High Court of KeralaSingle JudgeWrit petition dismissed; petition fails.

K.A. Vasu (deceased) and Achamma Vasu v Cochin Shipyard Ltd. and Deputy General Manager (P&A), Cochin Shipyard Ltd.

Case / Petition Number:WP(C).8513/04

Case Details & Bench

Court
High Court of Kerala
Hon'ble Judges
  • C.K. Abdul Rehim
Judgment Date
2010-06-04
Court Decision / Holding
The writ petition is dismissed. The court held that the petitioner was precluded from claiming salary for the relevant period after opting for voluntary retirement and accepting the retirement benefits, aligning with the ex gratia/voluntary retirement doctrine.
Final Disposition
Writ petition dismissed; petition fails.

Parties to the Case

Appellants / Petitioners

  • K.A. Vasu
  • Achamma Vasu

Respondents

  • Cochin Shipyard Ltd., Cochin-682 015, represented by the Chairman and Managing Director
  • Deputy General Manager (P&A), Cochin Shipyard Ltd., Cochin-682015

Legal Representation & Advocates

Counsels for Petitioners

  • • Sri E. M. Joseph

Counsels for Respondents

  • • Sri M. Pathrose Matthai, Senior Advocate for R1
  • • Sri Saji Varghese, Standing Counsel for R1

Case Synopsis & Summary

This Kerala High Court writ petition concerns salary claims for the period 1 October 2002 to 31 March 2003 by the late K.A. Vasu, a Senior Fireman Grade III of Cochin Shipyard Ltd., and his wife, who was impleaded as the additional petitioner. Vasu fell ill with diabetes and gangrene, underwent multiple surgeries, and was certified fit to rejoin by the Medical Trust Hospital. He reported for duty on 1 October 2002 but was subjected to ongoing fitness assessments. He appeared before a Medical Board on 10 March 2003, which certified him fit for duty from 2 April 2003, but he had already opted for voluntary retirement effective 30 April 2003, accepting retirement benefits (except salary for the disputed period). The petition challenged the denial of salary for Oct 2002–Mar 2003, arguing that non-joining resulted from medical and administrative delays, not from personal fault, and that salary was hence payable. Respondents contended that voluntary retirement precludes such past claims and that ex gratia payments under the retirement scheme are for ceasing the employer–employee relationship, not for service. The court noted delay and negligence in decision-making and relied on Supreme Court authority (A.K. Bindal) that ex gratia is a package to end employment, not compensate for past service. The writ petition was dismissed, holding the petitioner precluded from salary claims after voluntary retirement and acceptance of retirement benefits.

Legal Doctrines & Maxims

  • Golden handshake (ex gratia) doctrine in voluntary retirement
  • Ex gratia payments in lieu of leaving service and foregoing all claims
  • Preclusion of past service claims after voluntary retirement

Submissions & Arguments

Contentions of Appellants / Petitioners

The petitioners’ counsel contended that the denial of salary for the period 1 October 2002 to 31 March 2003 was due to negligence in decision-making by the respondents regarding the petitioner’s fitness. Despite appearance before the Medical Officer, no final decision was taken until a Medical Board, which concluded fitness only from 2 April 2003. The absence from duty occurred during this interregnum, and the petitioner had reported for duty. They urged that the stay/cessation in payment occurred due to administrative delay and thus salary for the disputed period should be payable, especially since Exts. P1–P9 include medical certifications and board reports; reliance was placed on the Supreme Court precedent that ex gratia payments are not consideration for work but a scheme closing the employment relationship and extinguishing past claims.

Contentions of Respondents

The respondents argued that the petitioner chose voluntary retirement and accepted its benefits, which, under the retirement scheme, foreclose recovery of salary for the past period. They emphasized that the ex gratia/voluntary retirement package is designed as a final settlement to end the employer–employee relationship, not to credit salary for prior service. The failure to pay salary is thus consistent with the scheme and the legal principle laid down in A.K. Bindal (2003) 5 SCC 163, and subsequently followed in Kerala High Court decision O.P. No. 744/2001 (Judgment dated 8.6.2007). The respondents asserted there was no legitimate entitlement to salary for the disputed interval once retirement was accepted and the employee’s rights were settled under the scheme.

Cited Precedents (2)

Case NameCitationTreatmentExplanation
A.K. Bindal and Another v. Union of India and others(2003) 5 SCC 163PositiveThe Supreme Court held that the ex gratia component paid on voluntary retirement is intended to terminate the employment relationship and foreclose past service claims; it is not compensation for services rendered, supporting the Kerala High Court’s stance that salary for the disputed period is not payable.
O.P.No:744/2001Judgment dt. 8.6.2007PositiveThis Kerala High Court precedent applied the same principle that after voluntary retirement and acceptance of benefits, past salary claims are precluded, reinforcing the petition’s dismissal.

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Extracted Judgment Text

Exact text extracted from official judgment records.

