Santosh Kumar Sahu & Ors. v. Union of India & Ors.

Delhi High Court · 27 Mar 2023 · 2023:DHC:2304

Prathiba M. Singh

W.P.(C) 10599/2022

2023:DHC:2304

administrative appeal_allowed Significant

AI Summary

Delhi High Court held that employees of AIESL have no vested right to retain government accommodation post-Air India privatization and penal rent deductions require due process under the Public Premises Act.

Full Text

2023:DHC:2304

W.P.(C) 10599/2022
HIGH COURT OF DELHI
Date of Decision: 27th March, 2023

W.P.(C) 10599/2022 and CM APPL. 30700/2022, 34430/2022, 53215/2022, 4051/2023, 6415/2023
SANTOSH KUMAR SAHU & ORS. .... Petitioners
Through: Mr. Shree Prakash Sinha, Mr. Rakesh Mishra, Ms. Mohua Sinha and Mr. Nawalendra Kumar, Advs.
(M:9810368574)

VERSUS

UNION OF INDIA & ORS. ..... Respondents
Through: Mr Satya Ranjan Swain (Senior Panel Counsel -CG), Mr Sahaj Garg -GP, Mr
KautilyaBirat& Mr Pranav Jain, Advs. for R-1 & 5. (M:88601-89238)
Mr. AP Singh& Ms. Akanksha Das, Advs. for R-2. (M:9545355646)
Mr. Sanjiv Sen, Sr. Adv with Mr. AP Singh, Ms. Akanksha Das& Mr. Mridul Suri, Advs for R-3.
Mr. AvishkarSinghvi, Adv. with Ms.Anindita Burman, Mr. ShivamChanana, Mr. Adavaya Hari
Singh, Mr. Naved Ahmed & Mr. Vivek Kumar, Advs for AIL.
(M:8882766553)

CORAM:

JUSTICE PRATHIBA M. SINGH Prathiba M. Singh, J. (Oral)

JUDGMENT

1. This hearing has been done through hybrid mode.

2. The Petitioners, who are employees of Respondent No. 2-Air India Signing Date:31.03.2023 12:55 Engineering Services Limited (hereinafter ‘AIESL’) have raised a challenge to the communications dated 29th September, 2021 and 28th May, 2022 issued by the Respondents asking them to vacate the residential accommodation allotted to them at Vasant Vihar, Delhi (also known as Air India Colony) (‘the accommodation’), which is being occupied by them. At the relevant point in time, when the Petitioners were allotted the accommodation, AIESL was a fully owned subsidiary of the Respondent No.4 - Air India Limited, which has since been privatized.

AIESL was a subsidiary of Respondent No. 4- Air India Ltd. (‘AIL’) till 12th January 2022. On the said date, the entire shareholding of the AIL in AIESL was transferred to the Respondent No. 3- AIAHL. Therefore, AIESL became a wholly owned subsidiary of AIAHL. This was clarified by a circular dated 15th February 2022 issued by AIESL.

3. Admittedly, the Petitioners are living in the accommodation allotted to them under the Air India Housing Allotment Rules (‘the 2017 Rules’), dated 28th March, 2017. Clause 22 of the 2017 Rules reads as under: “22.

VACATION OF QUARTERS: The allottee of the residence to the employee is consistent with and is dependant solely on his being in employment in the Company and therefore the moment the allottee dies, retires, resigns or is discharged from the services, terminated for any reason whatsoever or abandons the service or is otherwise made ineligible for the allotment of a residence or commits breach of the terms and conditions of the Rules herein contained, the allotment shall stand cancelled forthwith unless specifically permitted to retain the residence. Requests for retention shall be processed by respective Personnel Department.”

4. The case of the Petitioners is that the AIESL continues to remain a government company and none of the circumstances, as contemplated in Clause 22 of the 2017 Rules i.e. death, termination and abandonment etc., has occurred qua the Petitioners. There is also a miscellaneous clause, which contemplates that if any of the allottees, who are otherwise made ineligible, the allotment shall stand cancelled and the Petitioners would have to vacate the premises.

