Holding

The appointment of a retired District Judge as President of a District Consumer Forum is a case of re‑employment of a pensioner, and the salary must be fixed in accordance with the Punjab Civil Services Rules, allowing deduction of the pension.

Summary

The appellants, retired District Judges, were appointed as Presidents of District Consumer Forums under Section 10 of the Consumer Protection Act, 1986. The Punjab Government issued an order on 25‑January‑1996 directing that the pension they received as retired judges be deducted from the salary payable as Forum Presidents. The appellants challenged this order, arguing that the Act and its Rules fixed their salary and that pension, being a statutory right, could not be curtailed by an administrative order. The Supreme Court held that such appointments constitute re‑employment of pensioners and that the Punjab Civil Services Rules, particularly Section 7.18 and Note 3(a)(i), govern the fixation of pay, requiring deduction of pension to the extent prescribed. Consequently, the Government order was deemed valid and the appeal was dismissed.

Issues considered

Whether the pension received by retired District Judges appointed as Presidents of District Consumer Forums can be deducted from the salary fixed under the Consumer Protection Act, 1986 and its Rules.

Legislation cited

Consumer Protection Act, 1986s. 10, s. 30

Subjects

re‑employmentpension deductionConsumer Protection Actsalary fixationPunjab Civil Services Rulesstatutory rightadministrative orderwaiverestoppel

Judgment

..
M.S. CHAWLA AND ORS. A
v.
STATE OF PUNJAB AND ANR.

APRIL 16, 2001

[G.B. PATTANAIK AND B.N. AGRAWAL, JJ.] B

Service Law:

Consumer Protection Act, 1986: Section 10.
c
District Consumer Forum-President-Salary of-Pension-
Deductibility from-Retired District Judge appointed as President-Pension
drawn by such District Judge deducted from salary payable to such President-
Validity of-Held: The appointment of a retired District Judge as President
ofDistrict Consumer Forum is a case ofre-employment of a pensioner-Such
pensioners are governed by Punjab Civil Services Rules-Hence, salary of D
such re-employed District Judge as President has been rightly fixed after
.. deducting his pension amount-Punjab Civil Services Rules, Note 3(a)(i) to
R. 7.18 Ch. VII Vol. II-Government Order dated 25-1-1996.

The appellants were retired Dh1lict Judges p1ior to their a1>1>ointments E
as Presidents of District Consumer Forums under Section 10 of the
Consumer Protection Act, 1986. The respondent-State issued a Government
order dated 25-1-1996 by which it was .directed that the pension amount of
each of these ap1>ellants should be deducted from their salary payable to them
as Presidents of the District Consumer Forums. The High Court dismissed
the \Vlit 1>etition filed by the appellants challenging the aforesaid order. Hence F
this a1>1>eal.

On behalf of the res1>0ndents it was contended that the ap1>ellants were
re-employed pensioners; that under Section 7.18 of Chapter VII of Volume Il
of the Punjab CMI Senices Rules the com1>etent authority could determine G
whether the app!!llants' pension would be held wholly or partly in abeyance;
and that Note 3(a)(i) of Section 7.18 of the Rules .stipulated that pension
which was non-effective pay should not ordinarily be allowed in addition.

The following question arose before this Court
81 H
82 SUPREME COURT REPORTS [2001] 3 S.C.R. .

A Whether the pension amount received by the appellants in respect of
their previous services as District Judges can be deducted from the salary of
_the President of the District Consumer Forum fixed under the provisions of
the Consumer Protection Act, 1986 and the Rules framed t)lereunder?

