Reportable
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NOS.626-627 OF 2008
A.N. Sachdeva (dead) by LRs. & Ors. ... Appellants
Vs.
Maharshi Dayanand University, Rohtak & Anr. ... Respondents
J U D G M E N T
ARUN MISHRA, J.
1. The question involved in the present appeals is whether services
rendered by the appellants in Kurukshetra University/Punjab University is
qualifying service for the purpose of pension and can be added to the
services rendered by them in the respondent no.1, i.e. Maharshi Dayanand
University, Rohtak (hereinafter called “M.D. University”).
2. The appellants are receiving pension after their retirement from M.D.
University, however, it is confined to the services rendered by them in the
same university. Deceased A.N. Sachdeva and Ram Parshad Saini were
appointed in Punjab University. R.K. Tuteja, petitioner no.3 and Prem Kumar
were appointed as Lecturer and Clerk respectively. They were appointed
without any break in M.D. University.
3. A.N. Sachdeva, since deceased was appointed as Steno-Typist in Punjab
University on 7.8.1961, thereafter as Private Secretary to Vice-Chancellor
in M.D. University on 1.5.1976, promoted as Deputy Registrar in August,
1988 and retired from the service of M.D. University on 31.12.2000.
Ram Prashad Saini after rendering services from 16.11.1962 to
14.1.1975 in Punjab University was appointed as Asistant in Kurukshetra
University on 15.1.1975 and served till 11.5.1977 and on 12.5.1977 he was
appointed in M.D. University and retired from service on 31.10.1999.
R.K. Tuteja was appointed as Lecturer in Kurukshetra University on
29.7.1964, served uninterruptedly till 20.8.1979 and was appointed on
21.8.1979 in the same capacity in M.D. University where he served till his
retirement on 31.12.2001.
Prem Kumar Naveen was appointed Clerk in Kurukshetra University on
7.8.1961 and served till 6.10.1976 and next day on 7.10.1976 he was
appointed in M.D. University. He retired on 28.2.2000.
4. The services of the said employees rendered by them in Punjab
University/Kurukshetra University have not been counted as qualifying
service for the purpose of pension by the M.D. University. Hence, the
writ petition was filed by them in the High Court after rejection of their
representation. The appellants submitted that M.D. University had
introduced pension scheme with effect from 1.4.1995. The appellants had
opted for the same. A memorandum dated 24.12.2001 was issued by the
Haryana Government for counting of service rendered by employees of Punjab
University/Kurukshetra University/M.D. University as qualifying service for
the purpose of pension.
5. Haryana Government issued a memorandum dated 7.1.2002 confining the
policy issued by it for the persons who retired after 7.1.2002, however,
Finance Department issued clarification dated 9.7.2003 that instructions
contained in the memorandum dated 7.1.2002 are not applicable to the
employees of the university because the pension schemes of the university
are different. Before that a clarification had been issued by the
Government of Haryana on 5.6.2002 mentioning that the employees of the
Punjab University were subsequently allocated to Kurukshetra University,
Rohtak and M.D. University, Rohtak before its formation used to be regional
centre of Kurukshetra University. That being the situation, decision was
taken to treat the services rendered in Punjab University/Kurukshetra
University as qualifying service for the purpose of pension on retirement
from M.D. University, Rohtak. It was also clarified that as regards the
services rendered by the employees elsewhere such as Central Government/
State Government/Autonomous Body, the same is not to be counted towards
qualifying service for the purpose of pension.
6. The stand of the respondents is that the retiral benefits of the
employees are governed by the provisions of M.D. University Pension Scheme,
1997 (hereinafter referred to as “Pension Scheme, 1997”). The past
services could not have been treated as qualifying service for pension in
view of Rule 4(vii) of the Pension Scheme, 1997 introduced with effect from
1.4.1995 in lieu of Contributory Provident Fund. Option was given to the
employees to opt for the contributory provident scheme or for the pension
scheme. In the pension scheme 1997 there is no provision for counting
previous service rendered by the appellants in Punjab
University/Kurukshetra University. Reliance had been placed on the
clarification dated 5.6.2002 to contend that the employees who continued in
the M.D. University on allocation/absorption with change of employer were
entitled to count their services for the purpose of pension. As the
appellants were directly appointed in the respondent university, they were
not entitled to count the service qualifying for pension.
7. The Division Bench of the High Court by way of impugned order has
dismissed the writ application on the ground that in view of Rule 4(vii)
of the Pension Scheme 1997, services rendered by the appellants in Punjab
University/Kurukshetra University cannot be counted. Reliance has also
been placed on the memorandum dated 7.1.2002. As the appellants had
retired before 7.1.2002, they are not entitled to count the past service
rendered by them in the aforesaid universities as qualifying service for
pension in M.D. University. It has also been observed that pension scheme
provides for constitution of corpus fund by transferring the university
contribution alongwith interest. Even if memorandum dated 7.1.2002 is not
applicable, as clarified by the Finance Department, appellants cannot get
the benefit as they had retired prior to 7.1.2002.
8. It was submitted on behalf of the appellants that as per memorandum
dated 24.12.2001 and its clarification dated 5.6.2002, the appellants are
entitled to count the services rendered in Punjab University/Kurukshetra
University as qualifying service for the purpose of pension. It is only the
service rendered in other autonomous body etc. which is not to be counted
towards the pensionary benefits. The appellants were receiving pension and
liberalised pension scheme has to be applied to the employees who had
retired earlier. It is not a new scheme, but an upward revision of
existing benefits. It is not a case of new retiral benefits. Appellants
have been discriminated vis-a-vis the other employees who had been
absorbed/allocated in the services of M.D. University from Punjab
University/Kurukshetra University, inasmuch as, their services rendered in
these universities have been counted as qualifying service for the purpose
of pension. Even the services of the employees who have rendered their
services in some other university have also been counted towards
pensionable services. In one of such case of Dr. Jahan Singh, this Court
did not intervene in the special leave petition which was dismissed. Even
otherwise, the classification sought to be created by the respondents is
not impermissible in view of Articles 14 and 16 and the services rendered
by the appellants in Punjab University/Kurukshetra University deserve to be
counted as qualifying service for the purpose of pension as has been done
in the case of employees who have been absorbed/allocated to M.D.
University.
9. Per contra, the respondents would contend that the admissible
benefits under Pension Scheme, 1997 have already been extended to the
appellants. In view of the clarification dated 5.6.2002, the services of
the employees who had been allocated/absorbed could have been counted, not
the past services of the employees who had been directly appointed in M.D.
University, appellants stood retired before 7.1.2002 as such they were not
entitled for benefit of counting of past services. The memorandum was not
having retrospective effect. Even if, memorandum dated 7.1.2002 is not
applicable, the appellants are not entitled for the benefit under the
Pension Scheme, 1997. Other employees who have been given the benefit for
counting their past services, namely, K.L. Pahuja, Yudhvir Singh Dahiya and
Sunder Singh Dahiya had retired on 30.9.2003, 31.5.2002 and 31.10.2002
respectively whereas appellants stood retired before 7.1.2002. The
decision in the case of Dr. Jahan Singh cannot be applied to the appellants
as while dismissing the special leave petition, this Court has left the
question of law open. The employer’s share of CPF has to be transferred to
the pension fund. It was a case of a new scheme as such its benefits could
not have been extended retrospectively. The appellants cannot claim
equality and complain of discrimination.
10. It is not in dispute that the appellants had opted for pension under
Pension Scheme, 1997. Para 4(vii) of the Pension Scheme, 1997 as has been
relied upon by the respondents reads thus:-
“(vii) The period of service rendered by an employee in any State Govt. or
Govt. aided Private College or in any University/autonomous body against
aided post prior to joining in the University shall not count as qualifying
service for pensionary benefits.”
However, it is not in dispute that vide memorandum dated
24.12.2001 issued by the Government of Haryana, the pension scheme was
modified inasmuch as the State Government has agreed for counting the
services of the employees of the Punjab University/Kurukshetra University
on retirement from M.D. University as qualifying service. The memorandum
dated 24.12.2001 is extracted hereunder:-
“From
Higher Education Commissioner,
Haryana Chandigarh.
To
The Vice-Chancellor,
M.D. University
Rohtak.
Memo No.18/41-2001 UNP (1)
Dated : Chandigarh the 24.12.2001
Sub: Implementation of Pension Scheme in M.D.U. Rohtak.
The State Govt. has considered and agreed for counting of service
rendered by the employees of the University in Punjab
University/Kurukshetra University/M.D. University as qualifying service for
the purpose of pension subject to the following terms and conditions :
The service rendered by the said employees in these institutions is without
any break and is continuous.
That the employer’s share of the CPF in respect of these employees has been
transferred to the pension fund even with respect to the service rendered
in Punjab University/Kurukshetra University as required under the pension
rules of the University. Further, that all other requirement of the
pension rules are fulfilled in respect of these employees. Kindly take
necessary action accordingly.
Sd/- Deputy Director, College-I,
For Higher Education Commissioner,
Haryana, Chandigarh”.
Another memorandum dated 7.1.2002 was issued by the Government of Haryana
on the basis of which certain incorporation was made in the Pension Scheme
1997. However, later on, the Finance Department on 9.7.2003 has clarified
that memorandum dated 7.1.2002 is not applicable to the employees of the
University.
11. Yet another memorandum dated 5.6.2002 has been referred to with
respect to the counting of the services of the Punjab
University/Kurukshetra University into M.D. University as qualifying
service for the purpose of pension. Same is extracted hereunder :-
“From
Higher Education Commissioner, Haryana,
Chandigarh.
To
Registrar,
Kurukshetra University, Kurukshetra.
Maharshi Dayanand University, Rohtak.
Memo No.18/44-2001 UNP (1)
Dated : Chandigarh, the 6.6.2002
Subject: Clarification regarding counting of previous service/foreign
service towards Pension.
Kindly refer to the subject noted above.
