Holding

The OROP policy as defined on 7 November 2015 is constitutionally valid, uniformly applicable, and not arbitrary, and therefore cannot be struck down.

Summary

The petitioners, ex‑servicemen, challenged the Union of India's implementation of One Rank One Pension (OROP) through a November 7, 2015 letter that altered the original promise of automatic pension revisions to periodic revisions every five years. They argued that the new definition created a class within a class, violated Articles 14 and 21, and breached legitimate expectations. The Government contended that the 2015 communication represented a lawful policy choice, that the cut‑off date was only for determining base salary, and that periodic revisions were a reasonable administrative decision. The Court held that the OROP definition as per the 2015 communication is uniformly applicable, not arbitrary, and falls within the scope of policy making, which is subject only to constitutional limits. Consequently, the Court ordered a re‑fixation of pension from July 1, 2019 and directed payment of arrears within three months, disposing of the writ petition.

Issues considered

The constitutionality of the 7 November 2015 OROP policy definition under Articles 14, 21 and 32 of the Constitution.
Whether the shift from 'automatic' to 'periodic' pension revisions violates the doctrine of legitimate expectations.
Whether the cut‑off date and use of average 2013 salary create an unlawful class within a class of pensioners.
Whether the periodic five‑year revision of pension is a permissible policy decision.

Legislation cited

Constitution of Indias. Article 14, s. Article 21, s. Article 32

Subjects

OROPPensionEx‑servicemenArticle 14Article 21Article 32Legitimate expectationPolicy decisionPeriodic revisionDiscriminationMACPACP

Judgment

[2022] 9 S.C.R. 885 885

INDIAN EX SERVICEMEN MOVEMENT & ORS. A
v.
UNION OF INDIA & ORS.
(Writ Petition (Civil) No. 419 of 2016)
MARCH 16, 2022 B
[DR. DHANANJAYA Y CHANDRACHUD,
SURYA KANT AND VIKRAM NATH, JJ.]
Armed Forces: One Rank One Pension-OROP –
Constitutionality of – Writ petition challenging the manner in which
the OROP policy for ex-servicemen of defence forces has been C
implemented by the Union of India through a letter dated 07.11.2015
issued to the Chiefs of three defence forces – Letter defining OROP
as the payment of uniform pension to armed services personnel
retiring in the same rank with the same length of service, irrespective
of the date of retirement; that OROP aims to bridge the gap between D
the rate of pension of current and past pensioners at periodic
intervals – Petitioners case that in the course of implementation,
the principle of OROP has been replaced by ‘one rank multiple
pensions’ for persons with the same length of service; that the initial
definition of OROP was altered by the UOI and, instead of an
automatic revision of the rates of pension, where any future E
enhancement to the rates of pension are automatically passed on to
the past pensioners, the revision now would take place at periodic
intervals, is arbitrary and unconstitutional – Held: There is no
constitutional infirmity in the OROP principle as defined by the
communication dated 07.11.2015 – Definition of OROP is uniformly F
applicable to all the pensioners irrespective of the date of retirement
– Cut-off date is used only for the purpose of determining the base
salary for the calculation of pension – While for those who retired
after 2014, the last drawn salary is used to calculate pension, for
those who retired prior to 2013, the average salary drawn in 2013
is used – Since the uniform application of the last drawn salary for G
the purpose of calculating pension would put the prior retirees at a
disadvantage, the Union Government has taken a policy decision
to enhance the base salary for the calculation of pension – Such a
decision lies within the ambit of policy choices – There was no
conscious policy decision on the part of the Union Government on
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886 SUPREME COURT REPORTS [2022] 9 S.C.R.

A the modalities for implementing OROP until the communication dated
07.11.2015 came into being, and thus, the communication of
07.11.2015 cannot be invalidated on the ground that it infringed
the ‘original understanding’ of OROP – Expression ‘automatically
passed on’ cannot be construed as a commitment with reference to
any period of time for the computation of benefits – Decision of the
B
Central Government to revise the pension every five years cannot
be held to violate the precepts underlying Art. 14 – Policy decision
– Constitution of India – Art. 14, 32 – Service law.
Pension – One Rank One Pension-OROP – Legitimate
Expectation – Invocation of – Held: Doctrine of legitimate
C expectations can be invoked if a representation made by a public
body leads an individual to believe that they would be a recipient
of a substantive benefit – Doctrine of legitimate expectations emerges
as a facet of Art. 14 – However, in the present case, there was no
concrete government policy in existence prior to 07.11.2015 – There
D existed only certain assurances – These assurances were also to
the effect that OROP has been accepted in principle - Implementation
was yet to be worked out.
Pension – One Rank One Pension – Concept and genesis of
– Policy and Principles – Discussed.
E Administrative Law: Policy Decisions – Scope of judicial
review – Held: Adjudication cannot serve as a substitute for policy
– Most questions of policy involve complex considerations of not
only technical and economic factors but also require balancing
competing interests for which democratic reconciliation rather than
F adjudication is the best remedy – An increased reliance on judges
to solve matters of pure policy diminishes the role of other political
organs in resolving contested issues of social and political policy,
which require a democratic dialogue – It is not that this Court will
shy away from setting aside policies that impinge on constitutional
rights – Rather it is to provide a clear-eyed role of the function that
G a court serves in a democracy – One Rank One Pension-OROP is
itself a matter of policy and it was open to the makers of the policy
to determine the terms of implementation – Policy is of course
subject to judicial review on constitutional parameters, which is a
distinct issue.
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INDIAN EX SERVICEMEN MOVEMENT & ORS. v. UNION OF 887
INDIA & ORS.

Disposing of the writ petition, the Court A
HELD: 1. There is no constitutional infirmity in the OROP
principle as defined by the communication dated 7 November
2015. (i) The definition of OROP is uniformly applicable to all the
pensioners irrespective of the date of retirement. It is not the
case of the petitioners that the pension is reviewed ‘automatically’ B
to a class of the pensioners and ‘periodically’ to another class of
the pensioners; (ii) The cut-off date is used only for the purpose
of determining the base salary for the calculation of pension. While
for those who retired after 2014, the last drawn salary is used to
calculate pension, for those who retired prior to 2013, the average
salary drawn in 2013 is used. Since the uniform application of the C
last drawn salary for the purpose of calculating pension would
put the prior retirees at a disadvantage, the Union Government
has taken a policy decision to enhance the base salary for the
calculation of pension. Undoubtedly, the Union Government had
a range of policy choices including taking the minimum, the D
maximum or the mean or average. The Union government
decided to adopt the average. Persons below the average were
brought up to the average mark while those drawing above the
average were protected. Such a decision lies within the ambit of
policy choices; (iii) While no legal or constitutional mandate of
OROP can be read into the decisions in Nakara’s case and SPS E
Vains’s case, varying pension payable to officers of the same rank
retiring before and after 1 July 2014 either due to MACP or the
different base salary used for the calculation of pension cannot
be held arbitrary; and (iv) Since the OROP definition is not
arbitrary, it is not necessary to undertake the exercise of F
determining if the financial implications of the scheme is negligible
or enormous. This Court accordingly orders and directs that in
terms of the communication dated 7 November 2015, a re-fixation
exercise shall be carried out from 1 July 2019, upon the expiry of
five years. Arrears payable to all eligible pensioners of the armed
forces shall be computed and paid over accordingly within a period G
of three months. [Paras 49 and 51][942-D-H; 943-A-C, E]
2.1 The features of the policy communication of 7 November
2015 need to be noticed. First, it contains the decision of the

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888 SUPREME COURT REPORTS [2022] 9 S.C.R.

A Indian government to implement OROP for ex-servicemen.
Second, it specifies the date with effect from which the decision
would be implemented, namely, 1 July 2014. Third, it embodies
the understanding that OROP implies the payment of uniform
pension to defence personnel retiring in the same rank with the
same length of service regardless of the date of retirement.
B
Fourth, it emphasises the need to bridge the gap between the
rates of pension of current and past pensioners at “periodic
intervals”. The analysis of the underlying document indicates that
while a decision to implement OROP was taken in principle, the
modalities for implementation were yet to be chalked out. There
C was no conscious policy decision on the part of the Union
Government on the modalities for implementing OROP until the
communication dated 7 November 2015 came into being. The
communication of 7 November 2015 cannot be invalidated on
the ground that it infringed the ‘original understanding’ of OROP.
A hierarchy in law exists between statutes and rules-a statutory
D
provision will have precedence over delegated legislation if the
latter conflicts with the former. Similarly, executive instructions
cannot override a statute or rules made in pursuance of a statute.
But in the present case the entire canvas is governed by a policy.
The terms for implementing the policy were specified on 7
E November 2015. Hence, that element of the policy cannot be
challenged on the notion that there is an inflexible notion of OROP
couched in an original understanding. OROP is itself a matter of
policy and it was open to the makers of the policy to determine
the terms of implementation. The policy is of course subject to
judicial review on constitutional parameters, which is a distinct
F
issue. [Paras 23 and 25][917-E-F; 918-E-H; 919-A]
1.3. The central limb of the submission of the petitioners is
that a revision of OROP should be automatic. The Union
government has submitted that besides lacking any prior
precedent, in terms of the practice governing pay scales, pensions
G and other financial emoluments of government servants, automatic
revision would be impossible to implement. Quite apart from the
above consideration, it is evident that the three documents which
have been relied upon by the petitioners namely (i) the Koshyari

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INDIA & ORS.

Committee Report; (ii) the minutes of the meeting chaired by A
the Defence Minister on 26 February 2014; and (iii) the
communication dated 26 February 2014 to CGDA underscore that
“any future enhancement in the rates of pension to be
automatically passed on to the past pensioners”. The expression
“to be automatically passed on” immediately follows upon the
B
words “any future enhancement in the rates of pension”. When
read together contextually, it signifies that the rates of pension
would be passed on to past pensioners without any administrative
impediments. The expression ‘automatically passed on’ cannot
be construed as a commitment with reference to any period of
time for the computation of benefits. The manner in which and C
the period over which revisions should take place of pensions,
salaries and other financial benefits is a pure question of policy.
The decision of the Central Government to revise the pension
every five years cannot be held to violate the precepts underlying
Article 14. [Para 37][931-E-H; 932-A]
D
1.4. As opposed to the factual matrix in Nakara, where the
liberalised pension scheme was not made applicable to employees
who had retired prior to the cut-off date, in this case the OROP
principle is applicable to all retired army personnel, irrespective
of the date of retirement. The cut-off date is only prescribed for
determining the base salary used for computing the pension. E
While for those who retired on or after 2014, the last drawn salary
is used for computing the pension; for those who retired prior to
2014, the average of the salary drawn in 2013 is used. This policy
only seeks to protect those who retired before 2014 since the
last drawn salary of the prior retirees might be too low and F
incomparable to the pay of the 2014 retirees. Moreover, if the
maximum salary drawn is to be used as the base value instead of
taking the average salary, an additional outlay of Rs 1,45,339.34
crores would be incurred. The executive is therefore, well within
its limits to prescribe a policy keeping in view the financial
implications. [Para 40][934-D-G] G

DS Nakara v. Union of India 1983 ( 2 ) SCR 165 :
1983 ( 1 ) SCC 305- distinguished.
1.5 The canvass which is sought to be traversed in these
proceedings under Article 32 of the Constitution trenches upon H
890 SUPREME COURT REPORTS [2022] 9 S.C.R.

A a domain which is reserved for executive policy. Adjudication
cannot serve as a substitute for policy. Most questions of policy
involve complex considerations of not only technical and
economic factors but also require balancing competing interests
for which democratic reconciliation rather than adjudication is
the best remedy. Further, an increased reliance on judges to solve
B
matters of pure policy diminishes the role of other political organs
in resolving contested issues of social and political policy, which
require a democratic dialogue. This is not to say that this Court
will shy away from setting aside policies that impinge on
constitutional rights. Rather it is to provide a clear-eyed role of
C the function that a court serves in a democracy. The OROP policy
may only be challenged on the ground that it is manifestly arbitrary
or capricious. In this regard, the policy which has been adopted
by the Union Government is evaluated. The policy of OROP
adopted by the Union Government stipulates thus: (i) The
benefits will be effective from 1 July 2014; (ii) Pensions of past
D
pensioners would be refixed on the basis of the pension of retirees
of calendar year 2013; (iii) Pension for all pensioners would be
protected; and (iv) In future, the pension would be refixed after
every five years. [Paras 46 and 47][940-H; 941-A, C-D]
1.6 The principles governing pensions and cut-off dates can
E be summarised as follows: (i) All pensioners who hold the same
rank may not for all purposes form a homogenous class. For
example, amongst Sepoys differences do exist in view of the
MACP and ACP schemes. Certain Sepoys receive the pay of the
higher ranked personnel; (ii) The benefit of a new element in a
F pensionary scheme can be prospectively applied. However, the
scheme cannot bifurcate a homogenous group based on a cut-off
date; (iii) The judgment of the Constitution Bench in Nakara
(supra) cannot be interpreted to read the one rank one pension
rule into it. It was only held that the same principle of computation
of pensions must be applied uniformly to a homogenous class;
G and (iv) It is not a legal mandate that pensioners who held the
same rank must be given the same amount of pension. The
varying benefits that may be applicable to certain personnel which
would also impact the pension payable need not be equalised
with the rest of the personnel. [Para 48][941-G; 942-A-C]
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INDIAN EX SERVICEMEN MOVEMENT & ORS. v. UNION OF 891
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Kalpana Mehta v. Union of India (2018) 7 SCC 1 : A
[2018] 4 SCR 1- followed.
Union of India v. SPS Vains [2008] 13 SCR 257 : 2008
(9) SCC 125- distinguished.
State of Arunachal Pradesh v. Nezone Law House (2008)
5 SCC 609 : [2008] 5 SCR 948; Col. B.J Akkara (Retd.) B
v. Government of India (2006) 11 SCC 709 : [2006]
7 Suppl. SCR 58; Indian Ex-Services League v. Union
of India AIR 1991 SC 1182 : [1991] 1 SCR 158; KL
Rathee v. Union of India SLJ 1997 (30 207); Suchet
Singh Yadav v. Union of India (2019) 11 SCC 520 :
[2018] 2 SCR 752; State of Jharkhand v. Brahmputra C
Metallics Ltd., Ranchi 2020 SCC OnLine SC 968;
Union of India v. Balbir Singh Turn (2018) 11 SCC 99
: [2017] 12 SCR 421- referred to.
Fuller, L. L., & Winston, K. I. (1978). The Forms and
Limits of Adjudication. Harvard Law Review, 92(2), 353– D
409 – referred to.
Case Law Reference
[2008] 13 SCR 257 distinguished Para 49
[1983] 2 SCR 165 distinguished Para 40, 49
E
[1991] 1 SCR 158 referred to Para 13
[2018] 2 SCR 752 referred to Para 13
[2018] 4 SCR 1 followed Para 17
[2008] 5 SCR 948 referred to Para 26
[2017] 12 SCR 421 referred to Para 33 F
[2006] 7 Suppl. SCR 58 referred to Para 44
CIVIL ORIGINAL JURISDICTION : Writ Petition (Civil) No.419
of 2016.
(Under Article 32 Of The Constitution of India)
Huzefa Ahmadi, Sr. Adv., Balaji Srinivasan, Arunava Mukherjee, G
Ms. Garima Jain, Rohan Sharma, Ms. Pallavi Sengupta, Ms. Lakshmi
Rao, Ms. Aakriti Priya, Md. Shahrukh, Prateek Yadav, Suhail Ahmed,
Advs. for the Petitioners.
N. Venkataraman, ASG, Ms. Priyanka Das, Akshay Amritanshu,
Apoorv Kurup, Rajat Nair, Ankur Talwar, Shyam Gopal, Ms. Chinmayee H
892 SUPREME COURT REPORTS [2022] 9 S.C.R.

