Holding

A resignation under Regulation 20(2) cannot be accepted before the expiry of the three‑month notice period unless the employee requests a waiver, and the employee may withdraw the resignation before it becomes effective.

Summary

P.K. Mittal, a permanent officer of Punjab National Bank, submitted a resignation on 21 January 1986, giving three months' notice and specifying that it would take effect on 30 June 1986. The bank, however, accepted his resignation on 7 February 1986, waiving the notice period and relieving him immediately. Mittal filed a writ petition challenging the early acceptance and later, on 15 April 1986, withdrew his resignation. The Delhi High Court held that under Regulation 20(2) of the bank's service regulations the resignation could not become effective before the expiry of the three‑month notice unless the employee requested a waiver, and that the employee could withdraw the resignation before it became effective. The Supreme Court affirmed this view, ruling that the bank had no jurisdiction to accept the resignation earlier and that the withdrawal was valid, thereby keeping Mittal in service. The appeal by the bank was dismissed.

Issues considered

Whether the bank could, under Regulation 20(2) and its proviso, accept an employee's resignation before the expiry of the three‑month notice period without the employee's request for a waiver.
Whether an employee may withdraw a resignation before it becomes effective under the service regulations.
Whether the competent authority of the bank had jurisdiction to determine an earlier date of resignation.

Legislation cited

Punjab National Bank Service Regulationss. Regulation 20(2)

Subjects

resignationnotice periodservice regulationswithdrawal of resignationbank employmentjurisdictionemployment law

Judgment

A PUNJAB NATIONAL BANK
v.
P.K. MITTAL

FEBRUARY 13, 1989

B [SABYASACHI MUKHARJI AND S. RANGANATHAN, JJ.] ~

Labour and Services: Punjab National Bank Service Regulation
No. 20(2): .Withdrawal of resignation letter-Effect of-Whether bank
entitled to accept resignation from an earlier date.

C Civil Services: Resignation by employee-Withdrawal of-
Permissibility and effect of.

Clause (2) of Regulation 20 of the Service Regulations of the
Punjab National Bank lays down that no officer shall resign from the
service of the bank otherwise than on the expiry of three months from
D the service on the hank of a notice in writing of such resignation. The
r-roviso thereto empowers the competent authority to reduce the period
of three months or remit the requirement of notice.

The respondent, a permanent officer of the bank, made an appli- -.;
cation on 21st .January 1986, purporting to resign from the service with
E effect from 30th June, 1986. He, however, received a letter from the
bank on 7th February, 1986 informing him that his resignation letter
had been accepted by the competent authority with immediate effect by
waiving the condition .of notice.

He thereupon filed a writ petition in the Jligh Court challenging ~ "\-
.F the validity of the purported acceptance of his resignation with effect ,
from 7th February, 1986 and for a direction to consider him as in
service up to 30th June, 1986. Thereafter, on 15th April, 1986 he wrote
another letter to the Bank purporting to withdraw the resignation letter
dated 21st January, 1986.

G The High Court held that the petitioner's resignatioin letter would
have become effective only on the 30th June, 1986, that under the f~
Regulations there was no jurisdiction whatever in the competent autho-
rity to determine his service earlier than that and that until the resigna-
tion became effective on 30th ,June, 1986 he had a right to withdraw the
same. Consequently, it quashed the order dated 7th February, 1986 and
H declared that the petitioner continued to be in service with the bank.
612
PUNJAB NATIONAL BANK v. P.K. MITTAL 613

