SURESHCHANDRA SINGH AND ORS.versusFERTILIZER CORPN. OF INDIA LTD. AND ORS.

                   SURESHCHANDRA SINGH AND ORS.                               A
                                       v.


-            FERTILIZER CORPN. OF INDIA LTD. AND ORS.

                              OCTOBER 16, 2003

                [S. RAJENDRA BABU AND RUMA PAL, JJ.]                          B
          Service Law-Increase in retirement age-Government of India and
    concerned ministries issued 0. Ms. increasing retirement age from 58
    years to 60 years-Directives to come to effect on amendment in relevant
    rules and regulations by concerned Public Sector Enterprises-Respond- C
    en! Corporation decided not to implement OM owing to financial
    constraints and excessive work force-Appellants on attaining 58 years,
    filed writ petition in High Court, for implementations of 0. Ms.-High
    Court dismissed the writ petition-On appeal, Held Directives were to
     become effective from date of notification of amendment to the relevant
     rules and regulations-Relevant factors for not implementing the directives D
    fully set out in the resolution of Board of Directors which was neither
     arbitrary nor unreasonable.

          Constitution of India-Articles 32 and 226-Maintainability of writ
    against administrative directions-Court cannot issue writ enforcing such E
    administrative instructions having no force of law-Appellants have no
    right to continue in service till age of 60 years-Decision of Board of
    Directors neither arbitrary nor unreasonable.

          The Government of India on recommendations of the Fifth
    Central Pay Commission issued O.M. dated 13.5.1998 enhanced the F
    retirement age of Central Government employees from 58 years to 60
    years. These directives were to come into effect from the date of
    notification of the amendment to the relevant rules and regulations. On
    19.5.1998, Department of Public Enterprises, Ministry of Industry,
    Government of India issued another O.M. making it clear that such G
    changes would come into force from the date the concerned Public
    Sector Enterprises amended their relevant rules and regulations. The
    Board of Directors of the respondent-Corporation considered the
    matter and passed a resolution deciding not to increase the retirement
    age due to ongoing losses, surplus work force, its declaration as sick H
                                        937
    938               SUPREME COURT REPORTS [2003] SUPP. 6 S.C.R.

A and reference to BFIR. Therefore, respondent-Corporation was granted
  ·exemption by the Government of India. The appellants were serving
   in the respondent-Corporation. On their attaining the age of 58 years
   they filed a writ petition in the High Court so that they should not be
   relieved from work before attaining age of 60 years. The writ petition
B was dismissed. Hence these appeals.
         Appellants contended that O.M. dated 13.5.1998 by itself in-
    creased the retirement age and the policy therein mandatorily bound
    the respondent-Corporation; that in violation of principles of equality
    Board level employees were allowed to continue in service till the age
C   of 60 years; and that employees of different Corporations ought to be
    treated alike.

         Respondents contended that Board level employees could not be
    equated or compared with other employees as the two whole time
D   directors are directly appointed by the President of India for a fixed
    term; and that other members of the Board are government servants
    and are nominees or representatives from various ministries and are
    appointed by the President of India for a term of 3 years.

          Dismissing the appeals, the Court
E
          HELD: I. O.M.s dated 25.1.1991 and 8.4.1991 of.the Ministry of
    Program Implementation and Department of Public Enterprises made
    it clear that all instructions/guidelines issued by the Government of
    India w'ould be of two kinds namely, Directives issued in the name of
F   PresidJnt of India and Guidelines. Directives were to be issued by the
    Adminiistrative Ministry in the name of the President while all other
    instructions were to be issued by the Department of Public Enterprise
    or by the Administrative Ministry which were advisory in nature and.
    the Board of Directors of the concerned Public Sector Undertakings '
    could in their discretion adopt or not for reasons to be recorded Jn
G   writing\ (942-A-C)