A Chandra, A. K. Sharma, Mukesh Kumar Maroria, Raj Bahadur Yadav,
V. Chandrasaekara Bharathi, S. Ram Narayan, Advs. for the
Respondents.
The Judgment of the Court was delivered by
DR. DHANANJAYA Y CHANDRACHUD, J.
B
This judgment has been divided into the following sections to
facilitate analysis:
A. Factual Background ...................................................... 3*
B. Submissions of Counsel ............................................. 11*
C
C. Analysis .........................................................................24*
C. 1 Concept and genesis of OROP ..............................26*
C. 2. Plea of Discrimination ............................................38*
C.2.1 ACP-MACP ............................................................44*
D
C.2.2 Financial Implications ...........................................46*
C.2.3 Average to Maximum ............................................48*
C.2.4 Periodic revision every five years ......................49*
A. Factual Background
E
1. The petition under Article 32 of the Constitution addresses a
challenge to the manner in which the “One Rank One Pension”1policy
for ex-servicemen of defence forces has been implemented by the first
respondent2 through a letter dated 7 November 2015 issued to the Chiefs
of three defence forces. The letter defines OROP as the payment of
F uniform pension to armed services personnel retiring in the same rank
with the same length of service, irrespective of the date of retirement.
OROP, in terms of the letter, aims to bridge the gap between the rate of
pension of current and past pensioners at periodic intervals. The
petitioners contend that in the course of implementation, the principle of
OROP has been replaced by ‘one rank multiple pensions’ for persons
G
with the same length of service. The petitioners contend that the initial
definition of OROP was altered by the first respondent and, instead of
an automatic revision of the rates of pension, the revision now would
1
"OROP”
2
Also referred as the “Union Government”
H * Ed. Note : Pagination is as per the original Judegment.
INDIAN EX SERVICEMEN MOVEMENT & ORS. v. UNION OF 893
INDIA & ORS. [DR. DHANANJAYA Y CHANDRACHUD, J.]

take place at periodic intervals. The petitioners submit that the deviation A
from the principle of automatic revision of rates of pension, where any
future enhancement to the rates of pension are automatically passed on
to the past pensioners, is arbitrary and unconstitutional under Articles 14
and 21 of the Constitution.
2. The salient facts giving rise to the proceedings need to be stated. B
The demand for OROP by ex-servicemen of the defence forces was
initially examined by Parliament in 2010-11. On 19 December 2011, the
Rajya Sabha Committee on Petitions3 presented its 142nd Report on the
Petition Praying for Grant of OROP to Armed Forces Personnel 4. The
Committee recommended the implementation of OROP. The Committee
defined OROP as a uniform pension to be paid to armed forces personnel C
retiring in the same rank with the same length of service, irrespective of
their date of retirement, where any future enhancements in the rates of
pension were to be automatically passed on to the past pensioners.
The Committee noted that OROP was being implemented till 1973
whenthe Third Central Pay Commission took a decision to revoke it. D
The relevant observations/recommendations of the Koshyari Committee
are extracted below:
“11.The Committee takes note of the fact that a sum of Rs 1300
crores is the total financial liability for the year 2011-12 in case
OROP is implemented fully for all the defence personnel in the E
country across the board. The Committee is informed that out of
this, 1065 crores would go to retirees belonging Post Below Officer
Ranks (PBOR) while the Commissioned Officers would be getting
the remaining i.e. 235 crores. The Committee feels that 1300 crores
is not a very big amount for a country of our size and economy for
meeting the long pending demand of the armed forces of the F
country. The Committee understands that this ·1300 crores is the
expenditure for one year which might increase at the rate of 10
percent annually. Even if it is so, the Committee does not consider
this amount to be high, keeping in view the objective for which it
would be spent. Needless for the Committee to point out here G
that our defence personnel were getting their pension and family
pension on an entirely different criteria before the Third Central
Pay Commission came into force. Till the recommendations of
3
“Koshyari Committee”
4
“Koshyari Committee Report”
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894 SUPREME COURT REPORTS [2022] 9 S.C.R.

A the Third Central Pay Commission were implemented for the
defence personnel of the country, they were satisfied and happy
with dispensation meant fortheir pension/family pension.
….
11.4 …the Committee feels that the decision of the Government
B to bring our defence personnel on the pattern of the civilians with
regard to their pay, pension, etc. (from Third Central Pay
Commission onwards) is not a considered decision which has
caused hardship to the defence personnel and has given birth to
their demand for OROP. The Committee understands that before
C the Third Central Pay Commission, the defence personnel were
getting their pay/ pension on the basis of a separate criteria
unconnected with the criteria devised for the civilian work force.
That criteria acknowledged and covered the concept of OROP
which has been given up after the Third Central Pay Commission.

D 11.5 The Committee is not convinced with the hurdles projected
by the Ministry of Defence (D/o Ex-Servicemen Welfare) in
implementing of OROP for defence personnel. They have
categorized the hurdles into administrative, legal and financial.
The financial aspect has already been dealt with by the Committee.
So far as the administrative angle is concerned, the Committee is
E given to understand that all the existing pensioners/ family
pensioners are still drawing their pension/family pension based
upon the lawfully determined pension/family pension. In that case,
revision of their pension/family pension, prospectively, as a one
time measure should not pose any administrative hurdle. So far as
F the legal aspect is concerned, the Committee is not convinced by
the argument put forth against the implementation of OROP
because the pension/family pension is based upon the service
rendered by personnel while in service and comparison of services
rendered during two sets of periods does not seem to be of much
relevance. If seen from a strict angle, in each set of periods, the
G army officer performed the duties attached to his post and it may
not be proper to infer that the officers who served at a later period
performed more compared to the officers of earlier period. On
the contrary, facts tilt towards treating past pensioners/family
pensioners at par with the more recent ones.”
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3. On 17 February 2014, the Finance Minister announced in his A
Budget Speech that the Union Government had in principle accepted
OROP and it would be implemented prospectively from financial year
2014-15. The Finance Minister stated that an amount of Rs 500 crores
has been transferred to the Defence Pension Account to meet the
budgetary expense. On 26 February 2014, the Defence Minister chaired
B
a meeting to discuss the implementation of OROP.The Defence
Secretary, the Secretary to the Department of Ex-Servicemen Welfare,
the Controller General of Defence Accounts5, the three Vice Chiefs of
Staff, and senior officers of the Service Headquarters along with the
concerned Joint Secretaries attended the meeting. The minutes of the
meeting refer to OROP as a uniform pension to be paid to armed forces C
personnel that are retiring in the same rank with the same length of
service, irrespective of the date of retirement, where any future
enhancements in the rates of pension are to be automatically passed on
to the past pensioners. The fourth respondent, CGDA, was directed to
take necessary steps to give effect to the decision of implementing OROP
D
in consultation with the three defence forces, and the first and second
respondents.
4. By its letter dated 26 February 2014 the first respondent directed
CGDA to work out the modalities of executing OROP. However, OROP
was not implemented at the time. On 10 July 2014 in his Budget Speech
for the year 2014-2015, the Finance Minister reaffirmed the Union E
Government’s commitment to implement OROP and a further sum of
Rs 1000 crores was set apart to meet the requirement. In a written reply
to a Member of Parliament on 2 December 2014, the Minister of State
for Defence stated that OROP implies that a uniform pension is paid to
retired servicemen having the same rank with the same length of service, F
irrespective of the date of retirement, with any future enhancement in
the rates being passed on to the past pensioners automatically.
5. The above sequence of events has been emphasised by the
petitioners to highlight that OROP always entailed an automatic revision
of the rates of pension to bridge the gap in the pension being received by
past and current pensioners. However, according to the petitioners, a G
letter dated 7 November 2015 of the Joint Secretary of the first respondent
to the Chiefs of three defence forces introduced a revised definition of
OROP, where the revision between the past and current rates of pension
was to take place at periodic intervals. Besides stating that OROP would
5
“CGDA” H
896 SUPREME COURT REPORTS [2022] 9 S.C.R.

A take effect from 1 July 2014, the letter also highlighted the salient features
of OROP:
“3. Salient features of the OROP are as follows:
i. To begin with, pension of the past pensioners would be re-fixed
on the basis of pension of retirees of calendar year 2013 and the
B benefit will be effective with effect from 1.7.2014.
ii. Pension will be re-fixed for all pensioners on the basis of the
average of minimum and maximum pension of personnel retired
in 2013 in the same rank and with the same length of service.

C iii. Pension for these drawing above the average shall be protected.
iv. Arrears will be paid in four equal half yearly instalments.
However, all the family pensioners including those in receipts of
Special/Liberalized family pension and Gallantry award winner
shall be paid arrears in one instalment.
D v. In future, the pension would be re-fixed every 5 years.”
6. The above definition of OROP was also adopted by the first
respondent while implementing OROP by its notification dated 14
November 2015. The rates of pension were now to be revised every
five years.The notification also constituted a Committee headed by Justice
E L. Narasimha Reddy to examine and make recommendations on the
terms of reference received by the Union Government on measures to
remove anomalies that may arise in the implementation of the letter
dated 7 November 2015.
7. By its letter dated 25 January 2016 to the Defence Minister the
F first petitioner objected to the revision of the definition of OROP
highlighting that the deviation from the automatic revision of rates of
pension to a revision at periodic intervals changed the accepted meaning
of OROP. It was submitted that the revised definition would deprive the
past pensioners of equal monetary benefits, which militated against the
principle of OROP. The letter urged that the Committee headed by Justice
G L. Narasimha Reddy would be ‘inapt’ in making recommendations on
the issue of OROP since the terms of reference took into account the
revised definition of OROP. The letter urged the Defence Minister to
revert to the original definition of OROP where the pension of past
pensioners would be automatically revised pursuant to any future
H enhancements. The first petitioner also wrote to Justice L. Narasimha
INDIAN EX SERVICEMEN MOVEMENT & ORS. v. UNION OF 897
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Reddy on 25 March 2016 highlighting the anomalies that will result from A
the implementation of the revised definition of OROP.
8. Meanwhile, the first respondent issued a letter to the Chiefs of
the three defence forces on 3 February 2016 regarding the implementation
of OROP. On 29 October 2016, the first respondent issued a letter to the
Chiefs of the three defence forces revising the pension of pre-2016 B
defence forces’ pensioners and family pensioners. The existing pension
was to be revised upwards by implementing the basic pension drawn on
31 December 2015 by a multiplication factor of 2.57. The petitioners
have highlighted that owing to the periodic revision of the pension rate
according to the revised definition, the pension of many ex-servicemen
would not be updated to the 31 December 2015 level. C

9. A post-facto approval of the Union Cabinet for implementation
of OROP was received on 6 April 2016 and was conveyed by the Cabinet
Secretariat on 7 April 2016. The proposal, which was approved by the
Union Cabinet is as follows:
D
“9.1. Ex-post facto approval of the Cabinet is solicited for
implementation of One Rank One Pension as under.
9.1.1 The benefit will be given with effect 1st July, 2014.
9.1.2 Pension will be re-fixed for pre 01.07.2014 pensioners retiring
in the same rank and with the same length of service as the E
average minimum and maximum pension drawn by the retirees in
the year 2013. Those drawing pensions above the average will be
protected.
9.1.3 The benefit would also be extended to family pensioners
including war widows and disabled pensioners. F
9.1.4 Personnel who opt to get discharged henceforth on their
own request under Rule 13(3)1(i)(b), Rules 13(3)1(iv) or Rule
16B of the Army Rule 1954 or equivalent Navy or Air Force
Rules will not be entitled to the benefits of OROP. It will be
effective prospectively. G
9.1.5. Arrears will be paid in four half-yearly instalments.
However, all the family pensioners including those in receipt of
Special/Liberalized family pension and Gallantry award winners
shall be paid arrears in one instalment.
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898 SUPREME COURT REPORTS [2022] 9 S.C.R.

