Holding

Resignation forfeits past service under Rule 26, precluding pension, but gratuity and leave encashment are payable to the legal heirs under the Payment of Gratuity Act, 1972.

Summary

Ashok Kumar Dabas, a conductor with Delhi Transport Corporation since 1985, resigned on 7 August 2014 and his resignation was accepted on 19 September 2014; a subsequent request to withdraw the resignation was denied. The deceased sought pension, gratuity and leave encashment for his legal heirs, but the Tribunal and the Delhi High Court rejected the pension claim, holding that resignation forfeits past service under Rule 26 of the Central Civil Services (Pension) Rules, 1972. The appellant argued that his resignation should be treated as voluntary retirement and that he was entitled to pension under Rules 48/48A, citing earlier Supreme Court decisions. The Court examined the relevant pension rules, confirming that resignation leads to forfeiture of service and therefore no pension is payable, while also noting that gratuity is payable under Section 4 of the Payment of Gratuity Act, 1972 after five years of service. It held that the legal heirs are entitled to gratuity and leave encashment, but not to family pension. Consequently, the appeal was partly allowed, granting gratuity and leave encashment but denying pension.

Issues considered

Whether resignation under Rule 26 of the Central Civil Services (Pension) Rules, 1972 results in forfeiture of past service and bars entitlement to pension.
Whether an employee who has resigned but completed more than twenty years of service is eligible for pension under Rules 48/48A.
Whether gratuity is payable to the legal heirs of a resigned employee under Section 4 of the Payment of Gratuity Act, 1972.
Whether leave encashment amounts are payable to the legal heirs of the deceased employee.

Legislation cited

Central Civil Services (Pension) Rules, 1972s. Rule 26, s. Rule 36, s. Rule 48, s. Rule 48A
Payment of Gratuity Act, 1972s. 4, s. 5

Headnote

Issue for Consideration The High Court has upheld the orders passed by the Tribunal by which the claim of the predecessors-in-interest of the appellant, for release of the pensionary benefits of the deceased employee, was declined. Headnotes† Central Civil Services (Pension) rr.26, 36, 48, 48A – Payment of Gratuity Act, 1972 – s.4 – The deceased employee/AK was selected and joined the Corporation in the year 1985 – He resigned from the job on 07.08.2014 – His resignation was accepted on 19.09.2014 – This was the end of his

Subjects

Service LawEmployeeResignationLeave encashmentGratuityPensionPayment of gratuityPast service

Judgment

[2025] 12 S.C.R. 548 : 2025 INSC 1404

Ashok Kumar Dabas
(Dead Through Legal Heirs)
v.
Delhi Transport Corporation
(Civil Appeal No. 14660 of 2025)
09 December 2025
[Rajesh Bindal* and Manmohan, JJ.]

Issue for Consideration
The High Court has upheld the orders passed by the Tribunal by
which the claim of the predecessors-in-interest of the appellant,
for release of the pensionary benefits of the deceased employee,
was declined.

Headnotes†
Central Civil Services (Pension) Rules, 1972 – rr.26, 36, 48,
48A – Payment of Gratuity Act, 1972 – s.4 – The deceased
employee/AK was selected and joined the Corporation in the
year 1985 – He resigned from the job on 07.08.2014 – His
resignation was accepted on 19.09.2014 – This was the end
of his employment with the Corporation – The issue raised
before this Court is regarding his entitlement to pension,
gratuity and leave encashment:
Held: In the case in hand, admittedly the deceased employee
resigned from service on 07.08.2014, which was accepted by
the competent authority on 19.09.2014 – The withdrawal of the
resignation after acceptance was declined by the competent
authority on 28.04.2015 – Meaning thereby, it is clear that the
deceased employee had resigned from service and his withdrawal
from resignation was not accepted – It is settled law that on
resignation, past service of an employee stands forfeited – Hence,
he will not be entitled to any pension – As far as payment of
gratuity to the legal heirs of deceased employee are concerned,
a perusal of s.4 of the Act 1972, clearly shows that an employee
who had rendered not less than five years of service will be entitled
to payment of gratuity, regardless of the fact that he had retired
or resigned from service – There is no dispute on the fact that

