B.S. YADAV & ANR. versus CHIEF MANAGER, CENTRAL BANK OF INDIA & ORS.

Citation: [1987] 3 S.C.R. 165 · Decided: 05-05-1987 · Supreme Court of India · Bench: E.S. VENKATARAMIAH, K.N. SINGH

Judgment (excerpt)

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~-· 
B.S. YADAV & ANR. 
A 
v. 
CHIEF MANAGER, CENTRAL BANK OF INDIA & ORS. 
MAY 5, 1987 
[E.S. VENKATARAMIAH AND K.N. SINGH, JJ.] 
B 
Labour and service law 
Central Bank of India (Officers) Service Regulations, 1979, Regu-
lation 19 & Annexure I-Rules for Age of Retirement, rr. 1, 2, & 
3-0fficers recruited before July 19, 1969 to superannuate at 60 years, c 
those inducted on or after that date at 58 years-Validity of-Whether 
violative of Articles 14 and 16 of the Constitution. 
Banking Companies (Acquisition and Transfer of Undertakings) 
Act, 1970: s. 12(2)-Service conditions of officers and employees tl!ans-
ferred from existing Banking Companies oefore nationalisation to D 
corresponding new banks-Validity of. 
Constitution of India: Articles 14, 16 and 32-Nationalisation of 
banks-Service condition that employees prior to nationalisation date 
superannuate at 60 years and others at 58 years-Such classification 
whether valid and reasonable. 
E 
Before nationalisation of banking companies, the members of the 
stall' of the Central Bank of India i,td. were entitled to remain in the 
.-- \,~ service of the bank till 60 years by virtue of the circular dated March 
f 11, 1969. Section 12(2) of the Banking Companies (Acquisition and 
Transfer of Undertakings) Act, 1970 upon nationalisation provided that F 
--( 
any employee of the Bank whose services were transferred to the cor· 
responding new bank could hold his office in that bank on the same 
terms and conditions and with the same rights to pension, gratuity, etc. 
until they were duly altered by the corresponding new bank. Clause (d) 
of s. 19(2) of the Act specifically conferred powers on the Board of 
Directors of the corresponding new bank to make regulations with G 
regard to the conditions or limitations subject to which the correspond-
ing new bank might appoint officers or other employees and tlx their 
t remuneration and other terms and conditions of service. 
Regulation 19 of the Central Bank of India (Otllcers') Service 
Regulations, 1979, empowered the Board of Directors to determine the H 
165 
A 
B 
166 
SL'PREME COURT PEPORTS 
[ 1987) 3 S.C. R. 
age of retirement of officer employees of the Bank. Rule 1 of the Rules 
for Age of Retirtment contained in Annexure 1 to the Regulations re-
quires an otlicer employee of the Bank recruited/promoted prior to the 
19th July, 1969 (the date on which banking business was nationalised) 
to ·retire on completion of the 60 years of age; rule 2 requires an officer 
employee of the Bank recruited prior to 19th July, 1969 but promoted 
as an ofticer on or aller 19th July, 1969 to retire on completion of 60 
years of age, while rule 3 requires an otllcer employee of the Bank 
recruited on or aller 19th July, 1969 to retire on completion of 58 years 
of age. 
The Isl petitioner WliS appointed on 13th August, 1972 as Chief 
C 
Cashier in the Bank. The letter of appointment contained a clause 
which stated that he will be governed by the terms and conditions of 
service as applicable to the other ollicer stalf of the Bank. He was 
served with a notice dated 25th February, 1980 stating that he would be 
treated as finally retired from the Bank's service aller the close ot' 
D business on February 29, 1980 on completion of 58 years of age. 
Id the writ petitions assailing the order of retirement it was con-
tended for the petitioner, that there could not be two dilferent ages of 
retirement in the case of otlicers of the Bank, and that since rule 3 of the 
Rules for Age of Retirement required the ollicers, who were recruited 
subsequent to July 19, 1969 to retire on completion of 58 years of age 
E while others falling under rules I and 2 could continue till 60 years of 
age, rule 3 was liable to be struck down as being violative of Arts. 14 
and 16 ot'the Constitution. 
F 
G 
H 
For the respondents, it was contended that the employees whose 
services were transferred to the Bank under sub-s. (2) of s. 12 of the Act 
were entitled to continue in service tiU 60 years of age by virtue of the 
conditions of service prev2iling in the Central Bank of India Ltd. prior 
to the nationalisation of bank, that the officers and employees other 
than the award staff recruited after the nationalisation of the banks 
were required to retire on completion of 58 years of age, which was the 
age of superannuation generally prevailing in the service of all Public 
Sectior Corporations, Central Government and many of the State 
Governme

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