A 9.1.6 In future, the pension would be re-fixed every 5 years.
9.1.7. Constitution of Judicial Committee headed by Justice L
Narasimha Reddy, Retd. Chief Justice of Patna High Court on
14.12.2015 which will give its report in six months on references
made by the Government of India.”
B 10. Aggrieved by what the petitioners contend is a revision in the
definition of OROP, the petition under Article 32 was instituted before
this Court on 9 June 2016. On 1 May 2019, this Court took note of the
anomalies which were highlighted on behalf of the petitioners:
“Fixation of pension as per calendar year 2013 instead of FY
C 2014: Fixation of pension as per calendar year 2013 would result
in past retirees (pre 2014) getting less pension of one increment
than the soldier retiring after 2014.
Fixation of pension as mean of Min and Max pension: Fixing
pension as mean of Min and Max pension of 2013 would result
D different pensions for the same ranks and same length of service
and the past retiree would get 1.5 increment lesser on account of
such fixation.
For example, if 8(i) and (ii) are implemented, two soldiers who
have served for same length of years, holding the same rank will
E draw different pension. A Sepoy (Group Y) who retired prior to
31 Dec 2013 will get Rs.6665 p.m. and another Sepoy (Group Y)
who retired on and after 1 Jan 2014 would get Rs 7605 p.m.
Further, onaccount of such implementation, a higher rank Naik
soldier whoretired before 31 Dec 2013 would draw a lesser pension
F of rs. 7170 p.m., than a junior rank Sepoy who retired after 1 Jan
2014 as his pension would be Rs.7605. This fact is illustrated by a
tabular chart which is enclosed. (See Pg.1, CC).
Therefore, implementation of this new definition of OROP defeats
the very principle of OPOP by creating a class within a class of
the same officers, which in practice tantamounts to one rank
G
different pensions. This is also contrary to the judgment by this
Hon’ble Court in Union of India v SPS Vains, {2008) 9 SCC 125.
Another fallacy in the new definition of OROP which detracts
from the principle of OROP is:
H
INDIAN EX SERVICEMEN MOVEMENT & ORS. v. UNION OF 899
INDIA & ORS. [DR. DHANANJAYA Y CHANDRACHUD, J.]

(iii) Pension Equalization every five years A
It is submitted that Pension equalization every five years would
result in the grave disadvantage to the past retirees.”
This Court directed the first respondent to scrutinise the grievances
raised by the petitioners. Pursuant to the order, the first respondent
filed an affidavit on 5 December 2019 submitting that after B
extensive consultations with experts and ex-servicemen, the Union
Government decided that it is practical and feasible to revise the
pension under OROP every five years. The average of the
minimum and maximum pension in calendar year 2013 wasdecided
to be taken as the revised pension of all pensioners retiring in the C
same rank and with the same length of service. At the same time,
the first respondent chose to protect the pensioners who were
drawing pension above the average. Thus, it was submitted, that
the implementation of OROP has benefitted the past pensioners,
though the amount of financial benefit varies. It was urged on
behalf of the first respondent that revising the rate of pension D
every year would cause administrative difficulty and is
impracticable to implement.
11 Since the grievance of the petitioners remained unaddressed, it
falls on this Court to adjudicate upon whether the revision of the definition
of OROP and its implementation in the present form, is arbitrary and E
violative of Articles 14 and 21 of the Constitution. Before we analyse
the rival contentions, we advert to the submissions of the counsel.
B. Submissions of Counsel
12. Mr Huzefa Ahmadi, Senior Counsel, appeared for the F
petitioners. The following submissions have been made on behalf of the
petitioners during the course of the proceedings:
(i) The letter issued by the Joint Secretary of the first
respondent to the Chief of Air Staff on 7 November 2015
arbitrarily alters the definition of OROP6 by bridging the
G
gap between the rates of pension of the current and the
past pensioners at ‘periodic intervals’ and not ‘automatically’.
This definition is contrary to the definition arrived at in the
meeting held on 26 February 2014 and the subsequent
executive order issued on the same day;
6
"new definition” H
900 SUPREME COURT REPORTS [2022] 9 S.C.R.

A (ii) The implementation of the scheme with the new definition
would lead to a situation where the pension drawn by an
ex-serviceman who retired on an earlier date would be less
than the pension drawn by an ex-serviceman who retired
in 2014, until such time that a ‘periodic’ review is conducted
to correct the anomaly;
B
(iii) The new definition creates a class within a class where ex-
servicemen who retired with the same rank and same length
of service would receive different pensions. In Union of
India v. SPS Vains7, this Courthas held that the creation of
a class within a class is unconstitutional;
C
(iv) Even if the differential pay is rectified by a periodic review,
it would cause injustice;
(v) The effective date of implementation of OROP was already
fixed as 1 April 2014 and this date has been arbitrary re-
D fixed to 1 July 2014 by the letter issued by the first respondent
on 7 November 2015;
(vi) According to the letter dated 7 November 2015, the pension
of the personnel retiring on or after 1 April 2014 will be
fixed based on the last pay drawn on retirement. However,
E the pension of soldiers who retired earlier than 2013 would
be fixed on the basis of the pension of the retirees of the
calendar year 2013. This would lead to a situation of one
rank different pension;

F

G

Figure 1
7
H (2008) 9 SCC 125
INDIAN EX SERVICEMEN MOVEMENT & ORS. v. UNION OF 901
INDIA & ORS. [DR. DHANANJAYA Y CHANDRACHUD, J.]

(vii) The pension of the past pensioners is further lowered by A
the re-fixation of pension based on the average of the
minimum and maximum pension of personnel retiring in the
calendar year 2013, as compared to personnel retiring on
or after 1 April 2014. In some cases, a past pensioner who
retired before 2014 receives pension lower than personnel
B
of a lower rank retiring on or after 2014. For instance, if
the new definition is followed then a Sepoy who retired
prior to 31 December 2013 will get a pension of Rs. 6665
per month while another Sepoy who retired on or after 1
January 2014 would get a pension of 7605 per month.
Extracted below is a chart depicting the anomaly: C

D

E

Figure 2

F

G

Figure 3 H
902 SUPREME COURT REPORTS [2022] 9 S.C.R.

A (viii) The difference in the pension as provided in the chart is not
due to the Modified Assured Career Progression8. Even
according to the new definition, all personnel with the same
rank and same length of service must receive the same
pension;
B (ix) The notification issued on 14 December 2015 adheres to
the arbitrary definition of OROP as provided by the letter
issued on 7 November 2015. The terms of reference ofthe
Committee appointed under the notification are also
restricted to the arbitrary new definition of OROP. The letter
issued by the first respondent to the Chief of Army Staff,
C the Chief of Naval Staff, and the Chief of Air Staff on 3
February 2016 also defined OROP in new and arbitrary
terms;
(x) As noted by the Koshyari Committee, after the Sixth Central
Pay Commission, officers from the grade of Lt. Colonel
D and above fall within one pay band of Rs 37400 to Rs 67000.
Therefore, defence retirees before 2014 would get pension
with reference to the minimum of the pay bracket,
irrespective of the fact that they held higher posts such as
Major General and Lt. General;
E (xi) All Havildars were granted the honorary rank of Naib
Subedar. They must thus be given the pension of Naib
Subedar;
(xii) All personnel who retired as Major after thirteen years of
service as Commissioned Officers should be given the
F pension of Lt. Colonel since Commissioned Officers now
automatically become Lt. Colonels after thirteen years of
service;
(xiii) All veterans who retired before 2004 as Lt. Colonel should
be given the pension of Colonel since all Commissioned
G Officers now automatically retire as Colonel;
(xiv) While the Government defines OROP as a “uniform pension
to be paid to the defence personnel retiring in the same
rank, with the same length of service regardless of the date
8
"MACP”
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of retirement”, it creates a class within a class based on A
the date of retirement;
(xv) The decision to define OROP in narrow terms is an
executive act which can be judicially reviewed and is not a
policy decision;
(xvi) According to the letter of the Union Government dated 7 B
November 2015, the pension of past pensioners would be
fixed one and a half year behind even if equalization is done
once in five years;
(xvii) Under the Seventh Pay Commission, the basic pension of
all pensioners is to be arrived at by multiplying basic pension C
as on 31 December 2015 by a factor of 2.57. Since the
basic pension of those who retired before 31 December
2013-14 has not been updated to 31 December 2015 (that
is Rs. 7605 per month) but has only been fixed based on
the mean of the 2013 pension, that is Rs. 6665 per month, a
past pensioner will get Rs. 2415 less than an officer with D
the same rank and same length of service but who retired
later;
(xviii) The Union Government has stated that after the Seventh
Pay Commission, the basic pension of personnel in the
Colonel and Brigadier ranks will be arrived at by increasing E
the multiplication factor from 2.57 to 2.67. However, this
increase has been denied to the past pensioners on the
ground that the benefit will only be given in 2019 after the
periodic equalization as per the new definition;
(xix) The ex-servicemen received the benefit of OROP till the
F
Third Central Pay Commission. Subsequently, it was
recommended that the pension of ex-servicemen be reduced
and to compensate them for such reduction, they were to
be absorbed in paramilitary forces, police forces or public
sector organisations. However, though the pension was
reduced, the recommendation relating to their absorption G
was not implemented. The army personnel then demanded
that OROP must be implemented;
(xx) The reliance placed by the respondents on DS Nakara
v. Union of India9 is incorrect since it only deals with
9
1983 AIR 130 H
904 SUPREME COURT REPORTS [2022] 9 S.C.R.

A the general law applicable to civil servants. The decision
in SPS Vains (supra) deals with the special law applicable
to ex-servicemen of the defence forces;
(xxi) The one man Committee headed by Justice L Narasimha
Reddy submitted its report to the Union Government on
B 26 December 2016. Even after two years, the
Government is still ‘studying’ the report and has not yet
released the report;
(xxii) If the respondents can calculate the enhancement of
pension for every five years, there is no reason that it
C cannot be done every year;
(xxiii) The rule of reduction in the pension if the service of the
armed personnel is less than twenty six years was
introduced in 1973. If a soldier has served for less than
twenty six years then his pension would be reduced pro
D rata of X (number of years served) % 26. The
Government has not updated the basic pay of soldiers
and did not bring it at par with the 31 December 2015
pay before multiplying it with the factor of 2.57. At the
same time, the pension was altered from being rank
based to 50 percent of the last drawn pay. This resulted
E in double loss to ex-servicemen. This Court has also
struck down the rule of reducing pension if an employee
has served less than twenty six years;
(xxiv) While the respondents have submitted that an amount
of Rs 10,795 crores has been paid as arrears for OROP
F in two years, it only amounts to an average increase of
Rs 2131 per month per soldier. The Union Government
is spending a higher amount of funds for Central
Government employees and pensioners;
(xxv) The Union Government has spent Rs 32,385 crores for
G OROP in six years which is less than its spending of Rs
27,800 crores per year for the scheme of Non-Functional
Upgradation. The Union Government consistently has
been spending less on the armed forces. For instance,
the “High Altitude Siachen Allowance” for Army
personnel is Rs 31,500, while it is Rs 50,000 to 70,000
H
INDIAN EX SERVICEMEN MOVEMENT & ORS. v. UNION OF 905
INDIA & ORS. [DR. DHANANJAYA Y CHANDRACHUD, J.]

for all Central Cadre for serving in ‘hard areas’ like A
Shillong;
(xxvi) MACP Scheme should be given to all past retirees to
comply with the judgment of this Court in SPS Vains
(supra). Even if MACP has been given to the 2013
retirees, the comparison made in the chart still holds B
correct;
(xxvii) While the Union Government states that the benefit of
OROP is to be given to ‘past retirees’, it has created a
confusion by stating that the scheme must be given
prospective effect; and C
(xxviii) The MACP Scheme came into effect from 1 January
2016. Therefore, the figure of Rs. 6665 referring to the
pension receivable by a Sepoy should include the benefits
of the MACP scheme.
13. We have heard Mr Venkataramanan, the learned Additional D
Solicitor General of India, for the respondents. The respondents have
made the following submissions during the course of the proceedings:
(i) The budget for pension has been increased after the
implementation of OROP with effect from 1 July 2014.
The disbursement of arrears with respect to OROP is E
approximately Rs 10795.04 crores. The yearly recurring
expenditure on account of OROP is Rs 7123.38 crores.
For the six years from 1 July 2014, the total recurring
expenditure is approximately Rs 42740.28 crores;
(ii) OROP seeks to bridge the gap by taking the maximum F
and minimum pension within the rank of pensioners
holding the same rank and same length of service to
determine the average. Those who are below the
average pension are brought to the average and those
who are drawing a higher pension are protected;
G
(iii) The OROP scheme has been implemented prospectively
with effect from 1 July 2014. The benefits arising out
of the scheme are to be paid after 1 July 2014 to those
who retired prior to 1 July 2014;
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906 SUPREME COURT REPORTS [2022] 9 S.C.R.

