Supreme Court of India
A.N. SACHDEVA (DEAD) BY LRS. & ORS.versusMAHARSHI DAYANAND UNIVERSITY, ROHTAK &ANR.
- Citation
- 2015 INSC 555
- Decided
- 10 August 2015
- Disposal
- Appeal(s) allowed
- Bench
- M Y EQBAL
Holding
The Court held that the 24‑December‑2001 memorandum validly effects an upward revision of pension benefits, requiring continuous prior service in Punjab/Kurukshetra University to be counted as qualifying service, and that the classification excluding directly appointed employees is unconstitutional under Articles 14 and 16.
Summary
The appellants, former employees of Punjab University and Kurukshetra University who later joined Maharshi Dayanand University (MDU), claimed that their uninterrupted service in the earlier universities should be counted as qualifying service for pension under MDU's 1997 pension scheme. The university rejected the claim, relying on a rule that excluded prior service and on a cut‑off date of 7 January 2002. The Court examined whether the Haryana Government memorandum dated 24 December 2001, which allowed counting such service, amounted to an upward revision of benefits and whether the classification that excluded directly appointed employees violated Articles 14 and 16 of the Constitution. Relying on the principles laid down in D.S. Nakara and subsequent cases, the Court held that the memorandum created a permissible upward revision and that the exclusion was arbitrary and discriminatory. Consequently, the appellants were entitled to have their prior service counted as qualifying service, subject to the conditions in the memorandum, and the impugned judgment was set aside.
Issues considered
- Whether service rendered in Punjab University/Kurukshetra University can be counted as qualifying service for pension under M.D. University Pension Scheme, 1997.
- Whether the exclusion of directly appointed employees from counting prior service violates Articles 14 and 16 of the Constitution.
- Whether the Haryana Government memorandum of 24‑December‑2001 constitutes an upward revision of pension benefits or a new scheme, and its retrospective effect.
- Whether the cut‑off date of 7 January 2002 is arbitrary and discriminatory.
Legislation cited
- Constitution of Indias. Article 14, s. Article 16
Subjects
pensionqualifying serviceupward revisionclassificationArticles 14 and 16service lawretirement benefitsdiscriminationmemorandumM.D. University Pension Scheme
Judgment
[2015] 8 S.C.R. 796
A A.N. SACHDEVA (DEAD) BY LRS. & ORS.
v.
MAHARSHI DAYANAND UNIVERSITY, ROHTAK &ANR.
(Civil Appeal Nos.626-627 of 2008)
B AUGUST 10, 2015
[M.Y. EQBALANDARUN MISHRA,JJ.)
Service law - Retiral benefits - Pension - Counting of
previous service as qualifying service for grant of pension -
C Service rendered by appellants in Kurukshetra University/
Punjab University is qualifying service for the purpose of
pension, if can be added to the services rendered·by them in
M.D. University- Held: In view of the principles enunciated
D under Articles 14 and 16 and that the benefit is not ex gratia
payment but a payment in recognition of past service,
appellants entitled to the benefit of counting the past services
as qualifying service subject to fulfilment of certain conditions
specified in the memorandum - Merely because these
E persons were directly appointed and others have been
absorbed/allocated makes no difference as to the service -
Further, it is a case of upward revision of benefit -
.Classification sought to be created by the method of not
extending benefit to persons appointed directly and by fixing
F cut-off date not an intelligible classification but is
discriminatory- M.D. University Pension Scheme, 1997- r.
4(viii)- Constitution oflndia, 1950-Arts. 14, 15.
Allowing the appeals, the Court
G HELD: 1.1 It is apparent from the memorandum dated
24.12.2001 that the first requirement to countthe services
rendered in Punjab University/Kurukshetra University/
M.D. University by the appellants were without bmak and
H continuous. It is not in dispute that after rendering the
796
A.N. SACHDEVA(DEAD) BY LRS. v. MAHARSHI 797
DAYANAND UNIVERSITY, ROHTAK
services in Punjab University/Kurukshetra University, the A
said 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 M.D. University used to be the regional
centre of Kurukshetra University prior to its B
establishment as full-fledged University. 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 C
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. [Paras 12, 13) [808-
0
G-H; 809-A-C]
1.2 Considering the principles enunciated under
Articles 14 and 16 of the Constitution, and thatthe benefit
is not an ex gratia payment but a payment in recognition
of past service, discrimination could not have been E
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 F
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 G
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 H
•
798 SUPREME COURT REPORTS [2015] 8 S.C.R.
A upward revision of benefit and the classification which
is sought to be created by the said 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
B 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
C 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. [Para 27]
D [826-G-H; 827-A-E]
1.3 The appellants are entitled for the benefit of
counting the services rendered in Punjab University/
Korukshetra University as qualifying service for the
purpose of pension subjectto fulfilment of the conditions
E 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
F amount payable to the appellants. The impugned
judgment is set aside. [Para 29] [827-H; 828-A-B]
D.S. Nakara & Ors. v. Union of/ndia 1983 (2) SCR 165:
1983 (1) SCC 305; M.C. Dhingra v. Union of India & Ors.