The advice issued vide letter No.18/44-2001 UNP (1) dated 24.12.2001 was in
respect of service rendered by the employees of Maharshi Dayanand
University, Rohtak in Kurukshetra University, Kurukshetra and Punjab
University. It is as well as known that initially, it was Kurukshetra
University, Kurukshetra and what constitutes Maharshi Dayanand University,
Rohtak now was a regional centre of Kurukshetra University, Kurukshetra
earlier. Similarly the employees also has rendered service in the Punjab
University and were subsequently allocated to Kurukshetra University,
Rohtak. That being the situation the advice was with regard to that
service which the employees had rendered initially in the Punjab University
followed by Maharshi Dayanand University, Rohtak. This pattern follows in
the same manner as the employees of the joining Punjab were allocated to
Haryana Govt. at the time of the creation of the Haryana State. Hence the
service rendered by these employees who continued to remain in suit but
there was a change of employer on account of division of jurisdiction after
a period of time. In their case, the previous service rendered was agreed
to be countable for the purpose of pension in Maharshi Dayanand University,
Rohtak.
To the extent the employees of Kurukshetra University, Kurukshetra fall in
the same category, their service may also be counted for the purpose of
pension at the time of retirement from Kurukshetra University, Kurukshetra
subject to fulfillment of the conditions mentioned in letter dated
24.12.2001 (copy enclosed) in respect of Maharshi Dayanand University,
Rohtak.
As regards service rendered by the employees elsewhere such as Central
Govt./State Govt./Autonomous Body, the same is not countable for the
purpose of pensionary benefits as there is no provision to this effect in
the pension scheme of Kurukshetra University, Kurukshetra. In case the
Kurukshetra University, Kurukshetra is keen to count such service for
pensionary benefits, they should be advised to first consider amendment in
their pension scheme for which a separate self-contained proposal should be
submitted for approval of the State Govt.
It is, therefore requested that the cases may be decided
accordingly.
Sd/- 5.6.02
Deputy Director Colleges-I,
For Higher Education Commissioner,
Haryana, Chandigarh.”
12. It is apparent from the memorandum dated 24.12.2001 that the first
requirement to count the services rendered in Punjab University/Kurukshetra
University/M.D. University by the appellants were without break and
continuous. It is also not in dispute that after rendering the services in
Punjab University/Kurukshetra University, the aforesaid employees had been
directly appointed on the very next day in M.D. University. Earlier, the
employees of Punjab University were allocated to Kurukshetra University and
it is not in dispute that present M.D. University used to be the regional
centre of Kurukshetra University prior to its establishment as full-fledged
University.
13. Second requirement of the memorandum dated 24.12.2001 is that the
employer’s share of the CPF has to be transferred to the pension fund with
respect to services rendered in Punjab University/Kurukshetra University.
The appellants had expressed their willingness in their representation to
fulfil the aforesaid requirement of the memorandum dated 24.12.2001
including all other requirements of the pension scheme.
14. The question which arises for consideration is whether it is a case
of upward revision of existing benefits or a new scheme floated by the
respondents, while issuing the memorandum dated 24.12.2001.
The appellants have placed reliance on a Constitution Bench decision
of this Court in D.S. Nakara & Ors. v. Union of India [1983 (1) SCC 305] in
which this Court has laid down that reasonable classification is
permissible. The classification must be founded on an intelligible
differentia and that must have a rational relation to the object sought to
be achieved. This Court has laid down that even though the scheme is
prospective, the benefit of liberalised pension scheme should be applied
equally to all and they are required to be paid the upward revision
commencing from the specified date. No arrears would be payable. This
Court has laid down thus:-
“29. Summing up it can be said with confidence that pension is not only
compensation for loyal service rendered in the past, but pension also has a
broader significance, in that it is a measure of socio-economic justice
which inheres economic security in the fall of life when physical and
mental prowess is ebbing corresponding to aging process and, therefore, one
is required to fall back on savings. One such saving in kind is when you
give your best in the hey-day of life to your employer, in days of
invalidity, economic security by way of periodical payment is assured. The
term has been judicially defined as a stated allowance or stipend made in
consideration of past service or a surrender of rights or emoluments to one
retired from service. Thus the pension payable to a government employee is
earned by rendering long and efficient service and therefore can be said to
be a deferred portion of the compensation or for service rendered. In one
sentence one can say that the most practical raison d’etre for pension is
the inability to provide for oneself due to old age. One may live and avoid
unemployment but not senility and penury if there is nothing to fall back
upon.
x x x x x
42. If it appears to be undisputable, as it does to us that the pensioners
for the purpose of pension benefits form a class, would its upward revision
permit a homogeneous class to be divided by arbitrarily fixing an
eligibility criteria unrelated to purpose of revision, and
would such classification be founded on some rational principle? The
classification has to be based, as is well settled, on some rational
principle and the rational principle must have nexus to the objects sought
to be achieved. We have set out the objects underlying the payment of
pension. If the State considered it necessary to liberalise the pension
scheme, we find no rational principle behind it for granting these benefits
only to those who retired subsequent to that date simultaneously denying
the same to those who retired prior to that date. If the liberalisation was
considered necessary for augmenting social security in old age to
government servants then those who, retired earlier cannot be worst off
than those who retire later. Therefore, this division which classified
pensioners into two classes is not based on any rational principle and if
the rational principle is the one of dividing pensioners with a view to
giving something more to persons otherwise equally placed, it would be
discriminatory. To illustrate, take two persons, one retired just a day
prior and another a day just succeeding the specified date. Both were in
the same pay bracket, the average emolument was the same and both had put
in equal number of years of service. How does a fortuitous circumstance of
retiring a day earlier or a day later will permit totally unequal treatment
in the matter of pension? One retiring a day earlier will have to be
subject to ceiling of Rs 8100 p.a. and average emolument to be worked out
on 36 months’ salary while the other will have a ceiling of Rs 12,000 p.a.
and average emolument will be computed on the basis of last 10 months’
average. The artificial division stares into face and is unrelated to any
principle and whatever principle, if there be any, has absolutely no nexus
to the objects sought to be achieved by liberalising the pension scheme. In
fact this arbitrary division has not only no nexus to the liberalised
pension scheme but it is counter-productive and runs counter to the whole
gamut of pension scheme. The equal treatment guaranteed in Article 14 is
wholly violated inasmuch as the pension rules being statutory in character,
since the specified date, the rules accord differential and discriminatory
treatment to equals in the matter of commutation of pension. A 48 hours’
difference in matter of retirement would have a traumatic effect. Division
is thus both arbitrary and unprincipled. Therefore, the classification does
not stand the test of Article 14.
43. Further the classification is wholly arbitrary because we do not find a
single acceptable or persuasive reason for this division. This arbitrary
action violated the guarantee of Article 14. The next question is what is
the way out?
x x x x x
48. It was very seriously contended, remove the event correlated to date
and examine whether the scheme is workable. We find no difficulty in
implementing the scheme omitting the event happening after the specified
date retaining the more humane formula for computation of pension. It would
apply to all existing pensioners and future pensioners. In the case of
existing pensioners, the pension will have to be recomputed by applying the
rule of average emoluments as set out in Rule 34 and introducing the slab
system and the amount worked out within the floor and the ceiling.
49. But we make it abundantly clear that arrears are not required to be
made because to that extent the scheme is prospective. All pensioners
whenever they retired would be covered by the liberalised pension scheme,
because the scheme is a scheme for payment of pension to a pensioner
governed by 1972 Rules. The date of retirement is irrelevant. But the
revised scheme would be operative from the date mentioned in the scheme and
would bring under its umbrella all existing pensioners and those who
retired subsequent to that date. In case of pensioners who retired prior to
the specified date, their pension would be computed afresh and would be
payable in future commencing from the specified date. No arrears would be
payable. And that would take care of the grievance of retrospectivity. In
our opinion, it would make a marginal difference in the case of past
pensioners because the emoluments are not revised. The last revision of
emoluments was as per the recommendation of the Third Pay Commission
(Raghubar Dayal Commission). If the emoluments remain the same, the
computation of average emoluments under amended Rule 34 may raise the
average emoluments, the period for averaging being reduced from last 36
months to last 10 months. The slab will provide slightly higher pension and
if someone reaches the maximum the old lower ceiling will not deny him what
is otherwise justly due on computation. The words “who were in service on
March 31, 1979 and retiring from service on or after that date” excluding
the date for commencement of revision are words of limitation introducing
the mischief and are vulnerable as denying equality and introducing an
arbitrary fortuitous circumstance can be severed without impairing the
formula. Therefore, there is absolutely no difficulty in removing the
arbitrary and discriminatory portion of the scheme and it can be easily
severed”.
15. In M.C. Dhingra v. Union of India & Ors. [1996 (7) SCC 564], the
question arose with respect to the counting of the previous service for
grant of pension. The circular dated 31.3.1982 which came up for
consideration provided the benefit thereof only to the persons retiring on
or after the date of issuance of circular was held to be arbitrary. This
Court has laid down thus:-
“4. It is seen that though the appellant had retired on 1-2-1973, since the
question of tagging the previous service rendered in the State Government
on temporary basis and the similar cases are pending, the Government had
taken a decision on 31-3-1982 to tag the previous service for computation
of the pension. Learned counsel appearing for the respondents contended
that clause 4 of the abovesaid circular is one of the conditions which
prescribes that it would be applicable to the government servants who
retired from that date, namely, 31-3-1982. Since the appellant had retired
on 1-2-1973, he is not eligible. We find no force in the contention. All
the persons who rendered temporary service prior to their joining the
Government of India Service have been given the benefit of fixation of the
pension payable by tagging the temporary service. The cut-off date is
arbitrary violating Article 14 of the Constitution of India. Having grouped
all the similarly circumstanced employees, fixing the cut-off date and
giving benefit to those who retired thereafter is obviously arbitrary. In
similar circumstances, following the ratio in D.S. Nakara v. Union of India
[1983 (1) SCC 305], this Court held in the case of R.L. Marwaha v. Union of
India [1987 (4) SCC 31 that such a restriction is arbitrary violating
Article 14. On the facts and circumstances, we find that the restriction
imposed in clause 4 of the circular is violative of Article 14. It is,
therefore, unconstitutional. However, the appellant will be entitled to the
pro rata pension from March 1982”.
16. In State of Punjab v. Justice S.S. Dewan (Retd.) & Ors. [1997 (4) SCC
569], this Court held that benefit extended was new one. However, this
Court has observed thus:-
“7. Therefore, what we have to consider is what is the nature of the change
made by the amendment. Is it by way of upward revision of the existing
pension scheme? Then obviously the ratio of the decision in D.S. Nakara
case [1983 (1) SCC 305] would apply. If it is held to be a new retiral
benefit or a new scheme then the benefit of it cannot be extended to those
who retired earlier”.