A (iv) The OROP scheme envisages revision of pension once
in five years, unlike civilian pension schemes which are
revised once in ten years. The plea of the petitioners to
provide ‘automatic’ adjustment cannot be acceded to
as it is impossible to implement it;
B (v) It is a settled principle of law that minutes, statements
and inter-ministerial discussions with the Ministry and
within the Ministry do not have the force of law.
Therefore the reference made by the petitioners to the
minutes of the meeting to argue that the definition of
OROP has been altered is unsustainable;
C
(vi) The scheme/policy can be challenged on the grounds
of arbitrariness but a demand to substitute the policy
cannot be made;
(vii) The disparity alleged by the petitioners in the pensions
D of the defence personnel with the same rank and same
length of service has been wrongly depicted on account
of the OROP scheme. An artificial disparity has been
shown by equating different classes of pensioners;
(viii) In Figure 1 of the chart produced by the petitioners,
E they have compared the pension payable to a Sepoy
with 15 years of service under the OROP Scheme and
the pension of a Sepoy who retired before 2014 (before
the application of OROP) after fifteen years of service
who is drawing pay in the rank of Naik due to the MACP
Scheme introduced pursuant to Circular No. 555 dated
F 4 February 2016;
(ix) The pension figure of Rs 6,665 is arrived at by taking
the average pension of the maximum and minimum
pension of 2013. However, the figure of Rs 7,605 is
calculated on the basis of 50 percent of the last pay
G drawn before retirement;
(x) Under the MACP Scheme, a Sepoy who was originally
getting Rs 2000 as grade pay would after eight years of
service receive a next grade pay of Rs 2400. The grade
pay of Rs 2400 corresponds to the grade pay of Naik.
H Similarly after sixteen years of service, he would receive
INDIAN EX SERVICEMEN MOVEMENT & ORS. v. UNION OF 907
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the higher grade pay of Rs. 2800, which corresponds to A
the grade pay of Havildar;
(xi) Similarly, the disparity shown in Figure 2 by the
petitioners is due to the implementation of the MACP
Scheme rather than OROP. Figure 3 which pertains to
the rank of Group Captain quotes the pension amount B
of Group Captain Daniel Victor who retired on 28
February 2015. The OROP scheme is not applicable to
Group Captain Victor;
(xii) The comparison drawn by the petitioners is a comparison
between non-comparables. The pension calculated C
based on the average pension in 2013 cannot be
compared with the actual pension received based on
the pension rules;
(xiii) The MACP regime warranted a service of 6, 16 and 24
years of service by the Sepoy for grouping with the D
rank of Naik, Havildar and Naib Subedar. On the other
hand, under the earlier Assured Career Progression10
regime, the required service is of 10, 20 and 30 years;
(xiv) For computation of OROP, the Union Government has
taken MACP as the base and has applied it across the E
board to all retirees having the same length of service.
OROP is not calculated based on MACP and ACP
regime. No such differentiation is made;
(xv) An executive decision of the Union Government on the
OROP can only be challenged on legal principles. F
However, the petitioners are seeking the most beneficial
interpretation of OROP to be implemented. It cannot
be contended that the most beneficial interpretation of
OROP is the only ‘true’ interpretation and that it must
be implemented as a right;
G
(xvi) In SPS Vain (supra), this Court held that pre and post
1996 retired Major Generals must be treated at par to
remove an anomaly in the pension of pre-1996 retired
Major generals. The principle in that case was about
the removal of anomaly between the ranks of Major
10
“ACP” H
908 SUPREME COURT REPORTS [2022] 9 S.C.R.

A General and Brigadier which had arisen due to the
implementation of the fifth and the sixth Central Pay
Commission;
(xvii) In Indian Ex-Services League v. Union of India11,
this Court hasheld that unless the claim of OROP can
B be treated to be flowing from the reliefs provided in
Nakara (supra), the reliefs claimed cannot be granted.
It was also observed that the decision in Nakara (supra)
cannot be enlarged to cover within it all the claims made
by the pension retirees since the purpose of computation
of the pension is different. The decisions in KL Rathee
C v. Union of India12and Suchet Singh Yadav v. Union
of India13support this submission;
(xviii) The Committee headed by Justice L Narasimha Reddy
submitted its report to the Union Government. The
Internal Committee is examining the feasibility of the
D recommendations;
(xix) The recommendations of the Koshyari Committee were
not accepted by the Union Government and are thus
not binding upon it. The recommendations of the
Committee cannot be termed as the decision of the
E Union Government;
(xx) Since the Sixth Pay Commission, the length of service
is no longer a criterion for calculating pension. The
pension is now determined by 50 percent of the last
pay drawn. However, due to demands, OROP rates
F have been prepared based on the average pension of
retirees in 2013;
(xxi) It is not feasible to undertake an automatic revision.
Though the government has accepted the principle of
uniformity, it is not unreasonable to define periodicity
G for ensuring uniformity;
(xxii) The argument that OROP should be approved with
effect from 1 April 2014 because it was announced in
11
AIR 1991 SC 1182
12
SLJ 1997 (30 207)
13
H (2019) 11 SCC 520
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the Budget of 2014 is erroneous. The scheme was A
proposed by the Ministry of Defence through the letters
dated 7 November 2015 and 3 February 2016;
(xxiii) The pension of OROP beneficiaries who retired before
1 July 2014 was revised by the multiplication factor of
2.57 according to the recommendations of the Seventh B
Central Pay Commission. However, those who retired
after 1 January 2016 received the benefit of only revision
in emoluments in terms of the recommendations of the
Seventh Central Pay Commission;
(xxiv) The statement made by the Finance Minister on 17
February 2014 was not based on the decision of the C
Union Cabinet. The Cabinet Secretariat conveyed the
approval of the Prime Minister to the OROP scheme
on 7 November 2015. The Ministry of Defence
communicated this policy by a notification dated 7
November 2015. A post facto approval was conveyed D
by the Union Cabinet on 6 April 2016;
(xxv) One of the qualifying conditions for the OROP scheme
is that the personnel must have the ‘same length of
service’. One who had not put in the same length of
service is not eligible for an MACP. The total financial E
outflow that is likely to be incurred by the Union
Government for non-MACP to be linked with MACP
personnel would be in the range of Rs 42,776.38 crores;
and
(xxvi) The expression ‘automatically’ used in the Koshyari
Committee report, the minutes of the meeting held on F
26 February 2014 and the executive order dated 26
February 2014 defining the OROP scheme follow the
expression ‘in the rates of pension to be automatically
passed on to the past pensioners’. It must, thus, be read
as meaning that the rates of pension will be passed to G
the past pensioners without any difficulties. The phrase
‘automatically’ does not mean the time period.
C. Analysis
14. Though, a significant number of factual and detailed issues
were raised in the course of the pleadings. Mr Huzefa Ahmadi, learned H
910 SUPREME COURT REPORTS [2022] 9 S.C.R.

A Senior Counsel appearing on behalf of the petitioners brought focus upon
and urged the following specific submissions during the course of the
hearing:
(i) The Union government took an executive decision to
implement OROP as understood by the Koshyari
B Committee. This is evidenced by:
a. The statement of the Minister of Finance in the Lok
Sabha on 17 February 2014;
b. The decision taken on 26 February 2014 in the meeting
convened by the Union Minister for Defence;
C
c. The letter dated 26 February 2014 of the Union
government to the CGDA;
d. The Budget speech of the Minister of Finance on 10
July 2014; and
D e. The reply of 2 December 2014 of the Minister of State
for Finance to Member of Parliament.
(ii) The essential elements underlying the concept of OROP
are:
a. Those retiring from the same rank with the same length
E of service must receive the same pension irrespective
of the date of retirement;
b. Future enhancements of pension must be automatically
passed on to past pensioners; and

F c. Bridging of the gap between the rate of pension of
present and past pensioners.
(iii) In substitution of the above principle underlying OROP, the
communication dated 7 November 2015 of the Ministry of
Defence modified the executive decision by stipulating that:
G i. The pension of past pensioners would be refixed on
the basis of the pension of the retirees of calendar
year 2013, with the benefit being effective from 1
July 2014;
ii. Pension is to be revisited for all pensioners on the
H basis of the average of the minimum and maximum
INDIAN EX SERVICEMEN MOVEMENT & ORS. v. UNION OF 911
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pension of persons who retired in 2013 in the same A
rank and with the same length of service;
iii. In the future pension would be revisited every five
years and not automatically; and
iv. Hence, the actual decision which was taken on 7
November 2015 deviates from the principle of equality B
which OROP adopts.
15. The submissions which have been urged by the pensioners
are sought to be buttressed by referring to the charts set out in the
earlier part of this judgment and marked asfigures 1, 2 and 3 by which
an attempt has been made to show the disparity in the pension payable C
to persons of the same rank with the same length of service, based on
the date of retirement.
C. 1 Concept and genesis of OROP
16. The adoption of OROP as a guiding statement of policy on 7 D
November 2015 was preceded by discussions both within and outside
Parliament. The Koshyari Committee submitted its report on 10 December
2011. The Committee formulated an understanding of the concept of
OROP. According to the report of the Committee, OROP implies that a
“uniform pension be paid to the armed forces personnel retiring in the
same rank with the same length of service irrespective of their date of E
retirement and any future enhancements in the rate of pension to be
automatically passed on to the past pensioners”. The concept, according
to the report implied “bridging the gap between the rate of pension of the
current pensioners and the past pensioners”. This understanding of the
concept of OROP in the Koshyari Committee Report was based on the F
norm that hierarchy in the armed forces comprises of two elements
namely rank and length of service. Ranks are conferred by the President
and signify command, control and responsibility. Ranks are allowed to
be retained even after retirement. Hence OROP, according to the
Koshyari Committee postulates that two personnel from the armed forces
in the same rank and with the equal length of service should get the G
same pension irrespective of their dates of retirement and any future
enhancement in the rates of pension must be automatically passed on to
past pensioners. While proposing the adoption of OROP in principle, the
Koshyari Committee highlighted that:
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912 SUPREME COURT REPORTS [2022] 9 S.C.R.

A (i) OROP was in vogue till 1973 when the Third Central Pay
Commission decided otherwise;
(ii) Unlike civilian employees who retire by age, armed forces
personnel retire by rank; and
(iii) The conditions of service of personnel from the armed forces
B are harsher than those of civilian employees and armed
forces personnel cannot be equated with civilian employees
of the government.
17. Now it needs to be understood that the Koshyari Committee
Reportis a report submitted to the Rajya Sabha by the Committee on
C Petitions. The report cannot be enforced as a statement of government
policy. In Kalpana Mehta v. Union of India14, a Constitution Bench of
this Court dealt, on the reference under Article 145(3), with two issues
namely:
“9…73.1. (i) Whether in a litigation filed before this Court either
under Article 32 or Article 136 of the Constitution of India, the
D Court can refer to and place reliance upon the report of the
Parliamentary Standing Committee?
73.2. (ii) Whether such a report can be looked at for the purpose
of reference and, if so, can there be restrictions for the purpose
of reference regard being had to the concept of parliamentary
E privilege and the delicate balance between the constitutional
institutions that Articles 105, 121 and 122 of the Constitution
conceive?”
Chief Justice Dipak Misra (speaking for himself and Justice AM
Khanwilkar) held thus:
F “Q. Conclusions
159.1. Parliamentary Standing Committee report can be taken aid
of for the purpose of interpretation of a statutory provision
wherever it is so necessary and also it can be taken note of as
existence of a historical fact.
G 159.3. In a litigation filed either under Article 32 or Article 136 of
the Constitution of India, this Court can take on record the report
of the Parliamentary Standing Committee. However, the report
cannot be impugned or challenged in a court of law.

14
(2018) 7 SCC 1
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159.4. Where the fact is contentious, the petitioner can always A
collect the facts from many a source and produce such facts by
way of affidavits, and the court can render its verdict by way of
independent adjudication.
159.5. The Parliamentary Standing Committee report being in the
public domain can invite fair comments and criticism from the B
citizens as in such a situation, the citizens do not really comment
upon any Member of Parliament to invite the hazard of violation
of parliamentary privilege.”
18. One of us (DY Chandrachud, J) speaking for himself and
Justice Dr AK Sikri held that a report of a Parliamentary Committee C
may have a bearing upon diverse perspectives some of which were
formulated thus:
“259.1. The report of a Parliamentary Committee may contain a
statement of position by Government on matters of policy;
259.2. The report may allude to statements made by persons who D
have deposed before the Committee;
259.3. The report may contain inferences of fact including on the
performance of Government in implementing policies and
legislation;
E
259.4. The report may contain findings of misdemeanour
implicating a breach of duty by public officials or private individuals
or an evasion of law; or
259.5. The report may shed light on the purpose of a law, the
social problem which the legislature had in view and the manner
F
in which it was sought to be remedied.”
The judgment elaborates that:
“264. Committees of Parliament attached to ministries/
departments of the Government perform the function of holding
the Government accountable to implement its policies and its duties G
under legislation. The performance of governmental agencies may
form the subject-matter of such a report. In other cases, the
deficiencies of the legislative framework in remedying social
wrongs may be the subject of an evaluation by a Parliamentary
Committee. The work of a Parliamentary Committee may traverse
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914 SUPREME COURT REPORTS [2022] 9 S.C.R.

A the area of social welfare either in terms of the extent to which
existing legislation is being effectively implemented or in highlighting
the lacunae in its framework. There is no reason in principle why
the wide jurisdiction of the High Courts under Article 226 or of
this Court under Article 32 should be exercised in a manner
oblivious to the enormous work which is carried out by
B
Parliamentary Committees in the field. The work of the committee
is to secure alacrity on the part of the Government in alleviating
deprivations of social justice and in securing efficient and
accountable governance. When courts enter upon issues of public
interest and adjudicate upon them, they do not discharge a function
C which is adversarial. The constitutional function of adjudication in
matters of public interest is in step with the role of Parliamentary
Committees which is to secure accountability, transparency and
responsiveness in the Government. In such areas, the doctrine of
separation does not militate against the court relying upon the
report of a Parliamentary Committee. The court does not adjudge
D
the validity of the report nor for that matter does it embark upon a
scrutiny into its correctness. There is a functional complementarity
between the purpose of the investigation by the Parliamentary
Committee and the adjudication by the court. To deprive the court
of the valuable insight of a Parliamentary Committee would amount
E to excluding an important source of information from the purview
of the court. To do so on the supposed hypothesis that it would
amount to a breach of parliamentary privilege would be to miss
the wood for the trees. Once the report of the Parliamentary
Committee has been published it lies in the public domain. Once
Parliament has placed it in the public domain, there is an irony
F
about the executive relying on parliamentary privilege. There is
no reason or justification to exclude it from the purview of the
material to which the court seeks recourse to understand the
problem with which it is required to deal. The court must look at
the report with a robust commonsense, conscious of the fact that
G it is not called upon to determine the validity of the report which
constitutes advice tendered to Parliament. The extent to which
the court would rely upon a report must necessarily vary from
case to case and no absolute rule can be laid down in that regard.”
19. In a concurring judgment, Justice Ashok Bhushan observed:
H
INDIAN EX SERVICEMEN MOVEMENT & ORS. v. UNION OF 915
INDIA & ORS. [DR. DHANANJAYA Y CHANDRACHUD, J.]

