Shri Des Raj Bhatnagar & Anr. Vs. Union of India
EmailAppeal: Writ Petition (Civil) Nos.11757 & 11758 of 1984
WITH
Civil Appeal No.1124 of 1985
WITH
Civil Appeal No.1124 of 1985
Petitioner: Shri Des Raj Bhatnagar & Anr.
Respondent: Union of India
Apeal: Writ Petition (Civil) Nos.11757 & 11758 of 1984
WITH
Civil Appeal No.1124 of 1985
WITH
Civil Appeal No.1124 of 1985
Judges: N.M. KASLIWAL & K. RAMASWAMY, JJ.
Date of Judgment: Feb 13, 1991
Head Note:
SERVICE AND LABOUR LAW
Pension
Liberalised Pension Rules – Benefits under – Petitioners got 1/3rd of their pension commuted and exercised option of getting the entire pension commuted and in lieu thereof got a lumpsum – Such persons cannot fall in the category of Central Govt. pensioners for purposes of getting benefits under Liberalised Pension Rules – Office Memorandum dated 22-10-1983, clause 5 – Central Civil Service (Pension) Rules, 1972.
Held:
The commutation brings about certain advantages. The commuting pensioner gets a lumpsum amount which ordinarily he would have received in the course of his spread over period subject to his continuing to live. Thus, two advantages are certainly forthcoming out of commutation – (1) availability of a lumpsum amount, and (2) the risk factor. In the present case the petitioner had not only got 1/3rd of their pension commuted but exercised the option of getting the entire pension commuted and in lieu thereof got a lumpsum. Such persons cannot fall in the category of Central Government pensioners for the purposes of getting benefit of Liberalised Pension Rules which can be made applicable only to Central Government pensioners. It is no doubt correct that the family pension has been allowed in case of the persons like the petitioners but that does not make them entitled to get any benefit given to the pensioners on account of the Liberalised Pension Rules taking note of the fallen value of the rupee. (Para 10)
Cases Reffered:
1. “Common Cause” a Registered Society & Ors. v. Union of India, 1987 (1) SCC 142. (Para 9)
2. D.S. Nakara & Others v. Union of India, 1983 (2) SCR 165. (Para 8)
2. D.S. Nakara & Others v. Union of India, 1983 (2) SCR 165. (Para 8)
JUDGEMENT:
KASLIWAL, J. :
1. The above writ petition and appeal are disposed of by one single order as identical questions of law are involved in these cases. In order to appreciate the controversy we would narrate the facts of the writ petitions. Shri Des Raj Bhatnagar, Petitioner No.1 and Shri Ved Pal Seth, Petitioner No.2 were employees of the Central Government. The petitioner No.1 after serving in various capacities in the Department of food of the Central Government from 24.10.1941 to 31.8.1971 (29 years and 10 months) was permanently absorbed in Food Corporation of India as Assistant on 1st September, 1971 and retired from the Government service.
2. The petitioner after serving the Government in various capacities for the period from 5.11.1947 to 8.12.1972 (20 years and 3 months) was permanently absorbed on 9.2.1972 in Food Corporation of India as Sr. Asstt. Manager and retired from the Government service.
3. On absorption in the Food Corporation of India, the petitioners were required to exercise either of the following two options:
(a) Receiving the pro-rata monthly pension and death-cum- retirement gratuity as admissible under the rules; and
(b) Receiving the pro-rata gratuity and a lumpsum amount in lieu of pension worked out with reference to commutation table obtaining on the date from which the pension was to be admissible and under the option order.
The office of the Pay and Accounts Officer, Ministry of Food and Agriculture determined the original pension payable to the petitioners per mensem. The petitioners were sanctioned original pensions in accordance with the provisions of the Central Civil Service (Pension) Rules, 1972. In case of petitioner No.1 the original pension was determined at Rs.240/- per mensem payable from 1st September, 1971. In case of petitioner No.2 the original pension admissible was determined at Rs.287/- per mensem payable from 9.2.1972.