         2. Government of India took a policy decision to increase the
    retirement ·of Central Government employees. Application of that
    decision in respect ofemployees of Public Sector Enterprises is dependent
H   upon so many factors that are to be taken into account in the light of
            SURESHCHANDRA SINGH v. FERTILIZER CORPN. OF INDIA LTD.        939
     the peculiar characteristics of each company or corporation Oi" A
     department. The OM dated 13.5.1989 itself provides that the order will
     come into force only with effect from the date of Notification of
     amendment to the relevant rules and regulations. It is for the concerned
     authority to make necessary changes in the rules and regulations after
     taking into account all the relevant aspects. Immediately after the OM B
     dated 13.5.1998 the Department of Public Enterprises, Ministry of
     Industry, Government of India issued OM dated 19.5.1998 wherein the
     modalities of the implementation offirst OM in the concerned department
     was detailed. OM dated 19.5.1998 is not an instruction issued in the
     name of the President. On the other hand, it was issued by the Department C
     of Public Enterprise, which is advisory in nature. It accorded a broad.
     discretion to the corporations or companies for the implementation of
     the enhanced retirement age after taking into account all the relevant
     factors. Pursuant to this direction the Board of Directors of the respondent
'\   took the decision not to increase the retirement age ofits employees. The
     relevant factors that prevailed upon the Board of Directors are fully set D
     out in its resolution. (942-C-GJ
.         3. The OM dated 19.5.1998 itself does not raise the retirement age
     to 60 years. It is only an administrative direction and Court cannot
     issue a writ to enforce such administrative instructions that is not E
     having the force of law. Appellants d_o not have any right to continue
     in service till the age of60 years. The decision of the Board ofDiFectors
     is not arbitrary or unreasonable or unrelated to the question of
     enhancement in age of retirement. (943-B-D)

            4. The Board of Directors themselves form a different class and F
     cannot be compared with other employees in regard to conditions
     of service applicable to them. There is no discrimination of appellants
     vis-a-vis employees ofother corporation. Each Public Sector Undertaki11g
     is an independent body-entity and is free to have its own service conditions
     as per law. All employees in the respondent-corporation who are working G
     in its various Units and Divisions retire at the age of 58 as per the
     relevant rules; and that even the future employees will retire at the age
     of 58. The employees of different corporations cannot not be treated
     alike as every corporation will have to take into account its separate
     circumstances so as to formulate its policy. (943-F-H; 944-A)                H
     940                  SUPREME COURT REPORTS [2003] SUPP. 6 S.C.R.

 A        CIVIL APPELLATE JURISDICTION: Civil Appeal Nos. 717-719
     of 1999.

           From the Judgment and Order dated 16. l 0.1998 of the Allahabad
      High Court in Civil Misc. W.P. Nos. 24069, 27662 and 23656 of 1998.

 B                                        ,WITH

            W.P. (C) No. 133/2000.

            Manoj Goel, Shuvodecp Roy, Avinish Kumar and Brij Bhushan for
 C the Appellants.
          Mukul Rohtagi, Additional Solicitor General, Punit D. Tyagi for the
      Respondents.

            The Judgment of the Court was delivered by
 D
            RAJENDRA BABU, J. : Pursuant to the recommendations of the
      Fifth Central Pay Commission, Government of India issued an Office
                                                                                           II
      Memorandum (OM) No. 25012/2/87 - Col (A) dated 13th May, 1998                        r
      enhancing the retirement age of Central Government Employees to sixty
 E    years from fifty-eight years. It was also provided that OM would come into
      force with effect from the date ofNotification of amendment to the relevant
      rules and regulations. To a similar effect Department of Public Enterprises,
      Ministry of Industry, Government of India issued another OM No. 18(6)/
      98-GM-GL-002 dated 19th May, 1998 making it clear that such increase
      in age of retirement would come into force from the date the relevant rules
 F    and regulations ·of the PS Es concerned are amended by the concerned
      Public Sector Enterprises. As per this OM the Board of Directors of the
      Fertilizer Corporation of India Ltd (FCIL) considered the matter and
      passed a resolution on 6th July 1998. Relevant portion of which reads:

