Created byFuzzy Cloud

Supreme Court of India

PADUBIDRI DAMODAR SHENOYversusINDIAN AIRLINES LTD. AND ANR.

Citation
2009 INSC 1127
Decided
10 September 2009
Disposal
Dismissed

Holding

Voluntary retirement under Regulation 12(b) is effective only upon approval by the competent authority; without such approval, the retirement does not take effect.

Summary

The appellant, Padubidri Damodar Shenoy, gave a notice of voluntary retirement under Regulation 12(b) of the Service Regulations on 30 September 2005, having completed 29 years of service. The competent authority neither approved nor rejected the application within the three‑month notice period, and the appellant continued to work until June 2006 before claiming that his retirement was effective from 1 July 2006. The employer later communicated that the request had not been acceded to. The Supreme Court held that the phrase "shall be subject to approval" in the proviso to Regulation 12(b) makes approval by the competent authority a condition precedent to the retirement taking effect. Since no approval was granted, the appellant’s voluntary retirement never became operative. The appeal was dismissed.

Issues considered

  • The interpretation of the proviso to Regulation 12(b) – whether "shall be subject to approval" makes approval a condition precedent or merely a discretionary power.
  • Whether the employer’s failure to communicate a decision within the notice period affects the validity of the voluntary retirement.
  • Whether the appellant could claim retirement despite the lack of approval and continued service after the notice period.

Subjects

voluntary retirementservice regulationsapproval conditionstatutory interpretationproviso constructionemployee rightsservice law

Judgment

                  [2009] 14 (ADDL.) s.c:R. 356

                                                                              j-
A                PADUBIDRI DAMODAR SHENOY                              J
                                  v.
                 INDIAN AIRLINES LTD. AND ANR.
                  (Civil Appeal No. 6186 of 2009)
                       SEPTEMBER 10, 2009
B
         [TARUN CHATTERJEE AND R.M. LODHA, JJ.]

          Service Law - Voluntary Retirement - Service
    Regulations for Employees (other than those in the Flying
C Crew and those in the Aircraft Engineering Departments) -
                                                                            ,,..
    Regulation 12(b) - _Interpretation and construction of the
    Regulation and the proviso appended thereto - Held: The
    expression "shall be subject to approval" used in proviso
    appended to Regulation 12 clearly indicates that voluntary
D retirement applied by employees covered by clause (b) is           ~­
    effective only upon approval by the competent authority -
    There is nothing to indicate in Regulation 12 that if employer
 _ decides to withhold approval of voluntary retirement, such
    refusal of approval must be communicated to the employee
E du_ring period of notice - Since on facts, approval was not
  - granted, voluntary retirement of the employee never came into
    effect.                                                            •
                                                                     .J._
        Words and Phrases:

F      "shall be subject to approval" - "shall" and "subject to" -
    Meaning and effect of.

       On 30th September, 2005, the appellant, in terms of
  Regulation 12 of the Service Regulations for Employees
G (other than those in the Flying Crew and those in the
  Aircraft Engineering Departments), gave a notice of his
  intention to voluntarily retire from service on completion
  of three months from the date of the notice. At the
  relevant time, the appellant had completed 29 years of.
  continuous service.
H                                356
                 PADUBIDRI DAMODAR SHENOY v. INDIAN AIRLINES         357
                               LTD. AND ANR.

      i            The appellant purportedly sent a reminder to the         A
               authorities on December 16, 2005 and when he did not
               receive any reply, he sent another letter dated June 8,
               2006 informing the respondents that he would cease to
               be an employee of the respondent no.1 after close of the
               working hours on June 30, 2006. Again on July 1, 2006,       B
               the appellant purportedly informed the respondent no.1
               and the concerned authority that in terms of notice dated
      ~
               September 30, 2005 he has ceased to be an employee of
      .>       the respondent no.1 in terms of Regulation 12(b) of the
               Service Regulations and requested the respondents to         c
..,            release and pay all his legal dues including the provident
               fund and gratuity from July 1, 2006.
                    Purportedly by letter dated July 31, 2006, the
               appellant was informed that his application for voluntary
      _)  '    retirement has been forwarded to the Headquarters for D
               decision and he was advised to report for duty
               immediately, failing which he was informed that a
               disciplinary action would be taken against him. The -
               appellant sent reply reiterating his stand and further
               informing, the respondents that he had ceased to be the E
               employee of the respondents from July 1, 2006 and,
'      ;. •    therefore, there was no question of his reporting for duty.
                                                                   -
                    The appellant then filed a writ petition. During
               pendency of the writ petition, the appellant received a F
               communication dated September 15, 2006 from the
               respondents that his request for voluntary retirement
               from service has not been acceded to by the competent
               authority. The writ petition was ultimately dismissed by
               the High 'Court. The appellant filed fresh writ petition G
      ....     before the High Court which too was dismissed .
                                          /



                    In appeal to this Court, the appellant contended that
              · Regulation 12 vests the employees covered thereby with
                a right to voluntarily retire after giving three months
                                                                            H
    358     SUPREME COURT REPORTS (2009] 14 (ADDL.) S.C.R.


A notice, namely, those who have attained the age of 55              1
  years and also those who have completed 20 years of
  continuous service anct both these categories form one
  class and that the proviso appended to Regulation 12
  only empowers the competent authority to withhold
B approval before the notice period is over.

       Per contra, the Respondent contended that the notice
  dated 30th September, 2005 given by the appellant to the             .
  employer under Regulation 12(b) expiring on 31st               ....(


c December,    2005 did not become effective and rather
  remained inoperative since the appellant continued to                     ,..,
  attend his duties not only until the expiry of notice period
  but thereafter as well upto June 30, 2006; that the proviso
  to Regulation 12-expressly· mandates the approval of the
  competent authority or, in other words, approval of the
D competent authority is a condition precedent to the event        ~

  of voluntary retirement and that the word "approval"
  occurring in proviso to Regulation 12 in its context would
  mean "to accept".

E        The interpretation and construction of Regulation 12
    of the Service Regulations was in issue in the present
    appeal.                                                        •
                                                                 .....i__

          Dismissing the appeal, the Court
F      HELD: 1.1. Regulation 12 of the Service Regulations
  for Employees (other than those in the Flying Crew and
  those in the Aircraft Engineering Departments), inter alia,
  enables an employee to seek voluntary retirement on
  attaining the age of 55 years or on completion of 20 years
G of continuous service by giving three months notice. An
  employee who has attained the age of 55 years and has
  applied for voluntary retirement under Regulation 12, his
  voluntary retirement is automatic on expiry of notice
  period i.e. three months. It is not equally applicable to an
H
                  PADUBIDRI DAMODAR SHENOY v.. INDIAN AIRLINES           359
                                LTD. AND ANR.

            j    employee who has not attained the age of 55 years but A
                 completed 20 years of continuous service and applied for
                 voluntary retirement, because for a category covered by
                 clause (b), namely, an employee having completed 20
                 years of continuous service who has given three months
                 notice for voluntary retirement from the service, the B
                 proviso appended thereto provides that voluntary
           ;l
                 retirement under clause (b) shall be subject to approval
                 of the competent authority. [Para 21) [369-F-G; 370-A-B]
           >--
                      1.2. The key words used in proviso appended to
                 Regulation 12 are that voluntary retirement under clause
                                                                                c
                 (b) 'shall be subject to approval' of the competent
                 authority. The use of the word 'shall' in the proviso, prima
                 facie leads to an inference that provision is imperative.