Dismissing the appeal, the Court
B
HELD: 1.1. The appointment of a Distrfrt Judge, after his
superannuation as the President of the District Consumer Forum under the
Consumer Protection Act, 1986 cannot but be held to be a case of re-
employment of a pensioner inasmuch as the said District Judge is in receipt
C of a 1>ension for the senices rendered'as a Distlict Judge in accordance with
the 1>rovisions contained in the Punjab Civil Senrices Rules, Chapter VII of
Volume II. [87-A-B]

1.2. The au1>ropriate authority "ill have to decide the pay and allowance,
which the retired District Judge is entitled to receive on being ap1>0inted as
D the President of the District Forum n9twithstandin.g the fixation of such pay
under the Rules framed under the Consumer Protection Act, 1986 and while
fixing the same, the principle underlined in Note 3(a)(i) to Section 7.18 of
Cha1>ter VII of Volume II of the Rules has to be followed. [87-C]

2. There is no infirmity in the Government Order dated 25-1-1996 by ·
E which the salary of the re-employed District Judges as President of the
District Consumer Forum has rightly been fixed takin~: into account the
pension which they are in receipt _of as retired District Judges. [87-D]

. CIVIL APPELLATE JURISDICTION : Civi.l Appeal No. 907 of
2001.
F
From the Judgment and Order dated 12.3.99 of the Punjab and Haryana
High Court in C.W.P. No. 4351of1998.

WITH

G Civil Appeal No. 908 of2001.

P.P. Rao, Anoop G. Chaudhary, Ravindra Bana, Manoj Swamp, Prem
Malhotra, K. C. Bajaj, Vinod Shukla, Rajeev Sharma, Mahabir Singh and Sandeep
Singh for the appearing parties.

H The Judgment of the Court was delivered by
i

M.S. CHAWLA v. STATE (PATTANAIK, J.] 83
PATTANAIK, J. These appeals filed by the Presidents of the District A
Consumer Forum, appointed under Section 10 of the Consumer Protection
Act, are directed against the judgment of Punjab and Haryana High Court and
the question for consideration is whether the pension amount received by
these appellants in respect of their previous services as District Judges, can
be deducted from the salary of the President of the District Consumer Forum,
fixed under the provisions of the Consumer Protection Act and the rules B
framed thereunder? The appellants approached the High Court by filing a writ
petition, challenging the legality of the Government Order dated 25th of
January, 1996, by which order it had been directed that the pension amount
of each of these appellants should be deducted from their salary, payable as
President of the District Consumer Forum. The High Court by the impugned C
judgment, dismissed the writ petition, essentially on the ground that the
appellants knew while joining the post of President, District Consumer Forum
that the pension amount received by them as Members of the Superipr
Judicial Service would be deducted from their salary and, therefore, they
having joined the post with full knowledge and without any protest, they do
not have any enforceable right und~r the provisions of the Act and the Rules, D
as contended.

Mr. P.P. Rao, the learned senior counsel, appearing for the appellants,
raised the following contentions in assailing the impugned judgment of the
High Court:
E
(1) The salary of the President of the District Consumer Forum,
having been fixed under Section I 0(3) of the Consumer Protecti<(ln
Act, 1986 (hereinafter referred to as 'the Act') read with Rule 3('I)
of the Consumer Protection Rules, 1987 (hereinafter referred to
as 'the Rules') and there being no provision for deduction of the F
pension, which such President had been drawing in respect of
the past services rendered, the Government is not entitled to
is~ue an Administrative Order to that effect and, therefore, the
Order directing deduction of pension is illegal.

(2) Pension being neither a bounty nor a matter of grace dependiqg G
upon the sweet will of the employer, as has been held by thls
Court in the Constitution Bench decision in D.S. Nakara s case,
the right to receive pension by each of the appellants, is a
statutory right governed by the Punjab Civil Services Rules,
made under the proviso to Article 309, and in the absence of any
provision thereunder, the said pension cannot be deducted from H
84 SUPREME COURT REPORTS [2001] 3 S.C.R.

A the salary provided for the President of the District Consumer
Forum under the Act and the Rules framed thereunder.

(3) In any view of the matter, the statutory right of receiving pen5ion
for sen1ices rendered as District Judges, cannot be taken away
·by an administrative order qiade by the Governor.
B
(4) The Consumer Protection Act and the Rules framed thereunder,
itself having provided the conditions of service and having.fixed
the salary of the President of the District Consumer Forum, the
same cannot be, in any manner altered by an administrative
order.
c
In this view of the matter, the impugned Order dated 25 .1.1996, is on the face
of it illegal, inoperative and null and void and must be struck down. Mr. Rao
also further contended that the conclusion of the High Court, applying the
principle of waiver and estoppel is wholly untenable, since there is no question
D of waiver or estoppel against any statute and the High Court committed error
in holding that the appellants knew about the condition that the pension
amount would be deducted from the salary/honorarium payable to the President
of the District Consumer Forum.

