[2010] 15 (ADDL.) S.C.R tax and EMI along with 12% p.a. and costs.

Transcription

1 [2010] 15 (L.) S..R SUPRM OURT RPORTS [2010] 15 (L.) S..R..N. NNTRM v. M/S. IT INI LT. N ORS. T. T. (Special Leave Petition () Nos of 2009) NOVMR 24, 2010 [LTMS KIR N YRI JOSP, JJ.] onsumer Protection ct, 1986: eficiency in service Purchaser of diesel vehicle complained to the dealer about defect in the performance of the vehicle and in its engine e alleged that the diesel vehicle made rattling noise ealer replaced the engine and few other parts Purchaser insisted on replacement of the vehicle with a new vehicle iled complaint before onsumer orum seeking replacement of vehicle and in the alternative refund of the purchase price along with expenses issatisfied with the orders of istrict orum and State ommission, the purchaser approached National ommission National ommission directed the dealer and the manufacturer to remove the defect and deliver it to the purchaser after certification of an independent technical expert that the vehicle was free from any defect eld: n engine operating on diesel makes a rattling noise which does not occur in petrol driven engines and in view of that there was really no manufacturing defect in the vehicle as complained of by the purchaser In such circumstances, the order passed by the National ommission was not unreasonable part from the complaint relating to noise from the engine and the gear box, there was no other major defect which made the vehicle incapable of operation, particularly when the engine was replaced with a new one irections given by the National ommission upheld with further direction that if the expert opines that the vehicle has inherent manufacturing defects, the purchaser would be entitled to refund of the price of the vehicle and the lifetime tax and MI along with 12% p.a. and costs. The complainant-petitioner purchased a diesel vehicle from a dealer, the second respondent and got it registered in his name. fter the registration, he took the vehicle on a drive and found certain defects in the vehicle particularly in the engine. On the same day, he left the vehicle with the dealer for removing the defects. The engine and few other parts were replaced. The petitioner was still not satisfied with the performance of the vehicle and informed the dealer that the vehicle had inherent defects which could not be repaired and insisted on replacement of vehicle with a new one or for refund of purchase price together with the expenses incurred by him in trying to rectify the defects in the vehicle. On not receiving any response, the petitioner filed a complaint before the istrict orum. The istrict orum allowed the complaint and directed the first and second respondents to refund the claimed amount, together with 12% P.. and a sum of Rs.5000 towards cost of legal proceedings. The State ommission modified the order of the istrict orum and directed the first and second respondents to replace the vehicle with a brand new one and on failure to do so to refund the purchase price of the vehicle along with road tax and the monthly instalments paid by the petitioner along with the 12% P.. from the date of order. ggrieved, the respondents filed revision before the National ommission. The National ommission held that the petitioner could not prove any manufacturing defect, but directed the dealer and the manufacturer to remove the defects, if any, in the vehicle and make it roadworthy, if necessary by reconditioning the vehicle and deliver it to the petitioner in the presence of an independent technical expert who would certify that the vehicle was free from any defect and the same would be final for all purposes. 619

2 .N. NNTRM v. M/S. IT INI LT. N ORS. T. T. The petitioner filed the instant special leave petitions challenging the order of the National ommission. isposing of the special leave petitions, the ourt L: 1. The question which emerged after considering the submissions made on behalf of respective parties was whether the manufacturing company and by extension the dealer/agent was under any compulsion to replace the vehicle itself when the engine of the vehicle from which certain noises were allegedly emanating had been replaced. It was explained that an engine operating on diesel makes a rattling noise which does not occur in petrol driven engines and that there was really no manufacturing defect in the vehicle as complained of by the purchaser. In such circumstances, the order passed by the National ommission was not unreasonable. or whatever reason, except for a mere 800 kilometers the petitioner had not used the vehicle after it was delivered and had, on the other hand, made several complaints in an attempt to prove that there were manufacturing defects in the vehicle. The National ommission took all these matters into consideration in giving the impugned directions regarding delivery of the vehicle to the petitioner after having the same properly checked by an independent technical expert who would have to certify that the vehicle was free from any defect. [Paras 15, 16] [ [628-; 629--] 2. part from the complaint relating to noise from the engine and the gear box, there was no other major defect which made the vehicle incapable of operation, particularly when the engine was replaced with a new one. owever, in addition to the directions given by the National ommission, it is directed that if the independent technical expert is of the opinion that there are inherent SUPRM OURT RPORTS [2010] 15 (L.) S..R. manufacturing defects in the vehicle, the petitioner will be entitled to refund of the price of the vehicle and the lifetime tax and MI along with 12% per annum and costs, as directed by the State ommission. [Para 17] [629-, ] Indochem lectronic v. ddl. ollector of ustoms (2006) 3 S 721; Maruti Udyog Ltd. v. Susheel Kumar abgotra (2006) 4 S 644; industan Motors Ltd. v. N. Siva Kumar (2000) 10 S 654 referred to. ase Law Reference: (2006) 3 S 721 referred to Para 9 (2006) 4 S 644 referred to Para 13 (2000) 10 S 654 referred to Para 14 IVIL PPLLT JURISITION : SLP (ivil) No of rom the Judgment & Order dated of the National onsumers isputes Redressal ommission, New elhi in RP No. 1585, 1713 and 2431 of Kiran Suri, Vijay Verma, Rishi Jain and S.J. Smith for the Petitioner. Vijay Kumar, Thomas Qammen, Viswajit Singh,. Umapathy, M.M. Manivel, Sangita hahan and Rakesh K. Sharma for the Respondent. The Judgment of the ourt was delivered by LTMS KIR, J. 1. On 31st October, 2002, the Petitioner herein purchased a iat Siena Weekender diesel vehicle from M/s Sundaram utomobiles, angalore, the common Respondent in all these three Special Leave Petitions and agent of M/s iat India Ltd., the manufacturer of the said