·+ , . In this appeal by special leave it was contended for the appellant
that ·Regulation 20(2) provided for a notice to the ~;,.,ployer only in
A
order to protect the employer's interests, that .its requ!rements.could,
therefore, be waived by the employer if it so desired unilaterally, that
~
under the proviso to clause (2) it was competent for the bank to waive
any notice at all and to accept the resignation witlJ immediate effect or
--1' with effect from such other date as the bank may consider appropriate. B
,., ...
I Dismissing th~ appea!,
.,,
~)- HELD: l. Until the resignation becomes effective ''" the terms of
the letter read with Service Regulation 20 of the Punjab National Bank,
I it is open to the employee, on general principles, to withdraw his letter
of resignation. [619C] c
-..,, Raj Kumar v. Union of India, [1968] 3 SCR 857; Union of India
v. Copa/ Chandra Misra, [1978] 3 SCR 12 and Bairam Gupta.v. Union
of India, [1987] Suppl. SCC 228.
D
2. Clause (2) of Regulation 20 makes it incumbent on an officer of
the hank, before resigning, to serve a notice in writing of such proposed
resignation. The clause also makes it clear that the resignation will not
~ l>e effective otherwise than on the expiry of three months from the
service of such notice. [616H; 617AI
E
3. What the proviso to clause (2) contemplates is that in a case
where the employee desires that his resignation should be effective even
before the expiry of the period of three months or without notice being
given by him, the hank may consider such a request and waive the
period or requirement of notice if it considers it lit to do so~ It does not
->t empower the hank to thrust a resignation on an employee with effect
from a date different from the one on which he can make his resignation
F

effective under the terms of the resignation. In the instant case, the
employee had not requested the hank to reduce the period of notice or to
waive the requirement of notice. [617F; 6I8G I

4. There are two ways' of interpreting clause (2). One is that the G
resignation of an employee from service being a voluntary act on his
~1x
. ·• part he is entitled to choose the date with effect from which his resigna-
lion wood he effective and give a notice to the hank accordingly. The
only restriction is that the proposed date should not be less than three
months from the date on which the notice is given. In the instant case,
the letter dated 21st January 1986, sent by the employee purporting to H
~-:

614 SUPREME COURT REPORTS [1989] 1 S.C.R.

A resign with effect from 30th June, 1986 fully complied with the terms of
this clause and so the resignation would have become effective only on
+
that date. The other interpretation is that when an employee gives a
notice or resignation, it becomes effective on the expiry of three months
from the date thereof. On this interpretation the respondent's resigna-
tion would have taken effect on or about 21st April, 1986 even though
B he had mentioned a later date. In either view of the matter, the respon-
dent's resignation did not become effective till 21st April, 1986 or 30th
June, 1986. The bank could not have accepted that resignation on any
earlier date. The letter dated 7th February, 1986 was, therefore, with-
out jurisdiction. [617A-B; 618A-B, G-H]

The respondent had thus continued to be in service till the 21st
c April, 1986 or 30th June, 1986. But, by that time, he had exercised his
right to withdraw the resignation. Since the withdrawal letter was writ-
ten before the resignation became effective, the resignation stood with-
drawn with the result that the respondent continued to be in the service
of the bank. [619A-B]
D
Delhi Electric Supply Undertaking v. Tara Chand, [1987] 2 SCR
425, distinguished.

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 2014 k
of 1986.
E
From the Judgment and Order dated 24.4.1986 of the Delhi High
Court in C. W. No. 477 of 1986.

F
Dr. Anand Prakash, D. Mehta, Atul Nanda and S.K. Mehta for
the Appellant. t '\-
S.K. Bisaria for the Respondent.

The Judgment of the Court was delivered by

RANGANATHAN, J. A very short question as to the interpreta-
G tion of the service regulations of the appellant-bank comes up for
consideration in this appeal. The relevant service regulation is Regula- J~
tion No. 20 which reads as under:

"20(1) Subject to sub-regulation (3) of regulation 16, the
bank may terminate the services of any officer by giving
H him three months' notice in writing or by paying him three
months' emoluments in lieu thereof.
PUNJAB NATIONAL BANK v. P.K. MITTAL IRANGANATHAN, J.I 615

