UNION OF INDIA AND ORS.versusDR. VIJAYAPURAPU SUBBAYAMMA

 A                         UNION OF INDIA AND ORS.
                                      v.
                       DR. VIJA YAPURAPU SUBBA YAMMA

                                 SEPTEMBER 22, 2000

B                      [V.N. KHARE AND S.N. PHUKAN, JJ.]


           Service Law:

           Central Civil Services (Temporary) Services Rules, 1965:
c          Pension-Pro rata pension-Entitlement to-Qualifying service-
     Government employee superannuated after putting in only 12 years of service
     instead of20 years ofqualifying service-But Fourth Pay Commission reduced
     the qualifying service from 20 years to 10 years without retrospective effect-
     Held, The recommendation of the Fourth Pay Commission not being with
D    retrospective effect the employee is not entitled to receive liberalised pension.

           The respondent retired from service on 13.11.1980 on attaining the
     age of superannuation after putting in only 12 years, instead of 20 years,
     of qualifying service. Therefore, the respondent w,as not granted pensionary
E    benefits under the Central Civil Services (Temporary) Services Rules, 1965.

            Subsequently, the Fourth Pay Commission made a recommendation that
     for entitlement of pro rata pension, the length of service be reduced from
     twenty years to ten years. The said recommendation was accepted and came
     into force w.e.f. 1.1.1986. The respondent made a representation to the appellant
F    that she was entitled to pro rata pension,\which was rejected. However, the
     Centi al Administrative Tribunal directed the appellant to grant pro rata
     pension to the respondent in view of the said Pay Commission
     Recommendations w.e.f. 1.1.1986. Hence this appeal.

           Allowing the appeal, this Court
G
            HELD: 1. The respondent retired on 13.11.1980 and under the then
     relevant Rules, an employee who has put in less than twenty years of qualifying
     service was not eligible to earn pension. At that point of time the respondent
     had put in only twelve years of qualifying service and, therefore, was not
     entitled to earn the pension on her retirement. The recommendations of the
II                                         372
    U.0.I. v. DR. VIJAYAPURAPU SUBBA YAMMA [V.N. KHARE, J.]               373

Fourth Pay Commission were accepted and enforced with effect from ~.1.1986       A
whereby the requirement of qualifying service to earn pension was reduced
to ten years from twenty years. By the said recommendations a new class
of pensioners was created. But the said recommendations of the Pay
Commission were not enforced with effect from 13.11.1980 - the date on
which the respondent retired but with effect from 1.1.1986. Thus, the
recommendations of the Fourth Pay Commission not being with retrospective        B
effect, the respondent was not entitled to receive liberalised pension under
the said recommendations which came into effect from 1.1.1986.
                                                            [376-H; 371-A-B]

      V. Kasturi v. Managing Director, State Bank of India, Bombay, (1998)
8 SCC 30; Commander Head Quarter, Calcutta v. Capt. Biplabendra Chanda,          C
(1997) 1 SCC 208; Union of India v. Lieut. (Mrs.) E. Iacats, [1997) 7 SCC
334 and T.N. Electricity Boardv. R. Veeraswamy, [1999) 3 SCC 414, relied on.

      M.C. Dhingra v. Union of India, [1996) 7 SCC 564 and T.S.
Thiruvengadam v. Secretary to Government of India, [1993) 2 SCC 174, held        D
inapplicable.

        CIVIL APPELLATE JURISDICTION : Civil Appeal No. 5346 of
1997.

     From the Judgment and Order dated 11.10.96 of the Central Administrative
Tribunal, Hyderabad in O.A. No. 532 of 1996.                                     E
     T.L.V. Iyer, Y.P. Mahajan, S.K. Dwivedi and Anil Katiyar for the
Appellants.

        D.V. Padma Priya for the Respondents.

        The Judgment of the Court was delivered by                               F

       KHARE, J. The respondent herein, was appointed as a Lady Medical
Officer in the Family Welfare Centre, Vishakhapatnam under the control of
Commanding-in-Chief, Eastern Naval Command, Vishakhapatnam on 22.9.1968.
Subsequently, she was made quasi-permanent with effect from 31.3.1972 by         G
an order dated 15.10.1974. On 13.11.1980, the respondent retired from service
on attaining the age of superannuation. On retirement, the respondent was
given the terminal and other benefits under Central Civil Services {Temporary)
Services Rules, 1965. The respondent was also given insurance money along
with other benefits, as admissible to her. At the time when the respondent
retired she had not completed the requisite qualified service of twenty years    H
    374                       SUPREME COURT REPORTS [2000] SUPP. 3 S.C.R.