17. In State of Rajasthan & Anr. v. Prem Raj [1997 (10) SCC 317], this
Court rejected the submission that decision in D.S. Nakara (supra) has
given a complete go-by. This Court has laid down thus:-
“12. In State of W.B. v. Ratan Behari Dey [1993 (4) SCC 62], this Court
considered the question whether in providing a pension scheme the State
could fix up a particular date and make it applicable to those who retired
on or after that date. The Court distinguished Nakara case [1983 (1) SCC
305] by holding that in Nakara case an artificial date had been specified
classifying the retirees governed by the same rules and similarly situated
into two different classes depriving one such class of the benefit of the
liberalised pension rules and that was held to be bad. Following the
decision of the Court in Krishena Kumar case [1990 (4) SCC 207] it was held
that the State can specify a date with effect from which the Regulations
framed or amended conferring the pensionary benefits shall come into force
but the only condition is that the State cannot pick a date out of its hat
and the date has to be prescribed in a reasonable manner having regard to
all the facts and circumstances.
13. In State of Rajasthan v. Sevanivatra Karamchari Hitkari Samiti [1995
(2) SCC 117] the provisions contained in Rule 268-H of Rajasthan Service
Rules came up for consideration as to whether the aforesaid provisions
restructuring the rights of government servants in service on 29-2-1964 can
be held to be violative of Article 14. The Court applied the principle in
Krishena Kumar case and Indian Ex-Services League case [1991 (2) SCC 104]
and held that the fixation of 29-2-1964 as the cut-off date with effect
from which the new liberalised pension scheme in Chapter XXIII-A was
introduced cannot be said to be arbitrary or violative of Article 14 of the
Constitution. As has been stated earlier for deciding the present
controversy it is not necessary for us to further delve into the question
as to the extent to which the decision of this Court in Nakara case has
been followed or explained. But suffice it to say that the contention of Mr
Gupta, the learned counsel for the appellant, that the decision of this
Court in Nakara case has been given a complete go-by cannot be sustained”.
18. In Dhan Raj & Ors. v. State of J&K & Ors. [1998 (4) SCC 30], this
Court considered the case where the appellants who had retired from the
services of Corporation prior to 9.6.1981 claimed to be entitled to
pensionary benefits by virtue of G.O. dated 3.10.1986. The contention of
the State that the benefit could not be extended to the appellants was
rejected. The relevant portion is extracted hereunder:-
“14. Even otherwise, we do not find any justifiable criteria for the State
Government to draw the line between those who retired earlier and those who
retired after 9-6-1981. Both such set of employees were equally placed in
the same Undertaking/Corporation temporary in character and all having
served in the organisations for more than 20 years. In fact, the appellants
have served with the Government for more than 30 to 40 years. The person
serving for such a long period earns his legitimate expectation. It is not
something which he seeks with a begging bowl. It is inappropriate for a
State Government to take up a stand to get its own order to be held
illegal, by giving restrictive interpretation to deny benefit to its own
employees who had worked for such a long period. In fact, in the
Constitution Bench decision of this Court in D.S. Nakara v. Union of India
[1983 (1) SCC 305] this Court held that criterion of date of enforcement of
the revised scheme entitling benefits of the revision to those retiring
after specified date while depriving the benefits to those retiring prior
to that date was violative of Article 14. Even otherwise, while considering
the question of grant of pensionary benefits the State has to act to reach
the constitutional goal of setting up a socialist State as stated and the
assurance as given in the Directive Principles of State Policy. A pension
is a part and parcel of that goal, which secures to a person serving with
the State after retirement of his livelihood. To deny such a right to such
a person, without any sound reasoning or any justifiable differentia would
be against the spirit of the Constitution. We find in the present case the
stand taken by the State Government to be contrary to the said spirit. In
the aforesaid D.S. Nakara this Court has very clearly recorded the
following:
“36. Having set out clearly the society which we propose to set up, the
direction in which the State action must move, the welfare State which we
propose to build up, the constitutional goal of setting up a socialist
State and the assurance in the Directive Principles of State Policy
especially of security in old age at least to those who have rendered
useful service during their active years, it is indisputable, nor was it
questioned, that pension as a retirement benefit is in consonance with and
in furtherance of the goals of the Constitution. The goals for which
pension is paid themselves give a fillip and push to the policy of setting
up a welfare State because by pension the socialist goal of security of
cradle to grave is assured at least when it is mostly needed and least
available, namely, in the fall of life.””
19. This Court in Union of India & Ors. v. K.G. Radhakrishna Panickar &
Ors. [1998 (5 SCC 111] again considered the question of classification and
differential treatment. It was held that conferment of new benefit from a
particular date cannot be held to be violative of Article 14. The benefit
in question was held to be a new benefit conferred on the casual labour.
This Court held that :-
12. In its judgment dated 8-2-1991 the Tribunal has held that exclusion of
period of service rendered as Project Casual Labour before they were
regularly absorbed prior to 1-1-1981 results in such employees being
discriminated against as compared to Project Casual Labour who were
employed subsequently and whose service as Project Casual Labour prior to
absorption is counted for the purpose of qualifying service. The said
finding of the Tribunal is based on the decision of this Court in D.S.
Nakara [1983 (1) SCC 305]. In this regard, it may be stated that the
Tribunal was in error in invoking the principle laid down in D.S. Nakara in
the present case. The decision in D.S. Nakara has been considered by this
Court in subsequent decisions and it has been laid down that the principle
laid down in D.S. Nakara can have application only in those cases where
there is discrimination in the matter of existing benefit between similar
set of employees and the said principle has no application where a new
benefit is being conferred with effect from a particular date. In such a
case the conferment of the benefit with effect from a particular date
cannot be held to be violative of Article 14 of the Constitution on the
basis that such a benefit has been conferred on certain categories of
employees on the basis of a particular date. (See: Krishena Kumar v. Union
of India [1990 (4) SCC 207]; State of W.B. v. Ratan Behari Dey [1993 (4)
SCC 62] and State of Rajasthan v. Sevanivatra Karamchari Hitkari Samiti
[1995 (2) SCC 117]) In the present case, the benefit of counting of service
prior to regular employment as qualifying service was not available to
casual labour. The said benefit was granted to Open Line Casual Labour for
the first time under order dated 14-10-1980 since Open Line Casual Labour
could be treated as temporary on completion of six months’ period of
continuous service which period was subsequently reduced to 120 days under
para 2501(b)(i) of the Manual. As regards Project Casual Labour this
benefit of being treated as temporary became available only with effect
from 1-1-1981 under the scheme which was accepted by this Court in Inder
Pal Yadav [1985 (2) SCC 648]. Before the acceptance of that scheme the
benefit of temporary status was not available to Project Casual Labour. It
was thus a new benefit which was conferred on Project Casual Labour under
the scheme as approved by this Court in Inder Pal Yadav and on the basis of
this new benefit Project Casual Labour became entitled to count half of the
service rendered as Project Casual Labour on the basis of the order dated
14-10-1980 after being treated as temporary on the basis of the scheme as
accepted in Inder Pal Yadav. We are, therefore, unable to uphold the
judgment of the Tribunal dated 8-2-1991 when it holds that service rendered
as Project Casual Labour by employees who were absorbed on regular
permanent/ temporary posts prior to 1-1-1981 should be counted for the
purpose of retiral benefits and the said judgment as well as the judgment
in which the said judgment has been followed have to be set aside. The
judgments in which the Tribunal has taken a contrary view have to be
affirmed.
20. In V. Kasturi v. Managing Director, State Bank of India & Anr. [1998
(8) SCC 30], this Court considered the prospective amendment and the
question whether earlier retirees were eligible for benefit of such
amendment. It was held that where the amendment enhanced the pension or
provided for a new formula of pension even the earlier retirees who at the
time of retirement were eligible for pension and survived till the
amendment would be eligible for the benefit from the date it came into
effect, however, where the amendment extended the benefit of the pension
scheme to a new class of persons, the earlier retirees at the time of
retirement who were not eligible for pension cannot get the benefit of
amendment. This Court has laid down thus:-
“22. If the person retiring is eligible for pension at the time of his
retirement and if he survives till the time of subsequent amendment of the
relevant pension scheme, he would become eligible to get enhanced pension
or would become eligible to get more pension as per the new formula of
computation of pension subsequently brought into force, he would be
entitled to get the benefit of the amended pension provision from the date
of such order as he would be a member of the very same class of pensioners
when the additional benefit is being conferred on all of them. In such a
situation, the additional benefit available to the same class of pensioners
cannot be denied to him on the ground that he had retired prior to the date
on which the aforesaid additional benefit was conferred on all the members
of the same class of pensioners who had survived by the time the scheme
granting additional benefit to these pensioners came into force. The line
of decisions tracing their roots to the ratio of Nakara case [1983 (1) SCC
305] would cover this category of cases”.
21. In Subrata Sen & Ors. v. Union of India & Ors. [2001 (8) SCC 71],
this Court has laid down thus:-
“18. Further, in All India Reserve Bank Retired Officers Assn. v. Union of
India [1992 supp. (1) SCC 664], Ahmadi, J. (as he then was), speaking for
the Court in the aforesaid decision highlighted the observations in Nakara
case [1983 (1) SCC 305] found at SCC p. 333 para 46 to the following
effect:
“… the pension will have to be recomputed in the light of the formula
enacted in the liberalised pension scheme and effective from the date the
revised scheme comes into force. And beware that it is not a new scheme, it
is only a revision of existing scheme. It is not a new retiral benefit. It
is an upward revision of an existing benefit. If it was a wholly new
concept, a new retiral benefit, one could have appreciated an argument that
those who had already retired could not expect it.”
The Court further observed:
“It must be realised that in the case of an employee governed by the CPF
(Contributory Provident Fund) Scheme his relations with the employer come
to an end on his retirement and receipt of the CPF amount but in the case
of an employee governed under the pension scheme his relations with the
employer merely undergo a change but do not snap altogether. That is the
reason why this Court in Nakara case drew a distinction between
liberalisation of an existing benefit and introduction of a totally new
scheme. In the case of pensioners it is necessary to revise the pension
periodically as the continuous fall in the rupee value and the rise in
prices of essential commodities necessitates an adjustment of the pension
amount but that is not the case of employees governed under the CPF Scheme,
since they had received the lump sum payment which they were at liberty to
invest in a manner that would yield optimum return which would take care of
the inflationary trends. This distinction between those belonging to the
pension scheme and those belonging to the CPF Scheme has been rightly
emphasised by this Court in Krishena case [1990 (4) SCC 207]”.