(2) No officer shall resign from the service of the bank A
otherwise than on the expiry of three months from the
sel"Vice on the bank of a notice in writing of such resigna-
tion. Provided further that the competent authority may
reduce the period of three months, or remit the require-
ment of notice .. "
B
The respondent, a permanent officer in the bank, sent a com-
munication to the bank on 21st January, 1986. By this letter he
purported to resign from the service of the bank due to personal

t· reasons. He added that the date of receipt of the letter should be
treated as the date of the commencement of the notice period so that,
inclusive of the same, his resignation would become effective on 30th C
June, 1986. According to the respondent, the Deputy General
Manager, who was the competent authority under the Service Regula-
tions, had agreed that the resignation may be accepted with effect
from 30th June, 1986. However, what actually transpired was that the
respondent received a letter from the bank on 7th February, 1986
informing him that his resignation letter dated 21st January, 1986,had D
been accepted by the competent authority with immediate effect by
waiving the condition of notice and that, consequently, he was being
relieved from the service of the bank with effect from the afternoon of
the same date, namely, 7th February, 1986. The respondent thereupon
filed a writ petition in the High Court challenging the validity of the
purported acceptance of his resignation with effect from 7th February, E
1986 and for a direction to the bank to treat him as in service of the
bank up to 30th June, 1986 and as entitled to all benefits while being in
such service.

I A further development took place after the filing of the writ
_.,,. -~ petition and before it came up for hearing. On 15th April, 1986, the F
respondent wrote a letter to the bank by which he purported to with-
draw the resignation letter dated 21st January, 1986. The High Court,
therefore, dealt with the situation resulting from this subsequent
development. The High Court held that the petitioner's resignation
letter would have becorrte effective only on the 30th June, 1986. Under
the regulations there was no jurisdiction whatever in the competent G
-,.)( authority to determine his services earlier. Until the resignation
became effective on 30th June, 1986, the petitioner had a right to
withdraw the same and in fact had also exercised that right. The High
Court concluded:

"We may notice that this writ petition was filed .at a stage H
616 SUPREME COURT REPORTS [1989] 1 S.C.R.

A
when the petitioner had not sent his letter dated 15th April, +-·
1986 whereby he withdrew his resignation letter dated 21st
January, 1986. This is a subsequent development during
the pendency of the writ petition. Therefore, we are not
called upon to decide the earlier grievance that the resigna-
tion could not have been accepted at an earlier date. Even
B to that submission we would have said that there is no l
provision of acceptance but that question does not arise so

1
we will not deal with it further. Result is that the impugned
order dated 7th of February, 1986 is hereby quashed and it
is declared that the petitioner continues to be in service ·
with the respondent-bank. However, in view of the facts of
the present case, parties are directed to bear their own
c costs of the present proceedings."

The bank has preferred this appeal. Dr. Anand prakash, learned
counsel for the appellant-bank, submitted that regulation 20(2)
provided for a notice to the employer only in order to protect the
D employer's interests and to enable the employer, in case it decided to
accept the resignation, to make other arrangements in place of the
resigning employee. He submitted that, this being a provision for the
benefit of the employer, its requirements could be waived by the
employer, if it so desired, unilaterally. The proviso to clause (2) of the ~
regulation indeed makes it clear that it is open to the bank to waive the
E requirement of notice or to reduce the period of the notice to less than
three months. He, therefore, submitted that, when the respondent
sent in his resignation on 21st January, 1986, it wa\ not incumbent on
the bank to wait till 30th June, 1986 when the notice period would
expire. It was competent for the bank to waive any notice at all and to
accept the resignation with immediate effect or with effect from such\.··
F other date as the bank may consider appropriate. It was further.., .. .,.,
contended by learned counsel that, once the resignation letter of the
respondent had been accepted by the bank and given effect to, to there
was no further possibility of the respondent seeking to withdraw the
resignation letter as he has purported to do in this case. Learned
counsel, therefore, submitted that the bank's letter dated 7th
February, 1986 was quite valid and effective and that the respondent's
/ G
writ petition ought to have been dismissed.