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.K.ABDUL REHIM FRIDAY, THE 4TH JUNE 2010 / 14TH JYAISTHA 1932 WP(C).No. 8513 of 2004(L) ------------------------- PETITIONER(S): --------------- 1. K.A.VASU, AGED 58, S/O. LATE KUTTY, KALEEKAL PADICKAL, THANKAM NIVAS, KUREEKAD P.O., ERNAKULAM DISTRICT.( ***** DIED) ## ADDL.2ND PETITIONER ACHAMMA VASU, AGED 52, W/O.LATE K.A.VASU, THANKAM NIVAS, KALEEKAL PADICKAL, CHOTTANIKKARA P.O. (IMPLEADED VIDE ORDER DT.23.6.2009 IN I.A.7426/09) BY ADV. SRI.E.M.JOSEPH RESPONDENT(S): --------------- 1. COCHIN SHIPYARD LTD., COCHIN-682 015, REP.BY THE CHAIRMAN AND MANAGING DIRECTOR. 2. DEPUTY GENERAL MANAGER (P&A) COCHIN SHIPYARD LTD., COCHIN -682015. ADV. SRI.M.PATHROSE MATTHAI, SENIOR ADVOCATE FOR R1 & 2 SRI.SAJI VARGHESE, STANDING COUNSEL FOR R1 THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 04/06/2010, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C).8513/04 ## APPENDIX ## PETITIONER'S EXHIBITS:- EXT.P1:- COPY OF JOINING REPORT DT.1.10.02 SUBMITTED BEFORE R2 EXT.P2:- COPY OF MEDICAL CERTIFICATE DT.30.9.02 SUBMITTED BEFORE R2 EXT.P3:- COPY OF REPRESENTATION DT.26.2.03 SUBMITTED BEFORE R1 EXT.P4:- COPY OF LETTER DT.7.3.03 ISSUED BY R2 EXT.P5:- COPY OF LETTER DT.2.4.03 ISSUED BY R2 EXT.P6:- COPY OF LETTER DT.29.4.03 ISSUED BY R2 EXT.P7:- COPY OF WAGE SLIP FOR APRIL 2003 EXT.P8:- COPY OF REPRESENTATION DT.4.8.03 SUBMITTED TO R1 EXT.P9:- COPY OF LETTER/ORDER DT.19.8.03 ISSUED ON BEHALF OF R1 ## RESPONDENT'S EXHIBITS:- EXT.R1(A):- TRUE COPY OF PROCEEDINGS OF THE CMO DT.5.11.02 EXT.R1(B):- TRUE COPY OF PROCEEDINGS DT.18.2.03REGARDING EFFORTS AT REDEPLOYMENT OF THE PETITIONER'S SERVICE EXT.R1(C):- TRUE COPY OF PROCEEDINGS DT.10.2.03REGARDING EFFORTS AT REDEPLOYMENT OF THE PETITIONER'S SERVICE EXT.R1(D):- TRUE COPY OF THE REPORT OF THE MEDICAL BOARD DT.10.3.03 _OKB_ //TRUE COPY// P.A. TO JUDGE ## **C.K.ABDUL REHIM, J.** ## **-----------------------------W.P.(C).No.8513 OF 2004** **------------------------------** ## **Dated this the 4[th] day of June, 2010** ## **J U D G M E N T ----------------------** 1. The 1[st] petitioner died during pendency of this writ petition. The additional 2[nd] petitioner, who is the wife of the 1[st] petitioner, got herself impleaded. The issue pertains to claim for salary of the 1[st] petitioner for the period from 1.10.2002 to 31.3.2003. The 1[st] petitioner while working as Senior Fireman Gr:III under the respondents developed chronic diabetes and developed diabetic gangrene. He underwent surgeries wherein his toes on both feet were amputated. Doctor at the Medical Trust Hospital, Ernakulam, wherein he underwent surgery certified that the 1[st] petitioner is fit to re-join duty on 1.10.2002 (Ext.P2 certificate). Petitioner reported for joining duty on 1.10.2002 as evidenced from Ext.P1. But he was referred to the Medical Officer attached to the 1[st] respondent, for evaluating fitness. According to the petitioner, eventhough he reported before the Medical Officer on 1.10.2002 and the _W.P.(C).8513/04_ -2- Medical Officer re-examined him thereafter on more than one occasion, no decision was taken with respect to his fitness for joining duty. Subsequently the 1[st] petitioner was referred to a Medical Board constituted at the District Hospital, Ernakulam. On request he appeared before the Medical Board on 10.3.2003 and the Medical Board opined that he is fit for joining duty with effect from 2.4.2003. Eventhough the 1[st] petitioner re-joined duty on 2.4.2003, he had opted for voluntary retirement with effect from 30.4.2003, which was allowed. The 1[st] petitioner was paid with all benefits available under scheme for voluntary retirement, except salary for the period from 1.10.2002 to 31.3.2003. The petitioner made a claim for payment of salary for the said period through Ext.P8, which was declined through Ext.P9 letter dt.19.8.2003. The said decision is under challenge in this writ petition. 2. Case of the petitioner is that he was prevented from joining duty from 1.10.2002 till 2.4.2003, in an arbitrary manner without any cogent or reasonable cause. It is the complaint of the petitioner that in spite of appearance before the Medical Officer, no decision was taken with respect to his fitness and that he was referred to the Medical Board only after _W.P.