“449.7. Both the parties have not disputed that parliamentary A
reports can be used for the purposes of legislative history of a
statute as well as for considering the statement made by a minister.
When there is no breach of privilege in considering the
parliamentary materials and reports of the Committee by the Court
for the above two purposes, we fail to see any valid reason for
B
not accepting the submission of the petitioner that courts are not
debarred from accepting the parliamentary materials and reports,
on record, before it, provided the court does not proceed to permit
the parties to question and impeach the reports.”
20. The Koshyari Committee Report can be relied upon to indicate
the background of the adoption of OROP. The report furnishes the C
historical background, the reason for the demand, and the view of the
Parliamentary Committee which proposed the adoption of OROP for
personnel belonging to the armed forces. Beyond this, the Koshyari
Committee Report cannot be construed as embodying a statement of
governmental policy. Governmental policy formulated in terms of Article D
73 by the Union or Article 162 by the State has to be authoritatively
gauged from the policy documents of the government, which in present
case is the communication dated 7 November 2015. Prior to it , on 17
February 2014, a statement was made by the Union Minister of Finance
in the Lok Sabha while presenting the interim budget for 2014-15 stating
that the government had accepted the principle of OROP for the defence E
forces and that the decision would be implemented from financial year
2014-15. The statement of the Union Minister of Finance reflects an in-
principle decision to adopt OROP for all personnel belonging to the armed
forces. Evidently, the modalities of implementing OROP were yet to be
chalked out and were adopted later. On 26 February 2014, a meeting F
was held by the Minister of Defence to discuss the modalities for
implementing the decision to adopt OROP. Paragraph 3 of the minutes
of the meeting elaborate that OROP implies that:
(i) Uniform pension be paid to armed forces personnel retiring
in the same rank with the same length of service irrespective G
of the date of retirement;
(ii) Any future enhancement in the rates of pension should be
passed on to past pensioners;
(iii) The gap between the rates of pension of current and past
pensioners should be bridged; and H
916 SUPREME COURT REPORTS [2022] 9 S.C.R.

A (iv) Future enhancements in the rates of pension should be
automatically based on to the past pensioners at that stage.
21. The CGDA was directed to initiate steps in consultation with
the Finance and Ex-servicemen Welfare departments of the Ministry of
Defence to give effect to the decision. The meeting which was held on
B 26 February 2014 was part of the decision-making process of the Union
Government for determining the modalities for implementing OROP. On
26 February 2014, a communication was addressed by the Department
of Ex-Servicemen Welfare to CGDA noting that at the meeting chaired
by the Minister of Defence, it had been decided to implement OROP for
all ranks of the defence forces prospectively from the financial year of
C 2014-15. Para 2 of the communication reads as follows:
“Accordingly, CGDA may work out the modalities in consultation
with Service Hqrs, (who in turn may appropriately consult ex-
servicemen), Department ESW and MoD (Fin) and take necessary
to implement the same.”
D
22. On 10 July 2014, the Minister of Finance in the course of his
speech while presenting the annual budget stated that the Union
Government had adopted the policy of OROP to address pension disparity
and a further sum of Rs 1,000 crores was set aside to meet the requirement
of the year. On 2 December 2014, information on OROP was furnished
E by the Minister of State for Defence in a reply to a Member of the
Rajya Sabha.
23. The adoption in principle of OROP followed by the discussion
on the modalities for implementing it eventually led to the communication
dated 7 November 2015 of the Ministry of Defence to the Chiefs of
F Army Staff,Air Force Staff and Naval staff. The communication indicates
that :
“2. It has now been decided to implement “One Rank One
Pension” (OROP) for the Ex-Servicemen with effect from
1.07.2014. OROP implies that uniform pension be paid to the
G Defence Forces Personnel retiring in the same rank with the same
length of service, regardless of their date of retirement, which,
implies bridging the gap between the rates of pension of current
and past pensioners at periodic intervals. [sic]”
Paragraph 3 of the communication adverts to the salient features:
H
INDIAN EX SERVICEMEN MOVEMENT & ORS. v. UNION OF 917
INDIA & ORS. [DR. DHANANJAYA Y CHANDRACHUD, J.]

“3. Salient features of the OROP as follows: A
i. To begin with, pension of the past pensioner would be re-fixed
on the basis of pension of retirees of calendar year 2013 and the
benefit will be effective with effect from 1.7.2014.
ii. Pension will be re-fixed for all pensioners on the basis of the
average of minimum and maximum pension of personnel retired B
in 2013 in the same rank with the same length of service.
iii. Pension for those drawing above the average shall be protected.
iv. Arrears will be paid in four equal half yearly instalments.
However, all the family pensioners including those in receipt of C
Special/Liberalized family pension and Gallantry award winners
shall be paid arrears in one instalment.
v. In future, the pension would be re-fixed every 5 years. “
The communication also indicated that personnel who opt to get
discharged henceforth would not be entitled to the benefit of OROP. D
Moreover, the Union Government had decided to appoint a committee
to look into the anomaly in the implementation of OROP and its report
was to be submitted within six months. The features of the policy
communication of 7 November 2015 need to be noticed. First, it contains
the decision of the Indian government to implement OROP for ex-
E
servicemen. Second, it specifies the date with effect from which the
decision would be implemented, namely, 1 July 2014. Third, it embodies
the understanding that OROP implies the payment of uniform pension to
defence personnel retiring in the same rank with the same length of
service regardless of the date of retirement. Fourth, it emphasises the
need to bridge the gap between the rates of pension of current and past F
pensioners at “periodic intervals”.
24. A considerable amount of debate has taken place in these
proceedings on whether the expression “at periodic intervals” was in
breach of the original understanding that enhancements in the rates of
pension would be automatically passed on. While dealing with the G
submission, it is important to note at the outset that right from the Koshyari
Committee Report,it was envisaged that “any future enhancement in
the rates of pension is to be automatically passed on to the past
pensioners”. The statement made by the Union Minister of Finance in
the Lok Sabha on 17 February 2014 propounded in principle the decision
H
918 SUPREME COURT REPORTS [2022] 9 S.C.R.

A to implement OROP. At the meeting chaired by the Defence Minister
on 26 February 2014, it was again envisaged that “any future enhancement
in the rates of pension to be automatically passed on to the past
pensioners”. The reply furnished in writing by the Minister of State for
Defence to a Member of the Rajya Sabha also similarly indicates that
“future enhancement in the rate of pension to be automatically passed
B
on to the past pensioners”. The legislative and other material prior to 7
November 2015 proposed that future enhancements in the rates of
pension would be automatically passed on. The expression
“automatically” was clearly not linked to a time period for the revision of
pensions. None of the documents on the record prior to the communication
C dated 7 November 2015 suggests that the process of revising pensions
was to be continued on an ongoing basis as opposed to revision at periodic
intervals.
25. The fallacy in the submission of the petitioners is in the
argument that the policy communication dated 7 November 2015 is
D contrary to the original decision which was taken by the Union
Government to implement OROP. Implicit in the submission of the
petitioners is the premise that the original decision was based on the
Koshyari Committee Report followed by the statement on the floor of
the House by the Minister of Finance (17 February 2014 and 10 July
2014) and the minutes of the meeting convened by the Defence Minister
E (26 February 2014). Our analysis of the underlying document indicates
that while a decision to implement OROP was taken in principle, the
modalities for implementation were yetto be chalked out. Thus, there
was no conscious policy decision on the part of the Union Government
on the modalities for implementing OROP until the communication dated
F 7 November 2015 came into being. The communication of 7 November
2015 cannot be invalidated on the ground that it infringed the ‘original
understanding’ of OROP. A hierarchy in law exists between statutes
and rules – a statutory provision will have precedence over delegated
legislation if the latter conflicts with the former. Similarly, executive
instructions cannot override a statute or rules made in pursuance of a
G statute. But in the present case the entire canvas is governed by a policy.
The terms for implementing the policy were specified on 7 November
2015. Hence, that element of the policy cannot be challenged on the
notion that there is an inflexible notion of OROP couched in an original
understanding. OROP is itself a matter of policy and it was open to the
H makers of the policy to determine the terms of implementation. The
INDIAN EX SERVICEMEN MOVEMENT & ORS. v. UNION OF 919
INDIA & ORS. [DR. DHANANJAYA Y CHANDRACHUD, J.]

policy is of course subject to judicial review on constitutional parameters, A
which is a distinct issue.
26. While the petitioners have not adverted to the doctrine of
legitimate expectations, they have implicitly relied on this principle. The
doctrine of legitimate expectations can be invoked if a representation
made by a public body leads an individual to believe that they would be B
a recipient of a substantive benefit. A part of the petitioners’ grievance
stems from the belief that an assurance made by State functionaries, the
Ministers of the Union Government, did not translate into a conscious
policy decision, which is embodied in the communication dated 7
November 2015. We have stated above that the expression
C
“automatically” was clearly not linked to a time period for the revision of
pensions. But if it is to be assumed that the expression “automatically”
meant that the revision in the rates of pension would take place on an
ongoing basis rather than at periodic intervals, the question arises whether
the doctrine of legitimate expectations can be invoked in the present
case. In the State of Jharkhand v. Brahmputra Metallics Ltd., D
Ranchi15,a two-judge Bench of this Court, of which one of us (DY
Chandrachud, J) was a part, clarified the doctrinal difference between
the concepts of promissory estoppel and legitimate expectations. The
Bench observed that the doctrine of legitimate expectations, a public
law concept,is premised on the principles of fairness and non-arbitrariness
E
in state action. The doctrine of legitimate expectations emerges as a
facet of Article 14 of the Constitution. On the other hand, promissory
estoppel, being a private law concept, can be invoked if the State has
entered into a private contract with another entity but is inapplicable
where a representation has been made by the State in the discharge of
its public functions. The doctrine of legitimate expectations is applicable F
in the latter situation. Noting that in India, the two doctrines have been
conflated, this Court went on to analyse if the change in an existing
government policy violates the legitimate expectations of those who were
previously covered by such policy. However, in the present case, there
was no concrete government policy in existence prior to 7 November
G
2015. There existed only certain assurances that were made by the
Ministers, or which could be deduced from the minutes of a meeting that
was chaired by the Minister of Defence. These assurances were also to
the effect that OROP has been accepted in principle. The implementation
was yet to be worked out. In State of Arunachal Pradesh v. Nezone
15
2020 SCC OnLine SC 968 H
920 SUPREME COURT REPORTS [2022] 9 S.C.R.

A Law House16, a two-judge Bench of this Court held that when the views
of various departments/Ministries are involved, an oral promise by a
Minister does not bind the government. In that case, a law publisher had
contended that the then Law Minister had assured the publisher that
certain books will be purchased from it. The document that was relied
B upon by the publisher was a departmental note which indicated that the
decision regarding the purchase was subject to the concurrence of other
departments and Ministries. This Court observed:

“8. As noted above the factual scenario is interesting. The
document relied upon by the respondent and the High Court refers
C to some oral expression of desire by the then Law Minister. When
the views of several departments were involved the
question of any oral view being expressed by a Minister is
really not relevant. Further, the document relied upon was
nothing but a departmental note which itself clearly
D indicated that the views of various departments/Ministries
were to be taken and their concurrence was to be obtained.
Apart from that, undisputedly there was some factual dispute as
to whether the intended purchase was of volumes or of sets. There
is conceptual difference between the two. The books were not
even printed at the relevant point of time. The High Court has
E noticed only one volume had been printed. Further the need for
the purchase of the books for the judicial officers was to be
assessed in consultation with the High Court. The Law Minister
could not have, without taking the view of the High Court, placed
orders. In any event the dispute as to the volumes or the sets and
F the interpolation in the documents were of considerable relevance.
Unfortunately the High Court has lightly brushed aside this aspect.
The doctrines of promissory estoppel and legitimate
expectation were not applicable to the facts of the case.”

(emphasis supplied)
G
27. In the present case, discussions took place within the
Government and even as of 26 February 2014, the meeting chaired by
the Minister of Defence set out broad parameters of the decision, while
leaving it to the CGDA to ensure necessary steps in consultation with
16
H (2008) 5 SCC 609
INDIAN EX SERVICEMEN MOVEMENT & ORS. v. UNION OF 921
INDIA & ORS. [DR. DHANANJAYA Y CHANDRACHUD, J.]

the three services and the Finance and ESW wings of MOD “to give A
effect to this decision”. The meeting envisaged that family pensioners
and disabled pensioners would be included and that ex-servicemen may
also be properly consulted as required by the service. All this is clearly
suggestive of the fact that in the evolving decisions which were taking
place within the Government, a formulation of the precise modalities B
which were to be adopted was yet to take place. This eventually took
place on 7 November 2015. The communication dated 7 November 2015
cannot, therefore, be assailed on the ground that it is contrary to the
original intent of the policy formulated by the Union Government. The
policy of the Union Government is what is embodied in the communication
C
dated 7 November 2015. The statements made on the Floor of the House
and minutes of ministerial committees are pointers to the fact that the
Union Government had in principle decided to implement OROP but the
precise framework of its implementation was a matter of evolving
discussion within Government. The formulation of modalities which took
place in the communication dated 7 November 2015 represents the policy D
choices adopted by the Government.

