IN THE HIGH COURT OF JUDICATURE AT BOMBAYutiamcofficersassociation.in/archive/2017_UOA Writ Petition Copy.pdf · IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL

IN THE HIGH COURT OF JUDICATURE AT BOMBAY

ORDINARY ORIGINAL CIVIL JURISDICTION

WRIT PETITION NO. OF 2011

In the matter of Article 226 of the

Constitution of India;

And

In the matter of Article 14, 16 and

21 of the Constitution of India;

And

In the matter of absolute lack of

transparency in the functioning of

the Respondent No. 5 with specific

reference to arbitrary grant of

disproportionately huge ad-hoc

payments under the guise of

executive allowance / special

executive allowance and

performance linked incentive

thereupon resulting into substantial

loss/appropriation of public money

due to wrongful and illegal actions

of the higher officials at the helm of

the affairs of the Respondent No. 5

who kept increasing emoluments of

few selected officers including

2

themselves at the cost of majority of

remaining officers who were left to

survive on an yearly increment of

Rs.900/- or so for more than a

decade from 2001.

And

In the matter of Impugned Order

and Decision dated 9.8.2011 and

impugned Administration Cir No.

9/2009-10 Dated 28/8/2009 and

impugned Administration Cir. No.

18/2010-11 dated 18/2/2011

issued by the Respondent No.5

arbitrarily discriminating amongst

the employees of the Respondent

No.5 ignoring the laws and rules

under UTI Staff Rules 1978 as

amended time to time and

Renamed as UTI AMC (Staff Rules)

2003 by which the service condition

of the employees of the

Respondent No.5 are governed;

and arbitrary & discriminatory

Payment of Very High/

Disproportionately huge Executive

Allowance and Perquisite amongst

3

senior officers and few selected

officers and those recruited after

2005 of the Respondent No.5

And

In the matter of Agreement Signed

between the President of India and

Four Sponsors/Shareholders of

Respondent No. 5 i.e SBI, LIC, PNB

& BOB to cause the UTI AMC Ltd to

comply with the Unit Trust of India

(Transfer of Undertaking and

Repeal) Act, 2002 in connection

with employees

And

In the matter of violation of Section

6 (1) of Unit Trust of India (Transfer

of Undertaking and Repeal) Act,

2002, on the part of the

Respondents resulting into inaction

to protect and provide the interest of

employees and to redress the

grievances of the Petitioner which

were brought to the notice of the

Respondent No. 4 and 5 on various

occasions and finally vide letter

dated 19.8.2011 wherein the

4

illegalities and wrongs committed by

the Respondent No 5 were

specifically detailed;

And

In the matter of ad-hoc and arbitrary

distribution of disproportionately

huge payments running into several

lakhs each per annum, among the

senior officers who are at the helm

and some other chosen officers and

associates since year 2004-05

without declaration of any criteria,

policy, administration circular or

declared mandate of the Board of

Directors for making such ad-hoc

payments

And

In the matter of arbitrary, secret and

undeclared distribution of company

resources since the year 2004-05

by senior officials mostly among

themselves and their chosen

associates towards ad-hoc

Executive Allowance without any

declared policy as well as the

consequent wrongful payment of

5

variable pay ( performance Linked

Incentive ) in gross violation of the

criteria laid down and guidelines

circulated among staff vide

Administration Circular no. 18/2002-

2003 dated June 11, 2003 and

wrongful and arbitrarily huge

payment running into several lakhs

each again towards performance

linked incentive illegally and in

gross violation of staff rules and

policy laid down, wrongfully taking

into account the Ad-hoc Executive

Allowance paid to officers in a

financial year, instead of as

prescribed only on the basic pay as

mandated and approved by the

Board of UTI AMC and circulated

among staff vide the said

administrative circular no. 18/2002-

2003 dated June 11, 2003, whereby

guidelines / criteria were laid down

for payment of performance linked

incentive for the officers, provision

of which have been flouted blatantly

by senior officials to benefits mostly

6

themselves illegally, secretly along

with some other chosen officers,

who help them in such wrongful

appropriation of company

resources, at the cost of large

number of remaining officers

And

In the matter of Administration

Circular No.18-2002-2003 dated

June 11, 2003, provisions of which

are being deliberately, arbitrarily

and blatantly violated by higher

officers who are at the helm to

benefit mostly themselves and their

chosen officers by payment of

undue Performance Linked

Incentive taking into account the ad-

hoc payment of executive

allowance, which itself is not

payable as per the rules. As per the

Administration Circular No.

18/2002-2003 dated June 11, 2003

the performance Linked Incentive is

to be calculated on the basic pay

only. However, to benefits

themselves the higher officials who

7

get disproportionately huge

executive Allowance have in gross

and blatant violation have also

started taking Performance Linked

Incentive on the amount of ad-hoc

payment of Executive Allowance,

which itself is being paid arbitrarily

in violation of the rules.

And

In the matter of arbitrary allotment

of bands to all the officers by senior

officials at the helm to benefits

themselves and their chosen

officials by allotting higher bands to

get better / higher benefit than they

are entitled to as per the rules and

lower bands to large number of

officers who though are much

senior and experienced to cut down

their legitimate entitlements and

privileges as enshrined in the

legally protected staff rules and

service conditions, under Section 6

(1) of the UTI (Transfer and Repeal)

Act, 2002, without declaring any

policy, guidelines, circulars, in

8

disregard to the seniority and

existing grades of the officers and

without laying down any criteria for

mapping of bands with the existing

grade and seniority of the officers,

to arbitrarily curtail grade based

legally protected benefits and

privileges to officers of erstwhile

Unit Trust of India under Section 6

(1) of the Unit Trust of India

(Transfer of Undertaking and

Repeal) Act, 2002.

And

In the matter of appointment of

approximately more than 600

employees by the Respondent No.

5 on various posts in an arbitrary

and discriminatory manner violating

established norms in public

companies / PSUs without issuing

public notice for filling up the said

posts and also without giving due

weightage to the suitability or

competitiveness of such candidate

recruited for the said post vis-à-vis

other candidates as well as internal

9

candidates who were not given an

opportunity to compete for the said

posts, despite being much more

experienced and more qualified

than those recruited by Respondent

No.5.

All India UTI AMC Officers’ Association )

Having its registered office at )

Dadyseth House, 1st floor (Rear), )

Nanabhai Lane, Fort, )

Mumbai 400 023. )…Pétitionner

Versus

1. Union of India )

Through the Ministry of Finance )

& Company Affairs (Department )

Of Economic Affairs & )

Financial Services )

Presently through its Regional Office,)

At Aykar Bhavan, Churchgate, )

Mumbai. )

2. Comptroller and Auditor General )

of India, )

having its office at 9, Deen )

Dayal Upahdyay Marg, )

New Delhi )

10

3. Mr. U. K. Sinha, )

Ex-Chairman & Managing Director,)

UTI AMC Ltd., and presently )

Chairman of SEBI, having office )

at Plot No. C4-A, G Block, )

Bandra Kurla Complex, )

Bandra (East), )

Mumbai 400 051 )

4. UTI Trustee Company Pvt. Ltd. )

through its Chairman, )

Having its registered office at )

UTI Tower, “Gn” Block )


Bandra (E), Mumbai 400 051 )

5. UTI Asset Management Company )

Ltd., )

through its Chairman and MD

[presently in the absence of Chairman )

& MD through the Committee of Executives])

having its registered office at )




6. Ms. Anita Ramchandran, )

Director on the Board of )

UTI AMC Ltd, and Chairperson )

11

of the HR Committee of )

UTI AMC Ltd. and also )

Founder and CEO of )

Cerebrus Consultants, )

having office at 405, Kakad )

Chambers, 135, Dr. Annie )

Besant Road, Worli, )

Mumbai 400 018 )

7. Shri T. N Radhakrishna )

Head-HR )

UTI Asset Management Company Ltd,)





8. Shri S. C. Dikshit, )

Chief Vigilance Officer & )

Chief Legal Adviser & )

Compliance Officer and )

Head-Internal Audit and )

Risk Management, )

UTI Asset Management Company Ltd,)





12

9. State Bank of India, )

Through its Chairman, )


State Bank Bhawan, Madam )

Cama Road, Nariman Point, )

Mumbai 400021 )

10. Life Insurance Corporation )

of India, )

Through its Chairman, )


