K.I. SHEPHARD & ORS. ETC. ETC. versus UNION OF INDIA & ORS.

K.I. SHEPHARD & ORS. ETC. ETC. versus UNION OF INDIA & ORS.

Rules of natural justice must be complied with in the administrative exclusion of employees under section 45 amalgamation schemes; excluded employees must be named in the draft scheme and given opportunity to be heard before finalization; post-decisional hearing is insufficient.

Parties
Petitioner: K.I. Shephard & Ors. etc. etc.; Respondent: Union of India & Ors.; Respondent: Reserve Bank of India; Intervener: E.C. Aggarwala and D.D. Gupta
Jurisdiction
India
Judgment Date
18 September 1987
Procedural Posture
Writ Petition and Appeals by Special Leave / Supreme Court Final Decision
Outcome
Petitions and appeals allowed; judgments of Single Judge and Division Bench of Kerala High Court set aside.
Legal Topics
Amalgamation of Banks, Doctrine of Natural Justice, Rules of Evidence, Employee Exclusion, Legislative Character of Scheme
Constitutional Law Administrative Law Labour Law Banking Law Amalgamation of Banks Doctrine of Natural Justice Rules of Evidence Employee Exclusion +1 more

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Parties

K.I. Shephard & Ors. etc. etc.

Petitioner

Union of India & Ors.

Respondent

Reserve Bank of India

Respondent

E.C. Aggarwala and D.D. Gupta

Intervener

Procedural Posture

Writ Petition and Appeals by Special Leave / Supreme Court Final Decision

Legal Issues

  1. 1 Whether rules of natural justice apply to the administrative action of excluding employees from service under amalgamation schemes framed under section 45 of the Banking Regulation Act, 1949
  2. 2 Whether employees intended for exclusion should be named in the draft scheme and given opportunity to be heard
  3. 3 Whether the scheme-making process under section 45 is legislative, precluding natural justice

Ratio Decidendi

Rules of natural justice must be complied with in the administrative exclusion of employees under section 45 amalgamation schemes; excluded employees must be named in the draft scheme and given opportunity to be heard before finalization; post-decisional hearing is insufficient.

Court Disposition

Petitions and appeals allowed; judgments of Single Judge and Division Bench of Kerala High Court set aside.

Orders

  • Each transferee bank (Punjab National Bank, Canara Bank, State Bank of India) to take over the excluded employees on the same terms and conditions of employment as prior to amalgamation.
  • Excluded employees entitled to benefit of continuity of service for all purposes including salary and perks throughout the period.