G 1996 (2) SCR 132:1996 (7) SCC 564; State of Punjab v.
Justice S.S. Dewan (Retd.) &Ors. 1997 (3) SCR 1027:1997
(4) SCC 569; State of Rajasthan &Anr. v. Prem Raj 1997
(2) SCR 60: 1997 (10) SCC 317; Ohan Raj & Ors. v. State
ofJ&K & Ors.1998 (2) SCR404:1998 (4) sec 30; Union of
H India & Ors. v. K. G Radhakrishna Panickar & Ors. 1998 (3)
•
A.N. SACHDEVA(DEAD) BY LRS. v. MAHARSHI 799
DAYANAND UNIVERSITY, ROHTAK
SCR 38: 1998 (5) SCC 111; II. Kasturiv. Managing Director, A
State Bank of India &Anr. 1998 (2) Suppl. SCR 269 : 1998
(8) SCC 30; Subrata Sen & Ors. v. Union of India & Ors.
2001 (3) Suppl. SCR 140: 2001 (8) sec 71; John
Vallamattom & Anr. v. Union of India 2003 (1) Suppl. SCR
638: 2003 (6) SCC 611; State Bank of India v. L. Kannaiah B
& Ors. 2003 (2) Suppl. SCR 735: 2003 (10) SCC 499; Union
of India & Anr. v. SPS Vains 2008 (13) SCR 257: 2008 (9)
SCC 125; K.J.S. Buttarv. Union oflndia &Anr. 2011 (4) SCR
136: 2011 (11) SCC 429; State of Punjab &Anr. v. J.L. Gupta
&Ors. 2000 (1) SCR 903: 2000 (3) SCC 736; State of Punjab C
& Ors. v. Boota Singh &Anr. 2000 (3) SCC 733 - referred
to.
Case Law Reference
D
1983 (2) SCR 165 referred to. Para 14
1996 (2) SCR 132 referred to. Para 15 ·
1997 (3) SCR 1027 referred to. Para 16
E
1997 (2) SCR 60 referred to. Para 17
1998 (2) SCR 404 referred to. Para 18
1998 (3) SCR 38 referred to. Para 19
F
1998 (2) Suppl. SCR 269 referred to. Para 20
2001 (3) Suppl. SCR 140 referred to. Para 21
2003 (1) Suppl. SCR 638 referred to. Para 22....
G
2003 (2) Suppl. SCR 735 referred to. Para 23
2008 (13) SCR 257 referred to. Para 24
'
2011 (4) SCR 136 referred to. Para 25 H
~•r..r
800 SUPREME COURT REPORTS [2015] 8 S.C.R.
A 2000 (1) SCR 903 referred to. Para 26
2000 (3) sec 733 distinguished. Para 26
CIVILAPPELLATE JURISDICTION :Civil Appeal No. 626-
B 627 of 2008.
From the Judgment and Order dated 02.11.2004 of the
High Court of Punjab and Haryana at Chandigarh in Civil Writ
Petition Nos. 11448 and 11449 of 2002.
C Nidhesh Gupta, Tarun Gupta, S. Janani for the Appellants.
Baldev Atreya, Atishi Dipankar, Nupur Choudhary, Kamal
Mohan Gupta for the Respondents.
The Judgment of the Court was delivered by
D
ARUN MISHRA, J. 1. The qµestion 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
E 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
F retirement from M.D. University, however, it is confined to the
services rendered by them in the same university. Deceased
AN. Sachdeva and Ram Parshad Saini were appointed in
Punjab University. R.K. Tuteja, petitionerno.3 and Prem Kumar
were appointed as Lecturer and Clerk respectively. They were
G appointed without any break in M.D. University.