* Author
[2025] 12 S.C.R. 549

Ashok Kumar Dabas (Dead Through Legal Heirs) v.
Delhi Transport Corporation

in terms of s.5 of the 1972 Act there is no notification issued by
the appropriate government exempting the Corporation from the
application of the 1972 Act – Hence, the appellant is entitled to
receive gratuity in terms of the 1972 Act for the service rendered by
him – Insofar as payment of emoluments towards leave encashment
is concerned, the respondent had submitted that amount due to
the deceased employee shall be paid to his family members –
The amount due to the deceased employee directed to be paid
along with interest @6 % p.a. from the date of his resignation till
payment. [Paras 9.1, 9.6, 10, 10.1, 10.2, 11, 12]

Case Law Cited
BSES Yamuna Power Limited v. Ghanshyam Chand Sharma and
Another, 2019 INSC 1324 : [2019] 14 SCR 546 : (2020) 3 SCC
346; Reserve Bank of India and Another v. Cecil Dennis Solomon
and Another, 2003 INSC 688 : [2003] Supp. 6 SCR 465 : (2004)
9 SCC 461; Shashikala Devi v. Central Bank of India & Others,
2014 INSC 1045 : [2014] 13 SCR 868 : (2014) 16 SCC 260; Shanti
Devi v. Delhi Transport Corporation, W.P.(C)No.4871/2010 decided
on 15.10.2012; Delhi Transport Corporation v. Ram Kishan, W.P.(C)
No.2627/2015 decided on 17.03.2015 – referred to.
Raj Kumar v. Union of India and Others, 2017 SCC OnLine Del
10877 : 2017:DHC:5783-DB – referred to.

List of Acts
Payment of Gratuity Act, 1972; Central Civil Services (Pension)
Rules, 1972.

List of Keywords
Service Law; Employee; Resignation; Leave encashment; Gratuity;
Pension; Payment of gratuity; Past service.

Case Arising From
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 14660
of 2025
From the Judgment and Order dated 20.12.2022 of the High Court
of Delhi at New Delhi in WP(C) No. 13642 of 2018
550 [2025] 12 S.C.R.

Supreme Court Reports

Appearances for Parties
Advs. for the Appellant(s):
Anil Mittal, Narender Kumar Verma.
Advs. for the Respondent(s):
Aviral Saxena, Abhinav Sharma, Paritosh Goyal.

Judgment / Order of the Supreme Court

Judgment

Rajesh Bindal, J.

1. Leave granted.
2. The appellant has filed the present appeal impugning the order1
passed by the Division Bench of the High Court2. The High Court
has upheld the orders3 passed by the Tribunal4 by which the claim
of the predecessors-in-interest of the appellant, for release of the
pensionary benefits of the deceased employee, was declined.
3. Briefly, the facts as available on record are that the deceased
appellant/Ashok Kumar Dabas was selected and appointed as
conductor with the respondent/Corporation5 in the year 1985. Vide
Office Order No.16 dated 27.11.1992 a new pension scheme was
introduced in the Corporation. The deceased employee opted for
the same. He resigned from the job on 07.08.2014 citing family
circumstances. The same was accepted by the competent authority
on 19.09.2014. Later on, vide letter dated 13.04.2015 a request was
made for withdrawal of the resignation. The same was declined by the
competent authority of the Corporation vide order dated 28.04.2015.
On 15.10.2015, the deceased employee requested the respondent for
release of his retiral benefits, namely, gratuity, provident fund, leave
encashment and pension. Vide order dated 23.10.2015 considering
the fact that the employee/Ashok Kumar Dabas had resigned from

