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RESERVE BANK OF INDIA versus RESERVE BANK OF INDIA STAFF OFFICERS ASSOCIATION AND ORS.

Citation: [1991] 3 S.C.R. 460 · Decided: 09-08-1991 · Supreme Court of India · Bench: M.H. KANIA · Disposal: Appeal(s) allowed

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Judgment (excerpt)

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RESERVE BANK OF INDIA 
v. 
RESERVE BANK OF INDIA STAFF OFFICERS 
ASSOCIATION AND ORS. 
AUGUST 9. 1991 
IM.l-1. KANIA AND P.B. SAWANT, JJ.] 
Cons1;1urion of India, 1950-An;c/es 14, 16-Non-local & local 
bank officers of Reserve Bank at Gauhati-Certain incentives to non-
/oral oj} 1cers-\.t\-'het/ier .discriminatory. 
By a letter dated December 9, 1983 certain incentives and allo-
wances were provided by the appellant to its officers posted at Gauhati 
who were not from the North-Eastern region. Those allowances were 
generally known as special duty allowances and the main special duty 
allowance comprised 25% of basic pay, subject to a maximum of Rs.400 
per month. 
By a Memorandum issued by the appellant on April II, 1985, an 
ad hoc increase in salary was effected for non-local officers and an 
option was given to them either to choose the ad hoc increase or the 
special duty allowances for the period during which they were posted at 
Gauhati. 
The respondent demanded the extension of the said benefits to 
the local officers by their letter dated May 10, 1985. When the 
appellant-bank declined to allow the benefits to the local officers, the 
respondent-association challenged the Memorandum dated April 11, 
1985 in a writ petition in the High Court, contending that all the officers 
of the appellant-bank posted at Gauhati, whether they were from the 
'.\orth-Eastern region or outside had to live in the same conditions and 
suffer from the same hardships, and hence, if any allowance was given 
to the officers transferred from outside to the Gauhati Office, the very 
same allowance should also be given to the local officers posted al 
( ;auhati. 
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The appellant bank averred in its counter that the' scheme of ad 
hoc incentives was introduced to tide over the problem of adequately 
staffing the Gauhati office; that the non-local officers experienced 
difficulties in getting accommodation, getting familiar with the lang-
uage and so on, and some incentives had to be given to them to mitigate 
the hardships experienced by them on transfer to Gauhati; that the said 
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incentives were temporary and because of the peculiar circumstances 
460 
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RESERVE BANK v. OFFICERS ASSOCN. [KANIA. J.[ 
461 
prevailing at the moment in· the North-Eastern region, which was 
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regarded as a difficult region. 
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The High Court allowed the petition, holding that all officers at 
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Gauhati suffered from substantially the same hardship and that the 
local officers of the appellant-bank at Gauhati were discriminated 
against and directed that they must be given the same benefits as the 
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non-local officers transferred to Gauhati. 
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Allowing the appeal by special leave filed by the·bank, this Court, 
HELD: 1.01. The hardship and inconveniences suffered by an 
officer of the appellant-hank who was transferred to Gauhati fro.m 
regions other than the North-Eastern region would certainly be more 
acute than those suffered by local officers posted at Gauhati. [463G-H I 
1.02. Some of the officers coming from the North-Eastern region 
may also face considerable hardship when posted at Gauhati but the 
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fact that there might be a few such officers would not render the pay-
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ment of special allowance, exclusively to officers transferred from dis-
tant regions discriminatory and bad in law. [464B-C] 
J .03. The Reserve Bank of India, is a banking institution and if in 
the interest of efficiency and proper working, it bona fide took the 
decision to grant some extra benefits to the non-local officers transfer-
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red to Gauhati with a view to maintain efficient working of its unit at 
Gauhati, they cannot be treated as being guilty of any unlawful 
discrimination. [464E-F] 
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 3107 
of 1991. 
From the Judgment and Order dated 14.8. 1990 of the Gauhati 
, High Court in Civil Rule No. 407 of 1985. 
H.N. Salve. K.S. Parihar and H.S. Parihar for the Appellant. 
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P.K. Goswami, Kailash Vasdev and M.J. Paul for the 
Respondents. 
The Judgment of the Court was delivered by 
KANIA, J. Special leave granted. Counsel heard. 
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SUPREME COURT REPORTS 
[ 1991] 3 S.C.R. 
This is an appeal filed by the Reserve Bank of India, by special 
leave. The contesting respondent, being respondent No. 1, is an 
association of its officers at its Gauhati unit. The respondent associa-
tion (referred to hereinafter as "the respondent") represents the 
interests of 4

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