22. In John Vallamattom & Anr. v. Union of India [2003 (6) SCC 611],
this Court considered the decision in D.S. Nakara (supra) and has observed
thus:-
“62. Article 14 of the Constitution states that the State shall not deny to
any person equality before the law or the equal protection of the laws
within the territory of India. The first part of Article 14 of the
Constitution of India is a declaration of equality of civil rights for all
purposes within the territory of India and basic principles of
republicanism and there will be no discrimination. The guarantee of equal
protection embraces the entire realm of “State action”. It would extend not
only when an individual is discriminated against in the matter of exercise
of his right or in the matter of imposing liabilities upon him, but also in
the matter of granting privileges etc. In all these cases, the principle is
the same, namely, that there should be no discrimination between one person
and another if as regards the subject-matter of the legislation their
position is the same. In my view, all persons in similar circumstances
shall be treated alike both in privileges and liabilities imposed. The
classification should not be arbitrary; it should be reasonable and it must
be based on qualities and characteristics and not any other who are left
out, and those qualities or characteristics must have reasonable relations
to the object of the legislation.
x x x x x
64. It has also been observed in the above judgment that in the very nature
of things, the society being composed of unequals, a welfare State will
have to strive by both executive and legislative action to help the less
fortunate in the society to ameliorate their condition so that the social
and economic inequality in the society may be bridged and in the absence of
the doctrine of classification such legislation is likely to flounder on
the bedrock of equality enshrined in Article 14 of the Constitution”.
23. In State Bank of India v. L. Kannaiah & Ors. [2003 (10) SCC 499],
this Court considered fixation of cut-off date for applicability of pension
scheme. Minimum service was prescribed 20 years and cut-off date for such
induction was fixed as 1.1.1965. This Court held minimum qualifying
service being the essential consideration. There is no rationale to
exclude employees confirmed earlier who have put in more than 20 years of
service. This Court has laid down thus:-
“6. Para 5 of the circular stipulated that the age-limit (viz. not being
over 35 years) for admission to Pension Fund shall continue. Thus the
pensioned ex-service personnel were admitted to pensionary benefits with
effect from 1-1-1965 subject to the restriction of the age-limit of 35
years (which was later on enhanced to 38 years) on that date. As the date
of confirmation of the respondents was much earlier to 1-1-1965, the
crucial date for admission to the Pension Fund would be 1-1-1965. On that
date, the confirmed employee of the Bank should not have exceeded 35 years
of age. That is the combined effect of Staff Circular No. 18 dated 8-4-1974
read with the Pension Fund Rules referred to supra. The reason for
prescribing the maximum age-limit of 35 or 38, as the case may be, for the
purpose of induction into Pension Fund appears to be that the employee
would be able to render minimum service of 20 years as contemplated by Rule
22 of the Pension Fund Rules. However, there does not appear to be any
rationale or discernible basis for fixing the cut-off date as 1-1-1965,
notwithstanding their earlier confirmation in bank service. True, a new
benefit has been conferred on the ex-servicemen and therefore, a cut-off
date could be fixed for extending this new benefit, without offending the
ratio of the decision in D.S. Nakara v. Union of India [1983 (1) SCC 305]
but, there could be no arbitrariness or irrationality in fixing such date.
Minimum qualifying service being the essential consideration, even
according to the Bank, there is no reason why the ex-servicemen like the
respondents, who from the date of their confirmation had put in more than
twenty years of service, even taking the retirement age as 58, should be
excluded. No reason is forthcoming in the counter-affidavit filed by the
Bank for choosing the said date. When it is decided to extend the
pensionary benefits to ex-servicemen drawing pension, the denial of the
benefit to some of the serving employees should be based on rational and
intelligible criterion. In substance, that is the view taken by the High
Court and we see no reason to differ with that view”.
24. In Union of India & Anr. v. SPS Vains [2008 (9) SCC 125], decision of
this Court in D.S. Nakara has been followed. It was held that there could
not be disparity of pension within the same rank. It was held thus:-
“29. The Constitution Bench (in D.S. Nakara [1983 (1) SCC 305]) has
discussed in detail the objects of granting pension and we need not,
therefore, dilate any further on the said subject, but the decision in the
aforesaid case has been consistently referred to in various subsequent
judgments of this Court, to which we need not refer. In fact, all the
relevant judgments delivered on the subject prior to the decision of the
Constitution Bench have been considered and dealt with in detail in the
aforesaid case. The directions ultimately given by the Constitution Bench
in the said case in order to resolve the dispute which had arisen, is of
relevance to resolve the dispute in this case also.
30. However, before we give such directions we must also observe that the
submissions advanced on behalf of the Union of India cannot be accepted in
view of the decision in D.S. Nakara case. The object sought to be achieved
was not to create a class within a class, but to ensure that the benefits
of pension were made available to all persons of the same class equally. To
hold otherwise would cause violence to the provisions of Article 14 of the
Constitution. It could not also have been the intention of the authorities
to equate the pension payable to officers of two different ranks by
resorting to the step-up principle envisaged in the fundamental rules in a
manner where the other officers belonging to the same cadre would be
receiving a higher pension” .
25. In K.J.S. Buttar v. Union of India & Anr. [2011 (11) SCC 429], this
Court considered the question when some new retiral benefits were
introduced and measurement to calculate disability was changed pursuant to
recommendation made by the 5th Pay Commission and same was implemented with
effect from 1.1.1996. The appellant was denied retiral benefits on account
of his retirement in 1979. This Court held the treatment to be
discriminatory and laid down that restriction of benefit to only officers
who were invalided out of service after 1.1.1996 is violative of Article 14
of the Constitution and hence illegal. In the case of liberalisation of
existing scheme all pensioners are to be treated equally. The appellant
was entitled to all retiral benefits with effect from 1.1.1996. This Court
has laid down thus:-
“11. In our opinion the appellant was entitled to the benefit of Para 7.2
of the Instructions dated 31-1-2001 according to which where the disability
is assessed between 50% and 75% then the same should be treated as 75%, and
it makes no difference whether he was invalided from service before or
after 1-1-1996. Hence the appellant was entitled to the said benefits with
arrears from 1-1-1996, and interest at 8% per annum on the same.
12. It may be mentioned that the Government of India, Ministry of Defence
had been granting war injury pension to pre-1996 retirees also in terms of
Para 10.1 of the Ministry’s Letter No. 1(5)/87/D(Pen-Ser) dated 30-10-1987
(p. 59, Para 8). The mode of calculation, however, was changed by the
Notification dated 31-1-2001 which was restricted to post-1996 retirees.
The appellant, therefore, was entitled to the war injury pension even prior
to 1-1-1996 and especially in view of the Instructions dated 31-1-2001
issued by the Government of India. The said instruction was initially for
persons retiring after 1-1-1996 but later on by virtue of the subsequent
Notifications dated 16-5-2001 it was extended to pre-1996 retirees also on
rationalisation of the scheme”.
26. Reliance has been placed by the respondents on a decision in State of
Punjab & Anr. v. J.L. Gupta & Ors. [2000 (3) SCC 736] in which this Court
referring to the decision in State of Punjab & Ors. v. Boota Singh & Anr.
[2000 (3) SCC 733] held that when financial implication is there, the
benefit conferred by notification dated 9.7.1985 can be claimed by those
who retired after the date of stipulation in the notification and those who
have retired prior to the date of stipulation, as the notifications are
governed by different rules. It was a case of pensionary benefits, i.e.,
pension, gratuity/DCRG, internal gratuity. Hence, the decision is clearly
distinguishable. Moreover, in the instant case, employees are governed by
same set of rules.
27. Considering the principles enunciated under Articles 14 and 16 of the
Constitution, and that the benefit is not an ex gratia payment but a
payment in recognition of past service, in our opinion, discrimination
could not have been made between those employees who have been
absorbed/allocated are entitled to count their services as qualifying
service for the purpose of pension and not those who have been appointed
directly. Fact remains that all these employees have served in Punjab
University/Kurukshetra University/MD. University without any break. M.D.
University, prior to its establishment, was the regional centre of
Kurukshetra University. Expectation had arisen to compute the period of
service rendered in Punjab University/Kurukshetra University which cannot
be unreasonably deprived of. Merely because a person has been appointed and
others have been absorbed/allocated makes no difference as to the service
rendered. Even otherwise, it is a case of upward revision of benefit and
the classification which is sought to be created by the aforesaid method of
not extending benefit to persons appointed directly and by fixing cut-off
date cannot be said to be intelligible one; same is discriminatory and
thus, the appellants would be entitled for the benefit from the date
decision has been taken on 24.12.2001 to compute the previous service
rendered in Punjab University/Kurukshetra University as qualifying service.
In other words, they would be entitled for the benefit prospectively from
the date of issuance of memorandum dated 24.12.2001. The employees have
expressed their willingness to deposit/adjustment of the employer’s
contribution of CPF as required in the memorandum dated 24.12.2001.
28. In yet another case of M.D. University v. Dr. Jahan, this Court did
not interfere in the decision of the High Court of Punjab and Haryana at
Chandigarh on 26.5.2009 in LPA No.27 of 2006, however, the question of law
was kept open. Hence, we have examined the case on merits and found the
case of the appellants on better footing as compared to Dr. Jahan and even
otherwise the appellants are entitled for the benefit.
29. In view of aforesaid discussion, the appellants are entitled for the
benefit of counting the services rendered in Punjab University/Kurukshetra
University as qualifying service for the purpose of pension subject to
fulfilment of the conditions specified in the memorandum dated 24.12.2001
etc. and in case the amount payable by the appellants towards contributory
provident fund is less than the amount payable to them as pension, it would
be adjusted by the respondents without insisting for its refund from the
amount payable to the appellants. Let the exercise be completed within a
period of three months from today.
30. The appeals are allowed, impugned judgment is set aside. We leave
the parties to bear their own costs.
..........................................J.
(M.Y. Eqbal)
New Delhi;
..........................................J.