3 .N. NNTRM v. M/S. IT INI LT. N ORS. T. T. [LTMS KIR, J.] vehicle. The Petitioner paid a sum of Rs.7,69,187/- towards the x-showroom price of the vehicle, together with a sum of Rs.56,537/- towards lifetime road tax and Rs.28,964/- as insurance. The vehicle was duly registered in the name of the Petitioner on 25th November, 2002, when the vehicle was delivered. 2. ccording to the Petitioner, immediately after registration of the vehicle, it was taken out for a drive when certain defects, particularly in the engine, began to manifest themselves. The same day, the Petitioner left the vehicle with the dealer for removing the defects. On the very same day, the Respondent No.2, M/s Sundaram utomobiles, wrote back to the Petitioner stating that the vehicle was in good condition and the noise was on account of the operational characteristics of the engine. Thereafter, on several occasions, the Petitioner left the vehicle with the agent and various parts, including the engine itself, were completely replaced. The Petitioner, however, was not satisfied with the performance of the vehicle and came to the conclusion that the vehicle had inherent defects and could not be repaired. e, accordingly, insisted that the vehicle be replaced with a new vehicle or the amount paid by him as sale price be refunded, together with expenses incurred in trying to rectify the defects in the vehicle. 3. Not getting any response, the Petitioner filed omplaint No.474 of 2003 before the IVth dditional istrict onsumer isputes Redressal orum, angalore Urban, on 17th pril, The complaint was heard by the istrict orum, which allowed the same by its order dated 20th ebruary, 2004, and directed the Respondents 1 and 2 to refund a sum of Rs.9,15,536/-, as claimed by the Petitioner, together with interest at the rate of 12% per annum and a further sum of Rs.5,000/- towards cost of the legal proceedings. The claim against Respondent No.3, M/s iat Sundaram uto inance Ltd. was rejected SUPRM OURT RPORTS [2010] 15 (L.) S..R. 4. ggrieved by the said order, the Respondents 1 and 2 herein filed two separate appeals, being Nos.513 of 2004 and 397 of 2004, respectively, before the Karnataka State onsumer isputes Redressal ommission, angalore. On 15th June, 2006, the State ommission disposed of the said ppeals modifying the order of the istrict orum by directing the ppellants (Respondents 1 and 2 herein) to replace the Petitioner s vehicle with a brand new vehicle or on their failure to do so to refund Rs.7,69,187/-, along with life time tax paid and the monthly instalments which had been paid by the Petitioner, to M/s Sundaram utomobiles, together with 12% per annum from the date of the order and also the cost of Rs.5,000/-. 5. The matter was, thereafter, taken to the National onsumer isputes Redressal ommission, New elhi, hereinafter referred to as the National ommission, by the Respondent No.1 in Revision Petition No.2431 of The Respondent No.2 (agent) filed Revision Petition No.1585 of The Petitioner, in his turn, filed Revision Petition No.1713 of 2006, before the National ommission. The National ommission, while admitting the Revision Petition No.1585 of 2006 on 25th July, 2006, only on the point of the monthly instalments (MI) paid and the quantum of interest, directed the Revision Petitioner to deposit its share with interest at the rate of 9%. ggrieved by the said order, the Respondent No.2 filed Special Leave Petition (ivil) No of 2006 before this ourt on 4th ugust, 2006, and the same was dismissed on 22nd ebruary, Revision Petition Nos of 2006, 1585 of 2006 and 1713 of 2006 were finally disposed of by the National ommission through a common order dated 17th pril, In the said order, the National ommission held as follows:.therefore, while we hold that the complainant has not been able to prove any manufacturing defect, all the same, the dealer and the manufacturer are directed to remove

