Holding

The Supreme Court’s decision in Common Cause is to be understood as fixing the 15‑year period from the date of commutation, so the 1990 memorandum does not contravene that judgment.

Summary

The appellant challenged the Government's Office Memorandum dated 22 August 1990 which changed the period for restoration of a commuted pension from "date of retirement" to "date of commutation". The appellant argued that the Supreme Court in Common Cause v. Union of India had fixed the 15‑year period from the date of retirement and that the Government could not unilaterally alter it. The Government contended that the Supreme Court, in its later Welfare Association judgment, had clarified that the 15‑year period should be reckoned from the date of commutation. The Court examined the language of the Common Cause judgment and subsequent decisions, holding that the Supreme Court’s intent was always that the period be measured from the date of commutation. Consequently, the 1990 memorandum does not conflict with the Supreme Court’s direction. The High Court’s dismissal of the writ petition was affirmed.

Issues considered

The validity of the 1990 Office Memorandum changing the basis for the 15‑year restoration period of a commuted pension.
Whether the phrase "on the expiry of 15 years from the period of retirement" in Common Cause v. Union of India means 15 years from the date of retirement or from the date of commutation.
Whether the High Court was correct in dismissing the writ petition challenging the memorandum.

Subjects

pension commutationrestoration of pensioninterpretation of judgmentoffice memorandumpublic interest litigationCommon Cause caseWelfare Association caseSupreme Court direction

Judgment

R. GANDHI A
\I,

U.0.1. AND ANR.

AUGUST 23, 1999

[K. VENKA T ASW AMI AND B
SYED SHAH MOHAMMED QUADRI, JJ.J

Service Law :

Pension-Commutation of-Restoration of commut~d pension after 15 C
years period-Reckoning of -Supreme Court's decision in .Common cause
case-Restoration of Pension on expiry of "15 years from the date of
retirement"-Office Memorandum (No. 3412186-P & PW (G) dated
22.8.1990-Providing reckoning of "Period of 15 years from the date of
commutation ofpension"-Validity of-Held, the decision in Common Cause D
case rightly understood in all subsequent judgments as "period of 15 years
from the date of commutation"-0.lfice Memorandum dated 22.8.1990 not
contrary to Common case.

Judgment-Interpretation of-Held, words in the Judgment of Court
cannot be interpreted as words in a statute.
E
By an Office Memorandum No. 34/2/86-P&PW (G) dated 22.8.1990
Government of India revised its earlier Memorandum by providing that period
of 15 years for restoration of commuted pension would be "from the date of
commutation of pension" instead of "from the date of retirement". Appellant
filed a public interest litigation challenging the said Office Memorandum on F
the ground it was contrary to the directions issued by this Court in Common
Cause case.* Respondent-Union of India filed a counter-affidavit stating
that the directions issued in Common Cause case was clarified by this Court
in Welfare Association's case**-"the period of 15 years be reckoned from
the date of commutation of pension". Consequently, Government revised its
earlier Office Memorandum and brought into force the Office Memorandum G
dated 22.8.1990. High Court dismissed the writ petition. Hence the present
appeal

On behalf of appellant it was contended that once the Government
accepted in principle that the commuted pension would be recovered for a H
661
662 SUPREME COURT REPORTS [1999] SUPP. I S.C.R.

A period of 15 years from the date of retirement and the same had culminated
into a direction of this Court, they could not have unilaterally changed the
same to reckon the period of 15 years from the date of commutation of
pension.

On behalf of respondent-Government it was contended that the period
B of 15 years is fixed on the basis that the commuted pension would normally
be recovered within the said period; when the commutation of pension and
the date of retirement synchronise, no difficulty would arise but if the
pension is commuted long after the date of retirement, the period of 15 years
will be cut short when counted from the date of retirement and in the result
C the pensioners will get an undue and unintended benefit of the order of the
Supreme Court.

Dismissing the appeal, the Court

HELD 1.1. Memorandum dated 22.8.1990 issued by Government does
D not 'incorporate any condition contrary to the judgment of this Court in
Common Cause case. High Court, therefore, was justified in dismissing the
writ petition. [666-H)

1.2. The decision in Common Cause case has been rightly understood
E in all subsequent judgments of this court "as 15 years from the date of
commutation". The arbitrary action of Government was struck down by this
Court in Common Cause Case by directing the Government to restore the
full pension after 15 years "from the period of the retirement" to ~he
pensioners who had commuted 1/3rd of the pension. The words in the judgment
of the court cannot be interpreted as the words in a statute. By the said
F direction, this court never intended to confer any unfair or undue advantage
on the pensioners. It only ensured fairness in the treatment of pensioners
at the hands of the Government in respect of deduction of pension consequent
upon commu~ation of portion of the.>pension. This Court in Welfare
Association's case came to hold that the period of 15 years for commutation
G of pension would be reckoned from the date of commutation of pension. The
judgment in Common Cause case was neither modified nor clarified. This
Court in Welfare Association's case only understood the words "on the
expiry of 15 years from the period of retirement" in Common Cause case
as "15 years from the date of commutation". [666-E, F, G)

H *Common Cause v. Union of India, (1987) 1 sec 142 and **Welfare
R. GANDHI v. U.0.1. [S.S. MOHAMMED QUADRI, J.] 663

Association ofAbsorbed Central Government Employees in Public Enterprises A
v. Union of India and Ors., (1991) 2 SCC 265, explained and reiterated.