-           )

           4-
                 There is nothing in the context to suggest that it is merely
                 directory. It is followed by the words, 'subject to approval'. D
                 The effect of the use of words 'subject to' is to introduce
                 a condition. The expression, "shall be subject to
                 approval" is indicative of its intendment that the voluntary
                 retirement applied by the employees covered by clause
                 (b) is effective only upon approval by the competent E
                 authority. The effect of these words is to introduce a
llllljo.
            '
           ).    condition and thereby make voluntary retirement applied
                 by employees covered by category (b) conditional upon
                 its approval by the competent authority. There is nothing
   .,
                 to indicate in Regulation 12 that if employer decides to F
                 withhold approval of voluntary retirement, such refusa1
                 of approval must be communicated to the petitioner
                 during the period of notice. True it is that notice of three
                 months for voluntary retirement given by an employee
                 covered by clause (b) remains valid even if no G
                 communication is received within notice period but it
                 becomes effective only on its approval by the competent
                 authority. As a matter of fact, this seems to have been
                 understood by both the parties. [Paras 27 and 32) [381-
                 C; 383-B-F)                                                    H
    360   SUPREME COURT REPORTS [2009) 14 (ADDL.) S.C.R.


A       1.3. In the present case, the appellant issued a notice    I
                                                                  ).
   of voluntary retirement under Regulation 12 (b) on
   September 30, 2005. The notice period was to expire on
   December-31, 2005. The competent authority neither
   gave approval nor indicated disapproval to the appellant
B within the notice period of three months. The employee
   never treated that there has been cessation of
   employment on expiry of three months notice period
   inasmuch as he continued to attend his duties after
   December 31, 2005 until June 30, 2006. It is only by his
c letter dated June 8, 2006 that the appellant requested the
   respondent to relieve him in terms of his notice dated
   September 30, 2005 by June 30, 2006 and he stopped
   attending work from July 1, 2006. The letter dated June
   8, ~006 does not make any material differ~nce as the fact
0
   of the matter is that after expiry of notice period, the
   appellant continued to attend his duties ·for many months
   thereafter. By the letter dated September 15, 2006 the
                                                                       -
   respondent communicated to the ap~ellant that his
   application for voluntary retirement under Service
   Regulation 12(b) has not been acceded to by the
E competent authority .. Since the notice for voluntary
   retirement by an employee who has not attained 55 years
   but has completed 20 years of continuous service, under
   proviso appended to Regulation 12(b), is subject to
   approval by the competent authority and that approval
F was not granted, the voluntary retirement of the appellant
  'never came into effect. [Para 32] [383-F-H; 384-A-C]

      A.N. Sehgal & Others vs. Raje Ram Sheoran & Others
  1992 Supp. (1)SCC 304; State of Haryana & Others vs. S.K.
G Singhal (1999) 4 SCC 293; Tek Chand vs. Dile Ram (2001)
  3 SCC 290; K.L.E. Society vs. Dr.R.R. Patil & Anr. (2002) 6
  SCC 278; Ashok Kumar Sahu v. Union of India & Ors., (2006)
  6 $.CC 704; H.P. Horticultural Produce Marketing &
  Processing Corpn. Ltd. vs. V. Suman Behari Sharma (1996)
H
             PADUBIDRI DAMODAR SHENOY v. INDIAN AIRLINES             361
                           LTD. AND ANR.

       '
       )   4 SCC 584; Dinesh Chandra Sangma vs. State of Assam & A
           Ors. (1977) 4 SCC 441; B.J. She/at vs. State of Gujarat &
           Others (1978) 2 SCC 202; Union of India vs. Sayed Muzaffar
           Mir 1995 Supp ( 1) SCC 76; Jaipal Singh vs. Sumitra
           Mahajan & Anr. (2004) 4 SCC 522; Madras & Southern
           Maharatta Rly. Co. Ltd. vs. Bezwada Municipality AIR 1944 B
           PC 71; Shah Bhoraj Kuverji Oil Mills and Ginning Factory vs.
           Subhash Chandra Yograj Sinha AIR 1961 SC 1596 and CIT,
     •     Mysore etc. vs. lndo Mercantile Bank Ltd. AIR 1959 SC 713,
      >    referred to.

                Local Govt. Board vs. South Stoneham Union (1909) AC
                                                                            c
           57, referred to.

               'Principles of Statutory Interpretation' (Seventh Edition,
.. ' .4.
           1999); by G.P. Singh,.referred to.
                                                                            D
                                Case Law Reference
               1992 Supp. (1) SCC 304 referred to             Para 17
               (1999) 4 sec 293          referred to          Para 18
               (2001) 3 sec 290          referred to          Para 19       E

,.   1         (2002) 5 sec 218          referred to          Para 20
               (2006) 6 sec 104          referred to          Para 20
               (1996) 4 sec 584          referred to          Para 20       F
               (1977) 4 sec 441          referred to          Para 23
                (1978) 2 sec 202         referred to          Para 23
               1995 Supp ( 1) SCC 76referred to               Para 23
                                                                            G
               (2004) 4 sec s22          referred to          Para 26
                AIR 1944 PC 71           referred to          Para 27


                                                                            H
     362    SUPREME COURT REPORTS [2009] 14 {ADDL.) S.C.R.


 A         (1909) AC 57             referred to           Para 28       j,


           AIR 1961 SC 1596         referred to           Para 29
           1959 SC 713              referred to           Para 30

 B       CIVIL APPELLATE JURISDICTION : Civil Appeal No.
     6186 of 2009.

         From the Judgment & Order dated 17.10.2007 of the High            •
                                                                        _....
                                                                                      ~


     Court of Judicature at Bombay in Writ Petition No. 1463 of
     2007.
 c
         S.F. Deshmukh, N.M. Ganguli; P.K. Manohar for the
     Appellant.

          P .S. Narasimha, Lalit Bhasin, Nina Gupta, Bina Gupta for
                                                                          • .,-.L
 D
     the Respondents.                                                     _._
           The Judgment of the Court was delivered by

           R.M. LODHA, J. 1. Leave granted.

         2._ In this appeal by special leave, interpretation and
 E
     construction of Regulation 12 of Service Regulations for
     Employees (other than those in the Flying Crew and those in           ....._ .....
     the Aircraft Engineering Departments) - for short 'Service
     ReguJations' - framed by respondent no. 1, is involved.

 F      3. Padubidri Damodar Shenoy - appellant - joined the                       .,.,,111...
   services of the Indian Airlines Limited - respondent no. 1 as
   Traffic Assistant on January 13, 1977. The appellant was
   promoted from time to time and, lastly, he was promoted to the
   post of Manager in the commercial department, In or about
.G September, 2002, the appellant was posted to work at Muscat
   as Airport Manager but was recalled from posting soon
   thereafter and posted as Manager, Mumbai Airport. The
   appellant challenged the pre-mature recall by filing writ petition
   which was later on withdrawn. It is not necessary to refer to the
 H

                                                                                      •
                 PADUBIDRI DAMODAR SHENOY v. INDIAN AIRLINES                 363
                         LTD. AND ANR. [RM. LODHA, J.]