4 .N. NNTRM v. M/S. IT INI LT. N ORS. T. T. [LTMS KIR, J.] the defect, if any, in the vehicle make it roadworthy, if necessary by reconditioning the vehicle and deliver it to the complainant in the presence of an independent technical expert mutually agreed upon by the complainant and opposite parties and for this purpose any of the party may apply to the istrict orum for appointing such expert if it is not mutually agreed upon by the parties. The expert shall certify that the vehicle is free from any defect which shall be final for all purposes. This should be done within a period of three months. The Ops, thereafter, to provide a warranty for one year from the date of delivery. The revision petitions are accordingly disposed of in these terms. Under the peculiar facts of the case, there would be no order as to costs. Thereafter, the Petitioner filed the instant Special Leave Petitions challenging the order of the National ommission. :- 6. The issues which fall for decision in these Petitions are (i) (ii) Whether it can be said that the manufacturing defect of the vehicle was such that it warranted replacement, and whether the refund of Rs.7,69,186/- and 12% interest as ordered by the State ommission was justified?; and Whether both the dealer and the manufacturer are jointly and severally liable in regard to deficiency of service? 7. ppearing for the Petitioner in all the three Special Leave Petitions, Ms. Kiran Suri, learned dvocate, urged that from the very day on which the vehicle was delivered to the Petitioner, it was obvious that there were several manufacturing defects in the vehicle, which could not be removed. The said position was duly appreciated both by the istrict orum as well as the State ommission which directed the Respondents SUPRM OURT RPORTS [2010] 15 (L.) S..R. to replace the vehicle or to refund the amounts which had been expended by the Petitioner for purchase and to make the vehicle operational and roadworthy. The National ommission struck a different note upon holding that there was no worthwhile evidence to indicate that the vehicle had suffered from any serious manufacturing defect and that in any case the allegation of noise emanating from the engine even after its replacement with a new engine, could not be believed. Ms. Suri also questioned the view of the National ommission that the obligation of the manufacturer/dealer is only to repair/replace any part of the vehicle found to be defective, even during the warranty period, free of charge, but that the question of replacing the vehicle with a new vehicle was not justified. 8. Ms. Suri lastly submitted that the finding of the National ommission that the omplainant/ Petitioner had not been able to prove any manufacturing defect, was perverse and contrary to the evidence adduced by the parties and the materials on record. Ms. Suri also questioned the finding that the refund of the cost of the vehicle would also not be justified, since the Petitioner had not taken the vehicle from the dealer despite their letter certifying that the vehicle had no defect. Ms. Suri submitted that further direction given by the National ommission to remove any defects and to make the vehicle roadworthy, if necessary, by reconditioning the vehicle and to deliver the same to the Petitioner in the presence of an independent technical expert mutually agreed upon, was wholly misconceived and could not be sustained. 9. In support of her submissions, Ms. Suri referred to a decision of this ourt in Indochem lectronic vs. ddl. ollector of ustoms [(2006) 3 S 721], wherein while considering the provisions of Sections 3 and 14 of the onsumer Protection ct, 1986, this ourt was of the view that when the deficiency began to manifest themselves it was the duty of the suppliers to attend to such deficiencies immediately and if the supplier was unable to attend to the deficiencies and

5 .N. NNTRM v. M/S. IT INI LT. N ORS. T. T. [LTMS KIR, J.] malfunctioning of the system soon after installation, it would amount to deficiency of service. urthermore, when the deficiencies in the system continued to persist during the warranty period, including the extended period, the suppliers were rightly held to be liable for deficiency in service by the State and National ommission. It was also held that in the light of the specific power conferred under Section 14(1)(c) of the aforesaid ct, damages equivalent to price of goods could be awarded, despite the provisions of Section 12(3) of the Sale of oods ct, 1930, as the provisions of the 1986 ct are in addition to and not in derogation of any other provision of law. 10. Mr. Vijay Kumar, learned dvocate, who appeared for M/s iat India Ltd., urged that the complaint made by the Petitioner herein was without any basis as the vehicle was fully roadworthy and it was the Petitioner who made continuous complaints which, the Respondent attended to for the sake of maintaining good business relations. It was submitted that the manufacturer company went to the extent of even replacing the engine and parts of the gear box to give the Petitioner complete satisfaction. owever, there was absolutely no justification for the Petitioner to demand that the vehicle be replaced or that the value thereof, together with the expenses incurred be refunded. It was also urged that the vehicle had been duly certified to be completely roadworthy and it was the Petitioner who was at fault for not having taken delivery of the same, despite the same being ready. It was submitted that the decision of the National ommission did not call for any interference and the Petition was liable to be dismissed. 11. On behalf of the Respondents it was contended that everything possible was done to meet the repeated complaints made by the Petitioner, which even involved the replacement of the engine and other parts. owever, instead of taking delivery of the vehicle, the Petitioner continued to insist on replacement of the vehicle which was not contemplated under the warranty given by the manufacturing company when the vehicle was delivered to the Petitioner SUPRM OURT RPORTS [2010] 15 (L.) S..R. 12. It was also submitted that, in any event, the agent of a vehicle manufacturer would not be made liable for the defects, if any, in the vehicle and the relief prayed for against Respondent No.2 was entirely misconceived. 13. In support of the aforesaid submissions, reference was made to the decision of this ourt in Maruti Udyog Ltd. vs. Susheel Kumar abgotra [(2006) 4 S 644], in which it was, inter alia, held that if the manufacturing defect was established, then replacement of the entire item or the replacement of the defective parts, is only called for. In fact, reference was made to the warranty condition which referred only to replacement of only the defective parts and not the car itself. This ourt held that from the various documents exhibited it would appear that the manufacturer had indicated that it was necessary to download the engine to trace the problem which has been complained of, but there was no agreement to replace the engine. Moreover, when the manufacturer asked for the vehicle to be brought in for the purpose of downloading the engine, the Respondent did not do so and, accordingly, to infer that there was any manufacturing defect in the said background was without any foundation. owever, the relief was moulded so that the defective part could be replaced without requiring the purchaser to pay any charge. 14. Reference was then made to the decision of this ourt in industan Motors Ltd. vs. N. Siva Kumar [(2000) 10 S 654], in which it was held that when it became impossible to comply with the National ommission s order directing replacement of the Respondent s defective vehicle, since the manufacturer had stopped manufacturing the said model, this ourt directed that the money along with interest, compensation and costs were to be paid to the purchaser. 15. aving considered the various submissions made on behalf of respective parties, what emerges is the question as to whether the manufacturing company and by extension the dealer/agent was under any compulsion to replace the vehicle