4. The petitioner No.1 received his pension @Rs.240/- per mensem for the period from 1.9.1971 to 29.10.1972. Petitioner No.2 received his pension @Rs.287/- per mensem for the period from 9.2.1972 to 16.8.1972. Under the above Rules maximum of one third of the amount of admissible pension could be commuted. However, in the case of Government Officers including Industrial Management Pool Officers who were opting for permanent absorption in Public Sector Undertakings, an option was given to commute the full amount of their original pension. The petitioner No.1 and petitioner No.2 commuted their original pensions for a lumpsum of Rs.35,568/- and Rs.43,601/- on 30.12.1972 and 17.8.1972 respectively.
5. The Third Central Pay Commission was required to make its recommendations in the matter of providing relief to Government Pensioners. The Pay Commission, in order to secure Government pensioners against the continuing erosion in the value of the rupee and to recommend appropriate measures for protecting the pension of Government servants from such erosion on account of the possible increase in the case (sic) of living in future and after having considered the matter, recommended that irrespective of the amount of pension drawn by them, pensioners should be given relief at the rate of 5% of their pension subject to a minimum of Rs.5 per mensem and a maximum of Rs.25/- per mensem. The relief at those rates were recommended to be given to the Government pensioners as and when there was a 16 point rise in the 12 months average of the All India Working Class Consumer Price Index (1960-100). The relief for the first time, at these rates was to be paid when the 12th monthly average of this index reached 216. The said recommendation made by the Pay Commission was duly accepted by the Central Government.
6. The Ministry of Finance Office Memorandum No.F.22(8)-EV(A)/75 dated 13.2.1976 inter alia, provided that where an officer on his retirement commutes a portion of his pension he is eligible for relief and ad hoc reliefs in pension on the full amount of original pension as admissible to him. Under the said O.M. the term ‘Pension’ includes for the purposes of ad hoc relief the commuted portion of pension, if any. The case of the petitioners is that according to these Rules, an officer who has commuted any part of his pension and an officer who has not opted for any commutation both receive the full quantum of relief and ad hoc relief on full amount of original pension. It has thus been contended that for the purposes of grant of the full benefit of relief or ad hoc relief the Rules do not make any distinction between an officer who has sought commutation of his original pension and one who has not sought any such commutation. The petitioner and other Government servants who opted for commutation of their original pension in accordance with the Rules are being arbitrarily and without just and reasonable cause are deprived of the relief and ad hoc relief on commutation on pursuance of the office Memorandum dated 13.2.1976. Though, an officer who commutes one third of his pension gets relief and ad hoc relief on the basis of original amount of his pension but whereas an officer commutes whole of his original pension is deprived of the entire amount of the relief or ad hoc relief. The petitioners have thus contended that aforesaid Office Memorandum dated 13.2.1976 is vitiated by an inherent discrimination and is violative of Articles 14 and 16 of the Constitution.
7. The petitioners have further submitted that they are entitled to the aforesaid reliefs granted to all other Government pensioners, and the amount of relief to which pensioners are entitled and has been denied to them under the impugned Office Memorandum dated 13.2.1976 works out to Rs.13,592/- and Rs.15,040/- in case of petitioner No.1 and petitioner No.2 respectively upto 29.2.1984. The Ministry of Finance in their Office Memorandum No.F.2(8)/EV/82 dated 10.10.1983 has sanctioned the grant of relief and ad hoc reliefs to Government servants who retired prior to 10th September, 1979 @ 92.5% of their original pension subject to minimum of Rs.93/- and maximum of Rs.463/- with effect from 1st July, 1983. This has been done by taking in view the decline in the purchasing power of the rupee and the original sanction being insufficient and meagre to sustain the pensioners.