A for entitlement of pension. She was informed that as she had not put in
    required number of length of service, she is not entitled to any pension.
    Subsequently, the Fourth Pay Commission made recommendation that for
    entitlement of pro rata pension, the length of service be reduced from twenty        .i
    years to ten years. The said recommendation was accepted by the Government
    of India and came into force with effect from 1.1.1986. The respondent, after
B   the Pay Commission Report came into force, made a representation that since
    the length of service for entitlement to pension has been reduced from twenty
    years to ten years as per recommendations of Fourth Pay Commission and as
    she had put in only twelve years, two months and nine days' length of
    service, she is entitled to pro rata pension with effect from 1.1.1986. The
C   representation of the respondent was considered and it was found that when
    the respondent retired, the requirement for entitlement for pension was that
    the retiree must have put in twenty years of service and since she retired prior
    to 1.1.1986, she was not entitled to pension. Under such circumstances, the
    respondent in the year 1996 filed an O.A. before the Central Administrative
    Tribunal, Hyderabad (hereinafter referred to as the "Tribunal") for direction
D   to the appellants herein, to grant pro rata pension in view of the
    recommendations of the Fourth Pay Commission with effect from 1.1.1986.

            The Tribunal relying a decision of this Court in MC. Dhingra v. Union
     of India, [1996] 7 SCC 564 held that even though the respondent retired much
E    prior to l. l .1986, the payment of pro rata pension cannot be denied to her with
     effect from 1. 1.1986. According to the Tribunal, such a denial would be
     arbitrary and violation of Article 14 of the Constitution. The Tribunal further
     relying upon another decision in T.S. Thiruvengadam v. Secretary to
     Government of India & Ors., [ 1993] 2 SCC 174, held that any benefit conferred
    by the Government is not prospective, but will have a retrospective effect and
F   such benefit will be available to even those who have retired prior to 1.1.1986
    and in that view of the matter the Tribunal allowed the O.A. filed by the
    respondent with a direction to the appellants herein to grant pro rata pension
    with effect from one year prior to filing of the O.A. It is against the aforesaid
    judgment of the Tribunal the appellants are in appeal before us.
G         Learned counsel for the appellant urged that in the year 1980 when the
    respondent retired from service she was not eligible for grant of liberalized
    pension in view of the fact that she had not put in 20 years of service. The
    grant of pro rata pension on completing ten years of qualified service for
    pension was introduced for the first time by the recommendation of the
H   Fourth Pay Commission with effect from 1.1.1986 and, therefore, the said
     U.0.1. v. DR. VIJAYAPURAPU SUBBAYAMMA [V.N. KHARE, J.] 375

recommendation cannot be made applicable with retrospective effect. Learned A
counsel pointed out that the present case stands covered by the decision of
this Court in the case of V. Kasturi v. Managing Director, State Bank of
India, Bombay and Anr., [1998] 8 SCC 30. Learned counsel also pointed out
that decisions relied upon by the Tribunal in allowing the O.A. filed by the
respondent were distinguished in V. Kasturi 's case (supra). Learned counsel B
also referred to decisions of this Court in Commander Head Quarter, Calcutta
& Ors. v. Capt. Biplabendra Chanda, [ 1997] l SCC 208; Union of India and
Ors. v. Lieut (Mrs.) E. Iacats, [ 1997] 7 SCC 334 and T.N. Electricity Board v.
R. Veerasamy and Ors., [ 1999] 3 SCC 414 in support of his argument.

       In the case of V. Kasturi (supra), the appellant joined the State Bank     C
of India as an Officer. After completing twenty years, but without completing
twenty five years of pensionable service, he resigned on 31. 7.1984 which was
treated as voluntary retirement and, therefore, he was not given any pension
as he had not put in twenty five years of service. With effect from 20.9.1986,
rule 22 (l)(c) was substituted by a new rule 21(l)(c) which provided pension
to an employee retiring on completion of twenty years of service. The appellant   D
in the said case, therefore, contended that he was entitled to pension under
new rule and the denial of pension to him was violative of Article 14 of the
Constitution. This Court held as under:

       " However, if an employee at the time of his retirement is not eligible
       for earning pension and stands outside the class of pensioners, and        E
       subsequently by amendment of the relevant pension rules any
       beneficial umbrella of pension scheme is extended to cover a new
       class of pensioners and by then the erstwhile non- pensioner might
       have survived, then only if such extension of pension scheme to
       erstwhile non-pensioners is expressly made retrospective by the            F
       authorities promulgating such scheme; the erstwhile non-pensioner
       who has retired prior to the advent of such extended pension scheme
       can claim benefit of such a new extended pension scheme. If such a
       new scheme is prospective only, old retirees non-pensioners cannot
       get the benefit of such a scheme even if they survive such new
       scheme. They will remain outside its sweep."                               G
      This Court in Commander Head Quarter, Calcutta and Ors. v. Capt.
Biplabendra Chanda, [ 1997] l SCC 208, held as under:

       "The new and revised Rules which came into force with effect from
       l. l. 1986 were not given retrospective effect. The respondent cannot      H
    376                      SUPREME COURT REPORTS [2000] SUPP. 3 S.C.R.

