Andhra Pradesh High Court Reviews Cooperative Bank’s Decision to Raise Retirement Age from 58 to 60 Years: Clarifies Financial Implications
Case Name: Sri Puvvada Venkata Mohana Murali Krishna Murthy v. The State of Andhra Pradesh
Case No.: Writ Petition No.4861 of 2018
Dated: May 22, 2024
Quorum: Justice Dhiraj Singh Thakur and Justice Raghunandana Rao
FACTS OF THE CASE:
The facts of the present case centre The petitioners were all workers at the Prakasam District Cooperative Central Bank Limited. By the year 2017, they had reached superannuation age and retired at the age of 58. The petitioners’ argument is that they should have retired when they became sixty years old.
The petitioners argued that the Andhra Pradesh Public Employment (Regulation of Age of Superannuation) (Amendment) Act, 2014, or simply “Act No. 4 of 2014,” was passed by the state legislature in order to bolster this claim. It replaced Section 3(1) with the following sub-section. It would be appropriate to include the Andhra Pradesh Public Employment (Regulation of Age of Superannuation) Act, 1984’s definition of “government employee” below.
The Andhra Pradesh government released G.O.Ms.No.147, which contained instructions for putting Act No. 4 of 2014 into effect. It reiterated that the Act’s provisions only applied to the categories listed in it. It was subsequently issued, outlining the plan to delay applying the increased age of superannuation to employees of Public Sector Undertakings and Institutions listed in the IX and X Schedules of the Andhra Pradesh Reorganisation Act, 2014, until the issue of the partition of the institutions’ assets and liabilities between the states of Andhra Pradesh and Telangana was resolved and the distribution of the employees between the two states for those public sector undertakings and institutions was finalised.
ISSUES:
- whether the petitioners, who are employees of a Cooperative Bank (a corporate body), can claim that they have been discriminated against in comparison to Government employees or employees working for entities listed under Schedule IX and X of the Reorganisation Act.
LEGAL PROVISIONS:
- Section 3(1) of the Andhra Pradesh Public Employment (Regulation of Age of Superannuation) (Amendment) Act, 2014. The last day of the month in which a government employee turns sixty years old is when they are all required to retire from service.
CONTENTIONS OF THE APPELLANTS:
The learned counsel for the appellants fiercely and strongly argued that the petitioners in this writ suit contest the Bank’s decision to not raise the superannuation age retroactively from 58 to 60 with effect from June 2, 2014, as was done in the case of institutions covered by Schedules IX and X of the Reorganisation Act by virtue of G.O.Ms. No. 138. It is claimed that the Bank’s decision to reject such a retroactive benefit was discriminatory, unlawful, arbitrary, and unfair.
In addition, it was argued that the Bank was unfairly distinguishing between individuals who retired after June 2, 2014, and those who continued to work as of June 30, 2017, and that raising the superannuation age just in June 2017 was an illogical move.
Learned counsel representing the petitioners argued that since the Andhra Pradesh Cooperative Societies Act, 1964 (also known as the “APCS Act”) made no mention of the age of superannuation and only mentioned it in Rule 28(6) of the Andhra Pradesh Cooperative Societies Rules, 1964 (also known as the “APCS Rules”), the Act No. 4 of 2014’s policy had to be adhered to.
It was also argued that the Government should have made the choice to raise the retirement age rather than the Bank’s Board of Management, as Section 115(D) of the APCS Act did not grant them that authority.
CONTENTIONS OF THE RESPONDENTS:
The arguments put forward by the learned counsel for the appellants were sharply and passionately rejected by the learned counsel according to Mr. C. Sumon, the learned counsel representing the respondents, the respondents’ position was that the petitioners were not government employees as defined by subsection (2) of Section 1 of the Act, and as such, they were not entitled to the benefit of the Act.
It was argued that employees of public enterprises and autonomous organisations were not covered by the aforementioned Act. According to the statement, the petitioners were workers in cooperative credit societies, which operated independently. The Bank had consciously decided to raise its employees’ retirement age from 58 to 60 years old as of June after carefully examining the issue of employee benefits enhancement.
The argument went on to say that fixing the age of superannuation was a policy decision and that raising it with effect from June 2017 was not perverse. Since it was a policy decision, this Court could normally only interfere with it in the exercise of its extraordinary jurisdiction if it was deemed to be arbitrarily or unreasonable.
COURT’S ANALYSIS AND JUDGMENT:
The court observed that the litigation history covered in the preceding paragraphs demonstrates that the lawsuit was started at the request of workers who had worked for the institutions included in the Reorganisation Act’s IX and X Schedule for 58 years, or acquired the age of superannuation.
The court further noted that the interim orders imposed by the Hon’ble Supreme Court had retrospective effect and went into effect on June 2, 2014. In addition, the aforementioned provided that employees of the businesses included in Schedules IX and X of the Reorganisation Act would not be eligible for superannuation only on the basis of reaching the age of 58.
The court held that since the petitioners in this case did not meet the requirements of Act No. 23 of 1984’s definition of “Government employees,” they cannot be considered government employees in any sense. If that’s the case, then corporate employees’ inability to expect the same treatment as state government employees as a matter of right is no longer res integra.
The government’s decision regarding those entities mentioned in Schedules IX and X will not bind the district cooperative central banks, which are cooperative credit societies. These institutions are required to make their own decisions based on a variety of factors, including their financial capacity, in order to decide whether or not to extend the age of superannuation and, if so, from what date. We believe that the DCCB’s decision is a decision of a policy character.
Finally, the court laid down that the decision to raise the retirement age from a prospective date, i.e., June 2017, was made after weighing the advantages of increasing retirement age from 58 to 60 years old as well as the financial implications of salary and other benefits that the Bank would have to pay as a result of the increase. It cannot be argued that the Bank’s decision was so irrational, perverse, or unreasonable as to be unsupportable. As a result, the court denied the current writ petitions, as we see no value in them.
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Judgment reviewed by Riddhi S Bhora.