We have given careful thought to this conteniion of the learned
counsel and we are of the opinion that the High Court was right in the
conclusion it reached. Clause (2) of regulation 20 makes it incumbent
H on an officer of the bank, before resigning, to serve a notice in writing
PUNJAB NATIONAL BANK v. P.K. MITIAL IRANGANATHAN, J.J 617

·-t of such proposed resignation and the clause also makes it clear that the A
resignation will not be effective otherwise than on the expiry of three
months from the service of such notice. There are two ways of in-
terpreting this clause. One is that the resignation of an employee from
service being a voluntary act on the part of an employee, he is entitled
to choose the date with effect from which his resignation would be
j effective and give a notice to the employer accordingly. The only B
rest;iction is that the proposed date should not be less than three
months from the date on which the notice is given of the proposed
resignation. On this interpretation, the letter dated 21st January, 1986
sent by the employee fully complied with the terms of this clause.
- Though the letter was written in January, 1986 the employee gave
, more than three clear months' notice and stated that he wished to
resign with effect from 30th of June, 1986 and so the resignation would c
---,. have become effective only on that ·date. The other interpretation is
that, when an employee gives a notice of resignation-, it becomes effec-
tive on the expiry of three months from the date thereof. On this
interpretation, the respondent's resignation would have taken effect
on or about 21.4.1986 even though he had mentioned a later date. In D
either view of the matter, the respondent's resignation did not become
effective till 21.4.1986 or 30.6.1986. It would have normally automati-
cally taken effect on either of those dates as there is no provision for
'J any acceptance or rejection of the resignation by the employer, as is to
be found in other rules, such as the Government Services Conduct
Rules. E

Much reliance was placed on the terms of the proviso to clause
(2) of regulation 20 to justify the action of the bank in terminating the
respondent's services earlier but we do not think that the proviso can
, ,be interpreted in the manner suggested by learned counsel for the
....,;,.-iof bank. The resignation letter of the officer has to give at least three F
: months' advance notice under the main part of the clause. What tlie
proviso contemplates is that in a case where the employee desires that
his resignation should be effective even before the expiry of the period
of three months or without notice being given by him, the bank may
consider such a request and waive the period or requirement of notice
if it considers it fit to do so. That question does not arise in the present G
case because the employee had not requested the bank to reduce the
-.~ period of notice or to waive the requirement of notice. Dr. Anand
Prakash seeks to interpret the proviso as empowering the bank, even
without any request on the part of the employee, to reduce the period
or waive the requirement of notice. In other words, he says the bank
has power to accept the resignation with immediate effect even though H
618 SUPREME COURT REPORTS [1989] 1 S.C.R.

A the notice is only of a proposed future resignation. We do not think i-
this contention can be accepted. As we have already mentioned, resig-
nation is a voluntary act of an employee. He may choose to resign with
immediate effect or with a notice of less than three months if the bank
agrees to the same. He may also resign at a future date on the expiry,
or beyond the period, of three months but for this no further consent
B of the bank is necessary. The acceptance of the argument of Dr.
Ananad Prakash would mean that, even though an employee might ~
express a desire to resign from a future date, the resignation can be

1
accepted, even without his wishes, from an earlier date. This would
not be the acceptance of a resignation in the terms in which it is (
offered. It amounts really to forcing a date of termination on the
C employee other than the one he is entitled to choo.se under the regula-
tions. As rightly pointed out by the High Court, the termination of
service under clause (2) becomes effective at the instance of the emp- A·--
loyee and the services of the employee cannot be terminated by the
employer under this clause.