1 Dated 20.12.2022 in W.P.(C) No.13642/2018
2 High Court of Delhi at New Delhi
3 Dated 24.09.2018 in O.A. No.4645/2015 and 29.10.2018 in R.A. No.207/2018
4 Central Administrative Tribunal, Principal Bench, New Delhi
5 Delhi Transport Corporation
[2025] 12 S.C.R. 551

Ashok Kumar Dabas (Dead Through Legal Heirs) v.
Delhi Transport Corporation

service, the Corporation informed him that he was found entitled to
only provident fund and no other benefit.
4. Aggrieved against the aforesaid order of the Corporation, an
application6 was filed by the deceased employee before the Tribunal.
The same was dismissed by the Tribunal vide order dated 24.09.2018.
The appellant thereafter filed a review application7 which was also
dismissed by the Tribunal vide order dated 29.10.2018. Still aggrieved,
Ashok Kumar Dabas/deceased employee approached the High
Court by filing a writ petition which was dismissed vide impugned
order, as noticed above. Aggrieved against the same, the appellant
is before this Court.
5. Learned counsel for the appellant submitted that the letter submitted
by the deceased employee to resign from the job may not have been
happily worded as he was not conversant with the legal language.
The same should not be taken to the extent that he should be denied
all his retiral benefits. The pension is not a bounty. It is earned by an
employee after putting in long service. He had put in about 30 years
of service and had resigned on account of family circumstances. Even
if he had not completed 30 years of service, his period of service
was more than 20 years and as per Rule 48 of Pension Rules8 he
was entitled to receive pension. It will be too harsh to forfeit his entire
service benefits merely because of a minor error in the resignation
letter submitted by him. The Corporation as well as courts below
should have taken a pragmatic view of the matter and not deprive
the deceased employee of his retiral dues.
5.1 In support of his arguments, he referred to the judgments of this
Court in Reserve Bank of India and another v. Cecil Dennis
Solomon and another9 and Shashikala Devi v. Central Bank
of India & others10. He has also referred to the judgment of
the High Court in the case of Shanti Devi v. Delhi Transport
Corporation11 allowing similar relief to an employee. The Special

6 O.A. No.4645/2015
7 R.A. No.207/2018 in O.A.No.4645/2015
8 Central Civil Services (Pension) Rules, 1972 (for short, ‘1972 Rules’)
9 2003 INSC 688 : (2004) 9 SCC 461
10 2014 INSC 1045 : (2014) 16 SCC 260
11 W.P.(C)No.4871/2010 decided on 15.10.2012
552 [2025] 12 S.C.R.

Supreme Court Reports

Leave Petition (C) No.9516/2013, preferred by the Corporation
against the aforesaid, was dismissed by this Court vide order
dated 26.04.2013. Another judgment of the High Court relied
upon by the learned counsel for the appellant is the case of
Delhi Transport Corporation v. Ram Kishan12.
5.2 As far as his claim for gratuity is concerned, he has referred
to the provisions of Section 4 of the Payment of Gratuity Act,
197213 which provided that even in case of resignation, if an
employee had served for not less than five years, gratuity is
payable to him. He submitted that even gratuity has been denied
to him. His further grievance is that even emoluments towards
leave encashment were not paid to him for which there is no
bar as such.
6. On the other hand, learned counsel for the respondent submitted that
from a perusal of the 1972 Rules applicable for the post on which the
deceased employee was working, it is clear that on resignation from
the job, entire service will be forfeited and no second opinion on that
can be formed. Rule 26(1) of the 1972 Rules is quite explicit. Other
Rules in the 1972 Rules will have application only if the appellant
comes out of operation of Rule 26 thereof. It is the admitted case
of the predecessors-in-interest of the appellant that the deceased
employee had resigned from the job. After resignation, he cannot
be permitted to claim that his resignation should be treated as
voluntary retirement and he should be given pensionary benefits.
The judgments relied upon by the appellant are not applicable due
to the latest judgment of this Court in the case of BSES Yamuna
Power Limited v. Ghanshyam Chand Sharma and another14 and
the Judgment of the High Court in the case of Raj Kumar v. Union
of India and others15.
6.1 He further submitted that during his service career the deceased
employee had been suspended on five occasions, nine times
warnings were issued on certain acts of mis-conduct whereas
on seven occasions major and minor punishment were imposed