28. While the communication dated 7 November 2015 is
undoubtedly open to be scrutinised on constitutional parameters, there is
no substance in the plea that the decision which was taken on 7 November
2015 is somehow contrary to an original policy decision of the Union E
Government. The policy and its modalities for implementation are those
which have been embodied in the communication dated 7 November
2015.

C. 2. Plea of Discrimination F
29. The submission of the petitioners on the violation of Article 14
is premised essentially on three aspects:

(i) Fixation of the pension as of calendar year 2013 would result
in pre 2014 retirees getting less pension of one increment G
than a soldier retiring after 2014;

(ii) Fixing the pension based on the mean of minimum and
maximum pension of 2013 would result in different pensions
for the same ranks and same length of service depending
on whether the personnel retired before or after 31 H
922 SUPREME COURT REPORTS [2022] 9 S.C.R.

A December 2013. In effect, a higher ranked soldier would
receive lesser pension on comparison to a lower ranked
soldier; and

(iii) As a result of the process of equalisation every five years,
persons who have retired prior in point of time would be
B placed at a disadvantage as their unequalised pension would
be multiplied by a factor of 2.57 while those who have retired
after 1 January 2014 would get the benefit of higher pension
which would be multiplied by 2.57.

C 30. In the course of its comprehensive affidavit, the Union
Government attempted to explain the disparity in the pension payable to
a Sepoy with 15 years of qualifying service under OROP and the actual
pension of a Sepoy with 15 years of qualifying service who retired in
2014 before the application of OROP. The following explanation was
offered to the three tabular charts appended as fixtures 1, 2 and 3 above:
D
“A. Tabular Chart 1:

(a) In this table, the comparison made by the Petitioner is
between pension payable to a Sepoy with 15 years of
qualifying service under OROP and the actual pension of a
E Sepoy who retired in 2014 (before application of OROP)
after 15 years qualifying service who is drawing pension in
the rank of Naik, due to operation of the Modified Assured
Career Progression Scheme [hereinafter referred to as
‘MACP Scheme’]
F
(b) The figure of Rs. 6,666 is derived from the Table at Pg. 3
of the Note. The figure of Rs. 6665 denotes the weighted
average pension of the minimum and maximum pension of
2013 of Sepoys who retired in 2013 with 15 years of
qualifying service.
G
(c) The figure of Rs. 7,605 is derived from the Pension Payment
Order annexed at Pg. 5 of the Note. Pension is calculated
on the basis of 50% of the last pay drawn before retirement.
This can be arrived at by the following:-
H
INDIAN EX SERVICEMEN MOVEMENT & ORS. v. UNION OF 923
INDIA & ORS. [DR. DHANANJAYA Y CHANDRACHUD, J.]

A

B

C

*figures from Pg. 5 of the Note
(d) The difference in pension between the two pensions in
Tabular Chart 1 is due to the applicability of the MACP D
Scheme (implemented based on the recommendations of
the6th Central Pay Commission). Under the MACP
Scheme, a defence personnel who has not been promoted
for 8/16/24 years of regular service, would be eligible for
grant of next higher grade pay after completion of 8/16/14
years of regular service. In other words, a Sepoy who was E
originally getting Rs 2,000 as grade pay would after 8 years
of service (without promotion) be granted the next higher
grade pay of Rs. 2,400. The grade pay of Rs. 2,400 ordinarily
corresponds to the grade pay of Naik.
(e) Similarly, after 16 years of service (without promotion), F
such Sepoy would get the next higher grade pay of Rs.
2,800. The grade pay of Rs 2,800 ordinarily corresponds to
the grade pay of Havildar.
(f) As a logical corollary, the pay (and consequently pension)
of different Sepoys would differ/vary depending on whether G
benefit of the MACP Scheme has been granted to such
Sepoy or not.
(g) The applicability of the MACP Scheme on the pension
of a retired defense personnel has been dealt by the Circular
H
924 SUPREME COURT REPORTS [2022] 9 S.C.R.

A No. 555 dated 04.02.2016, wherein at Para 11(C), it has
been stated:-
“…11. The provisions of this circular shall be applicable to
all Pre-01.07.2014 pensioners /family pensioners and their
pension/family pension shall be stepped up with reference
B to rank, group and qualifying service in which they were
pensioned.
Note:
a)…

C b)…
c) A JCOs/ORs pensioner, who has retired with a particular
rank and granted ACP-I will be eligible for revision of
pension of a next higher rank; if ACP-II has been granted,
he will be eligible for revision of pension of next higher
D rank of ACP-I; and if ACP-III has been granted, he will be
eligible for revision of pension of next higher rank of ACP-
II w.e.f. 01.07.2014.
For example- a Sepoy granted ACP-I will be eligible for
revision of pension of Naik rank, Sepoy granted ACP-II
will be eligible for revision of pension of Havildar rank and
E
sepoy granted ACP-III will be eligible for revision of pension
of Naib Subedar rank […]”
Therefore, the example of two Sepoys drawing different
pension amount is due to operation of MACP and is not
due to operation of the OROP Scheme.
F
(h) It is also important to point out that the MACP Scheme
is only one such factor which influences the pay drawn by
a Sepoy. The other factors include promotion, disciplinary
proceedings etc.
G B. Tabular Chart 2:
(a) In this Chart, the pension of a Naik has been compared
with a person drawing pension of Havildar by virtue of the
MACP Scheme.
(b) The figure of Rs. 7,170 is derived from the Table at Pg.
H 4 of the Note. The figure of Rs. 7,170 denotes the weighted
INDIAN EX SERVICEMEN MOVEMENT & ORS. v. UNION OF 925
INDIA & ORS. [DR. DHANANJAYA Y CHANDRACHUD, J.]

average pension of the minimum and maximum pension of A
2013.
(c) The figure of Rs. 8,295 is derived from the pension
payment order annexed at Pg. 6 of the Note Pension is
calculated on the basis of 50% of the last pay drawn before
retirement. This can be arrived at by the following:- B
S.No. Particulars Amount

1. Last Pay 11,490

2. Grade Pay 2,800
C
3. MSP 2,000

4. Class Allowance 300

5. TOTAL 16,590
D
6. Pension(50% of last 8,295
pay)

(d) Now, due to the operation of the MACP Scheme, the
Naik (grade pay of Rs. 2,400) is actually drawing the next E
higher grade pay of Rs.2,800, which corresponds to the
grade pay of Havildar. This is the same principle, which
was the basis for difference in pension in Tabular Chart 1.
C. Tabular Chart III
F
(a) The Tabular Chart III pertains to the rank of Group
Captain. As per Column II of this Chart, the example quoted
is that of a 2014 retiree. However, the pension amount
quoted is of Group Captain Daniel Victor, who retired on
28.02.2015. It is important to state that the OROP Scheme
was not applicable to Group Captain Daniel Victor. G
(e) Therefore, the Petitioner has misled this Hon’ble Court
by relying on the pension of a recent retiree who has not
been covered under the OROP Scheme. The PPO Number
of Group Captain Daniel Victor is 08/14/1/114/2015
H
926 SUPREME COURT REPORTS [2022] 9 S.C.R.

A 18. It is further submitted that the flaw in pointing out the
alleged disparities by referring to the Tables at Pg. 1 of the
Note are due to the following reasons, interalia:-
(i) The comparison as mentioned in the Table is a comparison
between non-comparables. The weighted average pension
B of the minimum and maximum pension of 2013 can never
be compared with the actual amount being received by a
defence personnel as pension fixed under the rules
applicable for retiring pension in the normal course.
(ii) The weighted average pension signifies the lowest/
C minimum amount that a defence personnel retiring upto 2013
is entitled to get as OROP pension. Whereas, the actual
pension of the retired defense personnel in 2014 (without
effect of OROP) is based on pay last drawn. This amount
of actual pension may be higher (due to various factors),
but cannot be lower than the weighted average pension, as
D in that case, pension would be raised (protected) to the level
of the weighted average pension (OROP)
(iii) In other words, the pension amount of Rs. 6,665 is the
minimum prescribed benchmark amount that any Sepoy
(with 15 years qualifying service) would get under OROP
E as per Table No. 7 at Page 3 of the Note. Therefore, no
Sepoy with the same pay and same length of service will
get an amount less than Rs. 6,665 under OROP. The
minimum prescribed benchmark is fixed to ensure that all
defense personnel retiring pre-2013 are pulled up to receive
F at least the minimum prescribed pension. The benchmarking
to the average of the minimum and maximum ensures
upliftment of those receiving below the benchmark rate,
whereas, protection of those who are receiving a higher
pension than the benchmark rate.

G (iv) The Petitioner’s interpretation is an attempt to equalize
the pension of every defense personnel with the highest
pension drawn by a defense personnel in the same rank
with the same length of service. Such an interpretation is
completely arbitrary definition of how OROP should be
implemented.”
H
INDIAN EX SERVICEMEN MOVEMENT & ORS. v. UNION OF 927
INDIA & ORS. [DR. DHANANJAYA Y CHANDRACHUD, J.]

31. During the course of the hearing, the Union Government placed A
on record a further affidavit. The affidavit places on record the status of
the grant of MACP benefits to defence personnel across the three
services.The sample data for 2013 which was the base year for the
calculation has been placed on the record and is reproduced below: -
“….(v) Likewise, a Sepoy who gets promoted at the first instance B
as Naik in its natural course but does not get promoted for the
subsequent ranks (which may happen due to non-availability of
vacancies or stagnation) would be entitled to the MACP
upgradations of those ranks.
(vi) It is also respectfully submitted that the threshold condition to
qualify for MACP is the completion of the required length of C
service. Consequently, one who completed the required length of
service would qualify for MACP automatically unless otherwise
barred due to disciplinary proceedings or performance.
(vii) It is also respectfully submitted that the threshold condition to
qualify for MACP is the completion of the required length of D
service. Consequently, one who completes the required length of
service would qualify for MACP automatically unless otherwise
barred due to disciplinary proceedings or performance.
(viii) It is therefore self-evident that a Sepoy who does not
complete the required length of service of 8 years and one E
who completed it, cannot be benchmarked together under
any circumstances.
(ix) A Sepoy of 3 years and a Sepoy who had crossed 8 years
qualifying for MACP is not equated even for OROP purpose since
they do not qualify the criteria of “same length of service.”
F
(emphasis supplied)
While explaining the difference in pensions of the two Sepoys,
the Union Government stated that this was due to the applicability of the
MACP scheme. In the subsequent affidavit, some of the issues which
remained to be explained in the comprehensive affidavit have been
G
attempted to be clarified.
C.2.1 ACP-MACP
32 In 2013, the ACP regime was put into place. In terms of the
scheme, a Sepoy upon completion of ten years of servicewouldbe
upgraded to a Naik for the purpose of pay, pension and other special
H
928 SUPREME COURT REPORTS [2022] 9 S.C.R.

A benefits. After completion of 20 years’ service, there would be a further
upgradation to the pay of a Havildar and after 30 years’ service, as a
Naib Subedar. Though the scheme was implemented from 2014, the
benefit was extended retrospectively by applying the norms of 10:20:30
years of service respectively. Hence, a Sepoy in 2013 with thirty years
of service was grouped with a Naib Subedar for pay, pension and other
B
financial benefits. The ACP scheme thus covered defence personnel
tracing back in time to 1973.
33. On 11 October 2008, by Army instruction No 1/S/2008,
theMACP Scheme was implemented. In terms of the scheme, the earlier
time line of 10:20:30 years of service for upgradation was modified to
C 8:16:24 years for conferment of benefits in terms of pay, pension and
other financial benefits. In view of the decision of this Court in Union of
India v. Balbir Singh Turn17, the MACP scheme was made operational
with effect from 1 January 2006. Though the MACP scheme was made
operational from 1 January 2006, it had retrospective effect as a result
D of which any person who was in service and qualified with the threshold
requirement of 8:16:24 years of service came to be grouped with the
corresponding rank upgradations for the purpose of pay, pension and
other benefits. In the above backdrop, the Union Government has stated
before this Court on affidavit that for the purpose of computing the OROP
benefit, it has taken MACP as the base and applied it across the board
E for all retirees having the same length of service. In other words, OROP
was not calculated in two parts comprising of the ACP regime and MACP
regime. In this context, reliance has been placed on Note VI appended
to the table for working out OROP calculations. Note VI reads as
follows:-
F “Pension of JCO/ORS granted upgradation under ACP/MACP
scheme shall be revised with reference to the rank for which
ACP/MACP was granted.”
34. On the above premises, it has been submitted that no disparity
on the ground of MACP/ACP has been introduced and the core value
of uniform pension for a person retiring in the same rank with the same
G
length of service is maintained without disparity.
C.2.2 Financial Implications
35. The Union Government has stated on affidavit that at the time
when OROP was implemented, the annual financial implication was in
17
H (2018) 11 SCC 99
INDIAN EX SERVICEMEN MOVEMENT & ORS. v. UNION OF 929
INDIA & ORS. [DR. DHANANJAYA Y CHANDRACHUD, J.]

the amount of Rs 7,123.38 crores. The actual arrears which had to be A
paid for the period of 1 July 2014 to 31 December 2015 stood in the
amount of Rs 10,392.35 crores. The table on the status of the grant of
MACP benefits to defence personnel (2013) indicates that 96.4% Sepoys,
72.3% Naiks, 48.9% Havildars and 90.9% Art III-I (Navy only) represent
the percentage of retirees getting MACP benefits. This indicates that
B
MACP benefit forms a significant portion of the retiring personnel in the
above four ranks, the last one being relevant only for the Navy. The
MACP factor is not of much impact in the case of Naib Subedar, Subedar
and Subedar Major, among whom 1.6%, 2.2% and 0.2% of all retiring
personnel are receiving MACP benefits. This is because they would
have reached those ranks by regular promotion. When a Sepoy with C
eight years of service is upgraded as a Naik and thereafter as a Havildar
and Naib Subedar after sixteen and twenty-four years of service, other
financial benefits attached to the higher ranks accrue automatically to
an MACP beneficiary. However, if a Sepoy is promoted to the rank of
Naik in the natural course before eight years of service, such a person
D
does not qualify for MACP and the same principle applies to the further
upgradation. Where a Sepoy is promoted as a Naik in the usual course,
but does not get promoted thereafter to subsequent ranks for non-
availability of vacancies, such a Sepoy would be entitled to MACP
upgradation only for those ranks. The threshold requirement for the grant
of MACP is completion of a specified length of service. A Sepoy who E
does not complete the required length of service cannot hence be
benchmarked with someone who completes the stipulated length of service
for the grant of MACP benefits. In other words, a Sepoy with three
years of service and a Sepoy who has acquired eight years of service
thereby qualifying for MACP are not equated even after OROP purposes
F
since they did not both have the same length of service from the past
rank of Naib Subedar. According to the Union Government, if non MACP
personnel are grouped with MACP personnel for the payment of OROP,
the total financial outflow from 2014 would be in the range of Rs 42,776.38
crores. If non MACP persons were required to be matched with MACP,
the financial implication for the period from 1 July 2014 to 31 December G
2015 would stand at Rs 13,731.03 crores. If such a benefit is given, the
financial implication for 2021 under the Seventh Pay Commission would
require a conversion factor of 2.57 besides which 31% DR would be
payable. As noted earlier, it has been stated that when OROP is
implemented, the annual financial implication was in the amount of Rs
H
930 SUPREME COURT REPORTS [2022] 9 S.C.R.