A           be made retrospectively eligible for pension by virtue of these Rules
            in such a case. This is not a case where discrimination is being made
            among pensioners who were similarly situated. Accepting the
            respondent's contention would have very curious consequences; even
            a person who had retired long earlier would equally become eligible
            for pension on the basis of the 1986 Rules. This cannot be."
B
         This Court in Union of India and Ors. v. Lieut (Mrs. E. Iacats), [1997]
    7 sec 334 held as under:

            ~'The terms and conditions of service were known to the respondent
            at the time she joined the service. She at that time had signed an          ---
c           agreement to abide by the rules and regulations governing Military
            Nursing Service (Local) from till!e to time. She cannot claim the benefit
            of a liberalized pensionary scheme which came into operation from a
            date subsequent to the date of her retirement."

D         The conspectus of legal position that emerges from the aforesaid
    decisions are these:

            (a) Where an einployee under the terms and conditions of service or
            under the relevant rules relating to pension is not eligible to earn
            pension on his or her retirement, any amendment to the rules covering
            a new class of pensioner would not confer pensionary benefits to the
E
            employee who has retired prior to coming into force of such amenchnent
            of Rules.

            (b) However, the position would be different if such an amendment in
            the relevant pension rules is with retrospective effect as to cover a
F           new class of employee including those employees who, at the relevant
            time, were not entitled to earn pension under the then existing rules
            or conditions of service.

            (c) Where an employee at the time of retirement is entitled to pension
            under the relevant rules, any subsequent amendment to the relevant
G           rules enhancing pension or conferring additional benefit would be
            also applicable to him.

           Applying the aforesaid principles what we find in the present case is
    that the respondent retired on 13. l l.l 980 and under the then relevant rules, .
    an employee who has put in less than twenty years of qualifying service was
H   not eligible to earn pension. At that point of time the respondent had put in


                                                                                              \ ,,
                                                                                               '
     U.0.1. v. DR. VIJA Y APURAPU SOBBA YAMMA [V.N. KHARE, J.] 377

only twelve years of qualifying service and, therefore, was not entitled to earn   A
the pension on her retirement. The recommendations of the Fourth Pay
Commission were enforced with effect from l. l.1986 whereby the requirement
of qualifying service to earn pension was reduced to ten years from twenty
years. By the said recommendations a new class of pensioner was created.
But the said recommendations of the Pay Commission were not enforced with          B
effect from 13.11.1980 - the date when the respondent retired but with effect
from 1.1.1986. Thus, the recommendations of the Fourth Pay Commission not
being with retrospective effect, the respondent was not entitled to receive
pension under the said recommendations which came into effect from 1.1.1986.

      Learned counsel for the respondent strongly relied upon the decision         C
of T.S. Thiruvengadam v. Secretary to Government of India & Ors. (supra)
and MC. Dhingra v. Union of India (supra) for the contention that once
qualifying service to earn pension was reduced from twenty years to ten
years the respondent became eligible to receive liberalised pension. In the
case of Thiruvengadam (supra), the concerned employee who has already
having pensionary benefits in the service of the Central Government, was           D
subsequently appointed in a Public Sector Undertaking. After the concerned
employee was absorbed in Public Sector Undertaking the Government issued
a memorandum conferring pensionary benefits to the employees of Public
Sector Undertaking. The question arose whether the pensionary benefits were
also available to those who had already been absorbed in the service of
Public Sector Undertaking prior to coming into force of the memorandum. This       E
Court, in view of the facts and circumstances of that case held as under:

        "The object of bringing into existence the revised terms and conditions
        in the memorandum dated June 16, 1967 was to protect the pensionary
        benefits which the Central Government servants had earned before
        their absorption into the public undertakings. Restricting the             F
        applicability of the revised memorandum only to those who are
        absorbed after the coming into force of the said memorandum, would
        be defeating the very object and purpose of the revised memorandum
        and contrary to fair play and justice."

      In MC. Dhingra v. Union of India, the concerned employee who was
                                                                                   G
in the State service joined the service of Central Government. The question
arose as to whether the past service rendered in the State service by the
employee could be taken into consideration for computing the quantum of
pension payable to him. It was held that since the concerned employee was
already a pensioner and, therefore, any additional benefit for computation of H
    378                      SUPREME COURT REPORTS [2000] SUPP. 3 S.C.R.

A pension on the basis of subsequent circular was available to him. The decisions
    in the cases of T.S. Thiruvengadam and MC. Dhingra are distinguishable and
    are not applicable to the facts of this case. The decisions in MC. Dhingra 's
    case as well as in T.S. Thiruvengadam 's case were also considered in V.
    Kasturi's case and were distinguished. We accordingly hold that the respondent
B   was not eligible to earn liberalised pension in pursuance of recommendations
    of Fourth Pay Commission.

          For the aforesaid reasons, the appeal deserves to succeed. Consequently,
    the judgment of the tribunal under appeal is set aside and the appeal is
    allowed. There shall be no order as to costs.
c v.s.s.                                                         Appeal allowed.