Yogakhshema, Jeevan Bhima Marg,)

Nariman Point, Mumbai 400021 )

11. Punjab National Bank, )

Through its Chairman and )

Managing Director, )


7, Bhikaji Cama Place, )

New Delhi 110066. )

12. Bank of Baroda, )

Through its Chairman and )

Managing Director, )

having its corporate office at )

Baroda Corporate Centre, )

C-26, G Block, Bandra Kurla )

Complex, Bandra East, Mumbai )

400051 ) .. Respondents

13

TO,

THE HON’BLE CHIEF JUSITCE AND OTHER HON’BLE

PUISNE JUDGES OF THE HON’BLE HIGH COURT OF

JUDICATURE AT BOMBAY

THE HUMBLE PETITION OF THE

PETITIONER ABOVENAMED:

MOST RESPECTFULLY SHEWETH:

1. The Petitioner is a separate legal entity

registered on 30.3.2011, having approximately 550

members all of whom are presently employed as Officers

with various designations and Grades with the

Respondent No. 5. The majority of membership of the

Petitioner is of officer’s/employees who were the

employees of the erstwhile UTI before the enactment of

the UTI (Transfer of Undertaking and Repeal) Act, 2002

and which employees have now continued their services

with the Respondent No. 5 and are covered and protected

under Section 6(1) of the UTI (Transfer of Undertaking and

Repeal) Act, 2002

2. The Respondent No.1 is the Government at

whose behest a special enactment known as Unit Trust of

India Act was enacted in 1963 and also at whose behest

14

Unit Trust of India (Transfer of Undertaking and Repeal)

Act, 2002 came to be enacted pursuant to which the

Respondent Nos. 4 and 5 came into existence.

3. The Respondent No. 2 is a constitutional

authority responsible for carrying out audit of accounts of

the Union and States and of any other authority or Body as

may be prescribed by or under any law made by

Parliament. As on date and prior thereto the Respondent

No. 2 has been and is carrying out audit of the

Respondent No. 5 in accordance with the provisions of the

Companies Act, 1956 with particular reference to Section

619 (2), Section 619 (3)(b) and Section 619 (4)

empowering the CAG to appoint / re-appoint statutory

auditor of a Government Company; to conduct a

supplementary or Test Audit; and to comment upon or

supplement the Audit Report in such manner as the CAG

may think fit.

4. The Respondent No. 3 is the ex-chairman and

Managing Director of the Respondent No. 5 and that he

was in the tenure as the CMD of the Respondent No. 5

from the period November, 2005 to February, 2011. The

Respondent No. 3 has been joined as a party to the

present proceedings because during his tenure various

wrongs and illegalities have been committed which wrongs

15

and illegalities have enhanced resulting into the filing of

the present Petition.

5. The Respondent No. 4 and 5 are separate

legal entities established and constituted by Respondent

No 1 under the UTI Repeal Act, 2002 whose entire 100%

shareholding at the time of their creation as an

undertaking in the year 2003 was held exclusively by

Respondent Nos. 9 to 12 upto January, 2010 after which it

is now reduced to 74% instead of the earlier 100%.

6. The Respondent No. 6 is a Director on the

Board of UTI AMC Ltd. i.e. Respondent No. 5 since

January, 2006 and she is also the Chairperson of the HR

Committee of the Respondent No. 5 responsible for

finalizing all policies relating to Human Resources. The

Respondent No. 6 is also a Director on the Board of

Cerebrus Consultants which company presumably is

controlled and managed and owned by the Respondent

No. 6. In fact Respondent No. 6 is the main person

responsible for all the arbitrary recruitments made by the

Respondent No. 5 over the last many years and more

particularly from the date when she resumed in the office

and designation wherein she is presently working.

16

7. The Respondent No. 7 is an employee of the

Respondent No. 5 and is the Principal Officer responsible

for formulating and implementing the human resources

policy of the Respondent No. 5. The Respondent No. 7 is

also the person under whose signature the impugned

order and decision dated 9.8.2011 and Administration

Circular No. 9/2009-10 Dated 28/8/2009 and

Administration Circular no. 18/2010-11 dated 18/2/2011

have been issued.

8. The Respondent No. 8 is the employee of the

Respondent No. 5 who has been continued in regular

employment by the Respondent No. 5 even upon and after

his retirement on 28.2.2011 upon attaining the age of 58

years as per Rule 21(1) of UTI AMC Staff Rules, 2003 and

even upon and after receiving all his retirement legal

dues. In fact Respondent No. 8 has been continued in

regular employment under the same employee Code No.

930 which Code was assigned to and used by the

Respondent No. 8 prior to his retirement and Respondent

No. 8 has been assigned the same powers and functions

and charge of the departments that were assigned to him

prior to retirement. Respondent No. 8 is continuing to hold

same portfolio and heading the most critical functions

namely Vigilance, Internal Audit, Compliance, Legal and

Risk management which he had been heading even

17

before his retirement for the last several years. He has

also been a beneficiary of large ad-hoc payments running

into lakhs of rupees every year without any transparent,

declared criteria or policy and also the consequent

wrongful payment of huge Performance Linked Incentive

in violation of the provision of the Administration Circular

no. 18/2002-2003 dated June 11, 2003, during the last

several years.

9. The Respondent No. 9 to 12 are sponsors of

Respondent No. 5 and are separate legal entities

established and/or controlled by the Central Government,

which entities on and from 2002/2003 onwards i.e. at the

time of enactment of the Unit Trust of India (Transfer of

Undertaking and Repeal) Act, 2002, and after have

exclusively held 100% shareholding of the Respondent

Nos. 4 and 5 upto January, 2010 after which the exclusive

shareholding has reduced from 100% to 74%.

10. The Petitioner submits that the Petitioner would

like to narrate the facts that have resulted into filing of the

present Petition.

a) Sometime on or about 1963 by a special

Parliamentary enactment UTI as a separate

18

legal entity is brought into existence by the

Respondent No. 1.

b) Sometime on or about 1978 UTI Staff Rules

were brought into existence by the erstwhile

UTI and the said Rules were continued and

are continuing even as on date though in a

different name even after the enactment of

the UTI (Transfer of Undertaking and

Repeal Act), 2002. Hereto annexed and

marked as Exhibit “A” is the copy of the

UTI (Transfer of Undertaking and Repeal

Act), 2002. Hereto annexed and marked as

Exhibit “B” is the copy of the Transfer

Agreement dated 15th January, 2003

executed between Respondent No. 1 and

Respondent Nos. 9 to 12 with specific

reference to the Respondent No. 4 and 5.

Hereto annexed and marked as Exhibit “C”

is the copy of the Notification dated 15th

January, 2003 issued by the Respondent

No. 1 with specific reference to powers of

the Respondent No. 4 in relation to

Respondent No. 5 and employees of

erstwhile UTI who have continued with

Respondent No. 5.

19

c) Sometime on or about 2003, pursuant to

UTI Repeal Act, 2002, the Respondent No.

5 renamed the existing UTI Staff Rules,

1978 with UTI Asset Management

Company (Staff) Rules, 2003 which fact is

clearly evident from the Adm. Cir No.

1/2002-2003 dated 1.2.2003 and Adm.

Circular No. 13/2003-2004 dated 19/8/2003.

Hereto annexed and marked as Exhibit “D”

is the copy of Admn. circular No. 1/2002-

2003 dated 1.2.2003. Hereto annexed and

marked as Exhibit “E” is the copy of Adm.

Circular No. 13/2003-2004 dated 19/8/2003.