6 .N. NNTRM v. M/S. IT INI LT. N ORS. T. T. [LTMS KIR, J.] 629 [2010] 15 (L.) S..R. 630 itself when the engine of the vehicle from which certain noises were allegedly emanating had been replaced. It has been explained that an engine operating on diesel makes a rattling noise which does not occur in petrol driven engines and that there was really no manufacturing defect in the vehicle as complained of by the purchaser. 16. In such circumstances, the order passed by the National ommission, impugned in these Special Leave Petitions, does not appear to be unreasonable. or whatever reason, except for a mere 800 kilometers the Petitioner has not used the vehicle after it was delivered and has, on the other hand, made several complaints in an attempt to prove that there were manufacturing defects in the vehicle. The National ommission has taken all these matters into consideration in giving the impugned directions regarding delivery of the vehicle to the Petitioner after having the same properly checked by an independent technical expert who would have to certify that the vehicle was free from any defect when it is delivered. 17. rom the facts as disclosed, it appears that apart from the complaint relating to noise from the engine and the gear box, there was no other major defect which made the vehicle incapable of operation, particularly when the engine was replaced with a new one. owever, in addition to the directions given by the National ommission, we direct that if the independent technical expert is of the opinion that there are inherent manufacturing defects in the vehicle, the petitioner will be entitled to refund of the price of the vehicle and the lifetime tax and MI along with 12% per annum and costs, as directed by the State ommission. 18. In such circumstances, the Special Leave Petitions are disposed of with the above directions... Special Leave Petitions disposed of. ININ INSTITUT O TNOLOY, KNPUR v. RJ RM VRM N ORS. (ivil ppeal No of 2003) NOVMR 24, 2010 [.S. SINVI N SOK KUMR NULY, JJ.] dministrative law: Judicial review Prescribing or extending age of retirement eld: Is a managerial function Such decision taken by the management of the institutions like I.I.T. and I.I.M. are on consideration of various aspects Most predominant consideration is the need of the institute, its functional requirements and efficient management of its manpower These are the areas where the court should not normally venture and judgment in this area should be best left with the authorities who are in-charge of running or managing such institutes owever, if court finds that the policy in fixing the age of retirement was not based on any intelligible criterion or is founded on such a basis which are patently unreasonable and perverse, the court has a bounden duty to interfere and direct the concerned management to proceed on a reasonable basis onstitution of India, 1950 rticle 14 Institutes of Technology ct, onstitution of India, 1950: rticle 14 xtension of age of retirement Intelligible differentia I.I.T., Kanpur confined the benefit of service upto 62 years to teachers and to employees on par with teachers eld: There is a valid rationale in allowing teachers and persons holding posts which are at par with teachers to work beyond 60 years ood faculty of academicians for doing the job of teachers is difficult to find In any discipline and especially in a discipline in an institute like I.I.T., it is very difficult to replace an experienced teacher with years of learning, maturity and experience Institutes of Technology ct,

7 ININ INSTITUT O TNOLOY, KNPUR v. RJ RM VRM Institutes of Technology ct, 1961: ss.2, 4, 11, 13, 31, 33 utonomy of the Institution I.I.T Kanpur is an Institution of National Importance The decision making exercise is with the council composed of academicians Therefore, it cannot be said that the independence of the institutions is controlled or diluted by overnment ducation/ducational institutions. The first respondent was appointed on to the post of ssistant Registrar at appellant-institute. e was to retire on on attaining the age of 60 years. Initially the statute of I.I.T. provided for 60 years as the age of superannuation for all the staff members. The first respondent claimed his entitlement to continue till 62 years of age on the basis of communications of the Ministry of uman Resource evelopment whereby the age of superannuation of University and ollege teachers was increased to 62 years. The appellant-institute sought for clarification as regards the applicability of the communications to the ssistant Registrars. One Mr. akre was allowed to continue in the absence of proper clarification from the entral overnment. Subsequently clarification was received and it was clear that the increase in the age of retirement was only in case of those categories of employees who could be treated at par with the teachers. The appellant-institute passed an order to that effect. writ petition was filed by the first respondent before the igh ourt challenging the said order. The igh ourt allowed the writ petition. The questions which arose for consideration in the instant appeal were whether the decision of the appellant that the benefit of service upto 62 years was confined to teachers and employees at par with teachers was justified; and whether rant-in-aid and loan rules could be made applicable to I.I.T. and I.I.M. and by applying said rules, the independence of institutions like I.I.T. and I.I.M SUPRM OURT RPORTS [2010] 15 (L.) S..R. in matter of employment of the teachers is sought to be diluted. llowing the appeal, the ourt L: 1.1. Prescribing the age of retirement is a managerial function and such decisions are taken by the management of the concerned institute on consideration of various aspects. One of the most predominant consideration is the need of the institute, its functional requirements and efficient management of its manpower. These are the areas where the court should not normally venture and judgment in this area should be best left with the authorities who are in-charge of running or managing such institutes. owever, if the court finds that the policy in fixing the age of retirement was not based on any intelligible criterion or is founded on such a basis which are patently unreasonable and perverse, the court has a bounden duty to interfere and direct the concerned management to proceed on a reasonable basis. In the segment of white collared employees, opportunities are quite few and there is a burning unemployment problem. Therefore, if considering the ground realities the overnment fixes 60 years as the age of retirement for certain categories of employees, the court should be very slow and circumspect before interfering with such decisions. [Paras 28, 31] [643--; 644-]. harat Kumar and Ors. v. Osmania University and Ors. (2007) 11 S 58; Nagaland Senior ovt. mployees Welfare ssociation and Ors. v. The State of Nagaland and Ors. 2010(7) SR 630 relied on There is a valid rationale in allowing teachers and persons holding posts which are at par with teachers to work beyond 60 years. The reason for this is that it is very difficult to find a good faculty of academicians for doing