August 10, 2015. (Arun Mishra)Ha
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NOS.626-627 OF 2008
A.N. Sachdeva (dead) by LRs. & Ors. ... Appellants
Vs.
Maharshi Dayanand University, Rohtak & Anr. ... Respondents
J U D G M E N T
ARUN MISHRA, J.
1. The question involved in the present appeals is whether services
rendered by the appellants in Kurukshetra University/Punjab University is
qualifying service for the purpose of pension and can be added to the
services rendered by them in the respondent no.1, i.e. Maharshi Dayanand
University, Rohtak (hereinafter called “M.D. University”).
2. The appellants are receiving pension after their retirement from M.D.
University, however, it is confined to the services rendered by them in the
same university. Deceased A.N. Sachdeva and Ram Parshad Saini were
appointed in Punjab University. R.K. Tuteja, petitioner no.3 and Prem Kumar
were appointed as Lecturer and Clerk respectively. They were appointed
without any break in M.D. University.
3. A.N. Sachdeva, since deceased was appointed as Steno-Typist in Punjab
University on 7.8.1961, thereafter as Private Secretary to Vice-Chancellor
in M.D. University on 1.5.1976, promoted as Deputy Registrar in August,
1988 and retired from the service of M.D. University on 31.12.2000.
Ram Prashad Saini after rendering services from 16.11.1962 to
14.1.1975 in Punjab University was appointed as Asistant in Kurukshetra
University on 15.1.1975 and served till 11.5.1977 and on 12.5.1977 he was
appointed in M.D. University and retired from service on 31.10.1999.
R.K. Tuteja was appointed as Lecturer in Kurukshetra University on
29.7.1964, served uninterruptedly till 20.8.1979 and was appointed on
21.8.1979 in the same capacity in M.D. University where he served till his
retirement on 31.12.2001.
Prem Kumar Naveen was appointed Clerk in Kurukshetra University on
7.8.1961 and served till 6.10.1976 and next day on 7.10.1976 he was
appointed in M.D. University. He retired on 28.2.2000.
4. The services of the said employees rendered by them in Punjab
University/Kurukshetra University have not been counted as qualifying
service for the purpose of pension by the M.D. University. Hence, the
writ petition was filed by them in the High Court after rejection of their
representation. The appellants submitted that M.D. University had
introduced pension scheme with effect from 1.4.1995. The appellants had
opted for the same. A memorandum dated 24.12.2001 was issued by the
Haryana Government for counting of service rendered by employees of Punjab
University/Kurukshetra University/M.D. University as qualifying service for
the purpose of pension.
5. Haryana Government issued a memorandum dated 7.1.2002 confining the
policy issued by it for the persons who retired after 7.1.2002, however,
Finance Department issued clarification dated 9.7.2003 that instructions
contained in the memorandum dated 7.1.2002 are not applicable to the
employees of the university because the pension schemes of the university
are different. Before that a clarification had been issued by the
Government of Haryana on 5.6.2002 mentioning that the employees of the
Punjab University were subsequently allocated to Kurukshetra University,
Rohtak and M.D. University, Rohtak before its formation used to be regional
centre of Kurukshetra University. That being the situation, decision was
taken to treat the services rendered in Punjab University/Kurukshetra
University as qualifying service for the purpose of pension on retirement
from M.D. University, Rohtak. It was also clarified that as regards the
services rendered by the employees elsewhere such as Central Government/
State Government/Autonomous Body, the same is not to be counted towards
qualifying service for the purpose of pension.
6. The stand of the respondents is that the retiral benefits of the
employees are governed by the provisions of M.D. University Pension Scheme,
1997 (hereinafter referred to as “Pension Scheme, 1997”). The past
services could not have been treated as qualifying service for pension in
view of Rule 4(vii) of the Pension Scheme, 1997 introduced with effect from
1.4.1995 in lieu of Contributory Provident Fund. Option was given to the
employees to opt for the contributory provident scheme or for the pension
scheme. In the pension scheme 1997 there is no provision for counting
previous service rendered by the appellants in Punjab
University/Kurukshetra University. Reliance had been placed on the
clarification dated 5.6.2002 to contend that the employees who continued in
the M.D. University on allocation/absorption with change of employer were
entitled to count their services for the purpose of pension. As the
appellants were directly appointed in the respondent university, they were
not entitled to count the service qualifying for pension.
7. The Division Bench of the High Court by way of impugned order has
dismissed the writ application on the ground that in view of Rule 4(vii)
of the Pension Scheme 1997, services rendered by the appellants in Punjab
University/Kurukshetra University cannot be counted. Reliance has also
been placed on the memorandum dated 7.1.2002. As the appellants had
retired before 7.1.2002, they are not entitled to count the past service
rendered by them in the aforesaid universities as qualifying service for
pension in M.D. University. It has also been observed that pension scheme
provides for constitution of corpus fund by transferring the university
contribution alongwith interest. Even if memorandum dated 7.1.2002 is not
applicable, as clarified by the Finance Department, appellants cannot get
the benefit as they had retired prior to 7.1.2002.
8. It was submitted on behalf of the appellants that as per memorandum
dated 24.12.2001 and its clarification dated 5.6.2002, the appellants are
entitled to count the services rendered in Punjab University/Kurukshetra
University as qualifying service for the purpose of pension. It is only the
service rendered in other autonomous body etc. which is not to be counted
towards the pensionary benefits. The appellants were receiving pension and
liberalised pension scheme has to be applied to the employees who had
retired earlier. It is not a new scheme, but an upward revision of
existing benefits. It is not a case of new retiral benefits. Appellants
have been discriminated vis-a-vis the other employees who had been
absorbed/allocated in the services of M.D. University from Punjab
University/Kurukshetra University, inasmuch as, their services rendered in
these universities have been counted as qualifying service for the purpose
of pension. Even the services of the employees who have rendered their
services in some other university have also been counted towards
pensionable services. In one of such case of Dr. Jahan Singh, this Court
did not intervene in the special leave petition which was dismissed. Even
otherwise, the classification sought to be created by the respondents is
not impermissible in view of Articles 14 and 16 and the services rendered
by the appellants in Punjab University/Kurukshetra University deserve to be
counted as qualifying service for the purpose of pension as has been done
in the case of employees who have been absorbed/allocated to M.D.
University.
9. Per contra, the respondents would contend that the admissible
benefits under Pension Scheme, 1997 have already been extended to the
appellants. In view of the clarification dated 5.6.2002, the services of
the employees who had been allocated/absorbed could have been counted, not
the past services of the employees who had been directly appointed in M.D.
University, appellants stood retired before 7.1.2002 as such they were not
entitled for benefit of counting of past services. The memorandum was not
having retrospective effect. Even if, memorandum dated 7.1.2002 is not
applicable, the appellants are not entitled for the benefit under the
Pension Scheme, 1997. Other employees who have been given the benefit for
counting their past services, namely, K.L. Pahuja, Yudhvir Singh Dahiya and
Sunder Singh Dahiya had retired on 30.9.2003, 31.5.2002 and 31.10.2002
respectively whereas appellants stood retired before 7.1.2002. The
decision in the case of Dr. Jahan Singh cannot be applied to the appellants
as while dismissing the special leave petition, this Court has left the
question of law open. The employer’s share of CPF has to be transferred to
the pension fund. It was a case of a new scheme as such its benefits could
not have been extended retrospectively. The appellants cannot claim
equality and complain of discrimination.
10. It is not in dispute that the appellants had opted for pension under
Pension Scheme, 1997. Para 4(vii) of the Pension Scheme, 1997 as has been
relied upon by the respondents reads thus:-
“(vii) The period of service rendered by an employee in any State Govt. or
Govt. aided Private College or in any University/autonomous body against
aided post prior to joining in the University shall not count as qualifying
service for pensionary benefits.”
However, it is not in dispute that vide memorandum dated
24.12.2001 issued by the Government of Haryana, the pension scheme was
modified inasmuch as the State Government has agreed for counting the
services of the employees of the Punjab University/Kurukshetra University
on retirement from M.D. University as qualifying service. The memorandum
dated 24.12.2001 is extracted hereunder:-
“From
Higher Education Commissioner,
Haryana Chandigarh.
To
The Vice-Chancellor,
M.D. University
Rohtak.
Memo No.18/41-2001 UNP (1)
Dated : Chandigarh the 24.12.2001
Sub: Implementation of Pension Scheme in M.D.U. Rohtak.
The State Govt. has considered and agreed for counting of service
rendered by the employees of the University in Punjab
University/Kurukshetra University/M.D. University as qualifying service for
the purpose of pension subject to the following terms and conditions :
The service rendered by the said employees in these institutions is without
any break and is continuous.
That the employer’s share of the CPF in respect of these employees has been
transferred to the pension fund even with respect to the service rendered
in Punjab University/Kurukshetra University as required under the pension
rules of the University. Further, that all other requirement of the
pension rules are fulfilled in respect of these employees. Kindly take
necessary action accordingly.
Sd/- Deputy Director, College-I,
For Higher Education Commissioner,
Haryana, Chandigarh”.
Another memorandum dated 7.1.2002 was issued by the Government of Haryana
on the basis of which certain incorporation was made in the Pension Scheme
1997. However, later on, the Finance Department on 9.7.2003 has clarified
that memorandum dated 7.1.2002 is not applicable to the employees of the
University.
11. Yet another memorandum dated 5.6.2002 has been referred to with
respect to the counting of the services of the Punjab
University/Kurukshetra University into M.D. University as qualifying
service for the purpose of pension. Same is extracted hereunder :-
“From
Higher Education Commissioner, Haryana,
Chandigarh.
To
Registrar,
Kurukshetra University, Kurukshetra.
Maharshi Dayanand University, Rohtak.
Memo No.18/44-2001 UNP (1)
Dated : Chandigarh, the 6.6.2002
Subject: Clarification regarding counting of previous service/foreign
service towards Pension.
Kindly refer to the subject noted above.