3. AN. 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
H 1.5.1976, promoted as Deputy Registrar in August, 1988 and
A.N. SACHDEVA (DEAD) BY LRS. v. MAHARSHI 801
DAYANAND UNIVERSITY, ROHTAK [ARUN MISHRA, J. ]
retired from the service of M.D. University on 31.12.2000. A
Ram Prashad Saini after rendering services from
16.11.1962 to 14.1.1975 in Punjab University was appointed
asAsistant in Kurukshetra University on 15.1.1975 and served
till 11.5.1977 and on 12.5.1977 he was appointed in M.D. B
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. c
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 D
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 E
in the High Court after rejection of their representation. The
appellants " •bmitted that M.D. University had introduced
pension scheme with effect from 1.4.1995. The appellants
had opted forthe same. A memorandum dated 24.12.2001 F
was issued by the Haryana Government for counting of service
rendered by employees of Punjab University/Kurukshetra
University/M.D. University as qualifying service forthe purpose
of pension.
5. Haryana Government issued a memorandum dated G
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 H
employees of the university because the pension schemes of
802 SUPREME COURT REPORTS (2015] 8 S.C.R.
A 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
B 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
C the employees elsewhere such as Central GovernmenU State
GovernmenUAutonomous 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
D 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
E 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
F 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
G 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
H impugned order has dismissed the writ application on the
ground that in view of Rule 4(vii) of the Pension Scheme 1997,
A.N. SACHDEVA(DEAD) BY LRS. v. MAHARSHI 803
DAYANAND UNIVERSITY, ROHTAK [ARUN MISHRA, J.)
services rendered by the appellants in Punjab University/ A
Kurukshetra University cannot be counted. Reliance has also
been placed on the memorandum dated 7.1.2002. As the
appellants had retired before 7. ~ .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.· B
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 C
retired prior to 7 .1.2002. ' •
8. It was submitted on behalf of the appella~ts that as per
memorandum dated 24.12.2001 and its clarification dated
5.6.2002, the appellants are entitled to count the services D
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 E
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 F
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 G
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 1>etition which
was dismissed. Even otherwise, the classificatfon sought to
be created by the respondents is not impermissible in view of H
804 SUPREME COURT REPORTS (2015) 8 S.C.R.
A 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.
B
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
C 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
D 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
E 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
F 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.
G 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:-
H "(vii) The period of service rendered by an employee in
A.N: SACHDEVA (DEAD) BY LRS. v. MAHAR SHI 805
DAYANAND UNIVERSITY, ROHTAK [ARUN MISHRA, J.]
any State Govt. or Govt. aided Private College or in any A
University/autonomous body against aided post prior to
joining in the University shall not count as qualifying
service for pensionary benefits."
Howeve~ it is not in dispute that vide memorandum dated B
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 C
24.12.2001 is extracted hereunder:-
"From
Higher Education Commissioner,
Haryana Chandigarh. D
To
The Vice-Chancellor,
M.D. University E
Rohtak.
Memo No.18/41-2001 UNP (1)
Dated : Chandigarh the 24.12.2001 F
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 G
Punjab University/Kurukshetra University/M.D. University
as qualifying service for the purpose of pension subject to
the following terms and conditions :
H
806 SUPREME COURT REPORTS (2015] 8 S.C.R.
A 1. The service rendered by the said employees in these
institutions is without any break and is continuous.
2. That the employer's share of the CPF in respect of
these employees has been transferred to the pension fund
B 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
C accordingly.
Sd/- Deputy Director, College-I,
For Higher Education Commissioner,
Haryana, Chandigarh".
D 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
E 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
F as qualifying service for the purpose of pension. Same is
extracted hereunder:-
"From
Higher Education Commissioner, Haryana,
G Chandigarh.
To
Registrar,
H 1. Kurukshetra University, Kurukshetra.
A.N. SACHDEVA (DEAD) BY LRS. v. MAHARSHI 807
DAYANAND UNIVERSITY, ROHTAK [ARUN MISHRA, J.]
2. Maharshi Dayanand University, Rohtak. A
Memo No.18/44-2001 UNP (1)
Dated: Chandigarh, the 6.6.2002
Subject: Clarification regarding counting of B
previous service/foreign service towards Pension.
Kindly refer to the subject noted above:
(i) The advice issued vide letter No.18/44-2001 UNP (1)
c
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 D
Maharshi Dayanand University, Rohtak now was a regional
centre of Kurukshetra University, Kurukshetra earlier.
Similarly the employees also hC!S rendered service in the
Punjab University and were subsequently allocated to
Kurukshetra University, Rohtak. That being the situation E
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 F
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 G
be countable for the purpose of pension in Maharshi
Dayanand University, Rohtak.
{ii) To the extent the employees of Kurukshetra University,
Kurukshetra fall in the same category, their service may H
808 SUPREME COURT REPORTS [2015) 8 S.C.R.
A 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.
B
(iii) 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
C 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
D self-contained proposal should be submitted for approval
of the State Govt.
It is, therefore requested that the cases may be decided
accordingly.