8. Apart from the above the petitioners have submitted that they are also entitled to the benefit of Liberalised Pension Formula of 1979, which was introduced vide the Finance Ministry’s Office Memorandum No.F.19(37)/EV/79 dated 25.5.1979, in respect of the approved pensionable service rendered by them in the Central Government as admissible to other pensioners who retired from Government service between 17.4.1950 to 31.3.1979. The said Memorandum was made applicable only to those Government servants who retired from service on or after 31.3.1979. However, this Court in D.S.Nakara & Others vs. Union of India (1983 (2) SCR 165) held that all Central Government pensioners governed by the Central Civil Service (Pension) Rules, 1972 were entitled to pension w.e.f. 1.4.1979 as computed under the Liberalised Pension Formula irrespective of the date of their retirement. Placing reliance on the above decision it has been claimed that there should be no discrimination between the applicability of the Liberalised Pension Formula to pre 31.3.1979 pensioners and there is no just and reasonable cause in denying such benefit to the petitioners under the impugned Office Memorandum No.F.1(3)/ EV/83 dated 22.10.1983.
9. Clause 5 of the Office Memorandum dated 22.10.1983 reads as under:
“Central Government employees, who got themselves absorbed under Central Public Sector undertaking/ autonomous bodies prior to 1.4.1979 and have received/or opted to receive commuted raise for 1/3rd of pension as well as terminal benefit equal to the commuted value of the balance amount of pension left after commuting 1/3rd, of pension, are not entitled to any benefit under these orders as they were not Central Government pensioners as on 1.4.79. In cases where only a portion of pension has been commuted, the pension will have to be enhanced in accordance with these orders with effect from 1.4.1979.”
The above clause makes it clear that such Central Government employees, who got themselves absorbed under Central Public Sector Undertakings prior to 1.4.1979 and opted to receive commuted raise for 1/3rd of pension as well as terminal benefit equal to the commuted value of the balance amount of pension left after commuting 1/3rd of pension were not entitled to any benefit as they were not Central Government pensioners as on 1.4.1979. An identical writ petition No.1068/1987 under Art.32 of the Constitution was filed on behalf of the Welfare Association of absorbed Central Government Employees in Public Enterprises and this Court dismissed the said writ petition on April 12, 1990. In the said writ petition benefit of Judgment of this Court in Common Cause” a Registered Society & Ors. vs. Union of India (1987 (1) SCC 142) was claimed but the same was negatived by making a distinction that the writ petition “Common Cause” was on behalf of the Government servants who had commuted their pension partially and this Court for the reasons indicated in the judgment came to hold that on the expiry of 15 years from the date of commutation the entire pension revived. The petitioners were persons who had, at the time of retirement from Government service and entering into public sector had taken the advantage of commuting the entire pension. They certainly belong to a class different from those whose case was before this Court at the instance of the common cause in Writ Petition Nos.1955-61 of 1983. It was further held in the above case that the commutation does bring certain advantages to the commutees and the class of Government officers whom the petitioner seeks to represent have derived such benefits.
10. We find no reason to take a different view. The commutation brings about certain advantages. The commuting pensioner gets a lumpsum amount which ordinarily he would have received in the course of his spread over period subject to his continuing to live. Thus, two advantages are certainly forthcoming out of commutation – (1) availability of a lumpsum amount, and (2) the risk factor. In the present case the petitioner had not only got 1/3rd of their pension commuted but exercised the option of getting the entire pension commuted and in lieu thereof got a lumpsum. Such persons cannot fall in the category of Central Government pensioners for the purposes of getting benefit of Liberalised Pension Rules which can be made applicable only to Central Government pensioners. It is no doubt correct that the family pension has been allowed in case of the persons like the petitioners but that does not make them entitled to get any benefit given to the pensioners on account of the Liberalised Pension Rules taking note of the fallen value of the rupee.
11. It was contended by Mr. Rao on behalf of the petitioners that the petitioners are not claiming any pension but their contention is that the Liberalised Pension Rules which give benefit to those pensioners who had got their 1/3rd pension commuted should be granted to the petitioners by awarding lumpsum after increasing their pension and calculating such amount in proportion to the increased pension. We find no force in this contention as the petitioners fall in a different class altogether and are not entitled to claim any benefit granted to Central Government pensioners. After getting a lumpsum in lieu of entire pension, they do not fall in the class of Central Government pensioners and are not entitled to any benefit granted to Central Government pensioners. The case of such Central Government pensioners who got their 1/3rd pension commuted also fall in a different class in as much as they get 2/3rd pension, and after 15 years of such commutation or having attained the age of 70 years whichever was later they become entitled to full pension. Petitioners on the other hand were not entitled to any pension after having received the lumpsum amount in lieu of pension being commuted and having opted to receive such amount in lumpsum at the time of entering the service in Public Sector Undertaking.