The advice issued vide letter No.18/44-2001 UNP (1) dated 24.12.2001 was in
respect of service rendered by the employees of Maharshi Dayanand
University, Rohtak in Kurukshetra University, Kurukshetra and Punjab
University. It is as well as known that initially, it was Kurukshetra
University, Kurukshetra and what constitutes Maharshi Dayanand University,
Rohtak now was a regional centre of Kurukshetra University, Kurukshetra
earlier. Similarly the employees also has rendered service in the Punjab
University and were subsequently allocated to Kurukshetra University,
Rohtak. That being the situation the advice was with regard to that
service which the employees had rendered initially in the Punjab University
followed by Maharshi Dayanand University, Rohtak. This pattern follows in
the same manner as the employees of the joining Punjab were allocated to
Haryana Govt. at the time of the creation of the Haryana State. Hence the
service rendered by these employees who continued to remain in suit but
there was a change of employer on account of division of jurisdiction after
a period of time. In their case, the previous service rendered was agreed
to be countable for the purpose of pension in Maharshi Dayanand University,
Rohtak.
To the extent the employees of Kurukshetra University, Kurukshetra fall in
the same category, their service may also be counted for the purpose of
pension at the time of retirement from Kurukshetra University, Kurukshetra
subject to fulfillment of the conditions mentioned in letter dated
24.12.2001 (copy enclosed) in respect of Maharshi Dayanand University,
Rohtak.
As regards service rendered by the employees elsewhere such as Central
Govt./State Govt./Autonomous Body, the same is not countable for the
purpose of pensionary benefits as there is no provision to this effect in
the pension scheme of Kurukshetra University, Kurukshetra. In case the
Kurukshetra University, Kurukshetra is keen to count such service for
pensionary benefits, they should be advised to first consider amendment in
their pension scheme for which a separate self-contained proposal should be
submitted for approval of the State Govt.
It is, therefore requested that the cases may be decided
accordingly.
Sd/- 5.6.02
Deputy Director Colleges-I,
For Higher Education Commissioner,
Haryana, Chandigarh.”
12. It is apparent from the memorandum dated 24.12.2001 that the first
requirement to count the services rendered in Punjab University/Kurukshetra
University/M.D. University by the appellants were without break and
continuous. It is also not in dispute that after rendering the services in
Punjab University/Kurukshetra University, the aforesaid employees had been
directly appointed on the very next day in M.D. University. Earlier, the
employees of Punjab University were allocated to Kurukshetra University and
it is not in dispute that present M.D. University used to be the regional
centre of Kurukshetra University prior to its establishment as full-fledged
University.
13. Second requirement of the memorandum dated 24.12.2001 is that the
employer’s share of the CPF has to be transferred to the pension fund with
respect to services rendered in Punjab University/Kurukshetra University.
The appellants had expressed their willingness in their representation to
fulfil the aforesaid requirement of the memorandum dated 24.12.2001
including all other requirements of the pension scheme.
14. The question which arises for consideration is whether it is a case
of upward revision of existing benefits or a new scheme floated by the
respondents, while issuing the memorandum dated 24.12.2001.
The appellants have placed reliance on a Constitution Bench decision
of this Court in D.S. Nakara & Ors. v. Union of India [1983 (1) SCC 305] in
which this Court has laid down that reasonable classification is
permissible. The classification must be founded on an intelligible
differentia and that must have a rational relation to the object sought to
be achieved. This Court has laid down that even though the scheme is
prospective, the benefit of liberalised pension scheme should be applied
equally to all and they are required to be paid the upward revision
commencing from the specified date. No arrears would be payable. This
Court has laid down thus:-
“29. Summing up it can be said with confidence that pension is not only
compensation for loyal service rendered in the past, but pension also has a
broader significance, in that it is a measure of socio-economic justice
which inheres economic security in the fall of life when physical and
mental prowess is ebbing corresponding to aging process and, therefore, one
is required to fall back on savings. One such saving in kind is when you
give your best in the hey-day of life to your employer, in days of
invalidity, economic security by way of periodical payment is assured. The
term has been judicially defined as a stated allowance or stipend made in
consideration of past service or a surrender of rights or emoluments to one
retired from service. Thus the pension payable to a government employee is
earned by rendering long and efficient service and therefore can be said to
be a deferred portion of the compensation or for service rendered. In one
sentence one can say that the most practical raison d’etre for pension is
the inability to provide for oneself due to old age. One may live and avoid
unemployment but not senility and penury if there is nothing to fall back
upon.
x x x x x
42. If it appears to be undisputable, as it does to us that the pensioners
for the purpose of pension benefits form a class, would its upward revision
permit a homogeneous class to be divided by arbitrarily fixing an
eligibility criteria unrelated to purpose of revision, and
would such classification be founded on some rational principle? The
classification has to be based, as is well settled, on some rational
principle and the rational principle must have nexus to the objects sought
to be achieved. We have set out the objects underlying the payment of
pension. If the State considered it necessary to liberalise the pension
scheme, we find no rational principle behind it for granting these benefits
only to those who retired subsequent to that date simultaneously denying
the same to those who retired prior to that date. If the liberalisation was
considered necessary for augmenting social security in old age to
government servants then those who, retired earlier cannot be worst off
than those who retire later. Therefore, this division which classified
pensioners into two classes is not based on any rational principle and if
the rational principle is the one of dividing pensioners with a view to
giving something more to persons otherwise equally placed, it would be
discriminatory. To illustrate, take two persons, one retired just a day
prior and another a day just succeeding the specified date. Both were in
the same pay bracket, the average emolument was the same and both had put
in equal number of years of service. How does a fortuitous circumstance of
retiring a day earlier or a day later will permit totally unequal treatment
in the matter of pension? One retiring a day earlier will have to be
subject to ceiling of Rs 8100 p.a. and average emolument to be worked out
on 36 months’ salary while the other will have a ceiling of Rs 12,000 p.a.
and average emolument will be computed on the basis of last 10 months’
average. The artificial division stares into face and is unrelated to any
principle and whatever principle, if there be any, has absolutely no nexus
to the objects sought to be achieved by liberalising the pension scheme. In
fact this arbitrary division has not only no nexus to the liberalised
pension scheme but it is counter-productive and runs counter to the whole
gamut of pension scheme. The equal treatment guaranteed in Article 14 is
wholly violated inasmuch as the pension rules being statutory in character,
since the specified date, the rules accord differential and discriminatory
treatment to equals in the matter of commutation of pension. A 48 hours’
difference in matter of retirement would have a traumatic effect. Division
is thus both arbitrary and unprincipled. Therefore, the classification does
not stand the test of Article 14.
43. Further the classification is wholly arbitrary because we do not find a
single acceptable or persuasive reason for this division. This arbitrary
action violated the guarantee of Article 14. The next question is what is
the way out?
x x x x x
48. It was very seriously contended, remove the event correlated to date
and examine whether the scheme is workable. We find no difficulty in
implementing the scheme omitting the event happening after the specified
date retaining the more humane formula for computation of pension. It would
apply to all existing pensioners and future pensioners. In the case of
existing pensioners, the pension will have to be recomputed by applying the
rule of average emoluments as set out in Rule 34 and introducing the slab
system and the amount worked out within the floor and the ceiling.
49. But we make it abundantly clear that arrears are not required to be
made because to that extent the scheme is prospective. All pensioners
whenever they retired would be covered by the liberalised pension scheme,
because the scheme is a scheme for payment of pension to a pensioner
governed by 1972 Rules. The date of retirement is irrelevant. But the
revised scheme would be operative from the date mentioned in the scheme and
would bring under its umbrella all existing pensioners and those who
retired subsequent to that date. In case of pensioners who retired prior to
the specified date, their pension would be computed afresh and would be
payable in future commencing from the specified date. No arrears would be
payable. And that would take care of the grievance of retrospectivity. In
our opinion, it would make a marginal difference in the case of past
pensioners because the emoluments are not revised. The last revision of
emoluments was as per the recommendation of the Third Pay Commission
(Raghubar Dayal Commission). If the emoluments remain the same, the
computation of average emoluments under amended Rule 34 may raise the
average emoluments, the period for averaging being reduced from last 36
months to last 10 months. The slab will provide slightly higher pension and
if someone reaches the maximum the old lower ceiling will not deny him what
is otherwise justly due on computation. The words “who were in service on
March 31, 1979 and retiring from service on or after that date” excluding
the date for commencement of revision are words of limitation introducing
the mischief and are vulnerable as denying equality and introducing an
arbitrary fortuitous circumstance can be severed without impairing the
formula. Therefore, there is absolutely no difficulty in removing the
arbitrary and discriminatory portion of the scheme and it can be easily
severed”.
15. In M.C. Dhingra v. Union of India & Ors. [1996 (7) SCC 564], the
question arose with respect to the counting of the previous service for
grant of pension. The circular dated 31.3.1982 which came up for
consideration provided the benefit thereof only to the persons retiring on
or after the date of issuance of circular was held to be arbitrary. This
Court has laid down thus:-
“4. It is seen that though the appellant had retired on 1-2-1973, since the
question of tagging the previous service rendered in the State Government
on temporary basis and the similar cases are pending, the Government had
taken a decision on 31-3-1982 to tag the previous service for computation
of the pension. Learned counsel appearing for the respondents contended
that clause 4 of the abovesaid circular is one of the conditions which
prescribes that it would be applicable to the government servants who
retired from that date, namely, 31-3-1982. Since the appellant had retired
on 1-2-1973, he is not eligible. We find no force in the contention. All
the persons who rendered temporary service prior to their joining the
Government of India Service have been given the benefit of fixation of the
pension payable by tagging the temporary service. The cut-off date is
arbitrary violating Article 14 of the Constitution of India. Having grouped
all the similarly circumstanced employees, fixing the cut-off date and
giving benefit to those who retired thereafter is obviously arbitrary. In
similar circumstances, following the ratio in D.S. Nakara v. Union of India
[1983 (1) SCC 305], this Court held in the case of R.L. Marwaha v. Union of
India [1987 (4) SCC 31 that such a restriction is arbitrary violating
Article 14. On the facts and circumstances, we find that the restriction
imposed in clause 4 of the circular is violative of Article 14. It is,
therefore, unconstitutional. However, the appellant will be entitled to the
pro rata pension from March 1982”.
16. In State of Punjab v. Justice S.S. Dewan (Retd.) & Ors. [1997 (4) SCC
569], this Court held that benefit extended was new one. However, this
Court has observed thus:-
“7. Therefore, what we have to consider is what is the nature of the change
made by the amendment. Is it by way of upward revision of the existing
pension scheme? Then obviously the ratio of the decision in D.S. Nakara
case [1983 (1) SCC 305] would apply. If it is held to be a new retiral
benefit or a new scheme then the benefit of it cannot be extended to those
who retired earlier”.