E
Sd/-5.6.02
Deputy Director Colleges-I,
For Higher Education Commissioner,
Haryana, Chandigarh."
F
12. It is apparentfrom 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
G 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
H Kurukshetra University and it is not in dispute that present M.D.
A.N. SACHDEVA (DEAD) BY LRS. v. MAHARSHI 809
DAYANAND UNIVERSITY, ROHTAK [ARLIN MISHRA,.J.)
University used to be the regional centre of Kurukshetra A
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 B
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. C
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. D
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 E
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 F
upward revision commencing from the specified date. ~o
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 G
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 H
810 SUPREME COURT REPORTS [2015) 8 S.C.R.
A 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
B 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
c 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.
D
xxxxx
42. If it appears to be undisputable, as it does to us that
the pensioners for the purpose of pension benefits form
E 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
F 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
G 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
H
those who, retired earlier cannot be worst off than those
A.N. SACHDEVA(DEAD) BY LRS. v. MAHARSHI 811
DAYANAND UNIVERSITY, ROHTAK [ARUN MISHRA, J.]
who retire later. Therefore, this division which classified A
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 B
just ci 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 C
permit totally unequal treatment in the matter ofpension?
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
0
of Rs 12,000 p.a. and average emolument will be
computed on the basis of last 10 months' a"!erage. 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 E
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 ofpension scheme. The equal treatment
guaranteed in Article 14 is wholly violated inasmuch as F
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 G
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 H
812 SUPREME COURT REPORTS [2015] 8 S.C.R. ·
A for this division. This arbitrary action violated the
guarantee of Article 14. The next question is what is the
way out?
xxxxx
B
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 happenin_g after the specified
c 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
D 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
E is prospective. All pensioners whenever they retired
would be covered by the liberalised pension scheme,
because the scheme is a scheme for payment ofpension
to a pensioner governed by 1972 Rules. The date of
retirement is irrelevant. But the revised scheme would
F 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
G 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 . .
H The last revision of emoluments was as per the
A.N. SACHDEVA (DEAD) BY LRS. v. MAHARSHI 813
DAYANAND UNIVERSITY, ROHTAK [ARUN MISHRA, J.]
recommendation of the Third Pay Commission A
(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 B
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 1-1--ere in service on March 31, 1979 and retiring
from service on or after that date" excluding the date for C
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 withoµt impairing the D
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)
sec 564], the question arose with respect to the counting of E
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 F
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 G
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 H
prescribes that it would be applicable to the government ·
814 SUPREME COURT REPORTS [2015] 8 S.C.R.
A 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
B the benefit offixation 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
c 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
ofR.L. Marwaha v. Union oflndia [1987 (4) SCC 31 that
such a restri<;tion is arbitrary violating Article 14. On the
D
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
E March 1982".
16. In State of P.unjab 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:-
F "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) sec 305] would apply. If it is held to be a
G 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
H D.S. Nakara (supra) has given a complete go-by. This Court
A.N. SACHDEVA(DEAD) BY LRS. v. MAHARSHI 815
DAYANAND UNIVERSITY, ROHTAK [ARUN MISHRA, J.]
has laid down thus:- A
"12. In State ofWB. 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 B
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 C
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 D
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.
E
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 F
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) sec 104] and held that the fixation of 29-2-1964 as
the cut-off date with effect from which the new liberalised G
pension scheme in Chapter XX/II-A was introduced
cannot be said to be arbitrary or violative of Article 14 of
the Constitution. As h~s been stated earlier for deciding
the present controversy it is not necessary for us to further H
delve into the question as to the extent to which the
816 SUPREME COURT REPORTS [2015] 8 S.C.R.
A 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".
B
18. In Ohan Raj & Ors. v. State of J&K & Ors. [1998 (4)
sec 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
C of GO. dated 3.10.1986. The contention of the State thatthe
benefit could not be extended to the appellants was rejected.
The relevant portion is extracted hereunder:-
"14. Even otherwise, we do not find anyju~tifiable criteria
o 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
E 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
F 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
G 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
H
grant of pensionary benefits the State has to act to reach
A.N. SACHDEVA(DEAD) BY LRS. v. MAHARSHI 817
DAYANAND UNIVERSITY, ROHTAK [ARUN MISHRA, J.]
the constitutional goal of setting up a socialist State as A
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 B
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: C
"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 D
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 E
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 F
cradle to grave is assured at least when it is mostly
needed and least available, namely, in the fall oflife. ""
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 G
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 :-
H
818 SUPREME COURT REPORTS (2015] 8 S.C.R.
A 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
B 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,
c it may be stated that the Tribunal was in error in invoking
the principle laid down in D.S. NakaraJn 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
D
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
E 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
F basis of a particular date. (See: Krishena Kumar v. Union
of/ndia {1990 (4) SCC 207]; StateofWB. 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
G 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
H six months' period of continuous service which period
A.N. SACHDEVA(DEAD) BY LRS. v. MAHARSHI 819
DAYANAND UNIVERSITY, ROHTAK [ARUN MISHRA, J.]
was subsequently reduced to 120 days under para A
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 lnder Pal
Yadav [1985 (2) SCC 648]. Before the acceptance of B
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 lnder
Pal Yadav and oh the basis of this new benefit Project C
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
0
lnder 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 E
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.