5. The matter has been heard by this Court from time to time. On 21st July, 2022, the ld. Solicitor General had made submissions to the following effect. “Mr. Tushar Mehta, the learned Solicitor General of India, states that in light of the issues which are raised in this writ petition, the respondent may be granted two weeks’ time to file a reply. He further states that the respondents do not intend to initiate any proceedings for the eviction of the petitioners except in accordance with law. Learned Solicitor General draws the attention of the Court to the specific recital(s) as appearing in the impugned notices in this respect and which record that in case the petitioners fail to vacate the premises in question, appropriate action under the Public Premises (Eviction of Unauthorized Occupants) Act, 1971 would be initiated. Mr. Jayant Mehta, learned Senior Counsel appearing for the petitioners, however contends that since the petitioners were the employees of AI Engineering Services Limited, the provisions of the 1971 Act would not apply. In any case and bearing in mind the nature of issues that stand raised and the request of the learned Solicitor General, let the noticed respondents file their replies within a period of two weeks from today.”

6. The grievance of the Petitioners in the present petition is that they are being charged the penal rent, which is being deducted from their salaries, which amounts to coercive measures to be taken by the Respondents, without following due process. It is further vehemently urged by Mr. Sinha, ld. Counsel appearing for the Petitioners, that the employees of the Respondent No. 4-AIL and Respondent No. 3-AIAHL cannot be equated to AIESL, as AIESL continues to be a government company and the land continues to be vested with the Ministry of Urban Development (‘MoUD’).

7. Vide order dated 27th February, 2023, this Court after hearing the submissions of ld. Counsels for the parties, had directed as under:

“9. After some hearing, ld. Counsel for the

Petitioners, under instructions from the Petitioners,

submits that the Petitioners are willing to vacate

the premises by 31st December, 2023, subject to the

following conditions.

i. That the basic amenities i.e. water, electricity etc. shall continue to be provided during the period when the Petitioners occupy the premises; ii. The penal rent, which is being charged, shall be stopped and the entire penal rent, which has been charged, shall be repaid to the Petitioners after deducting only the normal HRA. iii. That the Petitioners shall make a representation for alternate accommodation to the MoUD/DGCA, which may be considered in an expeditious manner. The above shall be without prejudice to the rights and contentions of the Petitioners. Ld. counsel for the Respondents seeks time to take instructions in the matter.”

26,834 characters total

8. On 6th March, 2023, further directions were issued to the following effect.

“3. Today, further time is sought by the ld. Counsel for the Union of India for reverting on the proposals recorded in the previous order dated 27th February, 2023. The Petitioner expresses urgency on the ground that even for the month of February 2023, deductions have been made in the salaries of the Petitioners, which is causing enormous harassment and frustration to the Petitioners. It is the submission on behalf of the Petitioners, that only around 1/4th of the total salary due to the Petitioners has been released for the last two months, as penal HRA is being deducted. 4. Considering these submissions, it is directed that the decision of the Union of India shall be placed on record, at least two days before the next date of hearing. If the decision is not taken by the next date of hearing, the Court would consider the application for interim relief in respect of the deductions from the salary of the Petitioners for the next month, which would now be due only in the first week of April. ”

9. Today, the matter has been listed for further hearing. Ld. counsel for the Petitioners have placed reliance on the decision of the Bombay High Court in All India Service Engineers Association (AISEA) v. Union of India & Ors, [W.P. (L) No. 34307/2022, decision dated 13th March 2023], where the Union of employees working in Air India Limited, AIESL and Air India Airport Services Ltd. had preferred writ petitions in respect of similar allotted residential accommodations in accordance with provisions of the 2017 Rules in Bombay and in respect of refusal to make reference to Central Government Industrial Tribunal (CGIT). The issues before the Bombay High Court in AISEA supra were as follows: “Though prayers made in the three petitions do not exactly match, the broad grievance of Petitioner unions are with regard to

(i) Order dated 12 October 2022 declining to make reference to Central Government Industrial Tribunal (CGIT)

(ii) changing of penal rent and damage rent

(iii) deduction/withholding of Performance Linked

10. The ld. Counsel for the Petitioner submits that in AISEA supra, the Bombay High Court has permitted the employees to agitate their grievances under the Public Premises Act, 1971 and has also restrained the Respondents- Union of India from recovering penal rent from employees for a period of two weeks from the date of the decision.