17. In State of Rajasthan & Anr. v. Prem Raj [1997 (10) SCC 317], this
Court rejected the submission that decision in D.S. Nakara (supra) has
given a complete go-by. This Court has laid down thus:-
“12. In State of W.B. v. Ratan Behari Dey [1993 (4) SCC 62], this Court
considered the question whether in providing a pension scheme the State
could fix up a particular date and make it applicable to those who retired
on or after that date. The Court distinguished Nakara case [1983 (1) SCC
305] by holding that in Nakara case an artificial date had been specified
classifying the retirees governed by the same rules and similarly situated
into two different classes depriving one such class of the benefit of the
liberalised pension rules and that was held to be bad. Following the
decision of the Court in Krishena Kumar case [1990 (4) SCC 207] it was held
that the State can specify a date with effect from which the Regulations
framed or amended conferring the pensionary benefits shall come into force
but the only condition is that the State cannot pick a date out of its hat
and the date has to be prescribed in a reasonable manner having regard to
all the facts and circumstances.
13. In State of Rajasthan v. Sevanivatra Karamchari Hitkari Samiti [1995
(2) SCC 117] the provisions contained in Rule 268-H of Rajasthan Service
Rules came up for consideration as to whether the aforesaid provisions
restructuring the rights of government servants in service on 29-2-1964 can
be held to be violative of Article 14. The Court applied the principle in
Krishena Kumar case and Indian Ex-Services League case [1991 (2) SCC 104]
and held that the fixation of 29-2-1964 as the cut-off date with effect
from which the new liberalised pension scheme in Chapter XXIII-A was
introduced cannot be said to be arbitrary or violative of Article 14 of the
Constitution. As has been stated earlier for deciding the present
controversy it is not necessary for us to further delve into the question
as to the extent to which the decision of this Court in Nakara case has
been followed or explained. But suffice it to say that the contention of Mr
Gupta, the learned counsel for the appellant, that the decision of this
Court in Nakara case has been given a complete go-by cannot be sustained”.
18. In Dhan Raj & Ors. v. State of J&K & Ors. [1998 (4) SCC 30], this
Court considered the case where the appellants who had retired from the
services of Corporation prior to 9.6.1981 claimed to be entitled to
pensionary benefits by virtue of G.O. dated 3.10.1986. The contention of
the State that the benefit could not be extended to the appellants was
rejected. The relevant portion is extracted hereunder:-
“14. Even otherwise, we do not find any justifiable criteria for the State
Government to draw the line between those who retired earlier and those who
retired after 9-6-1981. Both such set of employees were equally placed in
the same Undertaking/Corporation temporary in character and all having
served in the organisations for more than 20 years. In fact, the appellants
have served with the Government for more than 30 to 40 years. The person
serving for such a long period earns his legitimate expectation. It is not
something which he seeks with a begging bowl. It is inappropriate for a
State Government to take up a stand to get its own order to be held
illegal, by giving restrictive interpretation to deny benefit to its own
employees who had worked for such a long period. In fact, in the
Constitution Bench decision of this Court in D.S. Nakara v. Union of India
[1983 (1) SCC 305] this Court held that criterion of date of enforcement of
the revised scheme entitling benefits of the revision to those retiring
after specified date while depriving the benefits to those retiring prior
to that date was violative of Article 14. Even otherwise, while considering
the question of grant of pensionary benefits the State has to act to reach
the constitutional goal of setting up a socialist State as stated and the
assurance as given in the Directive Principles of State Policy. A pension
is a part and parcel of that goal, which secures to a person serving with
the State after retirement of his livelihood. To deny such a right to such
a person, without any sound reasoning or any justifiable differentia would
be against the spirit of the Constitution. We find in the present case the
stand taken by the State Government to be contrary to the said spirit. In
the aforesaid D.S. Nakara this Court has very clearly recorded the
following:
“36. Having set out clearly the society which we propose to set up, the
direction in which the State action must move, the welfare State which we
propose to build up, the constitutional goal of setting up a socialist
State and the assurance in the Directive Principles of State Policy
especially of security in old age at least to those who have rendered
useful service during their active years, it is indisputable, nor was it
questioned, that pension as a retirement benefit is in consonance with and
in furtherance of the goals of the Constitution. The goals for which
pension is paid themselves give a fillip and push to the policy of setting
up a welfare State because by pension the socialist goal of security of
cradle to grave is assured at least when it is mostly needed and least
available, namely, in the fall of life.””
19. This Court in Union of India & Ors. v. K.G. Radhakrishna Panickar &
Ors. [1998 (5 SCC 111] again considered the question of classification and
differential treatment. It was held that conferment of new benefit from a
particular date cannot be held to be violative of Article 14. The benefit
in question was held to be a new benefit conferred on the casual labour.
This Court held that :-
12. In its judgment dated 8-2-1991 the Tribunal has held that exclusion of
period of service rendered as Project Casual Labour before they were
regularly absorbed prior to 1-1-1981 results in such employees being
discriminated against as compared to Project Casual Labour who were
employed subsequently and whose service as Project Casual Labour prior to
absorption is counted for the purpose of qualifying service. The said
finding of the Tribunal is based on the decision of this Court in D.S.
Nakara [1983 (1) SCC 305]. In this regard, it may be stated that the
Tribunal was in error in invoking the principle laid down in D.S. Nakara in
the present case. The decision in D.S. Nakara has been considered by this
Court in subsequent decisions and it has been laid down that the principle
laid down in D.S. Nakara can have application only in those cases where
there is discrimination in the matter of existing benefit between similar
set of employees and the said principle has no application where a new
benefit is being conferred with effect from a particular date. In such a
case the conferment of the benefit with effect from a particular date
cannot be held to be violative of Article 14 of the Constitution on the
basis that such a benefit has been conferred on certain categories of
employees on the basis of a particular date. (See: Krishena Kumar v. Union
of India [1990 (4) SCC 207]; State of W.B. v. Ratan Behari Dey [1993 (4)
SCC 62] and State of Rajasthan v. Sevanivatra Karamchari Hitkari Samiti
[1995 (2) SCC 117]) In the present case, the benefit of counting of service
prior to regular employment as qualifying service was not available to
casual labour. The said benefit was granted to Open Line Casual Labour for
the first time under order dated 14-10-1980 since Open Line Casual Labour
could be treated as temporary on completion of six months’ period of
continuous service which period was subsequently reduced to 120 days under
para 2501(b)(i) of the Manual. As regards Project Casual Labour this
benefit of being treated as temporary became available only with effect
from 1-1-1981 under the scheme which was accepted by this Court in Inder
Pal Yadav [1985 (2) SCC 648]. Before the acceptance of that scheme the
benefit of temporary status was not available to Project Casual Labour. It
was thus a new benefit which was conferred on Project Casual Labour under
the scheme as approved by this Court in Inder Pal Yadav and on the basis of
this new benefit Project Casual Labour became entitled to count half of the
service rendered as Project Casual Labour on the basis of the order dated
14-10-1980 after being treated as temporary on the basis of the scheme as
accepted in Inder Pal Yadav. We are, therefore, unable to uphold the
judgment of the Tribunal dated 8-2-1991 when it holds that service rendered
as Project Casual Labour by employees who were absorbed on regular
permanent/ temporary posts prior to 1-1-1981 should be counted for the
purpose of retiral benefits and the said judgment as well as the judgment
in which the said judgment has been followed have to be set aside. The
judgments in which the Tribunal has taken a contrary view have to be
affirmed.
20. In V. Kasturi v. Managing Director, State Bank of India & Anr. [1998
(8) SCC 30], this Court considered the prospective amendment and the
question whether earlier retirees were eligible for benefit of such
amendment. It was held that where the amendment enhanced the pension or
provided for a new formula of pension even the earlier retirees who at the
time of retirement were eligible for pension and survived till the
amendment would be eligible for the benefit from the date it came into
effect, however, where the amendment extended the benefit of the pension
scheme to a new class of persons, the earlier retirees at the time of
retirement who were not eligible for pension cannot get the benefit of
amendment. This Court has laid down thus:-
“22. If the person retiring is eligible for pension at the time of his
retirement and if he survives till the time of subsequent amendment of the
relevant pension scheme, he would become eligible to get enhanced pension
or would become eligible to get more pension as per the new formula of
computation of pension subsequently brought into force, he would be
entitled to get the benefit of the amended pension provision from the date
of such order as he would be a member of the very same class of pensioners
when the additional benefit is being conferred on all of them. In such a
situation, the additional benefit available to the same class of pensioners
cannot be denied to him on the ground that he had retired prior to the date
on which the aforesaid additional benefit was conferred on all the members
of the same class of pensioners who had survived by the time the scheme
granting additional benefit to these pensioners came into force. The line
of decisions tracing their roots to the ratio of Nakara case [1983 (1) SCC
305] would cover this category of cases”.
21. In Subrata Sen & Ors. v. Union of India & Ors. [2001 (8) SCC 71],
this Court has laid down thus:-
“18. Further, in All India Reserve Bank Retired Officers Assn. v. Union of
India [1992 supp. (1) SCC 664], Ahmadi, J. (as he then was), speaking for
the Court in the aforesaid decision highlighted the observations in Nakara
case [1983 (1) SCC 305] found at SCC p. 333 para 46 to the following
effect:
“… the pension will have to be recomputed in the light of the formula
enacted in the liberalised pension scheme and effective from the date the
revised scheme comes into force. And beware that it is not a new scheme, it
is only a revision of existing scheme. It is not a new retiral benefit. It
is an upward revision of an existing benefit. If it was a wholly new
concept, a new retiral benefit, one could have appreciated an argument that
those who had already retired could not expect it.”
The Court further observed:
“It must be realised that in the case of an employee governed by the CPF
(Contributory Provident Fund) Scheme his relations with the employer come
to an end on his retirement and receipt of the CPF amount but in the case
of an employee governed under the pension scheme his relations with the
employer merely undergo a change but do not snap altogether. That is the
reason why this Court in Nakara case drew a distinction between
liberalisation of an existing benefit and introduction of a totally new
scheme. In the case of pensioners it is necessary to revise the pension
periodically as the continuous fall in the rupee value and the rise in
prices of essential commodities necessitates an adjustment of the pension
amount but that is not the case of employees governed under the CPF Scheme,
since they had received the lump sum payment which they were at liberty to
invest in a manner that would yield optimum return which would take care of
the inflationary trends. This distinction between those belonging to the
pension scheme and those belonging to the CPF Scheme has been rightly
emphasised by this Court in Krishena case [1990 (4) SCC 207]”.