12. In the above mentioned civil appeal the legal question is identical except that the appellant in this case became a pensioner of the Central Government w.e.f. 1.4.1977 and the pension determined as payable to him was Rs.609/- per month and the same was got commuted by the appellant for a lumpsum amount on and from 7.8.1978. The appellant had exercised the option for absorption in Steel Authority of India Limited (SAIL) a Public Sector Enterprise. The Writ Petition filed by him before the High Court of Delhi was dismissed on 25.8.1982. The appellant then filed a S.L.P. against the said order. This Court had granted special leave on 25.3.1985 and had given a direction to hear the appeal alongwith the writ petition Nos.11757 & 11758 of 1984.
13. In the result we find no force in all these cases and the same are dismissed with no order as to costs.
1. The above writ petition and appeal are disposed of by one single order as identical questions of law are involved in these cases. In order to appreciate the controversy we would narrate the facts of the writ petitions. Shri Des Raj Bhatnagar, Petitioner No.1 and Shri Ved Pal Seth, Petitioner No.2 were employees of the Central Government. The petitioner No.1 after serving in various capacities in the Department of food of the Central Government from 24.10.1941 to 31.8.1971 (29 years and 10 months) was permanently absorbed in Food Corporation of India as Assistant on 1st September, 1971 and retired from the Government service.
2. The petitioner after serving the Government in various capacities for the period from 5.11.1947 to 8.12.1972 (20 years and 3 months) was permanently absorbed on 9.2.1972 in Food Corporation of India as Sr. Asstt. Manager and retired from the Government service.
3. On absorption in the Food Corporation of India, the petitioners were required to exercise either of the following two options:
(a) Receiving the pro-rata monthly pension and death-cum- retirement gratuity as admissible under the rules; and
(b) Receiving the pro-rata gratuity and a lumpsum amount in lieu of pension worked out with reference to commutation table obtaining on the date from which the pension was to be admissible and under the option order.
The office of the Pay and Accounts Officer, Ministry of Food and Agriculture determined the original pension payable to the petitioners per mensem. The petitioners were sanctioned original pensions in accordance with the provisions of the Central Civil Service (Pension) Rules, 1972. In case of petitioner No.1 the original pension was determined at Rs.240/- per mensem payable from 1st September, 1971. In case of petitioner No.2 the original pension admissible was determined at Rs.287/- per mensem payable from 9.2.1972.
4. The petitioner No.1 received his pension @Rs.240/- per mensem for the period from 1.9.1971 to 29.10.1972. Petitioner No.2 received his pension @Rs.287/- per mensem for the period from 9.2.1972 to 16.8.1972. Under the above Rules maximum of one third of the amount of admissible pension could be commuted. However, in the case of Government Officers including Industrial Management Pool Officers who were opting for permanent absorption in Public Sector Undertakings, an option was given to commute the full amount of their original pension. The petitioner No.1 and petitioner No.2 commuted their original pensions for a lumpsum of Rs.35,568/- and Rs.43,601/- on 30.12.1972 and 17.8.1972 respectively.
5. The Third Central Pay Commission was required to make its recommendations in the matter of providing relief to Government Pensioners. The Pay Commission, in order to secure Government pensioners against the continuing erosion in the value of the rupee and to recommend appropriate measures for protecting the pension of Government servants from such erosion on account of the possible increase in the case (sic) of living in future and after having considered the matter, recommended that irrespective of the amount of pension drawn by them, pensioners should be given relief at the rate of 5% of their pension subject to a minimum of Rs.5 per mensem and a maximum of Rs.25/- per mensem. The relief at those rates were recommended to be given to the Government pensioners as and when there was a 16 point rise in the 12 months average of the All India Working Class Consumer Price Index (1960-100). The relief for the first time, at these rates was to be paid when the 12th monthly average of this index reached 216. The said recommendation made by the Pay Commission was duly accepted by the Central Government.