 G             " ...The Board noted that FCIL was referred to BFIR in April 1992
                  and declared sick in November 1992. No revival package has been
    9 ~n 9 n, ,. approved by BFIR so far. Gorakpur Unit is closed since June 1990
    b?1;; 9 11 9 c~lJ!iliYing.~.WPlus of 1322 men as on 1-7-1998 and Korba, which
    9 unsqn tfo{afr;W~ ~,,i i§A<i.<lr~ying surplus of 54 men. Besides, FCIL is
H-1             jft.aril}Qng;..sµIiP~~~e.~'.)iP<Hth~i <;miRP.ration all over for which a
      SURESHCHANDRA SINGH 1·. FERTILIZER CORPN. OF INDJA LTD. [RAIENDRA BABU. J]   941

        voluntary retirement scheme providing special financial incentive A
        to induce employees to seek early retirement is in operation since
        1998 and so far 1524 persons have availed the benefit under the
        scheme as on 30-6-1998. FCIL is totally dependent on Govt.
        support for critical capital expenditure, working capital and to
        meet the huge operating losses by its units. Wages of the ,B
        employees have not been revised; as a result there has been a flight '
        of talent. The only little incentive was promotion which will also
        be blocked in case age of retirement is enhanced from 58 years
        to 60. Enhancing the age of retirement involves financial impli-
        cations, which will further jeopardize the revival proposal of the C
        Corporation before the BIFR.

        In view of the above the Board unanimously decided not to raise
        the age of retirement from 58 to 60 years ... "

This decision was communicated to the concerned Ministry on 21st August D
1998 and the Department of Fertilizers, Ministry of Chemicals and
Fertilizers, Government of India granted exemption vide its letter dated
30th December 1999 from increasing the age of retirement from 58 to 60
years.

      In the meanwhile the appellants herein superannuated on their E
attaining the age of 58 years as per the terms of the service contract.
Appellants herein moved the High Court for a direction to the Respondents
herein not to retire them from services before they attained the age of sixty
years and till such time not to interfere with the functioning and discharge
of their duties. The High Court dismissed the petition and hence this appeal F
by special leave.

       It is urged on behalf of appellants that the OM dated 13th May 1998
by itself increased the retirement age and the policy set out therein is
mandatory and binding on FCIL to enhance the retirement age. This OM G
is applicable only to employees in Government Civil Services and not to
empl<?yees in the Public Sector Enterprises. Hence by reason of this OM,
the appellants cannot contend that they are entitled to continue in service
till they attain the age of 60 years. It is only by OM issued by the
Department of Public Enterprises dated 19th May 1998 the said policy was H
    942                SUPREME COURT REPORTS (2003] SUPP. 6 S.C.R.

A   made applicable to be effective from the date of modification of relevant
    Rules regarding the same.

          By OMs dated 25th January 1991 and 08th April 1991, the Ministry
    of Program Implementation and Depa1tment of Public Enterprises made
B   it clear that all instructions/guidelines issued by the Government of India
    would be of two kinds - a) Directives issued in the name of President
    oflndiaand b). Guidelines. Directives would be issued by the Administrative
    Ministry in the riame of the President while all other instructions issued
    by the Department of Public Enterprise or by the Administrative Ministry
    are only advisory which the Board of Directors of the concerned Public
c   Sector Undertakings may in their discre!ion adopt or not for reasons to be
    recorded in writing.