Hereto annexed and marked as Exhibit “F”

is the copy of the UTI AMC Staff Rules

2003.

d) Sometime on or about March 2004, the

Respondent No. 5 also rationalized Pay-

Scale of Officer Cadre and various

perquisites based on Grade System as

defined under UTI Staff Rules 2003 as is

evident from the Adm. Cir No. 50, 51, 52, &

53 of 2003-2004 all dated 31/3/2004 in view

of UTI Repeal Act’ 2002 preserving the

sanctity of Grade System as defined under

20

Staff Rules. Hereto annexed and marked as

Exhibit “G” “H” “I” and “J” are the copies

of Adm. Cir No. 50, 51, 52, & 53 of 2003-

2004 all dated 31/3/2004 respectively.

e) Sometime on or about 2005, Respondent

No. 3 was appointed as the Chairman and

Managing Director of the Respondent No. 5

and he continued as a Chairman and

Managing Director upto February, 2011. The

appointment of the Respondent No. 3 as

above mentioned was made at the behest of

the Respondent No. 1 since at the time of

the appointment in the year 2005 upto May

2008 the Respondent No. 3 was an IAS

Officer and in employment of the

Respondent No. 1. In fact Respondent No. 3

was deputed by the Respondent No. 1 with

the Respondent No. 5. During the tenure of

Respondent No. 3 the following wrongs and

illegalities in the functioning of the

Respondent No. 5 were committed:

i) The mandate of the Board of Trustees

of the erstwhile UTI which were

required to be mandatorily and

21

statutorily followed as per the UTI

Repeal Act with specific reference to

revision in the salary of the officers

every three years who had continued

in service with the Respondent No. 5

was not followed. The aforesaid wrong

and illegality was committed in total

contrast to the fact that revision in

salary of the Class III (clerical staff)

and Class IV (subordinate staff)

employees of the Respondent No. 5

that was given effect to and their

salary scales have been revised twice

during the period of last 10 years. In

fact a chart annexed and marked as

Exhibit “K” hereto clearly indicates

that Class III Class IV employees are

drawing more salaries than the officers

in the higher grades.

ii) In an arbitrary and discriminatory

manner the salary of certain chosen

officers of the Respondent No. 5 were

enhanced without any justifiable

reason under the guise of executive

allowance without any specific policy

22

being formulated and declared by the

Respondent No. 5 for grant of

executive allowance. Obviously the

intention behind grant of executive

allowance over and above the pay-

scales given to officers of respective

grades was to enhance the gross

salaries of selected few who were

ignoring the wrongs and illegalities

being committed within the

Respondent No. 5. In fact the

emolument paid to the Respondent

No. 3 for the year ended 31st March,

2006 was Rs.2,52,159/- (Rupees Two

Lakhs Fifty Two Thousand One

hundred fifty nine only) which

increased to Rs.2,46,25,288/- (Rupees

Two Crores Forty six lakhs twenty five

thousand two hundred and eighty eight

only) for the year ended 31st March,

2008. Hereto annexed and marked as

Exhibit “L” is the copy of the extract

of the remuneration of Directors from

audited financial statement of the

Respondent No. 5 for the year ended

31st March, 2006. Hereto annexed and

23

marked as Exhibit “M” is the copy of

the extract of the remuneration of

Directors from audited financial

statement of the Respondent No. 5 for

the year ended 31st March, 2008. For

illustration purposes the Petitioner is

citing a glaring example of Mr.

Imtaiyazur Rahman who despite being

the Chief Financial Officer of the

Respondent No. 5 has been receiving

wrongful and illegal benefit of the

executive allowance and consequent

wrongful performance linked incentive

(variable pay) running into several

lakhs every year since the year 2004-

05. He joined Respondent No. 5 on

deputation as Company Secretary for

a limited period of 3 years in March

2003 on a salary of around Rs. 5

Lakhs per annum but he started

receiving Rs.1 Lakh per month

towards ad-hoc executive allowance

on and from January, 2005 which has

presently in the year 2011 risen to

approximately Rs. 5 Lakhs per month

and his total salary has risen from

24

Rs.5 Lakhs per annum in 2004 to over

Rs.60-70 Lakhs per annum. Apart

from the aforesaid he is also receiving

variable pay based on his ad-hoc

executive allowance and therefore

gross salary per annum drawn by him

comes to approximately Rs. 1 Crore,

whereas majority of remaining officers

were left to survive on an yearly

increment of Rs.900/- or so for more

than a decade from 2001. The

Petitioner submits that it has received

information and presumably the

appointment and continuation of Mr.

Imtaiyazur Rahman with Respondent

No. 5 itself is wrong and illegal under

the law as he continued with

Respondent No. 5 even after expiry of

his deputation in Respondent No. 5

but at this stage since the Petitioner is

in the process of collecting cogent

material to substantiate the same, the

Petitioner craves leave and liberty to

refer and rely upon such material as

and when available to the Petitioner.

Another glaring example is the case of

25

Mr. Satish C. Dikshit (Respondent No.

8) the Chief Vigilance Officer of

Respondent No. 5 who has also been

receiving large amounts running into

several Lakhs every year towards

adhoc executive allowance and

consequent performance linked

incentive in the last 6 to 7 years in

violation of rules and guidelines as laid

down in administration circular

No.18/2002-2003 dated 11th June,

2003.

iii) To cover up the wrongs and illegalities

of enhancement of gross salaries of

selected few officers as pointed above,

in arbitrary and discriminatory manner

under the guise of ad-hoc executive

allowance substantial increase in

salary was effected for very few

selected officers which comprised of

approximately 10% of the total

strength of the officers ignoring the

large number of remaining officers

whose salary scales were not revised

for a decade after 2001. In fact the

26

aforesaid 10% officers referred to

above have withdrawn and continue to

withdraw almost 80% of the total ad-

hoc payments towards executive

allowance, special executive

allowance and performance linked

incentive thereupon paid by the

Respondent No. 5 at the cost of

remaining 90% officers who were

discriminated. Hereto annexed and

marked as Exhibit “N” is the list of

officers who are getting

disproportionately huge executive

allowance and consequent

performance linked incentive (variable

pay). It would be important to note that

other officers comprising almost 90%

of the total strength of the officers are

withdrawing low, negligible or in

certain cases Nil executive allowance.

The Petitioner submits that the

Respondent No. 5 be directed to

produce before this Hon’ble Court on

affidavit the quantum of payments

made under the name of executive

allowance, special executive

27

allowance and performance linked

incentive to all its officers from the

year 2004-05 onwards till date, which

will clearly indicate the aforesaid

wrong and illegality. The aforesaid

request is being made before this

Hon’ble Court since the expenditure of

the Company towards salary and

allowances rose from Rs.58.40 Crores

in the year 2004-05 to Rs.128.22

Crores in the year 2009-10 as is

evident from the balance sheet of the

Respondent No. 5, whereas there has

been no revision or enhancement in

the basic pay scales of all its officers

from 2001 to 2010. Hereto annexed

and marked as Exhibit “O” is the

copy of chart disclosing the

Employees Cost Comparison as

disclosed in the Balance Sheets of the

Respondent No. 5 from the year 2004

till 2010.

iv) During the period 2006 till 2011 almost

600 employees of the Respondent No.

5 falling within the officers grade are

28

arbitrarily recruited and appointed

without issuance of any public

advertisement and without allowing

candidates to compete amongst

themselves for the said posts. In fact

apart from non issuance of public

advertisement the appointments are

made arbitrarily and contrary to the

Staff Rules of the Respondent No. 5.

At the time of the aforesaid wrongful

and illegal appointments no

consideration is given to competition

amongst candidates by issuance of

public advertisements, no

consideration is given to promotion to

internal candidates who are equally or

more qualified, no consideration is

given to placing the wrongfully and

illegally appointed candidates in a

particular grade as specified in the

Staff Rules. It is interesting to note that

upon appointments of the wrongfully

and illegally appointed candidates,

they were given designations and

remunerations in total contravention of

the Staff Rules and as per the whims

29

and fancies designations and

remunerations were given. The

aforesaid arbitrary and discriminatory

approach is clearly evident from the

seniority list obtained upto 20.7.2010

which discloses the aforesaid factual

position. Hereto annexed and marked

as Exhibit “P” is the copy of the

seniority list obtained upto 20.7.2010.

Hereto annexed and marked as

Exhibit “Q” is the copy of the Chart

disclosing the commission paid by the

Respondent No. 5 in some cases to

certain placement agencies during last

few years. Hereto annexed and

marked as Exhibit “R” is the chart

disclosing the wrongful and illegal

appointments who had no professional

qualification and / or relevant

experience though in an arbitrary and

discriminatory manner have been

appointed in senior posts. Hereto

annexed and marked as Exhibit “S”

is the chart disclosing the illegal

promotion/ elevation and change of job

status. For the illustration purpose the

30

Petitioner is giving the example of Mr.

Jaideep Bhattacharya who has

wrongfully and illegally taken benefit of

his wrongful and illegal appointment.

