DIRECTOR GENERAL, ESI CORPORATION NEW DELHI AND ANR.versusSHRI M.P. JOHN AND ORS.

A   DIRECTOR GENERAL, ESI CORPORATION NEW DELHI AND ANR.
                                      v.
                          SHRI M.P. JOHN AND ORS.

                               DECEMBER I, 1998

B        [MRS. SUJATA V. MANOHAR AND G.B. PATTANAIK, JJ.]


           Service Law-Ex-servicemen-Re-employment-Fixation of pay-
    Government order dated 8. 2.1983 end Memorandum dated 25. // .1958-
    Fixation of pay at the minimum of prescribed scale on re-employment-
C   Provision for fixation ofpay at higher stage in case of hardship--Government
    order dated 19.9.85-Fixation of pay of re-employed pensioners-Provision
    for fixation ofpay at minimum ofscale-Entitlement to draw full pension from
    Military authorities-Respondent an ex-serviceman-Re-employed in
    appellant-Corporation-His pay fixed at minimum-Also entitled to full
D   pension-His contention that his pension has to be ignored in fixing his pay
    on re-employment-Rejection of-There was no hardship as contemplated
    under G.O. of 25.11.58, in the case of the respondent-Hence his pay fixation
     under the G.O. of 8.2.83 was proper-The Tribunal was not right in coming
    to the conclusion that the respondent's initial pay should be fixed by giving
    him one increment for each completed year of military service, ignoring his
E   pension-The impugned order of the Tribunal is, therefore, set aside.

         CIVIL APPELLATE JURISDICTION : Civil Appeal Nos. 6872-
    6875 of 1994.

         From the Judgment and Order dated 14.3.90 of the Central Administrative
F   Tribunal, Emakulam in 0.A. Nos.K 4 77/88, K 504, K505 and 525 of 1988.

                                       WITH

          Civil Appeal Nos. 7622-23 of 1994 and Civil Appeal No. 6890 of 1994.

          S.K. Gambhir and Diwakar Chaturvedi, Advocates for the Appellants.
G
          V.C. Mahajan, Roy Abrahim, (Sudhir P.S.) for M.M. Kashyap, (Ms.
    Arnita Verma) for S.W.A. Qadri and Ms. Anil Katiyar for the Respondent>.

          The following Order of the Court was delivered :

          Civil Appeal Nos. 6872-6875 and 7622-23/94.
H                                       268
             DIRECTOR GENERAL, ESI CORPN. v. M.P. JOHN                      269
      Learned counsel for the appellants states that in view of the decision A
of the Court in Union of India & Others v. G. Vasudevan Pi/lay & Ors., (1995)
1 JT 417 they are not pressing these appeals. The appeals are dismissed as
not pressed.

      Civil Appeal No. 6890/94.
                                                                                    B
      Respondent No. 1 who was an ex- serviceman was re-employed by the
appellant-corporation as Lower Division Clerk. His pay 'was fixed at the
minimum of the pay scale and' he was also entitled to his full pension as an
ex-serviceman. The , Government order of 8.2.83 inter alia, provides that in the
case of ex-services men who retire before attaining the age of 55 years and         C
are re-employed (in the case of personnel below the rank of a commissioned
officer) the entire pension may be ignored in fixing the pay on re-employment.
This Government order was in operation at the material time along with the
office Memorandum of25. l l.58.

      Under the office Memorandum of25. l l .58, re-employed pensioners were        D
allowed only the prescribed scales of pay. The initial pay, on re-employment,
was required to be fixed at the minimum of the scale of pay prescribed for
the post in which the ex-serviceman was re-employed. However , it was
provided that where the fixation of initial pay of a ni-employed person, at the
minimum of the prescribed scale of pay, would cause hardship, the pay may           E
be fixed at a higher stage in the scale by allowing one increment for each
year of service which the officer had rendered before retirement in a post not
lower than that in which he was re-employed. Under the clarification which
was issued pertaining to this office Memorandum, "hardship" was defined as
follows:-

        "There would be a case of hardship if on re-employment, the total
                                                                                    F
        amount received by the ex-serviceman namely the minimum of the pay
        scale plus pension and pension equivalent of gratuity, whether ignorable
        or not, is less than the last pay drawn at the time of the retirement,''.

       On 19.9.1985, another Office Memorandum was issued pertaining to the G
fixation of pay ofre-employed pensioners (ex-servicemen). Under clause I, the
pay of ex-serviceman upto the rank of non-commissioned officers re-employed
on 25. I .83 or thereafter, may be fixed at the minimum of the pay scale under
the Government oflndia order dated 25.11.58 and they will be entitled to draw
full pension from military authorities subject to the fulfilment of other conditions
as laid down in the order.                                                           H
    270                      SUPREME COURT REPORTS (1998] SUPP. 3 S.C.R.

A         The respondent, in the present case, was re-employed on 29.1.85 and
    his pay fixation on re-employment was done in accordance with the G.O. of
    8.2.83 and office Memorandum of25.J 1.58. It is the contention of the respondent
    that under the G.O. of 8.2.83, his pension has to be ignored in fixing his pay
    on re-employment. Hence his pension cannot be taken into account for the
B   purpose of determining hardship under office Memorandum of25. l l .58. This
    contention does not appear to have any substance. The pension is required
    to be ignored for the purpose of pay fixation under the G.O. of 8.2.83. The
    ex-serviceman who is so re-employed will get the minimum of the pay scale
    and in addition, he will also get his full pension as ex-serviceman from the
    military authorities. This is what is meant by stating that the pension will be
C   ignored while fixing the pay on re-employment.

           Office Memorandum of25.l l.58 is for a very different purpose. G.O. of
    25.11.58 enables the employer to give certain increments in the prescribed pay
    scale to a re-employed ex-serviceman at the time of his joining in a case of
    hardship. This hardship is defined as arising if his pay on re-employment
D   together with his pension fall short of his last drawn pay while in military
    service. Office memorandum quite clearly refers to pension ''Whether ignorable
    or not." Therefore, pension which is ignored for the purpose of determining
    the pay, may be considered under G.O. of25. l l.58 for the purpose of deciding
    if there is any financial hardship to the ex-serviceman. This cannot be
E   considered as in any way in conflict with the G.O. of 8.2.83 prescribing the
    grant of pay at the minimum of the scale on re-employment. The latter governs
    the pay which an ex-serviceman will draw in the ordinary course on re-
    employment. It also prescribes that in addition, he will get pension which has
    to be ignored for pay fixation. A departure from this norm of granting minimum
    in the pay scale is permissible only in the case of hardship and that too, to
F   the extent permitted. There is no hardship as contemplated under G.O. of
    25.11.58, in the case of the respondent. Hence his pay fixation under the G.O.
    of 8.2.83 is proper.

           The Tribunal was, therefore, not right in coming to the conclusion that
    the respondent's initial pay should be fixed by giving him one increment for
G   each completed year of military service., ignoring his pension, The impugned
    order of the Tribunal is , therefore set aside and the appeal is allowed. There
    wi II, however, be no order as to costs.

    T.N.A.                                                         Appeal allowed.