          Here the Government of India took a policy decision to increase the
    retirement of Central Government employees. Application of that decision
D   in respect of employees of Public Sector Enterprises is dependent upon so
    many factors that are to be taken into account in the light of the peculiar
    characteristics of each company or corporation or department. So the first
    OM itself provides that the order will come into force only with effect from
    the date of Notification of amendment to the relevant rules and regulations.
E   So it is for the concerned authority to make necessary changes in the rules
    and regulations after taking into account of all the relevant aspects.
    Immediately after the first OM dated 13 May 1998 the Depaitment of
    Public Enterprises, Ministry of Industry, Government of India issued OM
    dated 19th May 1998 wherein the modalities ofthe implementation of first
    OM in this department was detailed. Here it is pe1tinent to note that the
F   OM dated 19th May 1998 is Mt an instruction issued in the name of the
    President. On the other hand, it was issued by the Department of Public
    Enterprise, which is advisory in nature. It accorded a broad discretion to
    the corporations or companies for the implementation of the enhanced
    retirement age after taking into account all the relevant factors. Pursuant
G   to this direction the Board of Directors of FCIL took the decision not to
    increase the retirement age of its employees. The relevant factors that
    prevailed upon the Board of Directors are fully set out in its resolution and
    they are: that the company is one of the highest loss making company in
    the country; that the accumulated loss. till the relevant date was to the tune
H   of 5049 crores; that the company is incurring financial losses of roughly
       SURESHCHANDRA SfNGH '" FERTILIZER CORPN. OF INDIA LTD. [RAJENDRA BABU, J]   943

Rupees 2.35 crores everyday; that the company has no capacity to pay A
salaries to its employees; that the company was referred to BIFR and was
declared as sick in 6/11 /1992; that as on the relevant date the company has
the negative net worth to the tune of Rupees 4316.2 l crores and; that the
company has surplus manpower; that it is not taking any new employees
but on the contrary it is making conscious efforts to reduce the surplus B
manpower.

      It is also to be noted that the OM dated 19th May 1998 itself does
not raise the retirement age to sixty years. It is only ari administrative
direction and Court cannot issue a writ to enforce such administrative
instructions that is not having the force oflaw. The Appellants do not have              C
any right to continue in service till the age of sixty years. The decision
of the Board of Directors is not arbitrary or unreasonable or unrelated to
the question of enhancement in age of retirement. Hence the first
contention stands rejected.
                                                                                         D
      The Appellants assail the decision of the Board on the ground of
violation of principles of equality. It is alleged that the Board level
employees were allowed to continue in service till the age of sixty and the
employees like appellants who were below the Board level were forced to
retire at the age of fifty-eight. In reply respondents submitted that board E
level employees could not be equated and compared with the other
employees. Whole time directors, who are two in numbers, are directly
appointed by the President of India for a fixed term of five years that C..)uld
be reviewed even earlier; and that other members of the board are
government servants and are nominees or representatives from various
ministries and are appointed by the President of India for a term of three F
years. In these circumstances we find that board of directors themselves
form a different cla"s and cannot be compared with other employees in
regard to conditions of service applicable to them. Allegation of discrimi-
nation is also raised by the Appellants vis-a-vis employees of other
corporations. Each Public Sector Undertaking is an independent body/ G
entity and is free to have its own service condi•ions as per law. However,
all employees in the FCIL who are working in its various Units and
Divisions retire at the age of fifty-eight as per the relevant rules; and that
even the future employees will retire at the age of fifty-eight. We also find
that since the employees of different corporations could not be treated alike H
    944                 SUPREME COURT REPORTS [2003] SUPP. 6"S.C.R.

A sin_ce every corporation will have to take into account its separate
    circumstances so as to formulate its policy and consequently the argum~nt
    that there is discrimination of Appellants vis-a-vis employees of other
    corporation also cannot be accepted. Thus, appellantS have failed on all
    grounds. The Appeals stand dismissed.
B          A writ petition was also filed with the prayer to issue appropriate
    writ or order or direction - (a) to implement OM dated 19/05/1998 and
    21/08/1998 and (b) for quashing the order dated 30/1211999 of the
    department of Fertilizers on identical grounds considered by us in the
    appeals.
c
           For the very reasons stated therein this petition also stands dismissed.

    A.Q.                                             Appeals/Petition dismissed.