       \       details of that writ petition as the subject matter of the present   A
       i,
               appeal does not concern that. What is relevant to be noticed
               here is that a charge-sheet dated January 16/21, 2003 was
               served upon the appellant; enquiry was conducted and the
               appellant was found guilty of misconduct alleged in the charge-
               sheet and vide order dated March 31, 2006/April 10, 2006, the        B
               appellant's time scale by two incremental stages with
               cumulative effect was reduced by way of punishment.
       ~


       >           4. In the year 2003, the respondent no. 1 came out with a
               scheme of Voluntary Retirement for its employees entitled            c
               Voluntary Retirement Scheme, 2003 (for short, 'VRS, 2003').
               The appellant applied for voluntary retirement under the said
               scheme on September 17, 2003.

           t
                    5. On September 30, 2005 the appellant gave a notice of
...r           his intention to voluntarily retire from service on completion of    D
•      ~
               three months from the date of the notice as the appellant had
               completed 29 years of service. This was done under regulation
               12 of the Service Regulations .
•
I

4                    6. The appellant's case is that he sent a reminder to the E
               authorities on December 16, 2005 and when he did not receive
               any reply, he sent another letter dated June 8, 2006 informing
'      .l  '   the respondents that he would cease to be an employee of the
               respondent no. 1 after close of the working hours on June 30,
               2006. Again on July 1, 2006, the appellant is said to have
                                                                                 F
               informed the respondent no. 1 and the concerned authority that
..             in terms of notice dated September 30, 2005 he has ceased
               to be an employee of the respondent no. 1 in terms of
               Regulation 12(b) of the Service Regulations and requested the
               respondents to release and pay all his legal dues including the
               provident fund and gratuity within two weeks from July 1, 2006. G
               Another letter is said to have been sent by the appellant on July
               20, 2006 asking the respondents to release his legal dues
               failing which he informed them that he would be left with no
               alternative but to approach the court.
                                                                                 H
    364   SUPREME COURT REPORTS [2009] 14 (ADDL.) S.C.R.

                               /
A       7. It appears that by a letter dated July 31, 2006, the
                                                                        .:L
  appellant was informed that his application for voluntary
                                                                                      ;
  retirement has been forwarded to the Headquarters for decision
  in the matter. The appellant was advised to report for duty
  immediately, failing which he was informed .that a disciplinary.
B action would be taken against him.
          8. The appellant sent reply to the said letter on August 8,
    2006 reiterating his stand and further informing the respondents         ..
    trlat he has ceased to be the employee of the respondents from      _.(

    July 1, 2006 and, therefore, there was no question of his
c   reporting for duty.

       9. The appellant then filed a writ petition (Writ Petition No.
  2522 of 2006) before th~ High court of Judicature at Bombay.
  During the pendency of writ petition, the appellant received a
D communication dated September 15, 2006 from the
                                                                                  ~



                                                                        ~         '
  respondents that his request for voluntary retirement.from
  service has not been acceded to by the competent authority.

       10. Writ Petition No.2522 of 2006 was contested by the
  respondents. The Division Bench of the High Court heard the
E
  parties and by its order dated April 23, 2007, dismissed that
  writ petition.
                                                                        J'
        11. The appellant filed a fresh writ petition being Writ
  Petition No, 1463 of 2007 before the High Court of Judicature
F at Bombay praying therein that the communication dated
  September 15, 2006 rejecting the appellant's applicatiQn for
  voluntary retirement be quashed and set aside and a direction
  be issued to the respondents to approve the voluntary
  retirement of the appellant under Regulation 12(b) of Service
G Regulations pursuant to the notice dated September 30, 2005.
  The appellant also prayed that the respondents be further              .\·
  directed to release and pay all legal dues of the appellant along
  with interest thereon at 18% per annum from July 1, 2006 till
  payment and extend all post-retirement benefits.
H
              PADUBIDRI DAMODAR SHENOY v. INDIAN AIRLINES                365
                      LTD. AND ANR. [R.M. LODHA, J.]

                 12. The respondents contested that writ petition on diverse    A
           grounds, inter alia, namely: (i) that the appellant had raised the
           same issue in earlier writ petition (Writ Petition No. 2522 of
           2006) and by a detailed order, his writ petition was dismissed
           and, therefore, it was not open to the appellant to re-agitate the
           same issue; (ii) that the application for voluntary retirement is    B
           an offer made by an employee and unless it is accepted by the
           employer, it does not become effective. The employee is not
           relieved from service till the offer is accepted because the
           relationship of the employer and employee does not come to
           an end. The offer of the appellant was not accepted by the first     c
           respondent and (iii) that the delayed communication does not
           create any right in the appellant and that the Service
           Regulations do not contemplate reasons to be communicated
           for rejection of the application for voluntary retirement.

                13. The Division Bench of the High Court, after hearing the     D
           parties, dismissed the writ petition on October 17, 2007.
           Hence, the present appeal by special leave.

                14. Before we turn to Regulation 12 of the Service
           Regulations, we may observe that the appellant had raised the E
           same controversy by filing Writ Petition No. 2522 of 2006. It is

-      >
      ).
           true that the communication dated September 15, 2006 was
           received by him during the pendency of writ petition but the .
           Division Bench was conscious of this fact while passing the
           order dated April 23, 2007. The Division Bench held that right F
           to accept or reject the offer for voluntary retirement is that of
           the employer and although this has to be exercised within a
           reasonable time but that, however, does not give any right to
           the employee, if not accepted within reasonable time, to hold
           that the employment has come to an end. This is what the G
           Division Bench said in its order dated April 23, 2007 while
           dismissing earlier writ petition :

•·.            "The case of the petitioner is that once application is
'
               moved for retirement, under the provisions of Regulation
               16(b), it would be the bounden duty of the Respondents           H
     366     SUPREME COURT REPORTS [2009) 14 (ADDL.) s·.c.R.
                                                                                          •
                                                                                         ,,-


A          to have decided the same recently. As the Respondents
                                                                                ~
           for a long period of time did not accept the letter to offer
           retirement, the petitioner stopped attending the work as in
           his opinion, he ceases to be in the employment and
           demanded the compensation/retiremental benefits from
B.         Respondent No. 1.

           After having heard the learned counsel for the petitioner
           and the learned counsel for Respondent No. 1 and the
           relevant Regulation, we are clearly of the opinion that right       -(         t-
           to accept or reject is that of the employer. It is true that this              L
c          has to be exercised within a reasonable time, that however
           does not give right in employee if not accepted within
                                                                                           .
                                                                                           i'
           reasonable time to hold that the employment has to come                         Ir

                                                                                           \.-
           to an end. The requirement of the regulation is approval
           of the competent authority. The Competent Authority has                   ,,L
D          by a communication on 15.9.2006 refused the request for                   '
                                                                               ~
           voluntary retirement. Considering the above, we are of the
           opinion that no case is made out for interference by this
           court. -                                                                       }.