Jaideep Bhattacharya was appointed

as Chief marketing Officer on very

huge costs to company (CTC) as

understood of Rs.90,00,000/- per

annum in the year 2006 for which

Rs.16,76,865/- were paid to M/s Light

House Partners, New Delhi towards

profession placement charges

through private recruitment agency by

paying a commission of over Rupees

Sixteen Lakhs, though he had no

experience at all of mutual fund

industry and did not even possess the

requisite certification from the

Association of Mutual Fund, as

mandatory for all the officials involved

in marketing activities of any mutual

fund. He further continued to be

employed despite the fact that he

could not obtain Association of Mutual

Fund in India (AMFI) certification for

almost three years. The appointment

31

of Chief Marketing Officer (CMO) was

itself arbitrary and against the

provisions of the staff rules and

internal candidates, who were much

more experienced, much more

qualified having professional

qualifications and AMFI certified, were

overlooked. The Assets Under

Management (AUM) of UTI AMC have

not increased in proportion with the

increase in the mutual fund industry.

The fact is that Respondent No. 5 has

lost market share and has slipped from

No.1 ranking in the mutual fund

industry to No. 4 in the Mutual Fund

Industry after his appointment as the

Chief Marketing Officer and despite

the payment of over a crore of rupees

to him every year for the last five

years.

v) No transparency was observed by the

Respondent No. 5 in making

allotments while implementing

Employee Stock Option Plans (ESOP)

in the year 2007 and ESOPs were

32

allotted arbitrarily without declaring the

criteria and without taking the seniority

and grade of the officers instead new

recruits were allotted much higher

number of ESOPs than the senior

officers who have served the

company in the range of 20 – 30

years. In fact 16% of total ESOPs

were allotted to only top 10 officials of

the Respondent No. 5 which included

Shri U. K. Sinha, Chairman and

Managing Director, Shri Imtyazur

Rahman, Chief Financial Officer, Shri

Jaideep Bhattacharya, Chief Marketing

Officer along with other senior high

ranking officers. Out of the remaining

most of the portion was allotted to new

recruits and selected other officers and

the remaining was allotted to the

remaining other officers of the

Respondent No. 5. The aforesaid was

done without giving any justifiable

reason for the same and without any

criteria being fixed for allotment of

ESOP. The Petitioner requests this

Hon’ble Court to direct the

33

Respondent No. 5 to produce on

affidavit the records of the Respondent

No. 5 relating to allotment of ESOP in

the year 2007 and thereafter.

vi) Sometime on or about 1st April 2008

for the first time a surprise

communiqué was flashed on the

intranet site of Respondent No. 5

stating that with immediate effect the

grade mentioned in the salary slip

given to all employees would be

replaced with Bands without bringing

out any Administrative or Office

Circular and properly circulating the

same amongst the staff members.

Hereto annexed and marked as

Exhibit “T” is the copy of the

communiqué dated 1st April, 2008. The

Petitioner submits since the aforesaid

communiqué was wrong and illegal

under the law upon protests being

made the said communiqué was

immediately withdrawn from the

intranet site of the Respondent No. 5.

34

vii) Sometime on or about 2009, the

Respondent No. 5 issues

Administration Circular No. 9 /2009-

2010 dated 28/8/2009 whereby “New

Banding System – Consequent

Revision in Entitlement of Facilities” is

implemented resulting into gross large

scale indiscriminate changes into the

Seniority of the employees as well as

perquisites drawn by the employees

based on grade and seniority. Hereto

annexed and marked as Exhibit “U”

is the copy of the impugned

Administration Circular No. 9/2009-

2010. During the issuance and

implementation of the aforesaid

circular resulting into Band System no

efforts were taken to take into

consideration factors such as seniority

of the existing officers and their

respective grades which determined

their pay packets and therefore the

circular resulted into large scale

arbitrary discrimination amongst the

officers of the Respondent No. 5. In

fact the entire circular is contrary to the

35

UTI Staff Rules and the UTI Repeal

Act, since there is no such provision

for bringing in Band System to replace

or supplement the grade system

envisaged and mandated under the

UTI Staff Rules and protected under

the provisions of the UTI Repeal Act.

viii) Provisions of Administration Circular

No. 18-2002-2003 dated June 11,

2003, are being deliberately, arbitrarily

and blatantly violated by Higher

officers who are at the helm to benefit

mostly themselves and their chosen

officers by payment of undue

Performance Linked Incentive taking

into account the ad-hoc payment of

executive allowance, which itself is not

payable as per the rules. As per the

Administration Circular No. 18/2002-

2003 dated June 11, 2003 the

performance Linked Incentive is to be

calculated on the basic pay only.

However, to benefits themselves the

higher officials who get

disproportionately huge executive

36

Allowance have in gross and blatant

violation have started taking

Performance Linked Incentive on the

amount of amount of ad-hoc payment

of Executive Allowance, which itself is

being paid arbitrarily in violation of the

rules. Hereto annexed and marked as

Exhibit “V” is the copy of

Administration Circular No. 18-2002-

2003 dated June 11, 2003.

f) Sometime on or about 2011, the

Respondent No. 5 issues Administration

Circular No. 18/2010-2011 dated 18/2/2011

on Growth Opportunities under the New

banding System whereby the Banding

System introduced surreptitiously has been

sought to be made the basis for further

growth and career prospects resulting into

gross large scale indiscriminate changes

into the Seniority of the employees as well

as affecting adversely their growth and

career progression prospects. Hereto

annexed and marked as Exhibit “W” is the

copy of the Administration Circular No.

18/2010-2011 dated 18/2/2011.

37

g) Sometime on or about 30.3.2011 the

Petitioner is incorporated with a membership

of approximately 550 members since

individual and collective efforts by the

employees/officers of the Respondent No. 5

to air their grievances have not borne any

results.

h) Sometime on or about 15.4.2011 under the

guise of transfers, many committee

members and office bearers of the Petitioner

are suddenly transferred to far of and

remote places out of Mumbai and other

Centres by the Respondent No. 5 with

malafide intentions. The issue of transfer of

the office bearers and committee members

of the Petitioner is pending before the

Hon’ble Court and therefore the Petitioner is

restraining itself from making any further

comments on the said issue, but craves

leave and liberty of this Hon’ble Court to

refer and rely upon the said facts if

necessary.

i) Sometime on or about 9.8.2011 the

Respondent No. 5 issues the impugned

38

letter dated 9th August, 2011 whereby the

decision of the Respondent No. 5 is

communicated to all its employees that

w.e.f. August, 2011 the salaries of the

employees would be paid in a revised

manner by merging the basic pay of the

employee based upon his grade along with

the Executive Allowance given to the said

employee, arbitrarily demolishing the age

old and established grade and seniority

based basic pay structure, altogether again

to give more benefit to those who were

already getting huge executive allowance

and consequent variable pay for the last

several years. By merging the Executive

Allowance with Basic Pay, the Respondent

No. 5 is seeking to legalise / regularize the

Executive Allowance so that it can be

considered for terminal benefits as against

its own stated position / admission. By

merging the Executive Allowance with Basic

Pay, the Respondent No. 5 is not only

discriminating against those employees who

are senior but also contravening its own

stated position / admission that payment of

Executive Allowance and its continuation

39

shall be completely at the sole discretion of

the Management and can be increased,

reduced or eliminated at the sole discretion

of the Management at any time and the

Executive Allowance shall not be considered

for calculating / determining any terminal

benefits. The merger of Executive

Allowance with Basic Pay based upon grade

will result in Executive Allowance being

considered for calculation of Terminal

Benefits, contrary to the stated position /

admission of Respondent No. 5. Hereto

annexed and marked as Exhibit “X” is a

copy of the letter dated 7/7/2011 issued by

Respondent No. 7 as the President and

Head HR of Respondent No. 5. Hereto

annexed and marked as Exhibit “Y” is the

copy of the impugned letter dated 9th

August, 2011. Presumably the impugned

letter dated 9th August, 2011 is issued by the

Respondent No. 5 since the Respondent

No. 5 is informed that the employees of the

Respondent No.5 and more particularly the

officers of the Respondent No. 5 who also

happen to be the members of the Petitioner

were contemplating approaching the

40

Hon’ble Courts for appropriate reliefs

pointing out the arbitrary and discriminatory

approach adopted by the Respondent No. 5

in making payments to selected officers

under the guise of ad-hoc executive

allowance and consequent wrongful

performance linked incentive. The

Respondent No. 5 also issued the impugned

letter dated 9th August, 2011 apparently

because the Respondent No. 5 was facing

proceedings i.e. Contempt Petition No. 45 of

2011 initiated by the Petitioner sometime on

or about 30th June, 2011. The Petitioner

submits that upon the implementation of the

impugned letter dated 9.8.2011 the gross

discrepancies that have occurred in the

gross salaries of the officers / employees of

the Respondent No. 5 are detailed and

described in the chart which is annexed and

marked as Exhibit “Z” hereto. The chart

clearly discloses that the junior officials are

getting higher gross salaries as compared to

the senior officials to whom the junior

officials are subordinate, which is against

the law of the land.

