S N CHAUDHARY Vs. AIR INDIA

JUDGEMENT

(1.) The petitioner was employed as a Personnel Manager by respondent No. 1 Air India a Corporation, and retired with effect from January 2, 1979 on reaching the age of superannuation. Respondent No. 1 Corporation is established under the provisions of the Air Corporations Act, 1953 and in pursuance of the provisions contained in Section 45 of the Act, the Corporation has framed Air India Employees' Service Regulations, Air India Employees Provident Fund Regulations, 1954 and Air India Staff Housing Regulations 1967. The petitioner, while in service, became a member of respondent No. 8 Lohtse Co-operative Housing Society Ltd. which was formed by the employees of the Corporation. The petitioner owns a flat in the "Housing Society. The Corporation had sanctioned and disbursed to the Society a loan amounting to about Rs. 27 lakhs under the Housing Regulations. The Housing Regulations provide for advance of loan by the Corporation and repayn ent ot the same by the individual and by the Society. The loan, which the Society had originally apportioned to the petitioner's share, was Rs. 75,000. Subsequently, the Society apportioned an amount of Rs. 92,000 to the share of the petitioner and there is a dispute pending between the Society on one hand and the petitioner on the other before the Ilnd Co-operative Court in Arbitration Case No. 813 of 1976. The petitioner claims that the petitioner has already paid back an amount of Rs. 22,500 towards principal and Rs. 14,646.24 towards interest, and the rest of the amount is outstanding.

(2.) On retirement of the petitioner with effect from January 2,1979, the petitioner was entitled to the amount of provident fund, gratuity and salary and leave salary, and the Corporation by letter dated February 1, 1979 informed the petitioner that an amount aggregating to Rs. 2,30,435-71 is due to the petitioner and the break up is as follows : Provident Fund Rs. 1,89,017.61 Gratuity Rs. 30,000.00 Salary & leave salary Rs. 11,418.10 The Corporation paid a sum of Rs. 1,21,631.45 to the petitioner on February 22, 1979. The petitioner requested the Corporation to pay the balance amount, but the Corporation declined to do so. The balance aggregate amount is Rs. 1,08,894.26. The Housing Society, in the mean while, addressed a letter to the petitioner on November 9,1979 and referring to a letter dated October 5, 1979 received from the Corporation, informed the petitioner that the Corporation had ordered adjustment of an amount of Rs. 92,714.12 from the amount due to the petitioner against the loan granted by the Corporation to the Society and against interest thereon. The petitioner complained to the Corporation against the said action of adjusting the amount of loan by addressing several letters, and ultimately filed the present petition under Article 226 of the Constitution of India in this Court on March 25, 1980 and the reliefs sought are (i) that the respondents be directed to cancel the orders by which adjustment of the petitioner's retirement benefits were made and pay to the petitioner the amount of Rs. 1,08,894.26 ; and (ii) the respondents be directed to pay to the petitioner interest on the aforesaid amount at the rate of 15% per annum with effect from January 2, 1979 till the date of payment.

(3.) Shri Joshi, learned counsel appearing on behalf of the petitioner, submitted that under the Air India Employees Provident Fund Regulations, the petitioner is entitled to withdraw the full amount outstanding to his credit in the provident fund on his retirement, and the adjustment of the provident fund amount towards the loan obtained by the Housing Society is in violation of Section 3 read with Section 6 of the Provident Fund Act, 1925. the learned counsel also urged that under the Service Regulations framed by the Corporation, the petitioner is entitled to payment of full gratuity amount on retirement and the said amount could not be adjusted for payment of loan. Shri Joshi submits that the loan was granted by the Corporation to the Housing Society under Regulation 25 of the Housing Regulations and the liability for payment of the said loan is on the Society and it is not permissible for the Corporation to adjust the part of the loan granted to the Society against the amount of provident fund, gratuity, salary and leave salary due to the petitioner. It was urged that there is no provision in the Housing Regulations to recover the loan directly from the member of the Society, and therefore, the petitioner is entitled to the reliefs.