8 ININ INSTITUT O TNOLOY, KNPUR v. RJ RM VRM the job of teachers. In any discipline and especially in a discipline in an institute like I.I.T., it is very difficult to replace an experienced teacher with years of learning, maturity and experience. This explains why in many cases even teachers are retained beyond their extended period of retirement by way of extension or their services are continued on the basis of re-employment. This is done to preserve the intrinsic value and quality of teaching imparted in these institutions. Therefore, there is no error in the decision of the appellant whereby the benefit of service upto 62 years is confined to teachers and to those employees who are on a par with teachers. The first respondent was not able to establish that he was a member of teaching staff or he was to be treated at par with the teachers. In that view of the matter, his claim to continue in service after 60 years of age was not sustainable. Whether a particular employee has to be treated at par with the teaching staff is by and large a decision of the management of the appellant institute and it is difficult for this ourt to interfere with the said decision unless it is ex facie perverse. ere, no such case was made out by the first respondent. Mr. akre was allowed to continue only under fortuitous circumstances and in the absence of any proper clarifications by the entral overnment. The respondent cannot claim the same right. In the case of Mr. akre, no legal right was extended to him. e was allowed to continue in the absence of any clarification about when retirement fell due. Thus, in passing the impugned order of retirement of the first respondent on his attaining the age of 60 years, the appellant has not committed any illegality. [Paras 25, 26, 27, 32, 33] [644--; 645--; 642--; ] 2. The Preamble of the Institutes of Technology ct, 1961, which is an ct of Parliament, shows that the same has been enacted to declare certain institutions of SUPRM OURT RPORTS [2010] 15 (L.) S..R. technology to be institutions of national importance. Section 2 of the said ct makes it clear that I.I.T Kanpur (the appellant) is an Institution of National Importance. Under Section 31 of the ct, the entral overnment may by a notification in the official gazette establish a entral oard to be called the ouncil and in the ouncil the Minister in-charge of technical education of the entral overnment shall be the ex-officio hairman. rom the list of the re-constituted ouncil of I.I.Ts, it appears that hairman of all the I.I.Ts, namely, I.I.T ombay, I.I.T elhi, I.I.T uwahati, I.I.T Kanpur, I.I.T Kharagpur, I.I.T Madras, I.I.T Roorkee are members of the said ouncil. Most of them are professors or academicians. Under Section 33 of the ct it is the duty of the council to coordinate the activities of all the institutes and to perform all the functions which are specified under Section 33(2) of the ct. ll major decision making exercise has been left in the hands of the re-constituted ouncil which is predominantly composed of academicians. The ouncil in its 40th meeting held on has constituted a committee under the hairmanship of r. nil Kakodkar, hairman, oard of overnors, I.I.T ombay for suggesting a roadmap for the autonomy and the future of the I.I.Ts as world class institutions for research and higher learning. Pursuant to the said resolution in the 40th meeting of the ouncil, a ommittee has been constituted. The materials and the affidavit of the overnment disclosed that autonomy of these institutes is not being diluted. Rather, an attempt is made by the overnment of India to improve the academic ambience of these institutes by recommending extension of age of retirement of the irector of the Institute and of members of the academic faculty. ttempt has also been made to attract the best talent by a progressive revision of the pay scale. [Para 38, 39, 43, 44, 45, 46, 47, 52] [646--; 647-; 648--; 649--; 652--; 657--]

9 ININ INSTITUT O TNOLOY, KNPUR v. RJ RM VRM ase Law Reference: (2007) 11 S 58 relied on Para (7) SR 630 relied on Para 30 IVIL PPLLT JURISITION : ivil ppeal No of SUPRM OURT RPORTS [2010] 15 (L.) S..R. of recruitment and conditions of service of employees amongst other things of common interest. 3. Statute 11 classifies the employees under three categories. They are (a) academic, (b) technical and (c) administrative. Respondent No. 1 who was appointed as an ssistant Registrar falls under the third category. rom the Judgment & Order dated of the igh ourt of Judicature at llahabad, in ivil Misc. Writ Petition No of Nikhil Nayyar, T.V.S.R. Sreyas, Sunil oyal for the ppellant. 4. enerally, the statute 13 (2) framed under the ct prescribes the age of superannuation of a confirmed appointee. Initially the statute provided for 60 years as the age of superannuation for all the staff members. y an amendment on however, a sub-statute 3 was added making some changes. The said amendment runs as follows: opal Subramanium, S.., Raja Verma, nubhav Kumar (for.s. Mahra) for the Respondents. The Judgment of the ourt was delivered by NULY, J. 1. The Respondent No. 1 Shri Raja Ram Verma was appointed to the post of ssistant Registrar at Indian Institute of Technology, Kanpur (hereinafter I.I.T.) on s per Statute 13 of I.I.T., the respondent was due to retire on on attaining the age of 60 years. is case before us is that he should have been allowed to continue upto the age of 62 years. 2. I.I.T. Kanpur is a body incorporated under the Institutes of Technology ct, 1961 (hereinafter the ct ). Section 27 of the ct provides for framing of first Statutes by the I.I.T. Such statutes are to deal with matters mentioned in Section 26. Section 26 (g) provides for framing of statutes relating to terms and conditions of service of teachers and other staff of the I.I.T. Section 31 of the ct provides for the establishment of ouncil which is a central body. Under Section 33 of the ct the general duty of the ouncil is to coordinate the activities of the Institute and under Section 33(2)(b) one of the general duties of the ouncil is to lay down the policies regarding cadres, method (3)Subject to the provisions of the ct and the Statutes, all the new appointments to posts on revised salary scales adopted with effect from 1st January 1986 under the Institutie shall ordinarily be made on probation for a period of one year after which period the appointee, if confirmed, shall continue to hold office, subject to the provisions of the ct and the Statutes as follows: (a) (b) Teaching Staff (faculty and roup Staff): Till the end of the month in which he attains the age of 60 years roup, and staff (non faculty): Till the end of the month in which he attains the age of 58 years. 5. This amendment did not affect the Respondent No. 1 as it was applicable for those who were appointed w.e.f Thereafter, by an office order issued by the Registrar s office, I.I.T. Kanpur, dated , the age of retirement was increased from 58 to 60 years with effect from This was done in respect of members of roups, and (non faculty) who had been appointed on or after

