignation under the MVRS dated 12.07.2002 may be treated as cancelled. Appellant No.1 refused to act on the same as in their view the resignation letter already stood accepted on 28.05.2003. The respondent was relieved w.e.f. 16.07.2003. The acceptance of resignation and the abolition of the post were simultaneous exercises as that is part of Clause
5.1 of the Scheme. Clause 5.1 also prevents appellant No.1 from appointing anyone else to that post. Thus, once the letter of resignation was accepted on 28.05.2003, the post stood abolished. The letter dated 03.03.2003 cannot be construed as a letter of withdrawal of resignation. The postponement of the cut-off date and the consequent payment which would have to be made to the respondent for those few days is really a matter of financial exercise for appellant No.1, with which the respondent cannot concern himself as long as his resignation is accepted. In contractual terms, appellant No. 1’s acceptance of the respondent’s offer of resignation as available under the MVRS was completed on 28.05.2003. The respondent cannot be permitted to take advantage of the postponement of the cut-off date by a few days, during which time the respondent was asked to attend to office, albeit against no sanctioned post. [Paras 3639][767-F-H; 768-A-F]
1.6 Appellant No.1 had, in fact, closed down. The MVRS was undisputedly beneficial to the employees who availed of the same. An analysis of the MVRS including Clause 5.1 belies the respondent’s contention that there was any requirement of making the payments in advance. The wordings of the Scheme are clear that acceptance of resignation has to simultaneously happen with the abolition of the post and thereafter, the payments have to be disbursed. The construction given to the MVRS is as per its clauses and the action of the parties under the Scheme, which result in the conclusion that the resignation had already been accepted on 28.05.2003 before the respondent endeavoured to withdraw the same on 01.06.2003. The mere delay in relieving the respondent from duties would not impact the acceptance of his resignation. In pursuance of the offer and acceptance on 28.05.2003, the transaction was completed. The resignation letter of the respondent stood accepted on 28.05.2003 and the respondent is entitled to the benefits under the Scheme which have already been paid to the respondent albeit without prejudice to the rights and contentions of the respondent in the proceedings. The impugned order is set aside. [Paras 40-43, 45,
46 and 47][769-C-D, E-F, G-H; 770-A, E, G; 771-A] J.N. Srivastava v. Union of India & Anr. (1998) 9 SCC 559; Shambhu Murari Sinha v. Project & Development India & Anr. (2000) 5 SCC 621 : [2000] 3 SCR 9 – distinguished.
Air India Express Limited & Ors. v. Captain Gurdarshan Kaur Sandhu (2019) 17 SCC 129 : [2019] 12 SCR
980 – relied on.
Raj Kumar v. Union of India (1968) 3 SCR 857; Union of India v. Gopal Chandra Misra (1978) 2 SCC 301 : [1978] 3 SCR 12; Power Finance Corporation Limited v. Pramod Kumar Bhatia (1997) 4 SCC 280 : [1997] 2 SCR 1170; Bank of India v. O.P. Swarnakar (2003) 2 SCC 721 : [2002] 5 Suppl. SCR 438; HEC Voluntary Retd. Emps. Welfare Soc. & Anr. v. Heavy Engineering Corporation Ltd. & Ors. (2006) 3 SCC 708 : [2006] 2 SCR 678; Food Corporation of India & Anr. v. Ram Kesh Yadav & Anr. (2007) 9 SCC 531 : [2007] 3 SCR
336 – referred to.
As published in the Supreme Court Reports, Supreme Court of India. Text from the Indian Supreme Court Judgments open data set (Dattam Labs), CC BY 4.0.
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