A 7,123.38 crores. If non MACP personnel had to be matched with MACP
personnel, this figure would stand increased to Rs 9,411.71 crores. Based
on this, the following tabulation has been submitted by the Union
Government on affidavit indicating a total outflowif non MACP were to
be matched with MACP:
B

C

D

E

F C.2. 3 Average to Maximum
36. The Court has been apprised of the fact that the CGDA
working committee considered four options for OROP in the year 2013.
Of the four options, the fourth option was on the basis of the maximum
pension of current retirees, which was proposed by the services. The
G Committee noted that the financial implication of the fourth option
(maximum pension of current retirees) was Rs 14,898.34 crores per
annum and the total arrears which would be payable on this basis would
have been in the amount of Rs 1,45,339.34 crores, as is tabulated below:

H
INDIAN EX SERVICEMEN MOVEMENT & ORS. v. UNION OF 931
INDIA & ORS. [DR. DHANANJAYA Y CHANDRACHUD, J.]

A

B

C

D
C.2.4 Periodic revision every five years
37. The central limb of the submission of the petitioners is that a
revision of OROP should be automatic. The Union government has
submitted that besides lacking any prior precedent, in terms of the practice
governing pay scales, pensions and other financial emoluments of E
government servants, automatic revision would be impossible to
implement. Quite apart from the above consideration, it is evident that
the three documents which have been relied upon by the petitioners
namely (i) the Koshyari Committee Report; (ii) the minutes of the meeting
chaired by the Defence Minister on 26 February 2014; and (iii) the
communication dated 26 February 2014 to CGDA underscore that “any F
future enhancement in the rates of pension to be automatically passed
on to the past pensioners”. The expression “to be automatically passed
on” immediately follows upon the words “any future enhancement in
the rates of pension”. When read together contextually, it signifies that
the rates of pension would be passed on to past pensioners without any G
administrative impediments. The expression ‘automatically passed on’
cannot be construed as a commitment with reference to any period of
time for the computation of benefits. The manner in which and the period
over which revisions should take place of pensions, salaries and other
financial benefits is a pure question of policy. The decision of the Central
H
932 SUPREME COURT REPORTS [2022] 9 S.C.R.

A Government to revise the pension every five years cannot be held to
violate the precepts underlying Article 14.
38. The policy choices which have been made by the Union
Government must also be understood in the context that the estimated
budget allocation for defence pensions is Rs 1,33,825 crores representing
B 28.39 per cent of the total defence budget estimateof Rs 4,71,378 crores
for 2020-2021. This does not include budget on salaries which is of the
order of 34.89 per cent of the total defence budget estimates for 2020-
2021. Salaries and pensions thus account for nearly 63 per cent of the
total defence budget estimates for 2020-2021. In making policy choices,
the Union Government is entitled to take into account priorities towards
C modernization of the armed forces and to modulate the grant of financial
benefits so as to sub-serve and balance distinct priorities.
39. In the decision of this Court in Nakara (supra), the Constitution
Bench was deciding on the issue of whether the date of retirement would
be a relevant consideration for determining the application of a revised
D formula for the computation of pension. The liberalised pension scheme
was made applicable prospectively to those employees who retired on
or after March 31, 1979 in the case of government servants covered by
the 1972 Rules and in respect of defence personnel, those who became
non-effective on or after April 1, 1979. Consequently, those who retired
E prior to the date were not entitled to the benefits of the liberalised pension
scheme. It was held that payment of pension constitutes a compensation
for the service rendered in the past and as a measure of social welfare
for providing socio-economic justice to those who have rendered service
to the State. The Court noted that earlier,the measure of pension was
related to the average emoluments during a period of thirty-six months
F prior to retirement. By a liberalized scheme, the period was reduced to
an average of ten months preceding the date of retirement coupled with
the above aspects.A slab system for computation was introduced and
the ceiling was raised. This Court held that there was no justification for
arbitrarily selecting the criteria for eligibility for the grant of benefits
G under the scheme based on the date of retirement. Hence, this Court
held that all pensioners formed a homogeneous class and where an existing
scheme of pension was liberalized, a distinction could not be made on
the basis of a specified cut-off date. At the same time, it must also be
noted that the decision in Nakara (supra) noted that “the financial
implication in such matters has some relevance.” This Court struck down
H
INDIAN EX SERVICEMEN MOVEMENT & ORS. v. UNION OF 933
INDIA & ORS. [DR. DHANANJAYA Y CHANDRACHUD, J.]

the portion of the Memoranda by which the benefit of the liberalised A
pension scheme was only confined to persons retiring on or after the
specified date which resulted in the benefit being extended to all retirees,
irrespective of the date of retirement. It was observed as follows:
“63. The financial implication in such matters has some
relevance. However in this connection, we want to steer clear B
of a misconception. There is no pension fund as it is found either
in contributory pension schemes administered in foreign countries
or as in insurance-linked pensions. Non-contributory pensions
under 1972 Rules is a State obligation. It is an item of expenditure
voted year to year depending upon the number of pensioners and
the estimated expenditure. Now when the liberalised pension C
scheme was introduced, we would justifiably assume that the
government servants would retire from the next day of the coming
into operation of the scheme and the burden will have to be
computed as imposed by the liberalised scheme. Further
Government has been granting since nearly a decade D
temporary increases from time to time to pensioners.
Therefore, the difference will be marginal. Further, let it not
be forgotten that the old pensioners are on the way out and their
number is fast decreasing. While examining the financial
implication, this Court is only concerned with the additional liability
that may be imposed by bringing in pensioners who retired prior E
to April 1, 1979 within the fold of liberalised pension scheme but
effective subsequent to the specified date. That it is a dwindling
number is indisputable. And again the large bulk comprises
pensioners from lower echelons of service such as Peons, L.D.C.,
U.D.C., Assistant etc. In a chart submitted to us, the Union F
of India has worked out the pension to the pensioners who
have retired prior to the specified date and the comparative
advantage, if they are brought within the purview of the
liberalised pension scheme. The difference up to the level
of Assistant or even Section Officer is marginal keeping in
view that the old pensioners are getting temporary G
increases. Amongst the higher officers, there will be some
difference because the ceiling is raised and that would
introduce the difference. It is however necessary to refer to
one figure relied upon by respondents. It was said that if pensioners
who retired prior to March 31, 1979 are brought within the purview H
934 SUPREME COURT REPORTS [2022] 9 S.C.R.

A of the liberalised pension scheme, Rs 233 crores would be required
for fresh commutation. The apparent fallacy in the submission is
that if the benefit of commutation is already availed of, it cannot
and need not be reopened. And availability of other benefits is
hardly a relevant factor because pension is admissible to all
retirees. The figures submitted are thus neither frightening
B
nor the liability is supposed to be staggering which would
deflect us from going to the logical and of constitutional
mandate. Even according to the most liberal estimate, the
average yearly increase is worked out to be Rs 51 crores
but that assumes that every pensioner has survived till date
C and will continue to survive. Therefore, we are satisfied
that the increase liability consequent upon this judgment
is not too high to be unbearable or such as would have
detracted the Government from covering the old pensioners
under the Scheme.”
D (emphasis supplied)
40. As opposed to the factual matrix in Nakara (supra), where
the liberalised pension scheme was not made applicable to employees
who had retired prior to the cut-off date, in this case the OROP principle
is applicable to all retired army personnel, irrespective of the date of
E retirement. The cut-off date is only prescribed for determining the base
salary used for computing the pension. While for those who retired on or
after 2014, the last drawn salary is used for computing the pension; for
those who retired prior to 2014, the average of the salary drawn in 2013
is used.This policy only seeks to protect those who retired before 2014
since the last drawn salary of the prior retirees might be too low and
F incomparable to the pay of the 2014 retirees. Moreover, if the maximum
salary drawn is to be used as the basevalue instead of taking the average
salary, an additional outlay of Rs 1,45,339.34 crores would be incurred.
The executive is therefore, well within its limits to prescribe a policy
keeping in view the financial implications.
G 41. In Krishena Kumar (supra), a Constitution Bench of this
Court decided on the issue of whether the prescription of a cut-off date
for the eligibility to a pension scheme was arbitrary and violative of
Article 14. Before 1957, the only scheme for retirement benefits in the
Railways was the Provident Fund Scheme. This scheme was replaced
H in 1957 by the Pension Scheme. All the employees who served in the
INDIAN EX SERVICEMEN MOVEMENT & ORS. v. UNION OF 935
INDIA & ORS. [DR. DHANANJAYA Y CHANDRACHUD, J.]

Railways on or after 1 April 1957 were automatically covered by the A
Pension Scheme. Those who were in service before 1 April 1957 were
given the option to switch over to the Pensionary Benefits. It was the
contention of the appellants that till 1 April 1957, there was no difference
between the benefits receivable under the provident fund scheme and
the pension scheme. However, it was contended that between 1957 and
B
1987, the pensionary benefits were increased by various methods while
the benefits under the provident fund scheme were not enhanced.
Dismissing the petitions, this Court held that neither the prescription of a
cut-off date nor the creation of two classes of retirees (pensioners and
provident fund holders) was contrary to the decision of the Constitution
Bench in Nakara (supra). It was observed thus: C
“32. In Nakara [(1983) 1 SCC 305 : 1983 SCC (L&S) 145 : (1983)
2 SCR 165] it was never held that both the pension retirees and
the PF retirees formed a homogeneous class and that any further
classification among them would be violative of Article 14. On
the other hand the court clearly observed that it was not dealing D
with the problem of a “fund”. The Railway Contributory Provident
Fund is by definition a fund. Besides, the government’s
obligation towards an employee under CPF Scheme to give
the matching contribution begins as soon as his account is
opened and ends with his retirement when his rights qua
the government in respect of the Provident Fund is finally E
crystallized and thereafter no statutory obligation continues.
Whether there still remained a moral obligation is a different
matter. On the other hand under the Pension Scheme the
government’s obligation does not begin until the employee retires
when only it begins and it continues till the death of the employee. F
Thus, on the retirement of an employee government’s legal
obligation under the Provident Fund account ends while under the
Pension Scheme it begins. The rules governing the Provident
Fund and its contribution are entirely different from the
rules governing pension. It would not, therefore, be
reasonable to argue that what is applicable to the pension G
retirees must also equally be applicable to PF retirees. This
being the legal position the rights of each individual PF retiree
finally crystallized on his retirement whereafter no continuing
obligation remained while, on the other hand, as regard Pension
retirees, the obligation continued till their death. The continuing H
936 SUPREME COURT REPORTS [2022] 9 S.C.R.