11. On behalf of the Respondent No. 1 & 5- Union of India, Mr. Satya Ranjan, ld. Counsel has relied upon a recent judgment of a ld. Single Judge of this Court in W.P.(C) 10889/2022 titled ‘Capt. Amitabh Rajan v. Union of India’ dated 24th March, 2023 wherein in respect of the same very Air India colony in Vasant Vihar, the Court has given time to the employees to retain their accommodation till 31st July, 2023 and has held that no penal rent shall be deducted from the salaries of the Petitioners, after accepting the undertaking of the employees.

12. Mr. Sanjiv Sen, Sr. Counsel appearing for the Respondent No.3-AIAHL, submits that in the process of privatization of Air India, all the assets have been transferred to this holding company i.e AIAHL, which is to monetize the land, which was earlier vesting with AIL.

13. Mr. Avishkar Singhvi, ld. Counsel appearing for the Respondent No.4-AIL challenges the maintainability of this writ petition against the AIL.

14. A perusal of the two orders cited by ld. Counsel for the parties today would show that insofar as the employees of these companies are concerned, the matter has reached a conclusion. The relevant portions of the Bombay High Court decision in AISEA supra is set out below:

“39. The provisions of Housing Rules, as quoted above, would indicate that allotment of accommodations is to be done in accordance with Rule 5 by drawing of list of optees as and when the accommodations become available. It is not that every employee is granted accommodation as a matter of right. The accommodation is to be allotted as per availability and priorities specified in Rule 5. Upon allotment of accommodation, payment of House Rent Allowances (HRA) is to be stopped. The Rules further make it apparent that allottee of the accommodation would merely be a licensee. Under Rule 22, though an employee is permitted to retain the accommodation during the tenure of his service, the Rules also make it clear that housing is merely a welfare function. Furthermore, the Housing Rules become applicable only after an accommodation is allotted and the rules essentially deal with the terms and conditions of occupation. The Housing Rules do not, by themselves, create or confer any right on the employees for allotment of accommodation. xxx 66. It is also required to be noted that the land and buildings in which the residential accommodations are located have now become properties of AIAHCL (Respondent No. 5). Thus, the

accommodations are no longer held by the three Respondent-Companies in which members of Petitioner-Unions were/are employed. Admittedly they are not employees of AIAHCL. Therefore, whether members of Petitioner-Unions can continue to occupy properties of AIAHCL is another debatable issue, on which we do not wish to record any finding at this stage. xxx