Mr. A.G. Chaudhary, appearing for the State of Punjab, on the other
E hand contended that Volume II of the Punjab Civil Services Rules deal with
the pension of an employee. In Chapter VII of the aforesaid Punjab Civil
Services Rules of Volume II, Clause 7.18 enables the authority competent to
fix the pay and allowances of the post in which the pensioner is re-employed
to determine whether his pension shall be held wholly or partly in abeyance. .
Note 3 of the aforesaid provision, unequivocally stipulates that in determining
F the pay of re-employed pensioner, the principle to be followed is that the pay
must not exceed the substantive pay drawn immediately before retirement or
the maximum of the scale applicable to the post in which t~e Government
employee is re-employed whichever is less and pension which is non-effective
pay, shall not ordinarily be allowed in addition. In view of the aforesaid
G provisions and the appointment of the retired District Judges as President of
the District Consumer Forums being re-employment, the appropriate authority
was entitled to fix their salary and fixation of their salary has been done by
the appropriate authority by issuing the Government Order dated 25th January,
1996, and therefore, the said order is within the powers conferred under the
Punjab Civil Services Rules and in consonance with the principks enunciated
H therein. In this view of the matter, the High Court was fully justified in not
M.S. CHAWLA v. STATE [PATTANAIK, J.] 85

striking down the aforesaid Government Order. A
It is no doubt true, as contended by Mr. Rao the learned senior counsel,
appearing for the ·appellants that if the emoluments attached to a post under
any Act are fixed under the Act, then by an executive order, the same cannot
be altered or determined contrary to the provisions of the Act and the Rules.
The "District Forum" is defined in Section 2(h) to mean a Consumer Disputes B
Redressal Forum established under clause (a) of Section 9 of the Consumer
Protection Act, 1986. Section 9(a) makes it obligatory for the State Government
to establish a Consumer Disputes Redressal Forum to be known as the
"District Forum" in each District of the State by a notification. Section IO(l)(a)
of the Act, provides that each District Forum shall consist of a person who C
is, or has been, or is qualified to be a District Judge, who shall be its
President. Sub-section(3) of Section IO provides that the salary or honorarium
and other allowances payable to, and the other terms and conditions of
service of the members of the District Forum shall be such as may be prescribed
by the State Government. Sub-section (2) of Section 30 enables the State
Government by a notification to make rules for carrying out the provisions D
contained in Sub-section(3) of Section 10 along with other provisions
mentioned in the said sub-section. Thus, the salary or honorarium and
allowances payable to and the tern1s and conditions of service of Members
of the District Forum could be prescribed by the State Government by the
rules framed for the purpose. In exercise of powers under sub-section (2) of E
Section 30, the Government of Punjab, Department of Food and Supplies
(Consumer Protection Branch), has made the Rules called the Consumer
Protection (Punjab) Rules, 1987. Sub-rule (1) of Rule 3 thereof prescribes that
the President of the District Forum shall receive the salary of the District
judge of a District Court if appointed on whole-time basis or an honorarium
of Rs. 150 per day if appointed on part-time basis and other members, if sitting F
on whole-time basis, shall receive a consolidated honorarium of Rs. 2000 per
month and if sitting on part-time basis, a consolidated honorarium of Rs.100
per day for the sitting. The aforesaid salary and honorarium is defrayed out
of the Consolidated Fund of the State Government, as provided in sub-rule
(3) of Rule 3. These Rules of 1987, stood amended by Consumer G
Protection,Punjab) Rules, 1993 by notification dated 2nd of Au.gust, 1993.
Under the amended Rules, the President of a District Forum, if appointed on ·
whole-time basis, is entitled to pay in the grade of pay admissible to a Judge
of a District Court. Neither in the Act nor in the Rules framed thereunder, there
has been any indication as to whether on being appointed as President of the
District Consumer Forum, after superannuation as a District Judge, the pension H
86 SUPREME COURT REPORTS [2001] 3 S.C.R.