A obligation of the State in respect of pension retirees is adversely
affected by fall in rupee value and rising prices which, considering
the corpus already received by the PF retirees they would not be
so adversely affected ipso facto. It cannot, therefore, be said
that it was the ratio decidendi in Nakara [(1983) 1 SCC 305
: 1983 SCC (L&S) 145 : (1983) 2 SCR 165] that the State’s
B
obligation towards its PF retirees must be the same as that
towards the pension retirees. An imaginary definition of
obligation to include all the government retirees in a class
was not decided and could not form the basis for any
classification for the purpose of this case. Nakara [(1983)
C 1 SCC 305 : 1983 SCC (L&S) 145 : (1983) 2 SCR 165]
cannot, therefore, be an authority for this case.
34. The next argument of the petitioners is that the option given
to the PF employees to switch over to the pension scheme with
effect from a specified cut-off date is bad as violative of Article
D 14 of the Constitution for the same reasons for which
in Nakara [(1983) 1 SCC 305 : 1983 SCC (L&S) 145 : (1983) 2
SCR 165] the notification were read down. We have extracted
the 12th option letter. This argument is fallacious in view of the
fact that while in case of pension retirees who are alive the
government has a continuing obligation and if one is affected by
E dearness the others may also be similarly affected. In case of PF
retirees each one’s rights having finally crystallized on the date of
retirement and receipt of PF benefits and there being no continuing
obligation thereafter they could not be treated at par with the
living pensioners. How the corpus after retirement of a PF retiree
F was affected or benefitted by prices and interest rise was not
kept any tack of by the Railways. It appears in each of the cases
of option the specified date bore a definite nexus to the objects
sought to be achieved by giving of the option. Option once exercised
was told to have been final. Options were exercisable vice versa.”
G (emphasis supplied)
42. In Indian Ex-Services League (supra),it was contended
that in view of the decision in Nakara (supra), all retirees who held the
same rank irrespective of the date of retirement must receive the same
amount of pension. This Court observed that there was nothing in Nakara
H (supra) that backed the claim of the appellants that the same pension
INDIAN EX SERVICEMEN MOVEMENT & ORS. v. UNION OF 937
INDIA & ORS. [DR. DHANANJAYA Y CHANDRACHUD, J.]

must be given to all retirees of the same rank. The Court observed that A
it was held in Nakara (supra) that only the same formula for calculation
of pension was to be used and nowhere was the emoluments of the
retirees revised. The ratio decidendi in Nakara (supra) was explained
in the following words:
“12. The liberalised pension scheme in the context of which the B
decision was rendered in Nakara [(1983) 1 SCC 305 : 1983 SCC
(L&S) 145 : (1983) 2 SCR 165] provided for computation of
pension according to a more liberal formula under which “average
emoluments” were determined with reference to the last ten
months’ salary instead of 36 months’ salary provided earlier yielding
a higher average, coupled with a slab system and raising the ceiling C
limit for pension. This Court held that where the mode of
computation of pension is liberalised from a specified date, its
benefit must be given not merely to retirees subsequent to that
date but also to earlier existing retirees irrespective of their date
of retirement even though the earlier retirees would not be entitled D
to any arrears prior to the specified date on the basis of the revised
computation made according to the liberalised formula. For the
purpose of such a scheme all existing retirees irrespective of the
date of their retirement, were held to constitute one class, any
further division within that class being impermissible. According
to that decision, the pension of all earlier retirees was to E
be recomputed as on the specified date in accordance with
the liberalised formula of computation on the basis of the
average emoluments of each retiree payable on his date of
retirement. For this purpose there was no revision of the
emoluments of the earlier retirees under the scheme. It F
was clearly stated that ‘if the pensioners form a class, their
computation cannot be by different formula affording unequal
treatment solely on the ground that some retired earlier and some
retired later’. This according to us is the decision
in Nakara [(1983) 1 SCC 305 : 1983 SCC (L&S) 145 : (1983) 2
SCR 165] and no more.” G

(emphasis supplied)
It was observed that the effect of the judgment in Nakara (supra)
was that the same computation according to the liberalised formula
must be applicable to pre and post 1 April 1979 retirees and that the H
938 SUPREME COURT REPORTS [2022] 9 S.C.R.

A decision cannot be construed to mean that the same amount of pension
must be receivable.
43. In KL Rathee v. Union of India18, the decision in Nakara
(supra) was explained in the following terms :
“6. Nakara case dealt with the manner of calculation of pension
B on the basis of average emoluments of a retired government
employee. Prior to the liberalisation of the formula for computation
of pension made by the memorandum dated 25-5-1979, average
emoluments of the last thirty months of service of the employee
provided that basis for calculation of pension. The 1970 service
C of the employee provided that average emoluments must be
calculated on the basis of the emoluments received by a
government servant during the last ten months of the service.
That apart, a new slab system for computation of pension was
introduced and the ceiling on pension was raised […].

D 7. It is to be seen that the judgment did not strike down the definition
of “emoluments”. It merely held that if pension was to be
calculated on the basis of the last ten months’ emoluments of a
government servant, after 1-4-1979, there is no reason why those
who retired before 1-4-1979 should get pension calculated on the
basis of average of last thirty-six months’ emoluments. In other
E words, the rule of computation must be the same. The Court did
not hold that those who have retired before 1-4-1979 must be
treated as having the same emoluments as those who retired on
or after 1-4-1979 for the purpose of calculation of pension.
Therefore, on the strength of Nakara case, the petitioner is not
F entitled to ask for computation of pension with reference to
emoluments which he never got.”
44. In Col. B.J Akkara (Retd.) v. Government of India19, this
Court summarised the principles relating to pension. Justice RV
Raveendran writing for a two-Judge bench observed:
G “20. The principles relating to pension relevant to the issue are
well settled. They are:
(a) In regard to pensioners forming a class, computation of pension
cannot be by different formula thereby applying an unequal
18
1991 2 SCC 104
19
H (2006) 11 SCC 709
INDIAN EX SERVICEMEN MOVEMENT & ORS. v. UNION OF 939
INDIA & ORS. [DR. DHANANJAYA Y CHANDRACHUD, J.]

treatment solely on the ground that some retired earlier and some A
retired later. If the retiree is eligible for pension at the time of his
retirement and the relevant pension scheme is subsequently
amended, he would become eligible to get enhanced pension as
per the new formula of computation of pension from the date
when the amendment takes effect. In such a situation, the additional
B
benefit under the amendment, made 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.
(b) But all retirees retiring with a particular rank do not form a
single class for all purposes. Where the reckonable emoluments C
as on the date of retirement (for the purpose of computation of
pension) are different in respect of two groups of pensioners,
who retired with the same rank, the group getting lesser pension
cannot contend that their pension should be identical with or equal
to the pension received by the group whose reckonable emolument D
was higher. In other words, pensioners who retire with the
same rank need not be given identical pension, where their
average reckonable emoluments at the time of their
retirement were different, in view of the difference in pay,
or in view of different pay scales being in force.
E
[…]
One set cannot claim the benefit extended to the other set on the
ground that they are similarly situated. Though they retired with
the same rank, they are not of the “same class” or “homogeneous
group”. The employer can validly fix a cut-off date for introducing F
any new pension/retirement scheme or for discontinuance of any
existing scheme. What is discriminatory is introduction of a benefit
retrospectively (or prospectively) fixing a cut-off date arbitrarily
thereby dividing a single homogeneous class of pensioners into
two groups and subjecting them to different treatment.”
G
(emphasis supplied)
45. The decision in SPS Vains (supra) has been relied upon by
the petitioners. The issue in that case was whether the officers of the
rank of Major General, who had retired prior to 1 January 1996, could be
given the benefit of the provisions of the revised pay scale, though
H
940 SUPREME COURT REPORTS [2022] 9 S.C.R.

A according to the policy only those who retired after the said cut-off date
would be entitled to such benefit. The rank of Brigadier is a feeder post
for the promotional rank of Major General. A Major General always
drew a higher pension than the pension payable to the officers holding
the rank of a Brigadier, as on the basis of the recommendation of the
Fourth Pay Commission, the pension was calculated on the basis of the
B
salary drawn during the last ten months prior to retirement. An anomaly
arose with the acceptance of the recommendation of the Fifth Pay
Commission which created a situation in which a Brigadier began drawing
more pension and family pension than the Major General. The
Government increased the pension of Major Generals who had retired
C prior to 1996 so that they do not receive lesser pension than the officers
of the rank of Brigadier. The disparity which was noted in that case is
evident from the following extract of the judgment:
“23. From the submissions made, the dispute appears to be confined
only to the question whether officers of the rank of Major General
D in the army and of equivalent rank in the two other wings of the
Defence forces, who had retired prior to 1.1.1996 have been validly
excluded from the benefit of the revision of pay scales in keeping
with the recommendations of the fifth Central Pay Commission
by virtue of the Special Army Instruction 2/S/1998.”
This Court held that such a disparity in the pension payable to two
E groups of officers occupying the same rank of Major General based on
those retiring before or after 1 January 1996 violated Article 14. It was
in this backdrop that this Court directed that the pay of all pensioners in
the rank of Major General and its equivalent rank in the other two wings
of the Defence services should be notionally fixed at the rate given to
F the similar officers of the same rank after the revision of pay scales with
effect from 1 January 1996, and thereafter to compute the pensionary
benefits with prospective effect from the date of the writ petition. The
decision in SPS Vains (supra) thus involved a completely different factual
situation. The rank of Brigadier was a feeder post for the rank of Major
General. An anomaly had arisen as a result of which the pay and pension
G of Brigadier were higher than of the Major Generals. By increasing the
pension of Major General, distinction was made between those who had
retired before and after 1 January 1996. This was held to be violative of
Article 14.
46.The canvass which is sought to be traversed in these
H proceedings under Article 32 of the Constitution trenches upon a domain
INDIAN EX SERVICEMEN MOVEMENT & ORS. v. UNION OF 941
INDIA & ORS. [DR. DHANANJAYA Y CHANDRACHUD, J.]

which is reserved for executive policy. We must remember that A
adjudication cannot serve as a substitute for policy. Lon Fuller described
public policy issues that come up in adjudication as “polycentric problems”,
that is, theyraise questions that have a “multiplicity of variable and
interlocking factors, decisions on each one of which presupposes a
decision on all others”. Such matters, according to Fuller, are more suitably
B
addressed by elected representatives since they involve negotiations,
trade-offs and a consensus-driven decision-making process. Fuller argues
that adjudication is more appropriate for questions that result in “either-
or” answers.20 Most questions of policy involve complex considerations
of not only technical and economic factors but also require balancing
competing interests for which democratic reconciliation rather than C
adjudication is the best remedy. Further, an increased reliance on judges
to solve matters of pure policy diminishes the role of other political organs
in resolving contested issues of social and political policy, which require
a democratic dialogue. This is not to say that this Court will shy away
from setting aside policies that impinge on constitutional rights. Rather it
D
is to provide a clear-eyed role of the function that a court serves in a
democracy. The OROP policy may only be challenged on the ground
that it is manifestly arbitrary or capricious. In this regard, we now evaluate
the policy which has been adopted by the Union Government.
47. The policy of OROP adopted by the Union Government
stipulates thus: E

(i) The benefits will be effective from 1 July 2014;
(ii) Pensions of past pensioners would be refixed on the basis
of the pension of retirees of calendar year 2013;
(iii) Pension for all pensioners would be protected; and F
(iv) In future, the pension would be refixed after every five
years.
48. The principles governing pensions and cut-off dates can be
summarised as follows:
G
(i) All pensioners who hold the same rank may not for all
purposes form a homogenous class. For example, amongst
Sepoys differences do exist in view of the MACP and ACP
20
Fuller, L. L., & Winston, K. I. (1978). The Forms and Limits of Adjudication.
Harvard Law Review, 92(2), 353–409. H
942 SUPREME COURT REPORTS [2022] 9 S.C.R.

A schemes. Certain Sepoys receive the pay of the higher
ranked personnel;
(ii) The benefit of a new element in a pensionary scheme can
be prospectively applied. However, the scheme cannot
bifurcate a homogenous group based on a cut-off date;
B (iii) The judgment of the Constitution Bench in Nakara (supra)
cannot be interpreted to read the one rank one pension rule
into it. It was only held that the same principle of computation
of pensions must be applied uniformly to a homogenous
class; and
C (iv) It is not a legal mandate that pensioners who held the same
rank must be given the same amount of pension. The
varying benefits that may be applicable to certain personnel
which would also impact the pension payable need not be
equalised with the rest of the personnel.
D 49. Applying the above principles to the facts of the case, we find
no constitutional infirmity in the OROP principle as defined by the
communication dated 7 November 2015 for the following reasons:
(i) The definition of OROP is uniformly applicable to all the
pensioners irrespective of the date of retirement. It is not
E the case of the petitioners that the pension is reviewed
‘automatically’ to a class of the pensioners and ‘periodically’
to another class of the pensioners;
(ii) The cut-off date is used only for the purpose of determining
the base salary for the calculation of pension. While for
F those who retired after 2014, the last drawn salary is used
to calculate pension, for those who retired prior to 2013,
the average salary drawn in 2013 is used. Since the uniform
application of the last drawn salary for the purpose of
calculating pension would put the prior retirees at a
disadvantage, the Union Government has taken a policy
G
decision to enhance the base salary for the calculation of
pension. Undoubtedly, the Union Government had a range
of policy choices including taking the minimum, the
maximum or the mean or average. The Union government
decided to adopt the average. Persons below the average
H
INDIAN EX SERVICEMEN MOVEMENT & ORS. v. UNION OF 943
INDIA & ORS. [DR. DHANANJAYA Y CHANDRACHUD, J.]

were brought up to the average mark while those drawing A
above the average were protected. Such a decision lies
within the ambit of policy choices;
(iii) While no legal or constitutional mandate of OROP can be
read into the decisionsin Nakara (supra) and SPS Vains
(supra), varying pension payable to officers of the same B
rank retiring before and after 1 July 2014 either due to
MACP or the different base salary used for the calculation
of pension cannot be held arbitrary; and
(iv) Since the OROP definition is not arbitrary, it is not necessary
for us to undertake the exercise of determining if the C
financial implications of the scheme is negligible or
enormous.
50. In terms of the communication dated 7 November 2015, the
benefit of OROP was to be effected from 1 July 2014. Para 3 (v) of the
communication states that “in future, the pension would be re-fixed every D
five years”. Such an exercise has remained to be carried out after the
expiry of five years possibly because of the pendency of the present
proceedings.
51. We accordingly order and direct that in terms of the
communication dated 7 November 2015, a re-fixation exercise shall be E
carried out from 1 July 2019, upon the expiry of five years. Arrears
payable to all eligible pensioners of the armed forces shall be computed
and paid over accordingly within a period of three months.
52. The petition is disposed of in the above terms.
53. Pending application(s), if any, shall stand disposed of. F

Nidhi Jain Writ petition disposed of.
(Assisted by : Shubhanshu Das, LCRA)

G

H