69. Now we deal with the issue of levy of penal rent and damage charges in pursuance of the decision taken by AISAM as conveyed vide letter dated 29 September 2021. It is contended on behalf of Petitioner-Unions that levy of damage charges of Rs. 15,00,000/- in Mumbai is in violation of the provisions of Housing Rules. However, prayers made in the Petitions do not indicate that there is any specific prayer for setting aside the decision of levy of penal rent or damage rent. The issue involved in the present Petitions is essentially about refusal to make an order of reference. Also an objection is raised on behalf of the Respondent-Companies that the issue with regard to challenge to the letter dated 29 September 2021 has attained finality by way of judgment and order dated 25 August 2022 passed in Writ Petition (L) No. 1900[1] of 2022, 1917[1] of 2022 and 2033[8] of 2022 wherein specific challenge was raised to letters dated 29 September 2021, 7/8th October 2021 and 26 May 2022. We however do not propose to decide the issue with regard to levy of penal rent and/or damages. The aspect of recovery of rent or damages in respect of public premises is dealt with under section 7 of the PP Act which provides as under: “7. Power to require payment of rent or damages in respect of public premises.— (1) Where any person, is in arrears of rent payable in respect of any public premises, the estate officer may, by order, require that person to pay the same within such time and in such instalments as may be specified in the order. (2) Where any person is, or has at any time been, in unauthorised occupation of any public premises, the estate officer may, having regard to such principles of assessment of damages as may be prescribed, assess the damages on account of the use and occupation of such premises and may, by order, require that person to pay the damages within such time and in such instalments as may be specified in the order. (2-A) While making an order under sub-section (1) or sub-section (2), the estate officer may direct that the arrears of rent or, as the case may be, damages shall be payable together with compound interest at such rate as may be prescribed, not being a rate exceeding the current rate of interest within the meaning of the Interest Act, 1978 (14 of 1978). (3) No order under sub-section (1) or sub-section (2) shall be made against any person until after the issue of a notice in writing to the person calling upon him to show cause within seven days from the date of issue thereof, why such order should not be made, and until his objections, if any, and any evidence he may produce in support of the same, have been considered by the estate officer. (3-A) If the person in unauthorised occupation of residential accommodation challenges the eviction order passed by the estate officer under sub-section 2 of section 3-B in any Court, he shall pay damages for every month for the residential accommodation held by him. (4) Every order under this section shall be made by the estate officer as expeditiously as possible and all endeavour shall be made by him to issue the order within fifteen days of the date specified in the notice.” xxx

71. Also of relevance is the fact that only miniscule number of flats now remain to be occupied by some of the employees. As per the figures placed before us, the total number of flats is over 3000. Only 410 employees continue to be in occupation of accommodations, out of whom 238 employees have already submitted undertakings to vacate the same. Thus the petitions seem to be pressed to protect interest of only 142 employees who are yet to show willingness to vacate the accommodations. It is contended on behalf of the Petitioner-Unions that the undertakings given by employees are on account of threats of recovery of penal and damage rents and such undertakings should be ignored by this court. However, none of the Petitioner-Unions have given any details of the exact employees on whose behalf the petitions are filed. In absence of any details and any challenge in pleadings to the figures put forth by Respondents, we are left with no option but to accept those figures. Monitisation of lands and properties of AIL is one of the essential terms of disinvestment process. If such small number of employees continue to hold on to the accommodations, the AIAHCL will not be able to monitise the land to reduce the burden of debt of AIL put on it. Ofcourse the right, if any, of employees to occupy the accommodations will be dependent on the terms and conditions of leave and licence agreements and we have left this issue open to be decided in appropriate proceedings. Those employees who wish to agitate their grievance with regard to alleged right to occupy the premises can do so in proceedings initiated under the PP Act.

72. Resultantly, we do not find any error in the Order dated 12 October 2022 declining to make an order of reference. Petitions are devoid of merits and deserve to be dismissed. All issues on merits of contentions with regard to alleged rights of employees to retain their accommodations are however left open to be decided in appropriate proceedings, uninfluenced by observations made in the present judgment. Petitions are accordingly dismissed. There shall be no orders as to costs. Rule is discharged.”

15. In Capt. Amitabh Rajan (supra), the ld. Single Bench of the Court held as follows:

“15. Submissions made on behalf of the employees of Air India occupying the aforesaid colony that they shall vacate their flats within one month of monetisation of the land in question, cannot be accepted. As manifest from the record, in the wake of disinvestment of Air India Limited, the non-core assets including land and building, have been transferred to Air India Assets Holding Company (AIAHL), which is a subsidiary of the Government of India. Thus, the accommodation provided to the petitioners at the colony along with other residential colonies, have been transferred to AIAHL. 16. The employees of Air India Limited are no longer government employees after its privatisation. The colony in question is under the ownership of the Government, while the occupants are now employees of a private company after privatisation of Air India Limited. Thus, the employees of Air India Limited occupying the

colony in question, do not have any legal or vested right to continue with the occupation of the premises in question. Even otherwise, the facility of accommodation cannot be claimed as a vested right and is only provided to the employees/workmen depending upon availability of such facility in their respective location. Thus, it cannot be contended that accommodation provided should be enjoyed by the said occupants perpetually and as an essential condition of service.