6. The Ministry of Finance Office Memorandum No.F.22(8)-EV(A)/75 dated 13.2.1976 inter alia, provided that where an officer on his retirement commutes a portion of his pension he is eligible for relief and ad hoc reliefs in pension on the full amount of original pension as admissible to him. Under the said O.M. the term ‘Pension’ includes for the purposes of ad hoc relief the commuted portion of pension, if any. The case of the petitioners is that according to these Rules, an officer who has commuted any part of his pension and an officer who has not opted for any commutation both receive the full quantum of relief and ad hoc relief on full amount of original pension. It has thus been contended that for the purposes of grant of the full benefit of relief or ad hoc relief the Rules do not make any distinction between an officer who has sought commutation of his original pension and one who has not sought any such commutation. The petitioner and other Government servants who opted for commutation of their original pension in accordance with the Rules are being arbitrarily and without just and reasonable cause are deprived of the relief and ad hoc relief on commutation on pursuance of the office Memorandum dated 13.2.1976. Though, an officer who commutes one third of his pension gets relief and ad hoc relief on the basis of original amount of his pension but whereas an officer commutes whole of his original pension is deprived of the entire amount of the relief or ad hoc relief. The petitioners have thus contended that aforesaid Office Memorandum dated 13.2.1976 is vitiated by an inherent discrimination and is violative of Articles 14 and 16 of the Constitution.
7. The petitioners have further submitted that they are entitled to the aforesaid reliefs granted to all other Government pensioners, and the amount of relief to which pensioners are entitled and has been denied to them under the impugned Office Memorandum dated 13.2.1976 works out to Rs.13,592/- and Rs.15,040/- in case of petitioner No.1 and petitioner No.2 respectively upto 29.2.1984. The Ministry of Finance in their Office Memorandum No.F.2(8)/EV/82 dated 10.10.1983 has sanctioned the grant of relief and ad hoc reliefs to Government servants who retired prior to 10th September, 1979 @ 92.5% of their original pension subject to minimum of Rs.93/- and maximum of Rs.463/- with effect from 1st July, 1983. This has been done by taking in view the decline in the purchasing power of the rupee and the original sanction being insufficient and meagre to sustain the pensioners.
8. Apart from the above the petitioners have submitted that they are also entitled to the benefit of Liberalised Pension Formula of 1979, which was introduced vide the Finance Ministry’s Office Memorandum No.F.19(37)/EV/79 dated 25.5.1979, in respect of the approved pensionable service rendered by them in the Central Government as admissible to other pensioners who retired from Government service between 17.4.1950 to 31.3.1979. The said Memorandum was made applicable only to those Government servants who retired from service on or after 31.3.1979. However, this Court in D.S.Nakara & Others vs. Union of India (1983 (2) SCR 165) held that all Central Government pensioners governed by the Central Civil Service (Pension) Rules, 1972 were entitled to pension w.e.f. 1.4.1979 as computed under the Liberalised Pension Formula irrespective of the date of their retirement. Placing reliance on the above decision it has been claimed that there should be no discrimination between the applicability of the Liberalised Pension Formula to pre 31.3.1979 pensioners and there is no just and reasonable cause in denying such benefit to the petitioners under the impugned Office Memorandum No.F.1(3)/ EV/83 dated 22.10.1983.
9. Clause 5 of the Office Memorandum dated 22.10.1983 reads as under:
“Central Government employees, who got themselves absorbed under Central Public Sector undertaking/ autonomous bodies prior to 1.4.1979 and have received/or opted to receive commuted raise for 1/3rd of pension as well as terminal benefit equal to the commuted value of the balance amount of pension left after commuting 1/3rd, of pension, are not entitled to any benefit under these orders as they were not Central Government pensioners as on 1.4.79. In cases where only a portion of pension has been commuted, the pension will have to be enhanced in accordance with these orders with effect from 1.4.1979.”