                                                                                          \
E          It is made clear that we are not going to the merits as to                      l
           whether Respondent No. 1 was within its jurisdiction to
           accept or refuse. If the petitioner is aggrieved, it is for the                t
                                                                                         ...
           petitioner to take whatever action which he desires."               -l.        'J

         15. While dismissing the subsequent writ petition, in the
F
     impugned order, the Division Bench has observed that it was
                                                                                         ..,
     improper for the appellant to have another round of litigation
     on the same point. The Division Bench expressed its
     unhappiness about the conduct of the appellant thus :

G          "In its order dated 23/4/07, the Division Bench quoted                          ~
           Regulation 12(b). The Division Bench heard arguments on               ~

           this point. It is reflected in the order that this point was
           canvassed. The Division Bench then observed that
                                                                                           ""
                                                                                           't
                                                                                           ·I
                                                                                         ~
                                                                                           •
           because the employer does not exercise the right to
H          accept or reject the application within a reasonable time                       ;JI
                                                                                               \



                                                                                           I
                                                                                          ,;
                   PADUBIDRI DAMODAR SHENOY v. INDIAN AIRLINES                   367
                           LTD. AND ANR. [R.M. LODHA, J.]

         l            that does not give right in employee to contend that              A
                      employment has come to an end. It is distressing to note
•                     that though this contention is rejected it is again raised in
                      the present petition. It is improper for the petitioner to have
                      a round of litigation in this manner on the same point. We
                      are unhappy about this conduct of the petitioner."                B
                     16. Now, we come to the core issue. Regulation 12 of the
         ..      Service Regulations, which is the area of controversy, reads
         _.,._
                 thus:

                      "12. An employee shall retire from _the service of the            c
""'f..
                      Company on attaining the age of 58 years provided that
                      the competent authority may ask an employee to retire after
                      he attains the age of 55 years on giving three months'
                      notice without assigning any reason. An employee :-
•         .-i
                              (a)    On attaining the age of 55 years;
                                                                                        D


                                                    OR

                              (b)    On the completion of 20 years of continuous
                                     service may by giving three months notice          E
                                     voluntarily retire from the service;
             ~        Provided that the voluntary retirement under Clause (b)
                      shall be subject to approval of the competent authority.

                      Provided further, notwithstanding anything contained in           F
                      regulation - 12 the services of an employee may at the
                      option of the Managing Director and the employee being
                      found medically fit, be extended by one year at a time
                      beyond the age of retirement of 58 years for an aggregate
                      period not exceeding two years."                                  G
         4._

                      17. Mr. S.J. Deshmukh, learned counsel for the appellant
                 contended that Regulation 12 ves~s the employees covered
.....            thereby with a right to voluntarily retire after giving three months
                 notice, namely, those who have attained age of 55 years and            H

 "r
     368     SUPREME COURT REPORTS (2009] 14 (ADDL.) S.C.R.


A also those who have completed 20 years of continuous service
                                                                              ,._'
  and both these categories form one class. According to him,
  proviso appended to Regulation 12 only empowers the
                                                                         -·

                                                                                         .:-
                                                                                             .
  competent authority to withhold approval before the notice
  period is over. In other words, he would submit, that the
B employer can stop the voluntary retirement by not granting the
  approval within the period of notice and communicating the                                  >-
                                                                                             ,r
  same to the concerned employee that the employer was not
  giving his approval. Learned counsel submitted that a 'proviso'             ~


  to particular provision of a statute only embraces the field which    -4.
c is covered by main provision to which it has been enacted and
  to no other. He relied upon a decision of this Court in A.N.
                                                                                             '
                                                                                         '
                                                                                     • )Im
  Sehgal & Others vs. Raje Ram Sheoran & Others 1 and
  submitted that where the language of the main enactment is                                 rj:i::
  explicit and unambiguous, the proviso can have no
D repercussion on the interpretation of the main enactment, so                         ~
  as to exclude from it, by implication what clearly falls within its   _,.t__
  express terms.

        18. Insofar as norms relating to voluntary retirement are
  concerned, Mr. S.J. Deshmukh, learned counsel for the
E appellant submitted that the law in this regard is laid down by
  this Court in State of Haryana & Others vs. S.K. SinghaP. He,
  particularly, referred to paragraphs 13 and 14 of the report and       (

  submitted that any decision to withhold approval has to be taken      --(

  and communicated during the period of notice.
F-
        19. On the other hand, Mr. P.S. Narasimha, learned senior                    ' ...
  counsel for the respondents submitted that cases of voluntary                           i
  retirement fall in three categories name!y: (i) where, voluntary                           c

  retirement is automatic and comes into force on the expiry of
  notice period; (ii) where voluntary retirement comes into force
G
  on the expiry of notice period unless an order is passed within
                                                                         ),.
  the notice period withholding permission to retire; and (iii)
  where voluntary retirement does not come into force unless
     1.   (1992) Supp. (1) sec 304.                                                  ~
                                                                                     \
H_ 2.     (1999) 4 sec 293.

                                                                                             ..,
                                                                                       1"
                                                                                         _lC
                     PADUBIDRI DAMODAR SHENOY v. INDIAN AIRLINES             369
                             LTD. AND ANR. [RM. LODHA, J.]
                permission to this effect is specifically granted by the controlling A
         '
         A      authority. The learned senior counsel would submit that proviso
                appended to Regulation 12 relates to category (iii). He also
                relied upon decision of this Court in S.K. Singhal and another
                decision of this Court in the case of Tek Chand vs. Dile Ram3.
                                                                                     B
                     20. Learned senior counsel for the respondents -submitted
                that notice dated September 30, 2005 given by the appellant
        4
                to the employer under Regulation 12(b) expiring on December
                31, 2005 did not become effective and rather remained
        ~
                inoperative since the appellant continued to attend his duties
                not only until the expiry of notice periop but thereafter as well
                                                                                    c
                upto June 30, 2006. In this regard, he referred to a decision of
                this Court in the case of K.L.E. Society vs. Dr.RR. Patil & Anr.•
                He also submitted that the word "approval" occurring in proviso
                to Regulation 12 in its context would mean "to accept". In this
                regard, he referred to a decision of this Court in the case of D
         J..
                Ashok Kumar Sahu vs. Union of India & Ors. 5 Relying upon a
                decision of this Court in the case of H.P. Horticultural Produce
                Marketing & Processing Corpn. Ltd. vs. V. Suman Behari
                Sharma 6 , Mr. P.S.Narasimha submitted that 'proviso' to
                Regulation 12 expressly mandates the approval of the E
                competent authority or, in other words, approval of the
            >   competent authority is a condition precedent to the event of
         ;.     voluntary retirement.

                      21. Regulation 12 of the Service Regulations, inter alia, F
                enables an employee to seek voluntary retirement on attaining
                the age of 55 years or on completion of 20 years of continuous
                service by giving three months notice. An employee who .ha~
                attained the age of 55 years and has applied for voluntary
                retirement under Regulation 12, his voluntary reUrement is
                                                                                G
                automatic on expiry of notice period i.e. three months. Is it
        4.-
                3.   (2001) 3 sec 290.
                4.   (2002) 5 sec 278.
...
1111(
                5.   (2006) 6 sec 704.
                6.   (1996) 4 sec 584.                                              H
     370      SUPREME COURT REPORTS [2009] 14 (ADDL.) S.C.R.


