WA/1835/2024 of SRI B S GURUSWAMY, Vs KARNATAKA HANDLOOM CORPORATION LIMITED, on 10 April 2026

ORAL JUDGMENT

(PER: HON'BLE MR. JUSTICE T.M NADAF) This intra Court appeal by the petitioner in W.P.No.14203/2018 filed under Section 4 of the Karnataka High Court Act, 1961, calling in question the order dated 22.10.2024 passed by the Writ Court.

2. Under the impugned order, the Writ Court rejected the Writ Petition.

3. The parties are referred to as per their ranking before the Writ Court.

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The petitioner was before the Writ Court seeking following reliefs: "WHEREFORE, it is humbly prayed that this Hon'ble Court be pleased to issue:- a) Writ of Certiorari or any other writ or order to quash the impugned office order dated 02-07- 2016 issued by the Respondent Corporation at Annexure-D. b) Issue writ of Mandamus or any other writ or order directing the Respondent Corporation to consider the Representation dated 23-09-2016 and direct the Respondent Corporation to grant dearness allowance w.e.f 01-01-2016 on par with Government order at Annexure-C; c) Direct the Respondent Corporation to grant all the consequential "financial benefits" to the Petitioner, as per the Government order dated 13-4-2016 with effect from 01-01-2016 as per G.O at Annexure-C; d) To pass such other Order's as this Hon'ble Court deems fit to pass in the circumstances of the Case including the cost of this Writ Petition in the interest of Justice and Equity."

4. The petitioner was the employee under Karnataka Handloom Development Corporation Limited. It

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is the claim of the petitioner that under a settlement entered into between the Management and the workmen in terms of Section 12(3) R/w Section 18(3) of the Industrial Disputes Act, 19471 and Rule 59 of Industrial Disputes (Karnataka) Rules, 19572, resolved to revise the Dearness Allowance (DA), House Rent Allowance (HRA) and City Compensatory Allowance (CCA) on same pattern as that of the State Government. It is the further claim that, the Government thereafter as per Annexure-E revised the DA on several occasion to its employees and it is the contention of the employee that the same benefit be extended to the petitioner.

5. Opposing the contention of the employee, learned counsel Sri.D.Nagaraj, for the respondent Corporation submitted that the revision of DA is within the sole discretion of the Corporation, conducive to the financial health of the corporation and relied on the Profit 1 for short, 'the Act of 1947' 2 for short, 'the Rules of 1957'

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and Loss statement of the corporation produced at Annexures-R1 and R2 along with statement of objections and submitted that the financial health of the Company would reveal that the Corporation was running under loss. He further submits that as per Clause 6 of the Memorandum of Settlement, the applicability of DA, HRA & CCA in par with the State Government to the employee of the Corporation has been extended however, with a rider that as per the Corporation Circular issued in that regard from time to time. For easy reference, Clause 6 of the Memorandum of Settlement is extracted as under: "6. Revision of D.A., H.R.A., & C.C.A:- The D.A., H.R.A. & C.C.A. shall be sanctioned as per the State Government pattern to the employees from time to time as per KSBPE circular issued in this regard from time to time."

6. The Writ Court having considered the rival submissions as well as Clause 6 stated supra, observed that the settlement provides for payment of DA, HRA and CCA in par with Government employee, but subject to the

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discretion conferred by virtue of the stipulation at Clause 6 with the Corporation to issue a Circular to that effect for payment of allowances stated supra. In these circumstances, the Writ Court holds that the contention of the petitioner that withholding DA granted by the Government to its employees and non-consideration of the same in terms of the settlement is impermissible to the Corporation has been declined by the Writ Court.

7. The Writ Court considering the language used in Clause 6 concluded that the memorandum of settlement while being interpreted may have to take note of the discretion conferred by virtue of the stipulation that Circular is to be passed from time to time in that regard and such discretion could be exercised by the Corporation taking note of the financial health of the Corporation as well, rejected the Writ Petition. It is this order passed by the Writ Court is called in question in this appeal.

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8. Heard, Sri.Mukkannappa.S.B, learned counsel appearing for the appellant and Sri.Nagaraj.D, learned counsel appearing for the respondent Corporation.

9. Though Sri.Mukkannappa.S.B, argued the matter on several grounds on the basis of settlement arrived stated supra, but to the query of the Court with respect to Clause 6, wherein a discretion is embodied which says that the allowances shall be sanctioned in par with State Government employees as per KSBPE Circular issued in that regard from time to time, he is unable to answer any withholding against the settlement is impermissible, in the teeth of Clause 6.

10. The Writ Court having found Clause 6 wherein a discretion is left with the Corporation to pay DA in terms of the Circulars in that regard issued from time to time, declined to accede to the claim of the petitioner. We do not find any error in the order passed by the Writ Court,

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which call for interference with the order at our hands. The Writ appeal fails and accordingly is, dismissed. Sd/- (D K SINGH) JUDGE

Sd/- (T.M.NADAF) JUDGE TKN List No.: 1 Sl No.: 20