F
20. In II. Kasturi v. Managing Director, State Bank of/ndia
& 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 G
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 focthe benefit
from the date it came into effect, however, where the
amendment extended the benefit of the pension scheme to a H
820 SUPREME COURT REPORTS [2015] 8 S.C.R.
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
B 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
c 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
D 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
E 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) sec 305] would cover this category of cases'.
F 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},
G 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:
H "... the pension will have to be recomputed in the light of
A.N. SACHDEVA(DEAD) BY LRS. v. MAHARSHI 821
DAYANAND UNIVERSITY, ROHTAK [ARUN MISHRA, J.]
the formula enacted in the liberalised pension scheme A
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 B
have appreciated an argument that those who had
already retired could not expect it."
The Court further observed:
c
"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 o
scheme his relations with the employer merely undergo
a change but do not snap a/together. 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 pen~ioners it is E
necessary to revise the. pension periodically as the
continuous fall in the rupee value and the rise in prices
· ofessential commodities necessitates an adjustment of
the pension amount but that is not the case of employees
governed under the CPF Scheme, since they had F
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 G
been rightly emphasised by this Court in Krishena case
£1990 (4) sec 207]".
-·
22. In John Val/amattom & Anr. v. Union of India [2003
(6) SCC 611], this Court considered the decision in D.S. H
822 SUPREME COURT REPORTS [2015) 8 S.C.R.
A 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.
8 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
c 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
D 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
E 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.
F xxxxx
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
G 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
H bedrock oF equality enshrined in Article 14 of the
A.N. SACHDEVA (DEAD) BY LRS. v. MAHARSHI 823
DAYANAND UNIVERSITY, ROHTAK [ARUN MISHRA, J.]
Constitution". A
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 B
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:-
' c
"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 D
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 E
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 bf induction into Pension F
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 G
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 ~ecision in H
D.S. Nakara v. Union of India [1983 (.1) SCC 305] but,
824 SUPREME COURT REPORTS (2015) 8 S.C.R.
A 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
B 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 if is decided to extend the
pensionary benefits to ex-servicemen drawing pension,
c 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".
D 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:-
E "29. The Constitution Bench (in D.S. Nakara [1983 (1)
sec 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
F 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
G 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
H observe that the submissions advanced on behalf of the
A.N. SACHDEVA(DEAD) BYLRS. v. MAHARSHI 825
DAYANAND UNIVERSITY, ROHTAK [ARUN MISHRA, J.)
Union of India cannot be accepted in view of the decision A
in D.S. Nakara case. The. object sought to be achieved
was notto 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 B
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 C
receiving a higher pension" .
25. In K.J.S. Buttar v. Union of/ndia & Anr. [2011 (11)
SCC 429), this Court considered the question when some new
retiral benefits were introduced and measurement to calculate D
disability was changed pursuant to recommendation made by
the 51h 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 E
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 F
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% G
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- H
1996, and interest at 8% per annum on the same.
826 SUPREME COURT REPORTS [2015] 8 S.C.R.
A 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)187/D(Pen-Ser) dated 30-10-
1987 (p. 59, Para 8). The mode of calculation, however,
B 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
c 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''.
D 26. Reliance has been placed by the respondents on a
decision in Stale 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
E 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
F 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
G 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
H are entitled to count their services as qualifying service for the
I
A.N. SACHDEVA(DEAD) BY LRS. v. MAHARSHI 827
DAYANAND UNIVERSITY, ROHTAK [ARUN MISHRA, J.]
purpose of pension and not those who have been appointed A
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 1
had arisen to compute the period of service rendered in Punjab B
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, C
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 entitledfor D
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 E
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.O. University v. Dr. Jahan, F
this Court did not interfere in the decision of the High Court of
Punjab and Haryana at Chandigarh on 26.5.2009 in LPANo.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 G
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 H
for the purpose of pension subject to fulfilment of the conditions
828 SUPREME COURT REPORTS [2015] 8 S.C.R.
A 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
B 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.
c
Nidhi Jain Appeals allowed.
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