A equally applicable to an employee who has not attained the age               r
                                                                             ,fa.
     of 55 years but completed 20 years of continuous service and
     applied for voluntary retirement. In our judgment, it is not so
     because for a category covered by clause (b), namely, an
     employee having completed 20 years of continuous service who
8    has given three months notice for voluntary retirement from the
     service, a proviso appended thereto provides that voluntary
     retirement under clause (b) shall be subject to approval of the
     competent authority.                                                          ..
                                                                             --'--
           22. It is appropriate at this stage to consider the decision
c    of this Court in S.K. Singhal. In S.K. Singhal, the relevant rule
     5.32(8) of the Punjab Civil Services Rules under consideration
     was as follows:

                "5.32(8)(1) At any time a government employee has
D        completed twenty years' qualifying service, he may, by
                                                                              )._
        .giving notice of not less than three months in writing to the
       · appointing· authority retire from service. However, a
         government employee may make a request in writing to
         the appointing authority to accept notice of less than three
E        months·giving reason therefor. On receipt of a request, the
         appointing authority may consider such request for the
         curtailment of the period of notice of three months on merits         I
         and if it is satisfied that the curtailment of the period of         -A
         notice will not cause any administrative inconvenience, the
-F       ap.pointing authority may relax the requirement of notice of
         three months on the condition that the government
         employee shall not apply for commutation of a part of his
     • pension before the expiry of the period of notice of three
         months.
G          -(2) The notice of voluntary retirement given under sub-rule
            (1) shall require acceptance by the appointing authority
            subject to Rule 2.2 of the Punjab Civil Services Rules Vol.II:

                  Provided that where the appointing authority does not
            refuse to grant the permission for retirement before the
                                                                                        ,,_,.
H
                           PADUBIDRI DAMODAR SHENOY v. INDIAN AIRLINES               371

  .. i
  -                                LTD. AND ANR. [RM. LODHA, J.]

                             expiry of the period specified in sub-rule (1) supra, the· A
       '                     retirement shall become effective from the date of expiry
........
                             of the said period:

                                    Provided further that before a government employee
                             gives notice of voli.mtary retirement with reference to sub-
                                                                                            B
                             rule (1) he should satisfy himself by means of a reference
                             to the appropriate authority that he has, in fact, completed
                             twenty years' service qualifying for pension."
                "
                ~
                           23. In paragraph 9 of the report, this Court considered the
                      general scheme of voluntary retirement in service rules and also      c
      ..              noted earlier decisions of this Court in the case of Dinesh
                      Chandra Sangma vs. State of Assam & Ors. 7, B.J. She/at vs.
                      State of Gujarat & Others6, Union of India vs. Sayed Muzaffar
                      Mir6 and H.P.Horticultural Produce Marketing & Processing
                      Corpn. Ltd. This Court observed:                                 D
                .A
                                    "9. The employment of government servants is
                             governed by rules. These rules provide a partic~lar age as
                             the age of superannuation. Nonetheless, the rules confer
                             a right on the Government to compulsorily retire an
                                                                                          E
                             employee before the age of superannuation provided the
                             employee has reached a particular age or has completed
                 l           a particular number of years of qualifying service in case
                             it is found that his service has not been found to be
                             satisfactory. The rules also provide that an employee who
       ..',..
                             has completed the said number of years in his age or who F
                             has completed the prescribed number of years of qualifying
                             service could give notice of, say, three months that he
                             would voluntarily retire on the expiry of the said period of
                             three months. Some rules are couched in language which
                             results in an automatic retirement of the employee upon G
                -+-          the expiry of the period specified in the employee's notice.

                      7.   (1977) 4 sec 441.
     ...:             8.   (1978) 2 sec 202.
                      9.   1995 supp (1) sec 76.                                            H

     ..
     372     SUPREME COURT REPORTS [2009] 14 (ADDL.) S.C.R.                                  _,_
                                                                                             ..:
A"         On the other hand, certain rules in some other departments             i
           are couched in language which makes it clear that even
                                                                                 ).           -,
                                                                                              '1'
           upon expiry of the period specified in the notice, the
           retirement is not automatic and an express order granting
           permission is required and has to be communicated. The
B          relationship of master and servant in the latter type of rules
           continues after the period specified in the notice till such
           acceptance is communicated; refusal of permission could
                                                                                  ~
           also be communicated after 3 months and the employee
           continues to be in service. Cases like Dinesh Chandra            ---'---·
c          Sangma v State of Assam (1977) 4 SCC 441; B.J. She/at
           v. State of Gujarat (1978) 2 SCC 202 and Union of India                       ...
                                                                                       .,.

           v. Sayed Muzaffar Mir (1995 Supp.(1) SCC 76 belong to
           the former category where it is held that upon the expiry
           of the period, the voluntary retirement takes effect
D
           automatically as no order of refusal is passed within the
                                                                            ,A
                                                                              '
           notice period. On the other hand H.P. Horticultural
           Produce Marketing & Processing Corpn. Ltd. vs. Suman
           Behari Sharma ( 1996) 4 SCC 584 belongs to the second
           category where the bye-laws were interpreted as not giving
           an option "to retire" but only provided a limited right to
E          "seek" retirement thereby implying the need for a consent
           of the employer even if the period of the notice has
                                                                             (
           elapsed. We shall refer to these two categories in some          -;4

           detail."
                                                                                             ~
         24. In S.K. Singhal, this Court considered previous                                 ...
F
     decisions at quite some length and held:                                                ·-
                 "13. Thus, from the aforesaid three decisions it is
           clear that if the right to voluntarily retire is conferred in
           absolute terms as in Dinesh Chandra Sangma case by the
G
           relevant rules and there is no provision in the rules to          ,+.
           withhold permission in certain contingencies the voluntary
           retirement comes into effect automatically on the expiry of
           the period specified in the notice. If, however, as in B.J.                 'p

           Shelat case and as in Sayed Muzaffar Mir case the
H
                                                                                       -..    •
               PADUBIDRI DAMODAR SHENOY v. INDIAN AIRLINES               373
                       LTD. AND ANR. [RM. LODHA, J.]
                authority concerned is empowered to withhold permission         A
       l
                to retire if certain conditions exist, viz., in case the
                employee is under suspension or in case a departmental
                enquiry is pending or is contemplated, the mere pendency
                of the suspension or departmental enquiry or its
                contemplation does not result in the notice for voluntary       8
                retirement not coming into effect on the expiry of the period
                specified. What is further needed is that the authority
       "
       -~
                concerned must pass a positive order withholding
                permission to retire and must also communicate the same
                to the employee as stated in B.J. Shelat case and in Sayed      c
....            Muzaffar Mir case before the expiry of the notice period .
                Consequently, there is no requirement of an order of
                acceptance of the notice to be communicated to the
                employee nor can it be said that non-communication of
                acceptance should be treated as amounting to withholding        D
       ~        of permission.
                       14. Before referring to the second category of cases
                where the rules require a positive acceptance of the notice
                of voluntary retirement and communication thereof, it is
                necessary to refer to the decision of this Court in Ba/jit E
                Singh (Dr) v. State of Haryana (1997 (1) SCC 754] strongly
 ~     ,,t-
           >    relied upon by the learned counsel for the appellants and
                to Power Finance Corpn. Ltd. v. Pramod Kumar Bhatia [
                (1997) 4 sec 280]. The former case arose under Rule
                5.32(8) of the Punjab Civil Services Rules. That rule F
                extracted earlier contains an express provision in the
                proviso to sub-rule (2) that the retirement takes effect
                automatically if refusal is not communicated within 3
                months. In that case, when the employee gave notice for
                voluntary retirement on 20-9-1993, criminal cases were G
                pending against him. After expiry of 3 months, on 25-2-
                1994, the competent authority declined to accept the
,,,             notice. A two-Judge Bench of this Court, however, held that
                the voluntary retirement did not come about automatically
 '
                on the expiry of the notice period but that it could take H

..
    374     SUPREME COURT REPORTS [2009] 14 (ADDL.) S.C.R.