41

j) Sometime on or about 19.8.2011 the

Petitioner through its advocate issues a

letter to the Respondent No.5 requesting

the Respondent No. 5 to immediately and

forthwith redress all the grievances of the

Petitioner recorded in the said letter which

grievances form subject matter of the

present proceedings. Hereto annexed and

marked as Exhibit “AA” is the copy of the

letter dated 19.8.2011 addressed to the

Respondent No. 5. Hereto annexed and

marked as Exhibit “BB” is the copy of the

reply dated 23.8.2011 in response to the


Respondent No. 5.

k) Sometime on or about 19.8.2011 the

Petitioner through its advocate issues a

letter to the Respondent No.4 requesting

the Respondent No. 4 to immediately and

forthwith redress all the grievances of the

Petitioner recorded in the said letter which

grievances form subject matter of the

present proceedings. Hereto annexed and

marked as Exhibit “CC” is the copy of the


42

Respondent No. 4. Hereto annexed and

marked as Exhibit “DD” is the copy of the

reply dated 25.8.2011 in response to the


Respondent No. 4.

l) Sometime in the month of August 2011,

approximately 350 officers who also happen

to be the members of the Petitioner

individually sign protests letters and by

submitting the same with the office of the

Respondent No. 5 protest the issuance and

implementation of the impugned letter dated

9.8.2011. Similarly such protest letters were

submitted earlier by approximately 550

officers who had protested on 9th March,

2011 against the arbitrary and forceful

implementation of the banding system by

the Respondent No. 5. The Petitioner will

submit a separate compilation of the

aforesaid protest letters of 350 officers and

550 officers separately at the time of hearing

before this Hon’ble Court.

m) Sometime on or about September, 2011 the

Petitioner decides to initiate the present

43

proceedings seeking appropriate reliefs

since inspite of the aforesaid protests by the

Petitioner as well as by individual

employees/officers the Respondent No. 4

and 5 proceed with implementation of the

impugned letter dated 9.8.2011.

11. The Petitioner submits that the aforesaid

actions and inactions on the part of the Respondents are

absolutely wrong and illegal under the law and are more

particularly in violation of the Unit Trust of India (Transfer

of Undertaking and Repeal) Act, 2002. The relevant

extract of section 6 (1) reads as under:

“6. (1) Every officer or other employee of the

Trust (except a trustee of the Board, the

Chairman and executive trustee) serving in

the employment immediately before the

appointed day shall become, as from the

appointed day, an officer or, as the case

may be, other employee of the specified

company and shall hold his office or

service therein by the same tenure, at the

same remuneration, upon the same terms

and conditions, with the same obligations

and with the same rights and privileges as

to leave, leave fare concession, welfare

scheme, medical benefit scheme,

insurance, provident fund, other funds,

retirement, voluntary retirement, gratuity

44

and other benefits as he would have held

under the Trust if its undertaking had not

vested in the specified company and shall

continue to do so as an officer or, as the

case may be, other employee of the

specified company or until the expiry of a

period of six months from the appointed

day if such officer or other employee opts

not to continue to be the officer or other

employee of the specified company within

such period.”




particularly in violation of the UTI Asset Management

Company (Staff) Rules, 2003 [The Unit Trust of India

(Staff) Rules 1978 has been renamed as UTI Asset

Management Company (Staff Rules) 2003 vide

Administrative Circular No. 13 dated August 19, 2003].

The relevant extract of Rule 2 (3), 7(2),10(1) (a and b), 11,

22, 23, 68, 74 and 76 reads as under:

“2(3) Subsequent to the

promulgation of the Unit Trust

of India (Transfer of

Undertaking and Repeal)

Ordinance 2002 on 29th October

2002, the Staff Rules are to be

construed and interpreted in

accordance with the provisions

45

of the Ordinance/Act, as the

case may be or any scheme,

arrangement, agreement made

thereunder with any institution,

entity or body.

“7(2). The pay of each post or

group of posts shall be

prescribed from time to time by

the Board. The number of posts

of Officers in Class I above the

cadre of Officers in Grade C

shall be prescribed from time to

time by the Board and the

number of posts of Officers in

Grade „A”, “B” and “C‟ and the

posts in Classes II, III and IV by

the Chairman.

“10(1) Subject to such other

General and Special Instruction

as may be issued by the Board,

all appointments shall be made

as follows.

(a) If the post to which the

appointment is made is the

lowest in the group to which it

belongs, direct,

(b) in other cases, by

promotion;

Provided that, the Chairman

may at his discretion authorise

the appointment of candidates

Classification

of permanent

staff.

Appointments

46

possessing special

qualifications and /or good

experience to a grade higher

than the lowest.

“11. All first appointments shall

be made on the minimum Pay of

the grades to which the

appointment is made, Provided

that the Chairman may

authorize the grant of suitable

initial increments in the scale of

pay fixed for the grade in which

the appointment is made in the

case of an employee:

a) who possesses higher

academic qualifications;

b) who has in the employment

of the UTI AMC Ltd, prior to

his/her appointment in one of

the posts covered by these

Rules, or

c) who possesses the special

experience of value to the UTI

AMC Ltd.

Appointments

to be made on

minimum pay

of grade.

“22. In the case of officers a

record of service shall be

maintained by the UTI AMC Ltd

at Head Office. In the case of

other employees, the record of

service shall be maintained at

the Head Office or the relative

Record of

service.

47

Regional office as the case may

be. The record shall be kept in

such form and shall contain

such information as may be

indicated by the Executive

Trustee/Secretary.”

“23. An employee confirmed in

the UTI AMC‟s service shall

ordinarily rank for seniority in

his grade according to his date

of confirmation in the grade and

employee on probation

according to the length of his

probationary service.

Provided that where an

employee is appointed to a

grade by selection, he shall rank

for seniority in that grade

among the employees selected

along with him on the basis of

the ranking given by the

interview/ selection board.”

Seniority

“68. Every employee shall have

a post in one of the grades fixed

for each of the categories of

staff which will be considered

as his substantive grade and to

which he shall revert when he is

not

(a) under suspension.

(b) on leave or deputation, or

All employees

to be graded.

48

(c) holding a temporary or a

probationary post officiating in

another grade.”

“74. (1) In an incremental scale,

the increment shall ordinarily

accrue on the completion of

each specified period of service

on each stage of that scale,

whether such service be

probationary, officiating or

substantive:

Provided that an employee

other than an Officer shall draw

the increment on the 1st of the

month in which it would fall due

irrespective of the actual date of

its accrual and an Officer shall

draw increment on April 1st in

the calendar year and subject to

meeting the performance

parameters. An Officer on initial

appointment will draw his first

increment on April 1st of the

next calendar year subject to

meeting the performance

parameters.

Provided, however, that:

(i) the date of an advance or

enhanced increment which is

granted due to passing of

certain examinations will be

Increments

when accrue.

49

governed by the relevant rules;

(ii) an increment withheld as a

measure of penalty will be

granted from the date the

penalty ceases;

(iii) where consequent upon

grant of extraordinary leave

without pay and allowances not

counting for increment, the

normal increment is postponed,

such postponed increment will

be granted from the date it

actually falls dues.

(2) Where an employee is

appointed to officiate, in a

higher grade, service in the

higher grade will count for

increments under sub-rule (I) in

the employee‟s substantive

grade as well as in the higher

grade and if between the two

there is an intermediate grade in

which he was officiating or

would have been appointed to

officiate had he not been so

appointed in the higher grade

also in the intermediate grade.