10 ININ INSTITUT O TNOLOY, KNPUR v. RJ RM VRM [SOK KUMR NULY, J.] 7. On , the Ministry of uman Resource evelopment addressed to the Secretary, University rants ommission, and forwarded to the Vice hancellors of all entral Universities, Member Secretary, ll India ouncil for Technical ducation and Secretary of the Indian ouncil for gricultural Research, providing therein that the age of superannuation of University and ollege teachers would be 62 years with the liberty reserved to the Universities and olleges to re-employ superannuated teachers within the existing guidelines framed by the U The respondent No.1 claims his entitlement to continue till 62 years of age on the basis of this communication. 9. nother communication was issued on 31st ugust, 1998 by the epartment of ducation, Ministry of.r.. to the irector of the I.I.T. with regard to increase in the age of superannuation of academic staff including personnel of Registry, Library and Physical ducation. Thereupon, the appellant sought clarification from the Ministry about the term Personnel of Registry, Library and Physical ducation Staff. 10. The case of the appellant is that it got a telephonic communication from the Ministry on or about 14th October 1998 that the increase in the age of superannuation from 60 to 62 years is confined to the case of ssistant Registrar level and the officers above. Thereupon, the appellant allowed one Shri. S.. akre, ssistant Registrar to continue in service, who was due to retire on 31st ugust Thereafter, the hairman of the oard of overnors approved the proposal of the irector, wherein it was proposed that the staff, whose age of retirement was 58 years, would superannuate on attaining 60 years and the members of the staff whose age of retirement at the time of appointment was 60 years, would superannuate on attaining 62 years. owever, the said proposal of the irector even though approved by the hairman, was not put up before the oard of overnors for ratification, hence no effect was SUPRM OURT RPORTS [2010] 15 (L.) S..R. given to the same as required under statute 7(4) of the first statute. 11. In Statute 7(4) of the statutes of I.I.T., all orders of the hairman have to be approved by the oard. The relevant provision of Statute 7(4) is in the following terms: 7(4) In emergent cases the hairman may exercise the powers of the oard and inform the oard of the action taken by him for its approval. 12. It has been urged on behalf of the appellant that as respondent No.1 was admittedly appointed on , he was due for superannuation on on attaining the age of superannuation of 60 years in terms of statute 13(2). The exact provision of Statute 13(2) in this connection is set out below: (2) Subject to the provisions of the ct and the statutes, all appointments to posts under the Institute shall ordinarily be made on probation for a period of one year after which period the appointee, if confirmed, shall continue to hold his office subject to the provisions of the ct and the Statutes, till the end of the month in which he attains the age of 60 years. Provided that where the oard considers that in the interests of students and for the purposes of teaching and guiding the research scholars any member of the academic staff should be reemployed, it may reemploy such a member till the end of the semester or the academic session as may be considered appropriate in the circumstances of each case. Provided further that where it becomes necessary to re-employ any such member beyond the end of the semester or academic session as the case may be, the oard may with the previous approval of the visitor, reemploy any such member for a period upto three years in the first instance and upto two years thereafter and in no