12 W.P.(C)No.2627/2015 decided on 17.03.2015
13 For short, ‘1972 Act’
14 2019 INSC 1324 : (2020) 3 SCC 346
15 2017 SCC OnLine Del 10877; 2017:DHC:5783-DB
[2025] 12 S.C.R. 553

Ashok Kumar Dabas (Dead Through Legal Heirs) v.
Delhi Transport Corporation

upon him. This was his service career. In fact, he had resigned
because of this.
6.2 As far as payment of gratuity is concerned, learned counsel
for the respondent has submitted that even that may not be
payable, as he was covered under the 1972 Rules.
6.3 Regarding payment of leave encashment, the learned counsel
for the respondent has fairly submitted that the same shall be
released to the family members of the deceased employee.
7. Heard learned counsel for the parties and perused the relevant
referred record.
8. The basic facts which are not in dispute are that the deceased
employee/Ashok Kumar Dabas was selected and joined the
Corporation in the year 1985. He resigned from the job on 07.08.2014.
His resignation was accepted on 19.09.2014. This was the end of
his employment with the Corporation. The issue raised before this
Court is regarding his entitlement to pension, gratuity and leave
encashment, as was sought to be argued by the learned counsel
for the appellant.

REGARDING PENSION
9. The relevant Rules of the 1972 Rules which admittedly governed
the service of the deceased employee and in terms of which his
entitlement to pension is to be considered, are reproduced hereunder:
“Rule 26 – Forfeiture of service on resignation
(1) Resignation from a service or a post, unless it is allowed
to be withdrawn in the public interest by the Appointing
Authority, entails forfeiture of past service.

x x x
Rule 36 – Retiring pension – A retiring pension shall
be granted -
(a) To a Government servant who retires, or is retired, in
advance of the age of compulsory retirement in accordance
with the provisions of Rule 48 or 48-A of these rules, or
Rule 56 of the Fundamental Rules or Article 459 of the
Civil Service Reulations; and
554 [2025] 12 S.C.R.

Supreme Court Reports

(b) to a Government servant who, being declared surplus,
opts for voluntary retirement in accordance with the
provisions of Rule 29 of these rules.

x x x
Rule 48 – Retirement on completion of 30 years’
qualifying service –
(1) At any time after a Government servant has completed
thirty years’ qualifying service -
(a) he may retire from service, or
(b) he may be required by the appointed Authority to retire
in the public interest
And in the case of such retirement the Government servant
shall be entitled to a retiring pension:
Provided that –
(a) a Government servant shall give a notice in writing to
the Appointing Authority at least three months before the
date on which he wishes to retire; and
(b) the Appointing Authority may also give a notice in writing
to a Government servant at least three months before the
date on which he is required to retire in the public interest
or three months’ pay and allowances in lieu of such notice.
Rule 48-A – Retirement on completion of 20 years’
qualifying service
(1) At any time after a Government servant has completed
Twenty years’ qualifying service, he may, by giving notice
of not less than three months in writing to the Appointing
Authority, retire from service….”
9.1 A perusal of Rule 26 of the 1972 Rules clearly shows resignation
from service entails forfeiture of past service. In the case
in hand, admittedly the deceased employee resigned from
service on 07.08.2014, which was accepted by the competent
authority on 19.09.2014. The withdrawal of the resignation
after acceptance was declined by the competent authority on
28.04.2015. Meaning thereby, it is clear that the deceased
[2025] 12 S.C.R. 555