(3) If an employee officiating in

a higher grade proceeds on

leave, such period of leave,

except extraordinary leave

taken otherwise than on medical

50

certificate, as is certified by the

competent authority to be the

period for which the employee

would have continued to

officiate in the higher grade but

for his proceeding on leave,

shall count for purposes of

increment in the same way as

period of duty in the higher

grade although in terms of Rule

68 he would have reverted to his

substantive grade with effect

from the date he proceeded on

leave.

(4) Sanction to draw increments

will be given by the Competent

Authority.

(5) The period during which an

employee is on leave without

pay will not count for

increments unless otherwise

specially authorised by the

competent authority for reasons

to be recorded in writing.

(6) No increment may be

withheld except as a

disciplinary measure under Rule

55 and each order withholding

an increment shall state the

period for which it is withheld

and whether the postponement

shall have the effect of

51

postponing future increments;

Provided that if in an

incremental scale there is an

efficiency bar, an employee

shall not draw increments

above that bar until he has been

certified fit to do so by the

Executive Trustee/ Secretary in

the case of officers and by the

Secretary / Manager in other

cases. On each occasion on

which an employee is allowed to

pass an efficiency bar which

has previously been enforced

against him, he shall be placed

in the incremental scale at such

stage as the authority

competent to remove the bar

may fix provided that such

stage shall not be higher than

that at which he would draw his

pay if the bar had not been

enforced against him and

further that no increments

granted on the removal of a bar

shall have a retrospective

effect;

Provided further that an

efficiency bar shall not be

applied in the case of an

employee unless –

(a) he is given a notice to show

52

cause why the bar should not

be imposed on him, such notice

setting out the grounds on

which the bar is proposed to be

imposed; and

(b) he is heard on the show

cause notice.

Note: At the end of each year,

the order imposing the bar shall

be reviewed and rescinded if the

competent authority is satisfied

that there has been sufficient

improvement in the work of the

employee. Such an order of

recession shall not have

retrospective operation with

respect to increment or

seniority”.

“76 (1) The pay of an employee

on appointment on probation

from one grade to another shall

be initially fixed at the minimum

in the scale of higher grade, the

difference between the pay so

fixed and the substantive pay of

the employee in the old scale, if

the latter be more, being treated

as personal pay.

(2) On confirmation in the

higher grade the pay of an

employee shall be fixed at the

stage in the higher grade which

Refixation of

pay on

promotion.

53

is next above his substantive

pay in the old scale as on the

dates of confirmation if such

pay be higher than the pay

drawn by him at the time of

confirmation”.




particularly in violation of the Transfer Agreement dated

15th January, 2003 between the Respondent No. 1 and

the Respondent Nos. 9 to 12. The relevant extract of

clauses 3.3 and 6.1 reads as under:

“3.3 The Subscribers will be free to sell the

rights to manage assets held by them to

any third party subject to the condition that

they will follow the statutory requirements

including protecting the interest of the

employees as per section 6 of the Unit

Trust of India (Transfer of Undertaking and

Repeal) Act, 2002. The decision as to

whether the sale shall be by way of transfer

of shares, or by way of transfer of schemes

individually, to the third party concerned

shall be at the sole discretion of the

Subscribers.”

“6.1 The Subscribers shall cause UTI AMC

to comply with the provisions of Section 6

54

of the Act in respect of the officers and

other employees of the UTI.”

14. The Petitioner submits that the facts narrated

above clearly disclose that the Respondents have acted in

clear violation of law and therefore the Petitioners are

entitled for various reliefs as sought for in the present

proceedings by exercise of jurisdiction of this Hon’ble

Court under Article 226 of the Constitution of India.

15. The Petitioner submits that the actions and

inactions of the Respondents as narrated in the present

Petition clearly make out a case for issuance of directions

under Article 226 of the Constitution of India.

16. The Petitioner submits that the facts of the

matter disclose absolute lack of transparency, corporate

governance and lack of accountability within the

Respondent No. 5 resulting into substantial loss/

appropriation of company resources by officers at the

helm of affairs of the Respondent No. 5 under the guise of

various allowances which are not permissible under the

Staff Rules and as prescribed by way of administration

circulars issued by Respondent No. 5 and contrary to the

Repeal Act.

55


matter clearly disclose that the entire exercise of audit and

vigilance mechanism has been rendered, ineffective and

futile and requisite checks and balances required for

proper functioning of the Respondent No. 5 are not being

adhered to deliberately since all the payments made

towards ad-hoc executive allowance, special executive

allowance and consequent variable pay are deliberately

kept out of the purview of audit in order to keep all such

wrongful payments a secret known to only few who are

compensated with hefty allowances under which headings

most of the company resources earmarked for payment of

salary to all the Officers, have mostly been appropriated

by selected few.


matter disclose that the most sensitive and important posts

relating to vigilance, audit and finance are being headed

by only two senior officials i.e. the Chief Financial Officer

and the Chief Vigilance Officer, who is also heading the

Departments of Internal Audit, Compliance and Risk

Management of the Company and they are themselves

taking undue and wrongful advantage of appropriation of

funds under the guise of executive allowance and

performance linked incentive (variable pay) which are not

covered within the scope of audit of the Respondent No. 5.

56


matter disclose that the Respondent No. 5 has

continuously been specifically targeting, victimizing and

harassing all persons including office bearers and

committee members of the Petitioner who have raised

various issues individually and / or collectively with the

Respondent No. 5 and/or any other

authorities/government authorities.

20. The Petitioner submits that the Respondent

No. 4 cannot take the decision reflected in the impugned

letter dated 25.8.2011 of not addressing and resolving the

grievances of the Petitioner made vide letter dated

19.8.2011 because such decision is contrary to the

statutory and mandatory duty cast upon the Respondent

No. 4 with specific reference to Respondent No. 5 under

the Notification dated 15.1.2003 issued by the Respondent

No. 1.

21. The Petitioner submits that the impugned letter

dated 25.8.2011 disclosing the decision of the Respondent

No. 4 not to address and resolve the grievances of the

Petitioner made vide letter dated 19.8.2011 is perverse,

bad and illegal under the law and therefore it deserves to

be quashed and set aside.

57

22. The Petitioner submits that the impugned

Administration Circular No. 9/2009-10 dated 28.8.2009 is

contrary to the UTI Repeal Act and UTI Staff Rules since

admittedly there is no such provision which allows creation

and implementation of Band System.


Administration Circular No. 9/2009-10 dated 28.8.2009 is

perverse, bad and illegal under the law and therefore it

deserves to be quashed and set aside.


Administration Circular No. 18 / 2010-2011 dated February

18, 2011 is contrary to UTI Repeal Act and UTI Staff Rules

since admittedly there is no such provision which allows

creation and implementation of Band System.


/ decision dated 18th February, 2011 is perverse, bad and

illegal under the Law and therefore it deserves to be

quashed and set aside.


dated 9.8.2011 is contrary to the UTI Repeal Act and UTI

Staff Rules, etc. since admittedly there is no such

provision which allows merging of executive allowance

58

based on no policy of the Respondent No. 5 with the basic

pay scale and grade system of the officials employed with

the Respondent No. 5.


letter/decision dated 9.8.2011 is perverse, bad and illegal

under the law and therefore it deserves to be quashed and

set aside.


matter disclosed in the Petition clearly disclose substantial

financial loss to the Respondent No. 5 and loss of public

money through the Respondent No. 5 due to the

haphazard and arbitrary functioning of the Respondent No.

5 till date.


matter disclosed in the Petition clearly disclose inaction on

the part of the Respondent Nos. 1 and 4 to keep a check

on the irregular and illegal functioning of the Respondent

No. 5 till date.


matter disclosed in the Petition clearly disclose that

Respondent No. 8 has been wrongfully and illegally

continued in the employment of the Respondent No. 5 till

59

date contrary to the UTI Repeal Act and Staff Rules inspite

of the UTI Staff Rules 21 (1) mandating retirement of an

Officer completing 58 years of age and not having any

express or implied provision for appointment / re-

appointment / retention / extension of any retired officer

after his attaining the age of 58 years.


matter disclosed in the Petition clearly disclose that the

Respondent No. 3 has wrongfully and illegally committed

various wrongs during his employment with the

Respondent No. 5.