11 ININ INSTITUT O TNOLOY, KNPUR v. RJ RM VRM [SOK KUMR NULY, J.] case exceeding the end of the academic session in which he attains the age of 65 years. Provided also that in no circumstances such member shall be reemployed for any purposes other than those of teaching and guiding the research scholars. 13. Then by a communication dated the overnment of India, the second respondent, clarified the scheme notified in its earlier communication dated to the extent that the age of superannuation at 62 will be applicable only to those Registrars, Librarians, Physical ducation personnel who are treated at par with teachers and whose age of superannuation was 60 years. 14. Thereafter, the I.I.T. council met on and decided that the age of superannuation of staff members of I.I.Ts (except faculty and scientific/design staff in roup category) would continue to be 60 years, as in the case of the entral overnment employees. 15. In the meantime, the case of another ssistant Registrar, namely Shri S.K. upta, who was to retire on , came up for consideration and the then irector of I.I.T. sought clarification from the Ministry of uman Resource evelopment. In seeking such a clarification, the irector was informed by the Secretary, Ministry of uman Resource evelopment that a clarification would be sent shortly. In the absence of any clarification, the irector decided that till further clarification is received from the Ministry, Shri S.K. upta may continue. 16. owever, on itself a communication was received from the Ministry of uman Resource evelopment giving the clarification and in paragraph (5) of the said clarification it was provided as under: ttention of this Ministry has, however, been drawn to the fact that the position stated in para 4 above requires SUPRM OURT RPORTS [2010] 15 (L.) S..R. clarification. ccordingly, it is clarified that the increase in the age of superannuation from 60 to 62 years indicated in this Ministry letter of even number dated 31st ugust, 1998 as stated above would be applicable only to those categories of employees of IITs, IIMs and IISc who are being treated at par with the teachers and whose age of superannuation was 60 years. 17. On a further clarification was given by the second respondent to the irector of the appellant that the increase in the age of superannuation from 60 years to 62 years would be applicable only to those categories of employees of I.I.Ts, I.I.Ms and I.I.Sc who are being treated at par with the teachers and whose age of superannuation was 60 years. 18. In view of the aforesaid clarification by the second respondent, a grievance was raised about alleged discrimination between the members of faculty staff and those members of staff who are categoried as non-faculty staff. In the background of such a plea of discrimination, the second respondent, by its further communication dated , clarified that since the members of the staff of various I.I.Ts are classified into 3 categories namely, i) academic ii) technical and iii) administrative and others and since Librarians are falling in the categories of the academic staff, their age of retirement would be 62 years. 19. Thereafter, the oard of overnors of the appellant in its meeting held on , on consideration of the communication dated from the second respondent came to the following conclusion: The oard was informed of the outcome of the discussions at the IITs irectors meeting held on 9th pril, The oard after a brief discussion decided as under: 1. Those ssistant Registrars who are in service beyond

12 ININ INSTITUT O TNOLOY, KNPUR v. RJ RM VRM [SOK KUMR NULY, J.] 60 years will retire on ecember 31, owever, if a person reaches 62 years before that date, he will retire at the end of the month in which he completes 62 years. 2. Librarian and eputy Librarian will retire on completing 62 years, in view of MR clarification. 3. decision with respect to Physical ducation Instructors- lass- will be taken once a clarification is received from the MR. 20. Thereupon, a memorandum was issued by the appellant on to the effect that the date of superannuation of all the ssistant Registrars, who figured in the said memorandum will be 31st ecember, owever, Shri S.. akre was not allowed to continue since his date of superannuation was eing aggrieved by the said memorandum dated ; respondent No.1 filed a writ petition before the llahabad igh ourt. 22. The consistent case of the appellant before the igh ourt was that age of retirement of only those employees was enhanced who could be treated at par with the teachers. In the affidavit filed by the appellant before the igh ourt they have reiterated that they are bound by the communication from the Ministry of uman Resources, overnment of India dated and also one dated The relevant part of the notification has been set out above and the subsequent clarification by the Ministry s communication dated also relies on para 5 of the Ministry s communication dated On a combined reading of the aforesaid two communications issued by the second respondent, it is more than clear that increase in the age of retirement has been made available only to those categories of employees who are treated at par with the teachers. 23. owever, the igh ourt on an erroneous basis SUPRM OURT RPORTS [2010] 15 (L.) S..R. allowed the writ petition and quashed the order of the appellant dated It may be mentioned in this connection that subsequently the ull ench of the llahabad igh ourt by a judgment and order dated disagreed with the decision rendered by the llahabad igh ourt in favour of the respondent No.1 and held that ence in our opinion the age of retirement of an employee of the Indian Institute of Technology is 60 years and not 62 years vide Section 13(2). We, therefore, respectfully disagree with the decision in Raja Ram Verma s case. The judgment in Raja Ram Verma s case (supra) is hereby overruled. 24. It may be noted in this connection that an affidavit has been filed by the appellant before this ourt explaining the conditions under which Mr. akre was allowed to continue beyond 60 years. Since Mr. akre was an ssistant Registrar and was due to retire on the benefit of increased age was extended to him, pending clarification about the age of retirement from the second respondent. The issuance of clarification was by the second respondent, the entral overnment. The oard of the appellant decided that six of its ssistant Registrars would have to be superannuated based on the office memo dated issued by the overnment of India and thereupon the oard of overnors decided that all the six ssistant Registrars except Mr. akre would be allowed to continue till Therefore, Mr. akre was allowed to continue only under fortuitous circumstances and in the absence of any proper clarifications by the entral overnment. 25. This ourt is of the opinion that the respondent cannot claim the same right. In the case of Mr. akre no legal right was extended to him. e was allowed to continue in the absence of any clarification about when retirement fell due. 26. The first respondent, who is appearing in person, has not been able to establish before us that he is a member of teaching staff or he was treated at par with the teachers. In that view of the matter his claim to continue in service after 60 years