Bharat Petroleum Corporation ltd Ex-Employees Association & Ors.
v. Chairman & Managing Director Bharat Petroleum Corpn. ltd Bombay
&'Ors., (1993) 3 Scale 424 and Welfare Association of Absor.b.ed Central
Government Employees in Public Enterprises.& Ors. v. Union of India & _:e
Anr., AIR (1996) SC 1201, referred to.

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 4667 of
1999.

From the Judgment and Order dated 22.1.98. of the Madras High Court C
in W.P.No. 12381 ofl996.

R. Venkataraman, V. Prabhakar, Ms. Pallavi Choudhary and Ms. Radha
Rangaswamy for the Appellant.

A.S. Nambiar, Y.P. Mahajan and P. Parmeswaran for the Respondents,
D
The Judgment of the Court was delivered by

SYED SHAH MOHAMMED QUADRI, J. Leave is granted.

This appeal, an off-shoot of the judgment of this Court in Common
Cause v. Union of India, [1987] 1SCC142, arises from the judgment and order
of a Division Bench of the Madras High Court in Writ Petition No.12381 of E
1996 dated January 22, 1998.

The appellant, who is a Senior Advocate and a member of the Madras
High Court Bar, filed writ petition No.12381 of 1996, a public interest litigation,
in the High Court of Madras challenging Memorandum No.34/2/86-P&PW(G) F
dated August 22, 1990 issued by Department of Pension and Pensi-Oner's
Welfare and also the letter dated September 26, 1990, applying the above said
Memorandum to the Department of Justice, and seeking declaration that it
does not apply to the Judges of the High Courts and the Supreme Court of
India.

The substance of the appellant's case before the High Court was that G
the Supreme Court had issued direction that payment of reduced pension on
account of commutation of a part of the pension of a Government employee
should be only for a period of 15 years "from the date of retirement", but the
Union of India issued impugned Memorandum changing it to "from the date
of commutation of pension". The Union of India, in its counter-affidavit, H
664 SUPREME COURT REPORTS [1999) SUPP. I S.C.R.

A stated that the Supreme Court clarified the direction given in Common Cause
(supra) in its subsequent judgment that the period of 15 years be reckoned
from the date o(commutation and not from the date of retirement. Pursuant
to ihe subsequent judgment of this Court, Government of India revised its
earlier Memorandum No.34/2/86-P&PW dated March 5, 1987 and brought into
B force the impugned Memorandum.

A Division Bench of the Madras High Court, taking note of the various
judgments of this Court, dismissed the writ petition by order dated January
22, 1998. It is against that judgment, this appeal is preferred.

Mr. R. Venkataraman, learned senior counsel for the appellant,
C strenuously contended that once the Government of India accepted in principle
that the commuted pension would be recovered for a period of 15 years from
the date of retirement and the same had culminated into a direction of this
Court, they could not have unilaterally changed the same to reckon the period
of 15 years from the date of commutation of pension. The learned counsel has
D submitted that under the Pension Rules, a pensioner can commute a part of
his pension only within one year of the date ofretirement, therefore, the stand
of the Government that those who applied for and got their pension commuted
just on the verge of the completion of 15 years would be able to claim their
full pension after a few months of deduction was without any basis.

E Mr. A.S. Nambiar, learned senior counsel appearing for the respondents,
has argued that the period of 15 years is fixed on the basis that the commuted
pension would normally be recovered within the said period; when the
commutation of pension and the date of retirement synchronize, no difficulty
would arise but if the pension is commuted long after the date of retirement,
the period of 15 years will be cut short when counted from the date of
F retirement and in the result the pensioners will get an undue and unintended
benefit of the order of the Supreme Court.