D Dr. Anand Prakash emphasises that as clause (2) and its proviso
are intended only to safeguard the bank's interests they should be
interpreted on the. lines suggested by him. We are of the opinion that
clause (2) of the regulation and its proviso are intended not only for
the protection of the bank but also for the benefit of the employee. It ~-
is common knowledge that a person proposing to resign often wavers •
E in his decision and even in a case where he has taken a firm decision to
resign, he may not be ready to go out immediately. In most cases he
would need a period of adjustment and hence like to defer the actu~l
date of relief from duties for a few months for various personal
reasons. Equally an employer may like to have time to make some
alternative arrangement before relieving the resigning employee. \ .
F Clause (2) is carefully worded keeping both these requirements in1• "'
mind. It .gives the employi;e a period of adjustment and rethinking. It '
also enables.the bank \_O·have some time to arrange its affairs, with the
liberty, in an appropriate case, to accept the resignation of an emp-
loyee even without the requisite notice if he so desires it. The proviso
in our opinion should not be interpreted as enabling a bank to thrust a
G resignation on an employee with effect from a date different from the
one on which he can make his resignation effective under the terms of
the regulation. We, therefore, agree with the High Conrt that in the j.
present case the resignation of the employee could have become effec-
tive only on or about 21st April, 1986 or on 30th June, 1986 and that
the bank could not have "accepted" that resignation on any earlier
H date. The letter dated 7th February, 1986 was, therefore, without
jurisdiction.
PUNJAB NATIONAL BANK 'v. P.K. MITTAL [RANGANATHAN, J.J 619

The result of the above interpretation is that the employee con-, A
tinued to be in service till the 21st April, 1986 or 30th June, 1986, OJ)
which date his services would have come normally to an end in terms
of his letter dated 21st January, 1986. Bu(by that time, he had .exer-
cised his right to withdraw· the resignation. Since the wiihdrawal letter
was written before the resignation became effective, the r~signation
stands withdrawn, with the result that the respondentcontiques 19, l)e B
in the service of the bank. It is true that ihere is no specific provision in
the regulations permitting the employee to withdraw the reslgnatfon,
It is; however, not necessary that there should be any such specific
rule. Until the resignation become effective on the term's ofthe.lette~
read with regulation 20. it is open to the employee, on general princi-
ples, to withdraw his letter of resignation. That is why, in some cases
of public services, this right of withdrawal is also made subject to the c
permission of the employer. There is no such clause here. It is not
necessary to labour this point further as it is well settled by the earlier
decisions of this Court in Raj Kumar v. Union of India, 11963] 3 SCR
857; Union of India v. Gopal Chandra Misra, 11978] 3 SCR 12 and
Bairam Gupta v. Union of India, 11987] Suppl. SCC 228. D

Learned counsel for the appellant relied on certain observations
in Delhi Electric Supply Undertaking v. Tara Chand, 11987] 2 SLR 426.
'J Certain other decisions were also cited by Dr. Anand Prakash but we
do not think that they have any bearing on the issue before us. Tara
Chand was· a case under regulation 8 of the regulations made by the E
Delhi Electric Supply Undertaking under the Electricity (Supply) Act,
-. 1948. The regulation permitted the termination of the services of a
servant of the undertaking "on notice of three months from either side
without any cause to be assigned in case of permanent servants". The
. employee in that case sent a letter to the employer stating that "he was
it
-')r· compelled to resign for various reasons" and this resignation was F
accepted by the undertaking. The Delhi High Court in its judgment (to
which one of us was a party) observed that notice under the regulation
was intended for the benefit of the employer which could, if it
considered necessary or proper, waive the period of notice and accept
the resignation with immediate effect. But that was a case where the
employee, though bound to give three months' notice, expressed his G
• desire to resign with immediate effect and it was also accepted by the
-:X- employer. It was not the case that he had given notice indicating a
desire to be relieved at a future date. The analogy of that case would
have applied to the present case as well if the respondent here had expres-
sed his desire to be relieved immediately even before the expiry of the
three months' notice period and the bank had accepted it. The H
620 SUPREME COURT REPORTS 11989] 1 S.C.R.

A employer would then certainly have been entitled to accept the resigna- +
tion, as requested by ·the. employee, waiving the notice period. The
distinction betw.een that case and the present one is that, here, the
employee has choiien a future date on which his resignation would be
effective but he is being forced to "resign" before such date.
B For the reasons discussed above, we affirm the decision of the
High Court and dismiss this appeal. As the employee has got a relief
much larger than the one for which he initially came to Court and
which has been made possible by his subsequent conduct, we make no
order as to costs.

P.S.S. Appeal dismissed.

'
'

-I-