A     . effect only upon acceptance of the notice by the
        Government and that the acceptance must also be                  j
        communicated and till then the jural relationship of master
        and servant continues. This Court referred only to the
        decision of the two-Judge Bench in Sayed Muzaffar Mir
B       case and stated that that case was to be confined to its
        own facts. The two-Judge Bench of this Court in Baljit
        Singh case did not notice that there were two three-Judge
        Bench cases in Dinesh Chandra Sangma and She/at                      ..
        taking the view under similar rules that a positive order
                                                                        --"-·
c       was to be passed within the notice period withholding
        permission to retire and that the said order was also to
                                                                                  ,.....
        be communicated to the employee during the said period.
        By stating that an order of acceptance of the notice was
        necessary and that the said acceptance must be
        communicated to the employee and till that was done the
D
        jural relationship continued and there was no automatic
                                                                        ~
        snapping thereof on the expiry of 3 months' period, the two-
        Judge Bench, in our view, has gone contrary to the two
        three-Judge Bench cases which were not brought to its
        notice. In the above circumstances, we follow the ~o three-
E       Judge Bench ,cases for deciding the case before us.

                 15. Learned counsel for the appellant also relied on
          a two-Judge Bench decision in Power Finance Corpn. Ltd.        '
                                                                        "'-·
          v. Pramod Kumar Bhatia. That was a case where the
F         letter of voluntary retirement was conditionally accepted
          subject to payment of dues and the employee wrote a
          further letter seeking adjustment thereof but before that
          was done, the scheme itself was withdrawn. There are
          again some observations made to the effect that there
G         must be acceptance of request to retire and that it must
          be communicated. Neither Dinesh Chandra Sangma nor
          She/at was referred to. In our opinion, the express
          provision in the proviso to sub-rule (2) of Rule 5.32(B) in
          the case before us does not permit such a view to be                        ,'V
          taken. The said observations again run contrary to the
H                                                                                 '
     PADUBIDRI DAMODAR SHENOYv. INDIANAIRLINES               375
             LTD. AND ANR. [RM. LODHA, J.]

       decision in the two three-Judge Bench cases referred to      A
•
j,     above. Our comments on Baljit Singh apply equally to this
       case, so far as the observations are concerned.

              16. We then come to the second category of cases .
       where the rules require that an order of acceptance of
                                                                  B
       notice be passed to make the voluntary retirement
       effective. In HPMC v. Suman Behari Sharma it will be
       noticed, the principle in Dinesh Chandra Sangma case
•      was accepted but the case was distinguished on the
~
       ground that Bye-law 3.8(2) in HPMC case provided
       differently and that under that bye-law an employee could
                                                                    c
       be permitted at his request to retire on completion of 25
       years' service or 50 years of age. Para (5) of Bye-law 3.8
       stated as follows: (SCC p.588, para 7)
 ~           "(5) Notwithstanding the provision under para (2)      D
J            above, the corporation employees who. have a
             satisfactory service record of 20 years may also
             seek retirement from the service of the Corporation
             after giving three months' notice in writing to the
             appropriate authority. Persons under suspension        E
             would not be retired under this clause unless
             proceedings of the case against them are
             finalised .... "(emphasis supplied)

       While clause (2) speaks of 25 years' service, clause (5)
     · speaks of 20 years' service.                                 F

            17. The employee applied on 26-11-1990 for
      voluntary retirement effective from 30-11-1990 and also
      requested for waiver of notice of 3 months. He did not
      report to duty right from 1-12-1990. Earlier on 12-12-1989,   G
      a charge-sheet was issued against him for certain acts of
      misconduct. On 26-12-1990 he filed a reply to the charge-
      sheet. On 22-8-1992 another charge-sheet was served for
      unauthorised absence and one more on 18-9-1992. On
                                                                    H
    376     SUPREME COURT REPORTS [200~] 14 (ADDL.) S.C.R.

A         30-9-1992 he approached the Tribunal contending that he               •
          stood retired on expiry of 3 months from notice, w.e.f. 26-        J
          2-1990. The Tribunal accepted the said plea. Reversing
          the order of the Tribunal, this Court held- while
          distinguishing Dinesh Chandra Sangma case1 and other
B         similar High Court judgments, that clause (2) o.Mhe bye-
          law merely gave a right to make a request and :the request
          would become effective only if permitted;  .• Under
                                                          .
                                                              clause (2)
          of the bye-law, it was a "right to a request" and not "a right
          to retire". If the request was not accepted a!!ld permission      ~

c         was not granted, the employee could not claim that there
          was an automatic retirement on the expiry of the period.
          Even under clause (5) while it was true that there was a
          non obstante clause, it was only an exception to clause (2)
          to a limited extent, i.e., completion of 20 years' satisfactory
          service [rather than 25 under clause (2)] but the grant of
D
          ~permission" to the request seeking retirement was                \__
          necessary even under clause (5) and was not dispensed
          with. If under clause (2) a person who had put in 25 years
          had to "seek to retire" and had to be "permitted to retire",
          a person with only 20 years' service under clause.(5) could
E         not have been placed on a better footing, it was held. The
          Court emphasised: (SCC pp.588-89, para 8)

                 "The words 'seek retirement' in para 5 indicate that       '
                                                                            i--.

                 the right which is conferred by it is not the right to
F                retire but a right to ask for retirement. The word
                 'seek' implies a request by the employee and
                 corresponding acceptance or permission by
                 HPMC. Therefore, there cannot be automatic
                 retirement or snapping of service relationship on
G                expiry of three months' period."

