LexA.P. COOPERATIVE OIL SEEDS GROWERS FEDERATION LTD. HYDERABAD, ANDHRA PRADESH versus D. ACHYUTA RAO AND ORS.
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~ A.P. COOPERATIVE OIL SEEDS GROWERS FEDERATION LTD. A / HYDERABAD, ANDHRA PRADESH " D. ACHYUTA RAO AND ORS. MARCH 15, 2007 B [B.P. SINGH AND AL TAMAS KABIR, JJ.] Service· Law. ~ Seniority List-Federation registered as cooperative society adopting c 3 tier structure with Regional Unions in second tier-Many employees of Federation transferred to Regional Unions-Transfer of employees from federation to Unions not regulated by rules or norms laid down by management-Employees transferred getting promotions in Unions-Decision taken to close down Unions and revised staffing structure of Federation D finalized-Voluntary Retirement Scheme ojJered to surplus employees- Common seniority list of employees of federation and Unions prepared ,; indicating surplus employees-Seniority list challenged by some employees declared surplus-Held, promotions granted not governed by any promotion policy and also arbitrary and unreasonable-Determination of seniority by reference to promotions not governed by any rule not justified-In the facts E and circumstances, held, seniority to be reckoned by reference to length of service in the Federation by reference to date of initial appointment- Constitution of India, 1950-Articles 14 and 16. Appellant-Federation registered as cooperative society under the A.P. F Cooperative Societies Act adopted a 3 tier structure with the Federation at -r top and two Regional Unions in the second tier and cooperative societies at village level in the third tier. Many employees of Federation transferred to the Regional Unions. High Court on 6.6.2000 in petition filed by some of such transferred employees had held that they continued to be employees of the Federation and entitled to all service benefits. In view of mounting losses, a G decision was taken in the year 2001 to restructure the Federation and to close -..' down both the Unions and a revised staffing structure of the Federation of I manpower of 159 employees based on a broad Five Year Business Plan was .,; finalized resulting in many of the employees being rendered surplu~. It was also resolved to offer Voluntary Retirement Scheme (VRS) for the surplus H .. I ·~ . 2 SUPREME COURT REPORTS [2007] 4 S.C.R. A manpower of the Federation and the Unions as per the approved pattern. A common seniority list indicating surplus employees was prepared. Majority of employees declared surplus accepted VRS Scheme. Respondent were also declared surplus employees and they along with some other employees filed various writ petitions challenging order of B Federation declaring them surplus. Single Judge dismissed the writ petitions inter alia holding that employees transferred to Regional Unions continued to be employees of Federation and their services in the Union must be treated as on deputation only; that Federation was right in consolidating and issuing a common seniority list of its employees; and that the principles applied by C Federation for determination of seniority were not arbitrary. Respondents filed writ appeals challenging the order of the Sittgle Judge. Division Bench allowed the appeals inter alia holdin-g that criteria fixed for determining inter- se seniority was not just and reasonable; that only the relative seniority in the respective cadres of the Federation of employees sent on deputation to D the Unions could be taken into consideration, and their promotion in the ex- cadre post in the Unions had nothing to do with their seniority in their parent cadre under the Federation; that there was no clear cut promotion policy either in the Federation or the Unions and since the promotions were granted in an irrational manner, not much importance could be attached to the promotions granted in the Unions; and that seniority of employees had to be E determined by reference to date of their initial appointment. Hence the present appeals by the Federation. Appellant-Federation inter alia contended that soine hardship, inconvenience or injustice is bound to result to some members offhe service even when a rule is framed with care, objectivity and foresight ; and that in F working the VRS the principle followed was the rule of seniority determined / by reference to length of service in the grade and such a rule cannot be said to be unreasonable. Respondent inter alia contended that norms applied for reckoning seniority were arbitrary and unreasonable based on.promotions which were G gr
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