In the case of Common Cause (supra), it was represented before this
Court in a Writ Petition under Article 32 of the Constitution that on commutation
G of pension the amount paid to the pensioner in lump sum by the Government
would be recovered from his pension within a period of 12 years, there was,
therefore, no justification for the Government to pay reduced pension for the
rest of the life of the pensioner. This Court desired that the Government might
give a new look to the application of Central Civil Service (Commutation of
Pension) Rules, 1981. The Government took decision in the matter and
H communicated the same through the learned Attorney General, which is in the
R. GANDHI v. U.O.I. [S.S. MOHAMMED QUADRI, J.] 665
.. following terms : A
"(i) Recovery from pension payable every month towards commuted
value of pension will stop on the completion of 15 years from
the date of retirement on superannuation or on the pensioner
completing the age of 70 years, whichever is later.
B
(ii) The formulation will apply to all civilian pensioners in whose
case. the age of retirement on superannuation is 58 years and the
personnel of Armed Forces in whose case the retirement age
varies in accordance with the colour service prescribed for the

-- rank (attaining the age of 37/38 years or more).
(iii) Government have taken this decision as an act of goodwill to c
pensioners and to extend to them some measure of relief in the
evening of their lives. It is sincerely believed that there will be
no further demand on this issue and that the pensioners will
accept the decision of the Government without dissent or
reservation. D
(iv) The decision will take effect prospectively (from April 1, 1986)."

In hoc the first point, this Court considered it unnecessary to refer to
~ the age of commuting pensioner for restoration of full pension to him but on
taking note of the facts that the lump sum amount would fetch benefit like
interest and there is also an element of risk factor, directed by its judgment E
dated December 9, 1986 that "on the expiry of 15 years from the period of
.. retirement" full pension should be restored. In terms of the said judgment, the
Government issued Memorandum dated March 5, 1987.

In Welfare Association of Absorbed Central Government Employees in
Public Enterprises v. Union of India and Ors., [ 1991] 2 SCC 265, the question F
canvassed before this Court was whether Central Government employees,
who had taken benefit of the judgment in Common Cause (supra) and
subsequently got absorbed in Public Enterprises, were entitled to the benefit
of that judgment again on retirement from public enterprises. While negativing
their claim, it was observed, "this court for the reasons indicated in the
G
judgment came to hold that on expiry of 15 years from the date ofcommutation
the entire pension revived." From this observation it can be noticed that the
judgment in Common Cause (supra) was neither modified nor clarified. What
all can be inferred is that this Court in Welfare Association's case (supra)

- understood the words "on the expiry of 15 years from the period of retirement"
in Common Cause (supra) as" 15 years from the date of commutation .... ". The H
666 SUPREME COURT REPORTS [1999] SUPP. 1 S.C.R.

A judgment in Welfare Association case (supra) was rendered on April 12, 1990.
It is only pursuant to that judgment, the counter affidavit recites, the
Government revised its earlier Office Memorandum dated March 5, 1987 and
brought into force the impugned Office Memorandum dated August 22, 1990.

. In Bharat Petroleum Corporation Ltd. Ex-Employees Association &
B Ors. v. Chairman & Managing Director Bharat Petroleum Corporation Ltd.,
Bombay and Ors., (1993) 3 Scale 424, this Court extended the benefit of the
judgment in Common Cause (supra) to the clerical employees of Bharat
Petroleum. There also the words "period of 15 years from the period of
retirement" were understood as "15 years from the date of commutation".

C In Welfare Association of Absorbed Central Government Employees in
Public Enterprises and Ors. v. Union of India and Anr., AIR (1996) SC 1201,
the relief sought by the pensioners in their petition under Article 32 of the
Constitution was : restoration of I/3rd portion of the fully commuted pension
as per the decision of this Court in Common Cause (supra). A three-Judge
D Bench, of which one of us (Venkataswami, J.) was a member, reiterated the
principles applied in the aforementioned cases. Indeed, the date from which
15 years pension was to be reckoned was not in issue there.

This Court strikes at arbitrary action of the State and accordingly it did
in Common Cause (supra), by interdicting the arbitrary action of the
E Government in paying the reduced pension as a result of commutation of I/
3rd pension for the rest of the life of the pensioners and issued an equitable
direction t<:> restore the full pension after 15 years "from the period of the
retirement" to the pensioners who had commuted l/3rd of the pension. The
period of 15 years has been arrived at after taking into consideration various
factors mentioned above. It is well-settled principle that the words in the
F judgment of the Court cannot be interpreted as the words in a statute. By the
said direction this Court never intended to confer any unfair or undue advantage
on the pensioners. It only ensured fairness in the treatment of pensioners at
the hands of the Government in respect of deduction of pension consequent
upon the commutation of the portion of the pension. The decision in Common
G Cause (supra) has been understood in all subsequent judgments of this Court
as 15 years from the date of commutation and we are in respectful agreement
with the same. This neither prejudices the rights of any of the parties nor
confers any undue or unfair advantage upon any party.

From the above discussion, it follows that the impugned Memorandum
H does not incorporate any condition contrary to the judgment of this Court in ._.
R. GANDHI v. U.0.1. [S.S. MOHAMMED QUADRI, J.] 667
Common Cause (supra). The High Court was, therefore, right in dismissing A
the writ petition. We find no illegality in the order of the High Court. The
appeal fails and it is accordingly dismissed. No costs.

S.VK Appeal dismissed.

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