ALL INDIA INSURANCE EMPLOYEES ASSOCIATION AND ORS. Vs. THE LIFE INSURANCE CORPORATION, HIGHER GRADE, ASSISTANTS ASSOCIATION AND ORS.

JUDGEMENT

(1.) These four writ appeals arise out of writ Petition Nos. 825 and 826 of 1972 filed by (i) The Life Insurance Corporation of Higher Grade Assistants' Association and (ii) Thomas Mathew, a higher grade assistant in the Life Insurance Corporation, but who is not member of the aforesaid Association, seeking for the issue of a writ of mandamus directing the National Industrial Tribunal, New Delhi (sixth Respondent) to hear and determine the dispute relating to item No. 7 of the reference NIT 2 of 1969 relating to the rule of promotion and also for the issue of a writ of mandamus forbearing the Life Insurance Corporation of India and the Zonal Manager of the Life Insurance Corporation of India (Respondents 1 and 2) from enforcing the new rules of promotion embodied in the agreement, dated 15th October 1971. The facts are not in dispute and we shall briefly refer to the same. The Life Insurance Corporation of India is a Corporation established by the Life Insurance Corporation Act, (Act XXXI of 1956). Sec. 49 of the said Act empowers the Corporation to frame regulations governing the terms and conditions of service of the employees, subject to the condition that they are made with the previous approval of the Central Government. Clause 5 of the Staff Regulations sets out the various classes and categories of posts in the Life Insurance Corporation, hereinafter referred to as L.I.C. So far as the present writ petitions are concerned classes I and III consists of the following categories of posts:

(2.) In regard to item No. 7, negotiations began between L.I.C. and the four Associations and an agreement was reached on 15th October 1971 between the Management and the three Associations excluding the L.I.C. Higher Grade Assistants' Association and a notice under Sec. 9 -A of the Industrial Disputes Act, seeking to enforce the rules of promotion contained in the agreement, dated 15th October 1971 was sought to be issued to all the employees stating that the new rules of promotion would come into effect from the 6th November 1971. The principal features of the new rules of promotion contained in the agreement of 15th October 1971 are shortly as follows:

(3.) The L.I.C. by its Chairman and the Zonal Manager of the L.I.C. riled a common counter affidavit seeking to uphold the validity of the award of the Tribunal regarding the settlement between the parties and contending that such a settlement was a valid disposal of the reference. Dealing with the objection that the agreement runs contra to the terms of the award in N.I.T. 1 of 1969, it was contended that the said award did not guarantee or preserve the categories of the employees, but merely awarded different pay scales for the employees and that so long as the new pay scales are not lower than the scales of pay which the so -called affected persons were getting under the new promotion rules, they cannot be deemed to be aggrieved persons. The further contention was that the L.I.C. was within its rights in negotiating with the majority of the employees and having arrived at the rules of promotion, which is binding upon them (employees). The further contention raised is that the scheme of promotions drawn by negotiation are not rules and regulations, but administrative instructions and have been issued by the Chairman for the betterment of the prospects of the employees of the Corporation and that such instructions are valid and binding on all the employees and the new rules of promotion having been arrived at and embodied in the settlement under Sec. 18(1) of the Act, is binding upon all the employees and the issue of the notice under Sec. 9 -A of the Industrial Disputes Act is valid. Dealing with the contention that the impugned settlement violates Articles 14 and 16 of the Constitution, the L.I.C. contended that the Corporation is not a State and that the conditions of service are purely contractual and that consequently Articles 14 and 16 have no application.