Respondent Nos. 9 to 12 have failed to discharge statutory

and mandatory duties cast upon them under the Transfer

Agreement dated 15.1.2003 executed between the

Respondent No. 1 and the Respondent Nos. 9 to 12.


matter disclosed in the Petition clearly disclose that almost

600 irregular and illegal appointments have taken place in

the Respondent No. 5 without even issuance of public

advertisement and without adhering to the provisions of

60

Repeal Act and Staff Rules and well established norms of

recruitment in Public Companies.



higher officials of the Respondent No. 5 in control of the

management and administration of the Respondent No. 5

have for personal undue gains to the detriment of the

Respondent No. 5 acted wrongfully and illegally which is

not permissible under the law.



Respondents are duty bound to take cognizance of the

various protests made by the 550 individual employees /

officers of the Respondent No. 5 and also of the protests

made by the Petitioner because admittedly the total

employee/ officers strength with the Respondent No. 5 is

approximately 900 employees/officers

36. Being aggrieved and dissatisfied with the

various actions and inactions on the part of the

Respondents as narrated above, the Petitioner is

preferring the present Petition on the following amongst

other grounds without prejudice to one another :-

61

GROUNDS

A) That the actions and inactions of the

Respondents as narrated in the present

Petition clearly make out a case for

issuance of directions under Article 226

of the Constitution of India.

B) That the facts of the matter disclose

absolute lack of transparency, corporate

governance and lack of accountability

within the Respondent No. 5 resulting into

substantial loss/ appropriation of

company resources by officers of the at

the helm of affairs of the Respondent No.

5 under the guise of various allowances

which are not permissible under the Staff

Rules and as prescribed by way of

administration circulars issued by

Respondent No. 5 and contrary to the

Repeal Act.

C) That the facts of the matter clearly

disclose that the entire exercise of audit

and vigilance mechanism has been

rendered, ineffective and futile and

62

requisite checks and balances required

for proper functioning of the Respondent

No. 5 are not being adhere to deliberately

since all the payments made towards ad-

hoc executive allowance, special

executive allowance and consequent

variable pay are deliberately kept out of

the purview of audit in order to keep all

such wrongful payments a secret known

to only few who are compensated with

hefty allowances under which headings

most of the company resources

earmarked for payment of salary to all the

Officers, have mostly been appropriated

by selected few.

D) That the facts of the matter disclose that

the most sensitive and important posts

relating to vigilance, audit and finance are

being headed by only two senior officials

i.e. the Chief Financial Officer and the

Chief Vigilance Officer, who is also

heading the Departments of Internal

Audit, Compliance and Risk Management

of the Company and they are themselves

taking undue and wrongful advantage of

63

appropriation of funds under the guise of

executive allowance and performance

linked incentive (variable pay) which are

not covered within the scope of audit of

the Respondent No. 5.

E) That the facts of the matter disclose that

the Respondent No. 5 has continuously

been specifically targeting, victimizing

and harassing all persons including office

bearers and committee members of the

Petitioner who have raised various issues

individually and / or collectively with the

Respondent No. 5 and/or any other

authorities/government authorities.

F) That the Respondent No. 4 cannot take

the decision reflected in the impugned

letter dated 25.8.2011 of not addressing

and resolving the grievances of the

Petitioner made vide letter dated

19.8.2011 because such decision is

contrary to the statutory and mandatory

duty cast upon the Respondent No. 4

with specific reference to Respondent No.

64

5 under the Notification dated 15.1.2003

issued by the Respondent No. 1.

G) That the impugned letter dated 25.8.2011

disclosing the decision of the Respondent

No. 4 not to address and resolve the

grievances of the Petitioner made vide

letter dated 19.8.2011 is perverse, bad

and illegal under the law and therefore it

deserves to be quashed and set aside.

H) That the impugned Administration

Circular No. 9/2009-10 dated 28.8.2009

is contrary to the UTI Repeal Act and UTI

Staff Rules since admittedly there is no

such provision which allows creation and

implementation of Band System.

I) That the impugned Administration


is perverse, bad and illegal under the law

and therefore it deserves to be quashed

and set aside.

J) That the impugned Administration


65

is contrary to the UTI Repeal Act and UTI

Staff Rules since admittedly there is no

such provision which allows creation and

implementation of Band System.

K) That the impugned Administration

Circular No. 18/2010-2011 dated

18.2.2011 is perverse, bad and illegal

under the law and therefore it deserves to


L) That the impugned letter dated 9.8.2011

is contrary to the UTI Staff Rules, etc.

since admittedly there is no such

provision which allows payments/merging

of executive allowance with the basic pay

scales which are based on grade system

seniority of the officials employed with the

Respondent No. 5.

M) That the impugned letter / decision dated

9/8/2011 is perverse, bad and illegal

under the law and therefore it deserves to


66

N) That the facts of the matter disclosed in

the Petition clearly disclose substantial

financial loss to the Respondent No. 5

and loss of public money through the

Respondent No. 5 due to the haphazard

and arbitrary functioning of the

Respondent No. 5 till date.

O) That the facts of the matter disclosed in

the Petition clearly disclose inaction on

the part of the Respondent Nos. 1 and 4

to keep a check on the irregular and

illegal functioning of the Respondent No.

5 till date.

P) That the facts of the matter disclosed in

the Petition clearly disclose that

Respondent No. 8 has been wrongfully

and illegally continued in the employment

of the Respondent No. 5 till date contrary

to the UTI Repeal Act and Staff Rules.

Q) That the facts of the matter disclosed in

the Petition clearly disclose that the

Respondent No. 3 has wrongfully and

illegally committed various wrongs during

67

his employment with the Respondent No.

5.

R) That the facts of the matter disclosed in


Respondent Nos. 9 to 12 have failed to

discharge statutory and mandatory duties

cast upon them under the Transfer

Agreement dated 15.1.2003 executed

between the Respondent No. 1 and the

Respondent Nos. 9 to 12.

S) That the facts of the matter disclosed in

the Petition clearly disclose that almost

600 irregular and illegal appointments

have taken place in the Respondent No.

5 without even issuance of public

advertisement and without adhering to

established norms, provisions of the Staff

Rules which are protected under the

provisions of Repeal Act.

T) That the facts of the matter disclosed in


officials of the Respondent No. 5 in

overall control of the management and

68

administration of the Respondent No. 5

have for personal gains to the detriment

of the Respondent No. 5 acted wrongfully

and illegally which is not permissible

under the law.

U) That the facts of the matter disclosed in


Respondents are duty bound to take

cognizance of the various protests made

by the 550 individual employees / officers

of the Respondent No. 5 and also of the

protests made by the Petitioner because

admittedly the total employee/ officers

strength with the Respondent No. 5 is

approximately 900 employees/officers.


actions and inactions of the Respondents are perse bad

and illegal under the law and therefore, appropriate

directions need to be issued by this Hon’ble Court as

prayed for in the present proceedings by exercising

powers under Article 226 of the Constitution of India. The

Petitioner submits that the Respondent No. 4 and 5 are

the outcome of a special statute that was enacted by the

Respondent No.1 and therefore, the Respondent No. 4

69

and 5 falls within the definition of “State”. The Petitioner

further submits that the Respondent No. 4 and 5 were

brought into existence not only due to a special statute

enacted by the Respondent No. 1. Also at the time of the

Respondent No. 4 and 5 being brought into existence the

100% shareholding of the Respondent No. 4 and 5 was

exclusively held and controlled by four Government

undertakings controlled by Central Government i.e. Life

Insurance Corporation of India, State Bank of India,

Punjab National Bank and Bank of Baroda who presently

as on date are 74% stakeholders in the shareholding of

the Respondent No. 4 and 5 and who upto January 2010

were the 100% stakeholders in the shareholding of the

Respondent No. 4 and 5. The Government sponsors

cannot transfer their shares without the permission of

Government of India. The Petitioner further submits that

even as on date the accounts of the Respondent No. 4

and 5 are being audited by the Comptroller and Auditor

General of India. Due to the same also, the Respondent

No. 4 and 5 can be termed as “State”. Moreover the

Respondent No 4 and 5 follows the CVC guidelines similar

to LIC and PSU Banks. Hereto annexed and marked as

Exhibit “EE” is the copy of the extract of the 7th Annual

Report 2009-2010 of the Respondent No.5 which clearly

indicates that the accounts of the Respondent No. 5 are

audited by the Comptroller and Auditor General of India.