Ashok Kumar Dabas (Dead Through Legal Heirs) v.
Delhi Transport Corporation

employee had resigned from service and his withdrawal from
resignation was not accepted.
9.2 Rule 36 of the 1972 Rules provides that the government servant
who retired or compulsorily retired shall be granted retiring
pension in accordance with Rules 48 and 48-A of the 1972 Rules.
9.3 Rule 48 of the 1972 Rules talks about eligibility or grant of
pension on completion of 30 years of qualifying service. Whereas
Rule 48-A thereof provides for such entitlement on completion
of 20 years or more of qualifying service. In the case in hand,
the deceased employee had not completed 30 years of service
but certainly had more than 20 years service to his credit.
9.4 Learned counsel for the respondent had referred to service
records of the deceased employee during the course of his
service with the Corporation, immediately starting from the
period he joined service. The same is extracted below:
“SUSPENSION

S.No. Date of Order Relevant D a t e o f No. of Days
Entry Suspension
1. Order dated Entry 1 23/09/1986- 1 M o n t h 1
27/09/1986 day
24/10/1986
2. Order dated Entry 5 02/06/1989- 2 Months 16
01/06/1989 days
18/08/1989
3. Order dated Entry 13 22/05/1993- 4 Months 2
28/06/1993 days
24/091993
4. Order dated Entry 17 25/09/1994- 16 days
28/09/1994 11/10/1994
5. Order dated Entry 20 08/12/1995- 1 Year
13/12/1995
10/01/1997 1 Month
2 Days

INCREMENT STOPPED

S.No. Date of Order Relevant
Entry
1 Entry 3 Stoppage of 2 increments
556 [2025] 12 S.C.R.

Supreme Court Reports

2 18/08/1989 Entry 6 Stoppage of 1 increment
3 30/03/1992 Entry 10 Brought back to initial
basic pay
4 24/09/1993 Entry 14 Stoppage of Increment for
next 2 years
5 04/10/1993 Entry 16 Stoppage of increment for
next 2 years
6 13/12/1995 Entry 19 Stoppage of increment for
next 2 years
7 28/02/1997 Entry 22 Stoppage of Increment for
5 years and brought back
to initial basic pay

WARNING

S.No. Date of Order Relevant
Entry
1 08/10/1996 Entry 4 Warning
2 26/10/1989 Entry 7 Warning
3 28/08/1991 Entry 8 Warning
4 23/03/1992 Entry 9 Warning
5 03/12/1992 Entry 11 Warning
6 07/05/1993 Entry 12 Warning
7 18/08/1993 Entry 15 Warning
8 23/04/1999 Entry 23 Warning
9 29/09/2012 Entry 24 Warning

9.5 The argument raised by the learned counsel for the appellant is
that the words used in his letter “notice for resignation” should
not be literally construed but should be taken as voluntary
retirement so as to not deprive him of his pension, which was
earned on account of more than 20 years of service rendered
by him. In support of his arguments, he has relied upon Cecil
Dennis Solomon and another and Shashikala Devi’s cases
(supra) of this Court and Shanti Devi (supra) of the High Court,
which was confirmed by this Court.
9.6 Similar issue was considered by this Court in BSES Yamuna
Power Limited’s (supra). Earlier judgments of this Court in
[2025] 12 S.C.R. 557

