The Hindu : SC dismisses banks' appeal in VRS cases

Online edition of India's National Newspaper
Friday, Dec 20, 2002

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SC dismisses banks' appeal in VRS cases

By Our Legal Correspondent

NEW DELHI Dec. 19 . The Supreme Court has held that nationalised bank employees have "indefeasible rights'' to withdraw their offer from the Voluntary Retirement Scheme (VRS) before the same was accepted.

Giving this ruling a three-Judge Bench comprising, the (former) Chief Justice G.B. Pattanaik, Justice H.K. Sema and Justice S.B. Sinha, held that the banks' action in accepting the VRS applications even after their withdrawal by the employees concerned could not be sustained.

The Bench, therefore, dismissed the appeals filed by the Bank of India, the Punjab National Bank, the Allahabad Bank, the Dena Bank, the Punjab and Sind Bank and the Union Bank of India against the judgments of some of the High Courts holding that the scheme was not validly framed and it was open to the employees to withdraw from the scheme before his VRS application was accepted.

The Bench, however, allowed the SBI's appeal against a judgment of the Uttaranchal High Court in view of the fact that in its scheme, the bank had provided a clause, viz., a cut-off date for withdrawal from the scheme and opportunity was given to employees to opt out of the scheme.

Under the VRS scheme introduced by the banks in 2000, a total of 1,01,000 employees submitted their applications, out of whom about 200 withdrew their offer, which were however, accepted.

In the case of SBI, 35,380 employees applied for VRS and 21,000 were granted voluntary retirement and 1,996 had withdrawn before the cut-off date.

The High Courts of Bombay, Punjab and Haryana and others held as invalid the decision of the banks in accepting their offer despite withdrawal and the present appeals by banks were directed against these judgments.

Dismissing the appeals by the nationalised banks, the Bench rejected their contention that the scheme was purely voluntary and the conscious decision of the employees could be no reason for his withdrawal of application at a later date. But SBI stood on a different footing as it had given the option to withdraw from the scheme, the Bench pointed out.

The Bench, however, said that the benefit of this order would not apply to employees who had accepted a part of the benefit under the scheme. Further, this would not apply in respect of those employees who despite acceptance of a part of the retirement benefit under the VRS had continued under the orders of the High Court and had retired on attaining the age of superannuation.

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