A receivable is to be deducted. The pension of such superannuated District
Judges is Governed by the Punjab Civil Sen1ices Rules, Volume II.. Rule l. l(a)
of Punjab Civil Services Rules Vol.II, unequivocally stipulates that the Rules
in this part regulate the grant of pensions to the Government employees to
whom the rules in Volume I of these rules apply. The Punjab Civil Services
B Rules have been iss.ued by the Governor of Punjab under proviso to Artfole
309 of the Constitution. The Punjab Civil Services Rules apply tci all Government
employees except those who are specifically excluded from the operation of
the Rules by a general or special order of the competent authority. Appendix
(2) to the Rules contains a list of those employees who have been excluded
from the operation of the rules. The expression "State Government employees"
C has been defined to mean all persons whose conditions of service may be
regulated by the rules made by the Governor of Punjab under proviso to
Article 309 of the Constitution. It is undisputed that the pension of a District
Judge, on his superannuation is determined in accordance with the Punjab
Civil Services Rules, Volume II. Chapter II of Volume II deals with general
provisions relating to grant of pensions. Section 2.1 thereof provides that
D every pension shall be held to have been granted subject to the conditions
contained in Chapter VII of these rules. Chapter VII of Volume: II of the Punjab
Civil Services Rules contains Section 7.18, and the same is quoted herein ...
below:

E "Section 7.18.-The authority competent to fix the pay and allowances
of the post in which the pensioner is re-employed shall determine
whether his pension shall be held wholly or partly in abeyance. If the
pension is drawn wholly or in part, such authority shall take the fact
into account in fixing the pay to be allO\ved to him."

F Note 3(a)(i) to aforesaid Section 7.18 is extracted hereunder:

"Note 3(a): In determining the pay of a re-employed pensfoner, tlw.
following principles shall be observed namely:- (i) the pay must not
exceed the substantive pay drawn immediately before retirement or the
maximum of the scale applicable to the post in which the Government
G
employee is re-employed whichever is less and pension which is non-
effective pay, shall not ordinarily be allowed in addition:

Provided that if the pension does not exceed Rs. 50 p.m., the entire
amount of pension and where it exceeds Rs. 50 per month the first Rs.
H 50 shall not be taken in~count in fixing the pay on re-employment.
~--
-+
M.S. CHAWLA v. STATE [PATTANAIK, J.] 87
The appointment of a District Judge, after his superannuation as the President A
of the Distr.ict Consumer Forum under the Consumer Protection Act, cannot

... but be held to be a case of re-employment of a pensioner inasmuch as the
said District Judge is in receipt of a pension for the services rendered as a
District Judge in accordance with the provisions contained in the Punjab Civil
Services Rules, Volume II. Since Section 2.1 of Chapter II of Volume II,
unequivocally states that every pension shall be held to have been granted . B
~bject to the conditions contained in Chapter Vll and Chapter Vll contains
Rule 7 .18 as well as Note 3 (a)(i), which have been extracted before, the
conclusion is irresistible that the appropriate authority will have to decide the
pay and allowances, which the retired District Judge is entitled to receive on
being appointed as the President of the District Forum notwithstanding the C
·fixation of such pay ·under the Rules framed under Consumer Protection Act
and while fixing the same, the principle underlined in Note 3(a){i) has to be
followed. This being the position, we see no infirmity with the Government
Order dated 25th of January, 1996 an_d under the said notification the salary
of re-employed District Judges as President of the District Consumer Forum,
have rightly been fixed, taking into account the pension, which they are In D
receipt of, as retired District Judges. The contention of Mr. Rao that the salary
fixed under the Act and the Rules framed thereunder is being altered by an
administrative order is of no force, in view-of the legal provisions enumerated
above and in fact, it is the provision of the Punjab Civil Services Rules,
dealing with the salary of re-employed pensioners, which governs the field. E
The other contention on the bas.is of the judgment of this Court in D.S.
Nakara, that pension is not a bounty is also of no consequence. In the
aforesaid premises, we do not find any legal infirm!ty with the Judgment of
the High Court, requiring our interference under Article 136 of the Constitution.
.These appeals accordingly fail and are dismissed.
F
v.s.s. Appeals dismissed.

. '·