LAWS(APH)-2017-3-11

G. RAMA MOHAN RAO AND ANOTHER Vs. THE GOVERNMENT OF ANDHRA PRADESH, REP, BY ITS PRINCIPAL SECRETARY AND CHAIRMAN, AGRICULTURAL, MARKETING & COOPERATIVE DEPARTMENT, SECRETARIAT, HYDERABAD AND ANOTHER

Decided On March 07, 2017
G. Rama Mohan Rao And Another Appellant
V/S
The Government Of Andhra Pradesh, Rep, By Its Principal Secretary And Chairman, Agricultural, Marketing And Cooperative Department, Secretariat, Hyderabad And Another Respondents

JUDGEMENT

(1.) In these batch of Writ Petitions the petitioners, who are all employees of Corporations/Companies/Societies/Institutions, listed in the IX and X Schedule of the A.P. Reorganisation Act, 2014 (the "2014 Central Act" for short), have invoked the jurisdiction of this Court, under Art. 226 of the Constitution of India, to declare the orders issued by the Government of Andhra Pradesh, in G.O.Ms. No.112 dated 18.06.2016 keeping in abeyance the earlier orders issued by them, enhancing the age of superannuation of employees of public sector undertakings under the administrative control of the Government from 58 to 60 years, till formulation of a policy regarding extension of the age of superannuation of such employees, as arbitrary and illegal. The petitioners seek a declaration from this Court that they are entitled to continue in service till they attain the age of superannuation of 60 years.

(2.) The corporations/companies/societies, of which the petitioners are employees of, are categorized as (a) Corporations/Companies listed under the IX schedule; (b) Societies/Cooperative Societies under the IX schedule; (c) other institutions in the IX schedule; (d) societies listed in the X schedule; and (e) other institutions listed in the X schedule.

(3.) It is wholly unnecessary for us, while considering the rival submissions of the Learned Senior Counsel and the Learned Counsel on either side, to burden this judgment with the facts and events leading upto the filing of each of these Writ Petitions. It would suffice, instead, to note the claim of the Employees Federation, representing the employees in most, if not all, the respondent-organisations, that, under the Articles of Association/bye-laws of these legal entities, the Board of Directors/managing Committees are vested with the power to frame, and have been framing, rules/regulations regarding service conditions of employees working in their organisation; the Boards have been following Government norms, in framing service conditions of these employees, from time to time; there are specific provisions, in the Articles of Association of the PSUs, that any action or decision taken by the Directors, in the exercise of the powers vested in them under the Articles of Association, Memorandum of Association and the Companies Act shall prevail, and the shareholders in their general meeting cannot annul such decision of the Directors; Sec. 291 (2) of the Companies Act, 1956 may be referred to in this regard; though the Government, as the shareholder of the respective PSUs, is vested with the power to issue any directive, under the Articles of Association, to the company in regard to any matter and, in such a case, the Directors of the company are bound to implement such directives, the Government is not entitled to invoke the said Article, in the Articles of Association, to alter, modify or annul the resolution of the Board of Directors proposing enhancement of the age of superannuation from (58) to (60) years to its employees; having delegated powers to the Board of Directors, under the Articles of Association, to frame service conditions for the employees working in the respective companies, the Government, as a shareholder, is not entitled to encroach and divest the Board of Directors of their power to frame service conditions of their employees; and, as the employees working in the PSUs are not its employees, the Government is not entitled to curtail the benefit, or deny the benefit, to employees working in the PSUs while acting as the shareholder of the company.