SOUTH MALABAR GRAMIN BANK versus CO-ORDINATION COMMITTEE OF SOUTH MALABAR GRAM IN BANK H1PLOYEES UNION AND SOUTH MALABAR GRAMIN BANK OFFICERS FEDERATION AND ORS.

Citation: [2001] 1 S.C.R. 742 · Decided: 31-01-2001 · Supreme Court of India · Bench: G.B. PATTANAIK · Disposal: Disposed off
Cited by 1 judgment(s) · see the full citation network in Lexace
Open in Lexace · Ask the AI about this case
Judgment (excerpt)

A 
B 
SOUTH MALABAR GRAMIN BANK 
v. 
CO-ORDINATION COMMITTEE OF SOUTH MALABAR 
GRAM IN BANK H1PLOYEES' UNION AND 
SOUTH MALABAR GRAMIN BANK OFFICERS' 
FEDERATION AND ORS. 
JANUARY 31, 2001 
(G.B. PATTANAIK AND B.N. AGRAWAL, JJ.] 
C 
Service law 
Regional Rural Banks Act, 1976-Section 17 (/) Proviso 2 -Pay 
structure of Regional Rural Banks-Determination of-Claim of parity with 
the pay strucfl/re of commercial banks-Tribunal awarding parity-Whether 
D the pay would automatically get revised when pay of commercial bank 
employees gets revised-Without determination by Central Government-
Held, pay structure could be revised only after the Central Government 
exercises its power under the provisions of the Act and determines the same 
-It would be duty bound to maintain the parity with the pay structure of 
the employees of the commercial banks-Power conferred upon the Central 
E Government, by the legislature cannot be taken aw0' by an award of a 
tribunal. 
P0' structure-Determination of-Whethe~ financial condition of the 
employer bank relevant for determination-Held, no. 
F 
Words & Phrases-'Parity'-Meaning of. 
Writ petitions under Article 32 of the Constitution were filed by Gram in 
Bank Workers' Association and All India Regional Rural Bank Employees' 
Association claiming parity in their pay structure with the pay structure of 
the employees of rural banks of nationalised commercial banks. To decide 
G the issues in the matter, Tribunal was appointed. The Tribunal in its award 
held that the officers and the employees of the Regional Rural Banks (RRBs) 
were entitled to claim parity with the officers and other employees of the 
commercial banks in the matter of pay scale, allowances and other benefits. 
H 
' 
Government of India implemented the award vide its order dated 
742 
, __ 
-
---Jr-
S.M.G BANK 1·. CO-ORD. COMM. OF S M.G. BANK EMPLOYEE 
743 
22.2.1991 and the employees were also extended the benefit of 4th and 5th A 
Bipartite Settlement on the basis of which the pay scale of commercial banks 
has been determined. Thereafter pay structure of the employees of the 
commercial banks got revised by 6th and 7th Bipartite Settlement, but there 
was no corresponding revision of the pay structure of the employees of the 
RRBs. The respondents therefore filed writ petition before the High Court, 
claiming revision of their pay scale as per 6th and 7th Bipartite Settlement. B 
Single Judge allowed the writ petition holding that since Government 
of India, by extending 4th and 5th Bipartite Settlement in compliance of the 
award, on principle having accepted the same, further consideration for 
extending subsequent Bipartite Settlement was not required. Appeal to C 
Division Bench wad dismissed. 
In appeal to this Court, in an I.A. filed by the Central Government, it 
was asserted that w.e.f. 1.4.2000 the pay scales of RRB employees would 
become equal to that of their counterparts in commercial banks if they are 
granted benefit of the 6th and 7th Bipartite Settlements. 
D 
Appellants contended that under second proviso to Section 17(1) of the 
Regional Rural Banks Act, 1976, it was only the Central Government who 
would determine the remunerations, and the legislature having indicated 
guidelines in this respect the question of giving effect to any Bipartite 
Settlement could not be given effect to; and that the award of the Tribunal E 
would tantamount to usurping the jurisdiction of the Central Government; 
and that the expression parity would not mean the same pay structure and 
therefore the question of revision would have to be re-determined by Central 
Government; and that for determination of the pay structure financial 
condition of the bank, which is not very affluent, had to be taken into F 
consideration. Respondents contended that the Tribunal having held that the 
employees of RRBs were entitled to claim parity with the employees of 
commercial banks, the same must be maintained for all times to come; and 
that the financial condition of the bank was not germane for determination of 
the pay scale. 
G 
Dismissing the appeals, the Court 
HELD: I.I. On the construction of the award and the provisions of the 
second proviso to Section 17(1) of the Regional Rural Banks Act, 1976, the 
revision of pay structure of the employees of the RRBs could be made only 
after the Central Government exercises its power under the provisions of the H 
744 
SUPREME COURT REPORTS 
(2001] I S.C.R. 
A Act and determines t
Excerpt shown. Read the full judgment & AI analysis in Lexace.