Ashok Kumar Dabas (Dead Through Legal Heirs) v.
Delhi Transport Corporation

Shashikala Devi and Cecil Dennis Solomon and another’s
cases (supra) were also considered. It was opined therein that
on resignation, past service of an employee stands forfeited.
Distinction between resignation and voluntary retirement was
also considered. Relevant paras therefrom are extracted below:
“14. In the present case, the first respondent resigned
on 7-7-1990 with effect from 10-7-1990. By resigning,
the first respondent submitted himself to the legal
consequences that flow from a resignation under the
provisions applicable to his service. Rule 26 of the
Central Civil Service Pension Rules, 1972 (the CCS
Pension Rules) states that:
“26. Forfeiture of service on resignation.—(1)
Resignation from a service or a post, unless it
is allowed to be withdrawn in the public interest
by the Appointing Authority, entails a forfeiture
of past service.”
Rule 26 states that upon resignation, an
employee forfeits past service. We have noted
above that the approach adopted by the Court in
Asger Ibrahim Amin [Asger Ibrahim Amin v. LIC,
(2016) 13 SCC 797 : (2015) 3 SCC (L&S) 12]
has been held to be erroneous since it removes
the important distinction between resignation
and voluntary retirement. Irrespective of whether
the first respondent had completed the requisite
years of service to apply for voluntary retirement,
his was a decision to resign and not a decision
to seek voluntary retirement. If this Court were to
re-classify his resignation as a case of voluntary
retirement, this would obfuscate the distinction
between the concepts of resignation and
voluntary retirement and render the operation of
Rule 26 nugatory. Such an approach cannot be
adopted. Accordingly, the finding of the Single
Judge that the first respondent “voluntarily
retired” is set aside.

x x x
558 [2025] 12 S.C.R.

Supreme Court Reports

17. On the issue of whether the first respondent has
served twenty years, we are of the opinion that the
question is of no legal consequence to the present
dispute. Even if the first respondent had served twenty
years, under Rule 26 of the CCS Pension Rules his
past service stands forfeited upon resignation. The
first respondent is therefore not entitled to pensionary
benefits.”
From our aforesaid discussion, the only inescapable conclusion is
that on resignation by the employee, his past service stood forfeited.
Hence, he will not be entitled to any pension.

GRATUITY
10. As far as payment of gratuity to the legal heirs of deceased employee
are concerned, their claim is based on the argument that they are
entitled to payment of gratuity in terms of Section 4 of the Payment
of Gratuity Act, 197216. The same is extracted below:
“4. Payment of gratuity – (1) Gratuity shall be payable
to an employee on the termination of his employment
after he has rendered continuous service for not less
than five years.-
(a) On his superannuation, or
(b) On his retirement or resignation, or
(c) On his death or disablement due to accident or disease:
Provided that the completion of continuous service of
five years shall not be necessary where the termination
of the employment of any employee is due to death or
disablement.”
10.1 A perusal of the aforesaid section clearly shows that an
employee who had rendered not less than five years of service
will be entitled to payment of gratuity, regardless of the fact
that he had retired or resigned from service.
10.2 There is no dispute on the fact that in terms of Section 5 of
the 1972 Act there is no notification issued by the appropriate

16 Hereinafter, “1972 Act”
[2025] 12 S.C.R. 559

Ashok Kumar Dabas (Dead Through Legal Heirs) v.
Delhi Transport Corporation

government exempting the Corporation from the application of
the 1972 Act. Once it could not be established by the respondent
that the 1972 Act is not applicable to the Corporation, the claim
of the appellant for release of gratuity cannot be denied even
if he had resigned from service. Hence, they are held entitled
to receive gratuity in terms of the provisions of the 1972 Act
for the service rendered by him.

LEAVE ENCASHMENT
11. Insofar as payment of emoluments towards leave encashment is
concerned, learned counsel for the respondent had fairly submitted
that amount due to the deceased employee shall be paid to his
family members.
12. For the reasons mentioned above, the present appeal is partly
allowed to the extent that the legal heirs of deceased employee
are held entitled to receive gratuity in terms of provisions of the
1972 Act. They are also held entitled to receive amount towards his
leave encashment. As far as grant of family pension is concerned,
the claim being not admissible as per 1972 Rules, no relief on that
account can be granted to the legal heirs of deceased employee.
The amount due to the deceased employee be paid within a period
of six weeks along with interest @6 % p.a. from the date of his
resignation till payment.

Result of the case: Appeal Partly allowed.

†
Headnotes prepared by: Ankit Gyan