17. Even otherwise, as pointed out, the facility of accommodation was optional and majority of the employees of the erstwhile Air India and its subsidiaries chose not to avail this facility. The Air India Limited which is now a private entity owned by M/s Talace India Private Limited, does not have any right, title or interest over the property on which the accommodation has been provided to the various occupants at Air India Colony, Vasant Vihar, New Delhi. Consequent upon the transfer of shares held by Government of India in Air India Limited to M/s Talace India Private Limited, Air India Limited has ceased to be a government entity. Thus, the employees of Air India Limited are now employees of a non-government company.

18. The vacation of residential colonies occupied by employees of Air India Limited after its privatisation, is part of the policy decision taken by the Government of India in the wake of disinvestment of Air India Limited. The various occupants of Air India Colony, Vasant Vihar, thus, cannot be said to have any vested right to continue their occupation. The quarters at Air India Colony, Vasant Vihar, New Delhi, as noted above, is situated on land belonging to the Ministry of Housing and Urban Affairs.

19. Further, attention of this Court has been drawn to the Leave and License Agreement, as filed before this Court. Thus, as per the facts as brought forth on record, at the time of allotting the housing accommodation to its employees, a standard Leave and License Agreement was signed between the erstwhile company and the allottee, which stated that the company or the competent authority shall have right to terminate the allotment of housing accommodation, without assigning any reasons whatsoever. Thus, it transpires that the allotment and possession of the housing accommodation is governed by the terms of Leave and License Agreement, and the same is not a vested right of the employee of the erstwhile company.

20.

AIAHL in its short counter affidavit has clearly brought forth that nearly 72% of the occupants of the colony in question have given their undertaking and have already vacated the flats occupied by them in the Air India Colony, Vasant Vihar. Therefore, it is clear that all employees of Air India Limited who have been occupying the Air India Colony, Vasant Vihar, have to be treated at par with each other Therefore, no special equity flows in favour of the 38 occupants, who have prayed that they will vacate the premises within one month of monetisation of the land in question. The decision as regards monetisation of the land in question is a separate proceedings altogether and the said occupants cannot claim any vested or legal right to continue to occupy the premises in question.

21. As regards the undertaking given on behalf of 66 occupants of the Air India Colony, Vasant Vihar that they are willing to vacate the flats in question on or before 31.07.2023, this Court accepts the said undertaking.

22. In view of the aforesaid, all the employees of Air India Limited who are currently occupying the flats in Air India Colony, Vasant Vihar, New Delhi are directed to vacate the flats on or before 31.07.2023.

23. This Court notes that penal rent has been deducted from the employees who have been occupying the Air India Colony, Vasant Vihar. However, deduction of penal rent by the respondents cannot be held to be justified. On the one hand, the respondents have appointed an Estate Officer in respect of vacation of Air India Colony, Vasant Vihar, by way of Office Memorandum dated 28.09.2022 as issued by the Ministry of Housing and Urban Affairs, Land and Development Office, Government of India. On the other hand, without following the due process of law as envisaged under the PP Act, penal rent has been deducted from the Air India Employees occupying the Air India Colony, Vasant Vihar, New Delhi. Recovery of rent or damages in respect of public premises is dealt with under Section 7 of the PP Act. Therefore, no penal rent could have been deducted by the respondents randomly and in such arbitrary manner, without following the due process of law, especially when Estate Officer under the PP Act has already come to be appointed by the Government. Thus, the recovery of penal rent by the respondents from the various employees of Air India Limited occupying the Air India Colony, Vasant Vihar, New Delhi, is declared to be unlawful. Consequently, the respondents are directed to refund forthwith to the employees of Air India Limited, the amounts as deducted towards penal rent from their salaries. It is further directed that the respondents shall make no further deductions from the salary of the employees towards any penal rent, except after following due process of law.

