TRANSMISSION CORPN., A.P. LTD. AND ORS. versus P. RAMACHANDRA RAO AND ANR.

Citation: [2006] SUPP. 1 S.C.R. 18 · Decided: 17-04-2006 · Supreme Court of India · Bench: ARIJIT PASAYAT · Disposal: Appeal(s) allowed

Judgment (excerpt)

A 
B 
TRANSMISSION CORPN., A.P. LTD. AND ORS. 
v. 
P. RAMACHANDRA RAO AND ANR. 
APRIL 17, 2006 
[ARIJIT PASAYAT ANDTARUN CHATTERJEE, JJ.] 
Constitution of lndia--Article 14-Electricity Supply Act, 1948--
Sections 12(3) and 78(C)--Revision of pay scales of employees with effect 
C from I. 7.1990 in pursuance to a Memorandum of Settlement- -Respondents, 
who retired on 30. 4.1990, filed Writ Petition to ftx their pension and 01her 
terminal benefits at par with other employees who retired on or ajier 
1.7.1990-High Court allowed the Writ Petition on the ground of 
discrimination-Correctness of-Held, the settlement cannot be said to be 
unfair and unjust since the respondents did not challenge the moJulity of the 
]) settlement. 
Respondents retired on 30.4.1990 after attaining the age of 
superannuation. Pay scales of the employees of appellant Corporation were 
revised with effect from 1.7.1990. The pay scales were revised in pursuance 
to a Memorandum of Settlement. The revised pay scales permitted grant of 
E three annual increments beyond the time scale in regard to those who had 
reached or crossed the maximum pay as on 1.7.1986. 
The respondents filed Writ Petition before High Court to direct the 
appellants to fix their pension and other terminal benefits at par with other 
F employees who retired on or after 1.7.1990 and to pay all the arrears of 
pensions and other terminal benefits. The respondents contended that the 
appellants revised the pay scales previously with effect from 1.4.1981 which 
was only for a period of 4 years and the same was required to be revised with 
effect from 1.4.1985; that the appellants revised it only with effect from 
1.7.1986. Hence the respondents submitted that the classification done was 
G violative of Article 14 of the Constitution of India. The appellants contested 
the Writ Petition contending that the scheme of revised pay scales is applicable 
only to those who were on its rolls as on 1.7.1990 and that since they retired 
before that d<1te, the scheme is not applicable to them. Single Judge of the 
High Court allowed the Writ Petition of the respondents by holding that the 
H 
18 
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TRANSMISSION CORPN. v. P. RAMACHANDRA RAO 
19 
respondents have been discriminated. The Writ Appeal filed by the appellants A 
was dismissed by Division Bench of the High Court. 
In appeal to the Court, the appellants contended that the respondents 
did not challenge the settlement scheme but only challenged the rationale of 
fixing the cut off date with effect from 1. 7.1990 which is untenable. 
Allowing the appeal, the Court 
·-; 
HELD: 1.1. The Memorandum of Settlement clearly shows that the period 
B 
of settlement was from 1. 7.1990 to 30.6.1994. The settlement was made under 
Section 12(3) of the Electricity Supply Act, 1948. There was no challenge to 
the settlement which was the foundation for the Board's decision. No finding C 
has been recorded by either the Single Judge or the Division Bench of the 
High Court that the modality adopted is wrong. Under the Act, consequences 
flow for failure to implement the award, settlement or agreement. There is 
no dispute that the Board's decision is prospective. There is also no challenge 
to the legality of the Board's decision on the ground that there is no rationale D 
--1 
for fixing the date, except saying that it should have been done from an earlier 
date i.e. 1985 and not from 1.7.1986 as done earlier. Exclusion of workmen 
retiring before the date fixed is no good ground to characterise settlement as 
unjust and unfair. [22-D, H; 23-A, B; 24-EI 
1.2. A settlement cannot weigh in golden scales and the question whether E 
it is just and fair has to be answered on the basis of principles different from 
those which comes into play when an industrial dispute is under adjudication. 
If the settlement had been arrived at by a vast majority of concerned workers 
with their eyes open and was also accepted by them in its totality, it must be 
presumed to be just and fair and not liable to be ignored while deciding the 
reference made under the Act merely because a small number of workers F 
were not parties to it or refused to accept it. 125-D-EI 
Herbertsons ltd v. Workmen, [197614 SCC 736; K.C.P. ltd. v. Presiding 
Officer, [1996110 SCC 446; Tata Engg. and locomQlive Co. ltd. v. Workmen, 
[19811 4 SCC 627; ITC Ltd. Workers' Welfare Association and Anr. v. G 
Management of ITC ltd. and Anr., [20021 3 SCC 411; Barauni Rejine1y 
Pragatisheel S

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