          On that basis, it was held that though the rejection of the       -+
          request was not communicated within the notice period,
          there was no automatic retirement. There are no such
          provisions in the case before us.
H
        PADUBIDRI DAMODAR SHENOY v. INDIAN AIRLINES                  377
                LTD. AND ANR. [R.M. LODHA, J.]
 \                18. In the case before us sub-rule (1) of Rule 5.32(8)    A
 -"        contemplates a "notice to retire" and not a request seeking
         · permission to retire. The further "request" contemplated by
           the sub-rule is only for seeking exemption from the 3
           months' period. The proviso to sub-rule (2) makes a
           positive provision that "where the appointing authority does     B
           not refuse to grant the permission for retirement before the
,,         expiry of the period specified in sub-rule (1), the retirement
           shall become effective from the date of expiry of the said
~          period. The case before us stands on a stronger footing
           than Dinesh Chandra Sangma case so far as the                    c
           employee is concerned. As already stated Rule 2.2 of the
           Punjab Civil Services Rules Vol. II only deals with a
           situation of withholding or withdrawing pension to a person
           who has already retired."
)._        25. In Tek Chand vs. Dile Ram 3, a three Judge Bench of          D
      this Court considered S.K. Singhal in paragraph 34 of the
      report and then went on to hold as follows:
                35. In our view, this judgment fully supports the
          contention urged on behalf of the appellant in this regard. E
          In this judgment, it is observed that there are three
 ,.       categories of rules relating to seeking of voluntary
~-
          retirement after notice. In the first category, voluntary
          retirement automatically comes into force on expiry of
          notice period. In the second category also, retirement
                                                                      F
          comes into force unless an order is passed during notice
          period withholding permission to retire and in the third
          category voluntary retirement does not come into force
          unless permission to this effect is granted by the
          competent authority. In such a case, refusal of permission
          can be communicated even after the expiry of the notice G
+         period. It all depends upon the relevant rules. In the case
          decided, the relevant Rule required acceptance of notice
          by appointing authority and the proviso to the Rule further
          laid down that retirement shall come into force
                                                                      H
    378     SUPREME COURT REPORTS [2009] 14 (ADDL.) S.C.R.


A         automatically if the appointing authority did not refuse
          permission during the notice period. Refusal was not
          communicated to the respondent during the notice period
          and the Court held that voluntary retirement came into force
          on expiry of the notice period and subsequent order
B         conveyed to him that he could not be deemed to have
          voluntary retired had no effect. The present case is almost
          identical to the one decided by this Court in the aforesaid
          decision.

                 36. This Court in B.J. Shelatv. State of Gujarat while
c         dealing with a case of voluntary retirement, referring to the
          Bombay Civil Service Rules, Rule 161(2)(il) proviso and
          Rule 56(k) of the Fundamental Rules, in a similar situation,
          held that a positive action by the appointing authority was
          required and it was open to the appointing authority to
          withhold. permission indicating the same and
          communicating its intention to the government servant
          withholding permission for voluntary retirement and that no
          action can be taken once the government serVant has
          effectively retired. ?:;:-as 9 and 10 of the said judgment
E         read thus: (SCC pp. 207-08)

                 "9. Mr Patel next referred us to the meaning of the
                 word 'withhold' in Webster's Third New /ntemational
                 Dictionary which is given as 'hold back' and
                 submitted that the permission should be deemed
F
                 to have been withheld if it is not communicated. We·
                 are not able to read the meaning of the word
                 'withhold' as indicating that in the absence of a
                 communication it must be understood as the
                 permission having been withheld.
G
                 10. It will be useful to refer to the analogous
                 provision in the Fundamental Rules issued by the
                 Government of India applicable to the Central
                 Government servants. Fundamental Rule 56(a)
H                provides that except as otherwise provided in this
                   PADUBIDRI DAMODAR SHENOY v. INDIAN AIRLINES                379
                           LTD. AND ANR. [R.M. LODHA, J.]

                           Rule, every government servant shall retire from           A
         l                 service on the afternoon of the last day of the month
                           in which he attains the age of fifty-eight years.
                           Fundamental Rule 56(/) is similar to Rule 161(aa)(1)
                           of the Bombay Civil Services Rules conferring an
                           absolute right on the appropriate authority to retire      B
                           a government servant by giving not less than three
                           months' notice. Under Fundamental Rule 56(k) the
         -
         __.__
                           government servant is entitled to retire from service
                           after he has attained the age of fifty-five years by
                           giving notice of not less than three months in writing     c
                           to the appropriate authority on attaining the age
                           specified. But proviso (b) to sub-rule 56(k) states
                           that it is open to the appropriate authority to withhold
                           permission to a government servant under
              +            suspension who seeks to retire under this clause.          D
             )._           Thus under the Fundamental Rules issued by the
                           Government of India also the right of the government
                           servant to retire is not an absolute right but is
                           subject to the proviso whereunder the appropriate
                           authority may withhold permission to a government
                                                                                      E
                           servant under suspension. On a consideration of
                           Rule 161(2)(it) and the proviso, we are satisfied that
'            1             it is incumbent on the Government to communicate
                           to the government servant its decision to withhold
                           permission to retire on one of the grounds specified
                           in the proviso. n                                          F

                    In this decision effect of Rule 56(k) of the Fundamental
                    Rules is also considered which answers the argument of
                    the learned counsel for the respondent on this aspect. It
                    may also be noticed that under Rule 48-A in the G
             +      Government of India's decision giving instructions to
                    regulate voluntary retirement it is stated:

                         "Even where the notice of voluntary retirement given
-)'
                    by a government servant requires acceptance by the
    ,f                                                                                H
    380     SUPREME COURT REPORTS [2009] 14 (ADDL.) S.C.R.


A         appointing authority, the government servant giving notice
                                                                                  I
          may ptesume acceptance and the retirement shall be                 ,,4-

          effective in terms of the notice unless the competent
          authority issues an order to the contrary before the expiry
          of the period of notice."
B
          26. In the case of Jaipa/ Singh vs. Sumitra Mahajan &
    Anr. 10, in an appeal from election petition, this Court had an
    occasion to consider the difference between "voluntary
                                                                                lo
    retirement" and "resignation". This Court held thus:
                                                                           ---+--
c          10 ....... ln the case of ReseNe Bank of India v. Cecil
           Dennis Solomon (2004) 9 SCC 461, this Court has laid
           down that in service jurisprudence there is a difference
           between "voluntary retirement" and "resignation" as they
           convey different connotations. It has been held that
D         voluntary retirement and resignation involve voluntary acts
          on the part of the employee to leave service and though          -~
           both involve voluntary acts, they operate differently. One of
          the basic distinctions between the two is that in the case
          of resignation, it can be tendered at any time but in the
E         case of voluntary retirement, it can only be sought for after
          rendering prescribed period of qualifying service. In the
          case of resignation, a prior permission is nbt mandatory
          while in the case of voluntary retirement, permission of the     -;..
          employer concerned is a requisite condition. Under Rule
F         16 of the 1958 Rules, an employee who seeks voluntary
          retirement has to give three months' notice to enable the
          employer to complete the design~ted mode of acceptance.
          (See Ha/sbury's Laws ofEngland, 4th Edn., Vol. 9, p. 133.)
          Lastly, in a given case, the appointing authority may refuse
          to waive the said notice perio~ which shows that
G
          resignation may be unilateral whereas voluntary retirement
          is bilateral. A similar question came up before this Court       -+
          in the case of UCO Bank v. Sanwar Mal [(2004) 4 SCC
          412] in which this Court has.inter alia held that in the case

H   10. (2004) 4 sec s22.
- i




       l
                  PADUBIDRI DAMODAR SHENOY v. INDIAN AIRLINES
                          LTD. AND ANR. [RM. LODHA, J.]

                     of "resignation", the relationship of employer and. A
                     employee terminates on acceptance of resignation
                                                                            381




                     whereas in the case of "retirement", voluntary or on
                     superannuation, the relationship continues for the
                     purposes of payment of retiral benefits. In the case of

  ..
                     retirement, there is a nexus between such retirement and B
                     retiral benefits .... "

       ~             27. The aforesaid decisions of this Court do provide some
       ,;..    guidance but the controversy in hand has to be decided in .the
               light of the words used in proviso appended to Regulation 12.
               The key words therein are that voluntary retirement under clause
                                                                                   c
               (b) 'shall be subject to approval' of the competent authority. In
               'Principles of Statutory Interpretation' (Seventh Edition, 1999),
               Justice G.P. Singh has quoted words of Lord Macmillan in
               Madras & Southern Maharatta Rly. Co. Ltd. vs. Bezwada
       j       Municipality11 which read thus:                                     D

                           'The proper function of a proviso is to except and to
___.                 deal with a case which would otherwise fall within the
--;
                     general language of the main enactment and its effect is
                     confined to that case. n                                      E·
                    28. In the aforesaid book, author has also quoted the
           k   opinion of Lord Macnaghten in Local Govt. Board vs. South
               Stoneham Union 12 as follows:

                    "The proviso may be a qualification of the preceding           F
                    enactment which is expressed in terms too general to be
                    quite accurate".