The above clause makes it clear that such Central Government employees, who got themselves absorbed under Central Public Sector Undertakings prior to 1.4.1979 and opted to receive commuted raise for 1/3rd of pension as well as terminal benefit equal to the commuted value of the balance amount of pension left after commuting 1/3rd of pension were not entitled to any benefit as they were not Central Government pensioners as on 1.4.1979. An identical writ petition No.1068/1987 under Art.32 of the Constitution was filed on behalf of the Welfare Association of absorbed Central Government Employees in Public Enterprises and this Court dismissed the said writ petition on April 12, 1990. In the said writ petition benefit of Judgment of this Court in Common Cause” a Registered Society & Ors. vs. Union of India (1987 (1) SCC 142) was claimed but the same was negatived by making a distinction that the writ petition “Common Cause” was on behalf of the Government servants who had commuted their pension partially and this Court for the reasons indicated in the judgment came to hold that on the expiry of 15 years from the date of commutation the entire pension revived. The petitioners were persons who had, at the time of retirement from Government service and entering into public sector had taken the advantage of commuting the entire pension. They certainly belong to a class different from those whose case was before this Court at the instance of the common cause in Writ Petition Nos.1955-61 of 1983. It was further held in the above case that the commutation does bring certain advantages to the commutees and the class of Government officers whom the petitioner seeks to represent have derived such benefits.
10. We find no reason to take a different view. The commutation brings about certain advantages. The commuting pensioner gets a lumpsum amount which ordinarily he would have received in the course of his spread over period subject to his continuing to live. Thus, two advantages are certainly forthcoming out of commutation – (1) availability of a lumpsum amount, and (2) the risk factor. In the present case the petitioner had not only got 1/3rd of their pension commuted but exercised the option of getting the entire pension commuted and in lieu thereof got a lumpsum. Such persons cannot fall in the category of Central Government pensioners for the purposes of getting benefit of Liberalised Pension Rules which can be made applicable only to Central Government pensioners. It is no doubt correct that the family pension has been allowed in case of the persons like the petitioners but that does not make them entitled to get any benefit given to the pensioners on account of the Liberalised Pension Rules taking note of the fallen value of the rupee.
11. It was contended by Mr. Rao on behalf of the petitioners that the petitioners are not claiming any pension but their contention is that the Liberalised Pension Rules which give benefit to those pensioners who had got their 1/3rd pension commuted should be granted to the petitioners by awarding lumpsum after increasing their pension and calculating such amount in proportion to the increased pension. We find no force in this contention as the petitioners fall in a different class altogether and are not entitled to claim any benefit granted to Central Government pensioners. After getting a lumpsum in lieu of entire pension, they do not fall in the class of Central Government pensioners and are not entitled to any benefit granted to Central Government pensioners. The case of such Central Government pensioners who got their 1/3rd pension commuted also fall in a different class in as much as they get 2/3rd pension, and after 15 years of such commutation or having attained the age of 70 years whichever was later they become entitled to full pension. Petitioners on the other hand were not entitled to any pension after having received the lumpsum amount in lieu of pension being commuted and having opted to receive such amount in lumpsum at the time of entering the service in Public Sector Undertaking.
12. In the above mentioned civil appeal the legal question is identical except that the appellant in this case became a pensioner of the Central Government w.e.f. 1.4.1977 and the pension determined as payable to him was Rs.609/- per month and the same was got commuted by the appellant for a lumpsum amount on and from 7.8.1978. The appellant had exercised the option for absorption in Steel Authority of India Limited (SAIL) a Public Sector Enterprise. The Writ Petition filed by him before the High Court of Delhi was dismissed on 25.8.1982. The appellant then filed a S.L.P. against the said order. This Court had granted special leave on 25.3.1985 and had given a direction to hear the appeal alongwith the writ petition Nos.11757 & 11758 of 1984.
13. In the result we find no force in all these cases and the same are dismissed with no order as to costs.