24. The said issue regarding levy and recovery of penal rent is left open to be decided in appropriate proceedings.

25. As regards the contention of the petitioners regarding their claim for purchase of part of the property in Air India Colony, Vasant Vihar, New Delhi, as and when the respondents intend to monetise it, the petitioners/employees of Air India Limited who had been allotted accommodation in the said colony, are at liberty to make a representation to the respondents in this regard.”

16. In the present petition, there is no doubt that all the Petitioners are employees of AIESL and not of AIL. They continue to be government employees. Clause 22 of the 2017 Rules, extracted above, clearly records that if the employees are made otherwise ineligible for allotment of a residence, the employees would have to vacate their respective quarters. The AIESL, admittedly, was earlier a fully owned subsidiary of the AIL till 12th January 2022. Therefore, according to Mr. Sinha, AIESL continued to remain a subsidiary till 2022.

17. The land- which houses the said accommodation, now no longer belongs either to AIL or AIESL and now vests with the Respondent NO. 1-MoUD and the Respondent No.3-AIAHL has now been nominated as the company to monetize the assets. Thus, the lands and buildings in which the residential accommodations are situated are, post the privatisation of AIL vesting with AIAHL.

18. In view thereof, the land now being no longer available with AIESL, the Petitioners cannot claim as a matter of right that they are entitled to retain the allotment of the residential accommodation, which was allotted to them at the time when the AIESL was a subsidiary of AIL.

19. In the decision in Captain Amitabh Ranjan (supra), the ld. Single Judge has categorically held that the facility for accommodation cannot be claimed as a vested right and can only be provided depending upon the availability of such a facility. In the present petition, all the Petitioners are the engineers with AIESL. They have enjoyed their government accommodation for several years during their employment with AIESL/AIL. There are events, which have transpired including the privatization of AIL and the creation of AIAHL, which are supervening circumstances, which render the Petitioners otherwise ineligible for continuing to retain the premises, which does not belong to the AIESL any more. Further, the Respondents have deducted penal rent from the Petitioners.

20. In the overall circumstances, even the employees of the AIL can no longer occupy the said accommodation. Hence, the employees of AIESL entity, also cannot claim a better right to occupy the premises/accommodation. However, this Court is also of the view that since they continue to be employees of AIESL which is a government company, the Petitioners ought not be charged penal rent, without any prior adjudication of the same either by the Estate Officer or some other competent forum.

21. In order to ensure that sufficient opportunity is granted to the Petitioner for vacating the accomodation, which they have been occupying for several years, the following directions are issued: (1) All the Petitioners, as agreed before the Court, shall vacate the premises by 31st July, 2023. They shall hand over vacant and peaceful possession of the residential accommodation without causing any damage to the property. (2) All the charges payable such as electricity, water, gas and other municipal charges for consumption, shall also be cleared till 31st July 2023 without any dues by the Petitioners. (3) Subject to the above, the penal rents, which have been charged by Respondent No.1- Union of India and deductions, which have been made, shall be refunded to the Petitioners by 15th August,

2023. (4) In view of the fact that the Petitioners are given undertaking to vacate, which has been accepted by the Court, no proceedings under the Public Premises Act, 1971 for penalty, damages or other proceedings shall be initiated by or on behalf of the Petitioners. (5) The Petitioners are stated to have already made a representation dated 2nd March, 2023 before the Respondent No.1-Union of India for alternate accommodation. Considering the fact that Respondent No.2-AIESL continues to be a government company, let a decision be taken by the concerned authorities including the Ministry of Housing and Urban Affairs (MoHUA) and Ministry of Civil Aviation (‘MCA’) in respect of alternate accommodation within a period of 4 months.

22. With these observations, the petition along with all pending applications, is disposed of.

PRATHIBA M. SINGH JUDGE MARCH 27, 2023/dk/dn

Santosh Kumar Sahu & Ors. v. Union of India & Ors.

AI Summary

Full Text

JUDGMENT

Contact Us for a Free Consultation