22. In John Vallamattom & Anr. v. Union of India [2003 (6) SCC 611],
this Court considered the decision in D.S. Nakara (supra) and has observed
thus:-
“62. Article 14 of the Constitution states that the State shall not deny to
any person equality before the law or the equal protection of the laws
within the territory of India. The first part of Article 14 of the
Constitution of India is a declaration of equality of civil rights for all
purposes within the territory of India and basic principles of
republicanism and there will be no discrimination. The guarantee of equal
protection embraces the entire realm of “State action”. It would extend not
only when an individual is discriminated against in the matter of exercise
of his right or in the matter of imposing liabilities upon him, but also in
the matter of granting privileges etc. In all these cases, the principle is
the same, namely, that there should be no discrimination between one person
and another if as regards the subject-matter of the legislation their
position is the same. In my view, all persons in similar circumstances
shall be treated alike both in privileges and liabilities imposed. The
classification should not be arbitrary; it should be reasonable and it must
be based on qualities and characteristics and not any other who are left
out, and those qualities or characteristics must have reasonable relations
to the object of the legislation.
x x x x x
64. It has also been observed in the above judgment that in the very nature
of things, the society being composed of unequals, a welfare State will
have to strive by both executive and legislative action to help the less
fortunate in the society to ameliorate their condition so that the social
and economic inequality in the society may be bridged and in the absence of
the doctrine of classification such legislation is likely to flounder on
the bedrock of equality enshrined in Article 14 of the Constitution”.
23. In State Bank of India v. L. Kannaiah & Ors. [2003 (10) SCC 499],
this Court considered fixation of cut-off date for applicability of pension
scheme. Minimum service was prescribed 20 years and cut-off date for such
induction was fixed as 1.1.1965. This Court held minimum qualifying
service being the essential consideration. There is no rationale to
exclude employees confirmed earlier who have put in more than 20 years of
service. This Court has laid down thus:-
“6. Para 5 of the circular stipulated that the age-limit (viz. not being
over 35 years) for admission to Pension Fund shall continue. Thus the
pensioned ex-service personnel were admitted to pensionary benefits with
effect from 1-1-1965 subject to the restriction of the age-limit of 35
years (which was later on enhanced to 38 years) on that date. As the date
of confirmation of the respondents was much earlier to 1-1-1965, the
crucial date for admission to the Pension Fund would be 1-1-1965. On that
date, the confirmed employee of the Bank should not have exceeded 35 years
of age. That is the combined effect of Staff Circular No. 18 dated 8-4-1974
read with the Pension Fund Rules referred to supra. The reason for
prescribing the maximum age-limit of 35 or 38, as the case may be, for the
purpose of induction into Pension Fund appears to be that the employee
would be able to render minimum service of 20 years as contemplated by Rule
22 of the Pension Fund Rules. However, there does not appear to be any
rationale or discernible basis for fixing the cut-off date as 1-1-1965,
notwithstanding their earlier confirmation in bank service. True, a new
benefit has been conferred on the ex-servicemen and therefore, a cut-off
date could be fixed for extending this new benefit, without offending the
ratio of the decision in D.S. Nakara v. Union of India [1983 (1) SCC 305]
but, there could be no arbitrariness or irrationality in fixing such date.
Minimum qualifying service being the essential consideration, even
according to the Bank, there is no reason why the ex-servicemen like the
respondents, who from the date of their confirmation had put in more than
twenty years of service, even taking the retirement age as 58, should be
excluded. No reason is forthcoming in the counter-affidavit filed by the
Bank for choosing the said date. When it is decided to extend the
pensionary benefits to ex-servicemen drawing pension, the denial of the
benefit to some of the serving employees should be based on rational and
intelligible criterion. In substance, that is the view taken by the High
Court and we see no reason to differ with that view”.
24. In Union of India & Anr. v. SPS Vains [2008 (9) SCC 125], decision of
this Court in D.S. Nakara has been followed. It was held that there could
not be disparity of pension within the same rank. It was held thus:-
“29. The Constitution Bench (in D.S. Nakara [1983 (1) SCC 305]) has
discussed in detail the objects of granting pension and we need not,
therefore, dilate any further on the said subject, but the decision in the
aforesaid case has been consistently referred to in various subsequent
judgments of this Court, to which we need not refer. In fact, all the
relevant judgments delivered on the subject prior to the decision of the
Constitution Bench have been considered and dealt with in detail in the
aforesaid case. The directions ultimately given by the Constitution Bench
in the said case in order to resolve the dispute which had arisen, is of
relevance to resolve the dispute in this case also.
30. However, before we give such directions we must also observe that the
submissions advanced on behalf of the Union of India cannot be accepted in
view of the decision in D.S. Nakara case. The object sought to be achieved
was not to create a class within a class, but to ensure that the benefits
of pension were made available to all persons of the same class equally. To
hold otherwise would cause violence to the provisions of Article 14 of the
Constitution. It could not also have been the intention of the authorities
to equate the pension payable to officers of two different ranks by
resorting to the step-up principle envisaged in the fundamental rules in a
manner where the other officers belonging to the same cadre would be
receiving a higher pension” .
25. In K.J.S. Buttar v. Union of India & Anr. [2011 (11) SCC 429], this
Court considered the question when some new retiral benefits were
introduced and measurement to calculate disability was changed pursuant to
recommendation made by the 5th Pay Commission and same was implemented with
effect from 1.1.1996. The appellant was denied retiral benefits on account
of his retirement in 1979. This Court held the treatment to be
discriminatory and laid down that restriction of benefit to only officers
who were invalided out of service after 1.1.1996 is violative of Article 14
of the Constitution and hence illegal. In the case of liberalisation of
existing scheme all pensioners are to be treated equally. The appellant
was entitled to all retiral benefits with effect from 1.1.1996. This Court
has laid down thus:-
“11. In our opinion the appellant was entitled to the benefit of Para 7.2
of the Instructions dated 31-1-2001 according to which where the disability
is assessed between 50% and 75% then the same should be treated as 75%, and
it makes no difference whether he was invalided from service before or
after 1-1-1996. Hence the appellant was entitled to the said benefits with
arrears from 1-1-1996, and interest at 8% per annum on the same.
12. It may be mentioned that the Government of India, Ministry of Defence
had been granting war injury pension to pre-1996 retirees also in terms of
Para 10.1 of the Ministry’s Letter No. 1(5)/87/D(Pen-Ser) dated 30-10-1987
(p. 59, Para 8). The mode of calculation, however, was changed by the
Notification dated 31-1-2001 which was restricted to post-1996 retirees.
The appellant, therefore, was entitled to the war injury pension even prior
to 1-1-1996 and especially in view of the Instructions dated 31-1-2001
issued by the Government of India. The said instruction was initially for
persons retiring after 1-1-1996 but later on by virtue of the subsequent
Notifications dated 16-5-2001 it was extended to pre-1996 retirees also on
rationalisation of the scheme”.
26. Reliance has been placed by the respondents on a decision in State of
Punjab & Anr. v. J.L. Gupta & Ors. [2000 (3) SCC 736] in which this Court
referring to the decision in State of Punjab & Ors. v. Boota Singh & Anr.
[2000 (3) SCC 733] held that when financial implication is there, the
benefit conferred by notification dated 9.7.1985 can be claimed by those
who retired after the date of stipulation in the notification and those who
have retired prior to the date of stipulation, as the notifications are
governed by different rules. It was a case of pensionary benefits, i.e.,
pension, gratuity/DCRG, internal gratuity. Hence, the decision is clearly
distinguishable. Moreover, in the instant case, employees are governed by
same set of rules.
27. Considering the principles enunciated under Articles 14 and 16 of the
Constitution, and that the benefit is not an ex gratia payment but a
payment in recognition of past service, in our opinion, discrimination
could not have been made between those employees who have been
absorbed/allocated are entitled to count their services as qualifying
service for the purpose of pension and not those who have been appointed
directly. Fact remains that all these employees have served in Punjab
University/Kurukshetra University/MD. University without any break. M.D.
University, prior to its establishment, was the regional centre of
Kurukshetra University. Expectation had arisen to compute the period of
service rendered in Punjab University/Kurukshetra University which cannot
be unreasonably deprived of. Merely because a person has been appointed and
others have been absorbed/allocated makes no difference as to the service
rendered. Even otherwise, it is a case of upward revision of benefit and
the classification which is sought to be created by the aforesaid method of
not extending benefit to persons appointed directly and by fixing cut-off
date cannot be said to be intelligible one; same is discriminatory and
thus, the appellants would be entitled for the benefit from the date
decision has been taken on 24.12.2001 to compute the previous service
rendered in Punjab University/Kurukshetra University as qualifying service.
In other words, they would be entitled for the benefit prospectively from
the date of issuance of memorandum dated 24.12.2001. The employees have
expressed their willingness to deposit/adjustment of the employer’s
contribution of CPF as required in the memorandum dated 24.12.2001.
28. In yet another case of M.D. University v. Dr. Jahan, this Court did
not interfere in the decision of the High Court of Punjab and Haryana at
Chandigarh on 26.5.2009 in LPA No.27 of 2006, however, the question of law
was kept open. Hence, we have examined the case on merits and found the
case of the appellants on better footing as compared to Dr. Jahan and even
otherwise the appellants are entitled for the benefit.
29. In view of aforesaid discussion, the appellants are entitled for the
benefit of counting the services rendered in Punjab University/Kurukshetra
University as qualifying service for the purpose of pension subject to
fulfilment of the conditions specified in the memorandum dated 24.12.2001
etc. and in case the amount payable by the appellants towards contributory
provident fund is less than the amount payable to them as pension, it would
be adjusted by the respondents without insisting for its refund from the
amount payable to the appellants. Let the exercise be completed within a
period of three months from today.
30. The appeals are allowed, impugned judgment is set aside. We leave
the parties to bear their own costs.
..........................................J.
(M.Y. Eqbal)
New Delhi;
..........................................J.
August 10, 2015. (Arun Mishra)Ha