13 ININ INSTITUT O TNOLOY, KNPUR v. RJ RM VRM [SOK KUMR NULY, J.] of age cannot be sustained and the igh ourt came to an erroneous finding in taking a contrary view. 27. Whether a particular employee has to be treated at par with the teaching staff is by and large a decision of the management of the appellant institute and it is difficult for this ourt to interfere with the said decision unless it is ex facie perverse. ere, no such case has been made out by the first respondent. 28. It has been held by this ourt, more than once, that prescribing the age of retirement is a managerial function and such decisions are taken by the management of the concerned institute on consideration of various aspects. One of the most predominant consideration is the need of the institute, its functional requirements and efficient management of its manpower. These are the areas where the ourt should not normally venture and judgment in this area should be best left with the authorities who are in-charge of running or managing such institutes. owever, if the ourt finds that the policy in fixing the age of retirement was not based on any intelligible criterion or is founded on such a basis which are patently unreasonable and perverse, the ourt has a bounden duty to interfere and direct the concerned management to proceed on a reasonable basis. 29. In. harat Kumar and Ors. Vs. Osmania University and Ors. - (2007) 11 S 58, this ourt expressed such a view in paragraph 19 at page 73 of the judgment and which is quoted below: Learned counsel also argued, to a great extent, the desirability of the age of superannuation being raised to 60 or 62, as the case may be. We again reiterate that it is not for this ourt to formulate a policy as to what the age of retirement should be as by doing so we would be trailing into the dangerious area of the wisdom of the legislation. If the State overnment in its discretion, which is SUPRM OURT RPORTS [2010] 15 (L.) S..R. permissible to it under the scheme, decides to restrict the age and not increase it to 60, or as the case may be, 62, it was perfectly justified in doing so. 30. Similar views have been expressed recently by another ench of this ourt in Nagaland Senior ovt. mployees Welfare ssociation and Ors. Vs. The State of Nagaland and Ors. - ivil appeal No of 2010 decided on In paragraph 40 of the judgment this ourt opined as follows:...the rule of retirement on completion of 35 years of service has relevance to employees who have joined service at an age below 25 years and the prescription with regard to retirement at the age of 60 years is in respect of the persons joining service at the age of 25 and thereafter. The above two categories of employees, though performing similar duties and may be identically placed otherwise can still be reasonably understood to form two different classes to whom application of two rules of retirement will not violate rticle This ourt must remember that in the segment of white collared employees, opportunities are quite few and there is a burning unemployment problem. Therefore, if considering the ground realities the overnment fixes 60 years as the age of retirement for certain categories of employees, the ourt should be very slow and circumspect before interfering with such decisions. 32. This ourt finds that there is a valid rationale in allowing teachers and persons holding posts which are at par with teachers to work beyond 60 years. The reason for this is that it is very difficult to find a good faculty of academicians for doing the job of teachers. In any discipline and especially in a discipline in an institute like I.I.T., it is very difficult to replace an experienced teacher with years of learning, maturity and experience. This explains why in many cases even teachers are

14 ININ INSTITUT O TNOLOY, KNPUR v. RJ RM VRM [SOK KUMR NULY, J.] retained beyond their extended period of retirement by way of extension or their services are continued on the basis of reemployment. This is done to preserve the intrinsic value and quality of teaching imparted in these institutions. 33. Therefore, this ourt does not find any error in the decision of the appellant whereby the benefit of service upto 62 years is confined to teachers and to those employees who are on a par with teachers. Thus, in passing the impugned order of retirement of the first respondent on his attaining the age of 60 years, the appellant has not committed any illegality. 34. In this matter a somewhat larger question cropped up in view of submissions made by learned Solicitor eneral, who appeared on behalf of the Union of India, the second respondent. The learned Solicitor drew our attention to Rule 209(6)(iv)(a) of rants-in-aid and loan rules. Relying on the said rules, the learned Solicitor submitted that the age of retirement of teachers and others employed in I.I.Ts and I.I.Ms has been fixed at par with entral overnment employees. The said rule is set out below:- ll grantee institutions or organizations which receive more than fifty percent of their recurring expenditure in form of grant-in-aid, should ordinarily formulate terms and conditions of service of their employees which are by and large not higher than those applicable to similar categories of employees in central government. In exceptional cases relaxation may be made in consultation with the Ministry of inance. 35. onsidering the aforesaid stand of the second respondent, a question of public importance which arises is whether the aforesaid rules can be made applicable to I.I.Ts and I.I.Ms which are Institutes of National importance. This ourt pointedly asked this question to the learned Solicitor whether by applying the said rules independence of institutions like I.I.Ts and I.I.Ms in matter of employment of the teachers is sought to SUPRM OURT RPORTS [2010] 15 (L.) S..R. be controlled. Matter of concern for this ourt is whether in the process, the autonomy of these institutions is diluted by a mindless bureaucratization of educational institutions which are to function as centres of excellence and are Institutions of National Importance. 36. On such query being raised by this ourt, the learned Solicitor wanted some time for taking instructions and ultimately filed an additional affidavit on behalf of Union of India, the second respondent. 37. Reference in this connection may be made to ntry 63 and 64 of List I of the Seventh Schedule of the onstitution. Those two entries are set out:- 63. The institutions known at the commencement of this onstitution as the enares indu University, the ligarh Muslim University and the elhi University; the University established in pursuance of rticle 371- any other institution declared by Parliament by law to be an institution of national importance. 64. Institutions for scientific or technical education financed by the overnment of India wholly or in part and declared by Parliament by law to be institutions of national importance. 38. It may be mentioned that the Preamble of the Institutes of Technology ct, 1961 (the said ct), which is an ct of Parliament, shows that the same has been enacted to declare certain institutions of technology to be institutions of National Importance. Section 2 of the said ct runs as under:- 2. Whereas the objects of the institutions known as the Indian Institute of Technology, ombay, the ollege of ngineering and Technology, elhi, the Indian Institute of Technology, Kanpur and the Indian Institute of Technology, Madras are such as to make them institutions of national