(C).8513/04_ -3- lapse of about 5 months. It is contended that since the absence from duty was only because of the illegal and unjustifiable denial to join duty, the 1[st] petitioner is entitled for salary during the relevant period. ## 3. In Ext.P9, the report of the Medical Board is extracted, which reads as follows:- “He is a known Diabetic patient. He developed gangrene of the (L) foot and due to spreading infection his toes on (L) foot were amputated. The toes on (R) foot who have been amputated earlier. There is very small raw area on the dorsum of foot remaining to be healed. His diabetics is controlled. He walks with painful gait (R) foot. He is orthopaedically disabled and the resultant disability comes to about 30% which is mild in nature. Hence he is medically fit to continue his job.” According to the 1[st] respondent, the findings of the Board that the 1[st] petitioner was fit to join duty as Fireman was patently perverse. But the 1[st] petitioner was allowed to join duty only on compassionate grounds. It is further stated in Ext.P9 that during the relevant period the 1[st] respondent was exploring possibility for redeployment of the 1[st] petitioner in some other job. It is further mentioned in Ext.P9 that in between the _W.P.(C).8513/04_ -4- period itself there are records to show that the 1[st] petitioner underwent inpatient treatment at Medical Trust Hospital from 30.12.2002 to 4.1.2003. Along with the counter affidavit respondents have produced copies of the proceedings of the Chief Medical Officer as Ext.R1(a). The endorsement therein reveals that the 1[st] petitioner reported for joining duty on 1.10.2002 and on 16.10.2002. The endorsements of the Medical Officer on 16.10.2002 is to the effect that the 1[st] petitioner was advised to continue rest and treatment since he is not fit for re-joining duty. The further endorsement on 5.11.2002 reiterate the opinion that he is not fit for undertaking duties as a Fireman and therefore detailed assessment regarding fitness need be taken. The endorsement on that date reflects decision to refer him for examination by the Medical Board. 4. Considering the rival claims, fact situation arising out of the circumstances is that the issue pertaining to rejoining of duty was under consideration at different levels in the 1[st] respondent, during the interregnum period between 1.10.2002 and 5.11.2003. Even after 5.11.2003 the Medical Board examined the 1[st] petitioner only on 10.3.2003. Even _W.P.(C).8513/04_ -5- though it could not be said that the petitioner was fit for joining duty during these period, there seems to be some negligence and delay on the part of the authorities of the 1[st] respondent in taking a final decision on the matter. 5. But the question mooted for consideration is on another aspect, as to whether the petitioner is entitled for salary for the relevant period, even after he had opted for voluntary retirement and even after he had accepted all the benefits available under the scheme. Sri.E.M.Joseph, learned counsel for the petitioner contended vehemently that since denial of salary for the relevant period was only due to negligence on the part of the respondents, the petitioner is entitled for such a claim. Sri. Saji Varghese, learned counsel for the respondents on the other hand argued that the claim for entitlement of salary for the relevant period, even does not deserve consideration in view of the fact that the petitioner had opted for voluntary retirement. The scheme for voluntary retirement envisages a position of relinquishment of all claim for the past period and after accepting this scheme and after receiving benefits due thereunder the petitioner is not entitled to raise any claim with respect to the period during which he _W.P.(C).8513/04_ -6- was in service. 6. In support of the above proposition learned counsel for the respondents brought to my attention a decision of the Hon'ble Supreme Court in **A.K.Bindal and Another v. Union of India and others [(2003) 5 SCC 163]** . It is observed by the Hon'ble Supreme Court that the amount paid as ex gratia besides the terminal benefits, in case of voluntary retirement, is paid not for doing any work or rendering any service. But it is paid in lieu of the employee leaving service of the company or establishment and foregoing all his claims or rights. It is a package deal of give and take, popularly known as “golden handshake”. The purpose of paying that amount of ex gratia is to bring about a complete cessation of the employer-employee relationship and after the amount is paid the employee ceases to be under employment of the establishment. In such case he leaves with all his rights and there is no question of his again agitating for any kind of rights for past period against his erstwhile employer. 7. The principle laid down by the Hon'ble Supreme Court in the decision cited supra was followed by a learned Single Judge of this court in O.P.No:744/2001 (Judgment _W.P.(C).8513/04_ -7- dt.8.6.2007) in a case of another employee of the 1[st] respondent itself. Going by the dictum contained in the decision of the Hon'ble Supreme Court (cited supra) I am of the considered opinion that the 1[st] petitioner was precluded from raising a claim for salary for any particular period during which he was in service, after being opted for voluntary retirement and after being accepted benefits out of the scheme. In the result the writ petition fails and the same is accordingly dismissed. ## **C.K.ABDUL REHIM, JUDGE.** okb