                   29. In the case of Shah Bhoraj Kuverji Oil Mills and
               Ginning Factory vs. Subhash Chandra Yograj Sinha 13 , this          G
               Court held, " ... as a general rule, a proviso is added to an
               enactment to qualify or create an exception to what is in the
               11. AIR 1944 PC 71.
               12. (1909) AC 57, p.62.
               13. AIR 1961 SC 1596.                                               H
                                                                                       '
                                                                                       \




    382     SUPREME COURT REPORTS (2009] 14 (ADDL.) S.C.R.


A enactment. .. "                                                                J
       30. In the case of CIT, Mysore etc. vs. lndo Mercantile
    Bank Ltd. 14, this court observed:                                                     r


          "The proper function of a proviso is that it qualifies the
B         generality of the main enactment by providing an exception
          and taking out as it were, from the main enactment, a
                                                                                           t
          portion which, but for the proviso would fall within the main           .
          enactment. Ordinarily it is foreign to the proper function of         -4..
          proviso to read it as providing something by way of an
c         addendum or dealing with a subject which is foreign to the
          main enactment".

       31. In A.N. Sehgal & Ors1., upon which reliance has been
  placed by the learned counsel for the appellant, this Court stated                       ...
D as follows:
                                                                                \.
                "14. It is a cardinal rule <:>f interpretation that a proviso
          to a particular provision of a statute only embraces the field
          which is covered by the main provision. It carves out an                     r   '
          exception to the main provision to which it has been                             '
E         enacted by the proviso and to no other. The proper function                      ~-

          of a proviso is to except and deal with a case which would                   \
                                                                                           '
                                                                                       ,.___
          otherwise fall within· the general language of the main               ')l

          enactment, and its effect is to confine to that case. Where
          the language of the main enactment is explicit and
F         unambiguous, the proviso can have no repercussion on the                         >
          interpretation of the main enactment, so as to exclude from
          it, by implication what clearly falls within its express terms.

                15. The scope of the proviso, therefore, is to carve
G         out an exception to the main enactment and it excludes
          something which otherWise would have been within the rule.
          It has to operate in the same fieid and if the language of
          the main enactment is clear, the proviso cannot be torn
          apart from the main enactment nor can it be used to nullify
H 14. AIR 1959 SC 713.
             PADUBIDRI DAMODAR SHENOY v. INDIAN AIRLINES                    383
                     LTD. AND ANR. [R.M. LODHA, J.]

_._             by implication what the enactment clearly says nor set at          A
                naught the real object of the main enactment, unless the
                words of the proviso are such that it is its necessary
                effect."

                  32. The use of the word 'shall' in the proviso, prima facie
                                                                                   B
            leads to an inference that provision is imperative. There is
          · nothing in the context to suggest that it is merely directory. It is
1
            followed by the words, 'subject to approval'. The effect of the
            use of words 'subject to' is to introduce a condition. The
 .J..
            expression, "shall be subject to approval" is indicative of its
            intendment that the voluntary retirement applied by the
                                                                                   c
            employees covered by clause (b) is effective only upon
            approval by the competent authority. The effect of these words
            is to introduce a condition and thereby make voluntary
            retirement applied by employees covered by category (b)
            conditional upon its approval by the competent authority. There        D
    j
            is nothing to indicate in Regulation 12 that if employer decides
           to withhold approval of voluntary retirement, such refusal of
            approval must be communicated to the petitioner during the
           period of notice. True it is that notice of three months for
           voluntary retirement given by an employee covered by clause             E
           (b) remains valid even if no communication is received within
           notice period but it becomes effective only on its approval by
      ~    the competent authority. As a matter of fact, this seems to have
           been understood by both the parties. The appellant issued a
           notice of voluntary retirement under Regulation 12 (b) on               F
           September 30, 2005. The notice period was to expire on
           December 31, 2005. It is an admitted position that the
           competent authority neither gave approval nor indicated
           disapproval to the appellant within the notice period of three
           months. The employee never treated that there has been                  G
           cessation of employment on expiry of three months notice
  +        period inasmuch as he continued to attend his duties after
           December 31, 2005 until June 30, 2006. It is only by his letter
           dated June 8, 2006 that the appellant requested the respondent
           to relieve him in terms of his notice dated September 30, 2005          H
                                                                                       t


     384      SUPREME COURT REPORTS [2009] 14 (ADDL.) S.C.R.

A   by June 30, 2006 and he stopped attending work from July 1,
    2006. The letter dated June 8, 2006 does not make any                    J
    material difference as the fact of the matter is that after expiry           ,,.
  · of notice period, the appellant continued to attend his duties
    for many months thereafter. By the letter dated September 15,
B 2006 the respondent communicated to the appellant that his
    application for voluntary retirement under Service Regulation
    12(b) has not been acceded to by the competent authority. ·
    Since the notice for voluntary retirement by an employee who             •
    has not attained 55 years but has completed 20 years of              ..l_

    continuous   service, under proviso appended to Regulation
c
    12(b), is subject to approval by the competent authority and that
    approval was not granted, the voluntary retirement of the
    appellant never came into effect.
                                                                                 -
        33. It may be that voluntary retirement under a particular
D scheme framed by an employer is different from voluntary
  retirement provided in the Service Regulations and some of the
  observations by the Division Bench with reference to voluntary
                                                                         "
  retirement under a special scheme may not be relevant but the
  ultimate decision of the Division Bench does not suffer from any
E legal infirmity.

           34. By way of foot-note, we may record that before we         ~
                                                                                 I
     proceeded with the hearing of the matter, we granted an             ~       !"-
     opportunity to the parties to resolve the dispute amicably and
F    an offer was made by the respondents to the appellant in this
     regard but the appellant showed his disinclination to accept the
     offer made by the respondents.

          35. Be that as it may, the appeal must fail and is dismissed
     with no order as to costs.
G-                                                                               t
     B.B.B.                                      Appeal dismissed.       +       'II




                                                                                 1-

                                                                                 J


Search Indian case law

Ask in plain English, not just keywords. 25,000 AI words free, no card.

Try "voluntary retirement"Sign in to search

For a digitally signed copy suitable for filing, refer to the court's own website. Only the court can issue one.