E.S.I.C. & Ors. v. Joint Action Council Speciality and Doctors

1. These petitions have been filed by the petitioners challenging the Order dated 16.09.2005 (W.P.(C) 2600/2006); Order dated 18.11.2005 (W.P.(C) 1103/2008), and; the Order dated 02.08.2006 (W.P.(C) 9402/2009) passed by the learned Central Administrative Tribunal, Principal Bench, New Delhi (hereinafter referred to as, ‘Tribunal’), allowing the O.A.s filed by the respondents herein, holding that the respondents are entitled to the Transport Allowance at the rate of Rs.800/- per month, which was applicable to cities classified as Class ‘A’ in terms of the Office Memorandum dated 03.10.1997, and further restraining the petitioners from making any recovery of the alleged excess amount paid to the respondents as Transport Allowance.

2. As the three petitions raise a common question of law, they are being disposed of by this common Judgment.

3. The Government of India, by an O.M. dated 14.05.1993, issued a Special Dispensation Order, equating the city of Ghaziabad Municipal Area for purposes of House Rent Allowance (in short, ‘HRA’) and City Compensatory Allowance (in short, ‘CCA’) to Delhi. This dispensation was continued by the Office Memorandum dated 18.11.2004.

4. In the interregnum, however, by an Office Memorandum dated 03.10.1997, the rates of Transport Allowance with effect from 01.08.1997 were announced as under: “Rates of Transport Allowance w.e.f. 1.8.1997 Category/Pay Scale of the Employee Rate of Transport Allowance Rs. per month ____ “A-1”/“A” Other Class City Places

1. Rs. 8000 – 13500 or above

2. Rs. 8500 – 6900 or above but below the scale of Rs. 8000 – 13500

3. Below Rs. 6500 – 6900 and Casual Employees Granted Temporary Status. 800 400 400 200 100 75 ”

5. In the said OM, while Delhi was placed in Category ‘A’ and ‘A-1’ Cities, in Annexure-1 thereto, for the purposes of CCA, Ghaziabad was placed in Category ‘B-2’, and for HRA, it was placed in Category ‘C’.

6. Thereafter, the applicability of these new classifications was clarified vide the Office Memorandum dated 22.02.2002, which specifically stated that the special dispensation allowed in case of HRA/CCA with respect to classification of Cities is not applicable to the Transport Allowance. We quote the same as under: “…The special dispensation extended to HRA/CCA is not applicable to the transport allowance”

7. Subsequently, an Office Memorandum dated 10.08.2005 was issued, which directed the respondents to effectuate recoveries of the excess amounts erroneously paid for Transport Allowance.

8. By Notices dated 07.01.2005 and others, the petitioners sought to make recoveries of the excess amount paid as Transport Allowance to the respondents by treating Ghaziabad to continue to be Class ‘A’ City for purposes of Transport Allowance due to the special dispensation that was applicable only to the HRA/CCA. These recovery notices were challenged by the respondents before the learned Tribunal.

9. The learned Tribunal, by the Impugned Orders, has allowed the O.A.s filed by the respondents, stating that the special dispensation for purposes of HRA/CCA shall entitle the respondents and shall extend the said benefit even for Transport Allowance.

10. The learned counsel for the petitioners submit that the above is in clear contradiction to the O.M. dated 03.10.1997 and specifically in terms of the clarification thereof provided in the OM dated 22.02.2002.

11. On the other hand, the learned counsel for the respondents submits that once the HRA/CCA benefit of Delhi is extended to Ghaziabad, there is no reason why Transport Allowance should also not be paid at the same rate as applicable to Delhi.

12. She submits that Ghaziabad being a city contiguous to Delhi, it is also reasonable that the same Transport Allowance should be extended to the respondents at the rates applicable to Delhi.