70

The Petitioner further submits that the Respondent No. 5

is presently governed by the directives issued by the

Respondent No. 1 relating to implementation of the Official

Language Policy of the Government of India i.e. use of

Hindi, under the Official Language Act, 1963. Hereto

annexed and marked as Exhibit “FF” is the circulars

issued by Respondent No. 5 on the use and

implementation of the Official Language i.e Hindi. The

Petitioner further submits that the Respondent No. 5 is

classified as Public Sector by Securities and Exchange

Board of India (SEBI) the regulator of Mutual Funds and

Capital Markets in India constituted by the Government

under a Parliamentary Act in 1992 which is annexed

hereto and marked as Exhibit “GG”. The Petitioner also

submits that Indian Administrative Service IAS Officer Mr.

M. Damodaran, an officer in the Government’s service

was appointed the first Chairman and Managing Director

of the Respondent No. 5 from 1.2.2003 upto March 2005.

Thereafter from 3.11.2005 upto 17.2.2011 another IAS

Officer Mr. U.K. Sinha, an officer in the Government’s

service was the Second Chairman and Managing Director

of the Respondent No. 5. The Petitioner further submits

that apart from the Respondent No. 5 falling within the

definition of “State” the Respondent No. 4 also falls within

the definition of “State” due to the same aforesaid reasons.

The Petitioner also submits that even for a moment, it is

71

presumed that the Respondent Nos. 4 and 5 do not fall

within the definition of “State” still the reliefs sought by the

Petitioner in the present proceedings under Article 226 of

the Constitution of India can still be granted since the said

power can be exercised by this Hon’ble High Court not

only against State but also against any other person. The

Petitioner submits that apart from the aforesaid

Respondent Nos. 9 to 12 do fall within the definition of

“State”.

38. The Petitioner submits that there is no Rule/

Provision under which Respondent No. 8 who retired on

completing 58 years of age could have been appointed

and/or continued by the Respondent No. 5 as its employee

or as a consultant. The Petitioner submits that in a similar

and identical matter pertaining to appointment of retired

employees as consultants and also pertaining to

irregularities in promotion process with discernible

favouritism, the Respondent No. 1 has issued a

displeasure letter on 10th November, 2010 bearing File No.

1/42/99 from the office of the Under Secretary to the

Government of India, Ministry of Finance, Department of

Financial Services (Vigilance). Hereto annexed and

marked as Exhibit “HH” is the copy of the letter dated

10th November, 2010. Admittedly action was taken in the

aforesaid matter since the employee who had committed

72

various wrongs and illegalities had retired. Admittedly in

the facts of the matter since the Respondent No.8 is

presently employed and holding sensitive and important

designation and charge such as Chief Vigilance Officer

and Chief Legal Adviser and Compliance Officer and Head

Internal Audit and Risk Management of the Respondent

No. 5 inspite of the said illegalities being pointed out

neither the Respondent No. 5, nor the Respondent No. 4,

nor other the Respondents are taking any legal action in

relation to the said matter. The Petitioner therefore most

humbly pray and requests this Hon’ble Court to take

cognizance of the aforesaid illegality and issue directions

as sought by the Petitioner.

39. The Petitioner craves leave to add, alter amend

and/or delete any of the above mentioned paragraphs as

and when required.

40. The Petitioner has not filed any other appeal,

application or petition or suit either in this Hon’ble Court or

in the Hon’ble Supreme Court of India in respect of the

subject matter of the petition.

41. The Petitioner’s registered office is at Mumbai.

The Respondents are having their offices at Mumbai. The

entire cause of action has arisen in Mumbai. Therefore,

73

this Hon’ble Court has jurisdiction to entertain and try the

present petition.

42. The Petitioner states that they have no other

efficacious remedy but to approach this Hon’ble Court by

way of the present petition.

43. The Petitioner has approaching this Hon’ble

High Court as early as possible and there is no delay or

laches on the part of the Petitioners.

44. The Petitioner has not received any Caveat

from the Respondents pertaining to the subject matter.

45. The Petitioner shall relies upon the relevant

documents, a list whereof is annexed hereto.

46. The Petitioner has paid the fixed Court fee of

Rs._______ this petition.

47. The Petitioner, therefore, prays that:

a) Rule be issued;

b) For a writ or an order in the nature of writ

quashing and setting aside impugned letter

74

dated 9.8.2011 by declaring the same as

perverse, bad and illegal under the law.

c) For a writ or an order in the nature of writ

quashing and setting aside impugned

Administrative Circular No. 9/2009-10 dated

28.8.2009 by declaring the same as


d) For a writ or an order in the nature of writ

quashing and setting aside impugned

Administrative Circular No. 18/2010-11

dated 18.2.2011 by declaring the same as


e) For a writ or an order in the nature of writ

quashing and setting aside impugned letter

dated 25.8.2011 disclosing the decision of

the Respondent No. 4 not to address and

resolve the grievances of the Petitioner

made vide letter dated 19.8.2011 by

declaring the said letter dated 25.8.2011 as


f) For a writ or an order in the nature of writ

directing the Respondent No. 4 to

75

immediately and forthwith consider all the

grievances made by the Petitioner in the

Petition as well as the letter dated 19.8.2011

and proceed to resolve the same within a

period of 8 weeks from the date of the order

of this Hon’ble Court.

g) For a writ or an order in the nature of writ



grievances made by the petitioner in the

Petition within a period of 8 weeks from the

date of the order of this Hon’ble Court.

h) For a writ or an order in the nature of writ

directing the Respondent Nos. 9 to 12 to


grievances made by the Petitioner in the

Petition within a period of 8 weeks from the

date of the order of this Hon’ble Court.

i) For a writ or an order in the nature of writ


immediately and forthwith discontinue the

employment of the Respondent No. 8.

76

j) For a writ or an order in the nature of writ

directing the Respondent Nos. 1 and 4 to

immediately and forthwith proceed with

prosecution against Respondent No. 3

and/or Respondent No. 6 and/or

Respondent No. 7/ and/or Respondent No.

8 and/or any other person found responsible

for committing various wrongs and

illegalities pointed out in the present

Petition.

k) For a writ or an order in the nature of writ

directing the Respondent Nos. 1 and 4 to

immediately and forthwith proceed with the

process of recovery of public money that

was wasted / misappropriated by

Respondent No. 3 and/or Respondent No. 6

and/or Respondent No. 7/ and/or

Respondent No. 8 and/or any other person

found responsible for committing various

wrongs and illegalities pointed out in the

present Petition.

l) Pending the hearing and final disposal of the

present Petition for an order of this Hon’ble

Court directing the Respondent No. 4 and 5

77

to immediately and forthwith ensure that as

and when called upon by this Hon’ble Court

all the original records pertaining to the

present matter would be produced and will

not be destroyed or tampered with in any

manner whatsoever.

m) Pending the hearing and final disposal of the


Court immediately and forthwith staying the

operation and effect of the impugned letter

dated 9.8.2011.

n) Pending the hearing and final disposal of the



operation and effect of the impugned

Administrative Circular No. 9/2009-10 dated

28.8.2009.

o) Pending the hearing and final disposal of the



operation and effect of the impugned

Administrative Circular No. 18/2010-11

dated 18.2.2011.

78

p) Pending the hearing and final disposal of the



operation and effect of the impugned letter

dated 25.8.2011 disclosing the decision of

the Respondent No. 4 not to address and

resolve the grievances of the Petitioner

made vide letter dated 19.8.2011.

q) Ad-interim and interim reliefs in terms of

prayers (a) to (p) be granted;

r) costs be provided for;

s) any other and further orders or reliefs as this

Hon’ble Court deems fit.

AND FOR THIS ACT OF KINDNESS AND

JUSTICE, THE PETITIONER AS IN DUTY BOUND

SHALL EVER PRAY.

Bombay, dated this day of September, 2011

Advocate for Petitioner Petitioner

79

VERIFICATION

I, Pawan Kumar Abrol, the General Secretary of the

Petitioner abovenamed, do hereby solemnly declare that

whatever stated in paragraph No. _____ to ____ is true to

my knowledge and that what is stated in remaining

paragraphs Nos.____ to _____ based on information and

belief, and I believe the same to be true and correct.

Solemnly declared at Bombay )

this day of September, 2011)

Identified by me;

Before me,

Advocate for the Petitioner

Documents

IN THE HIGH COURT OF JUDICATURE AT BOMBAYutiamcofficersassociation.in/archive/2017_UOA Writ Petition Copy.pdf · IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL