State
of Rajasthan Vs. Sevanivatra Karamchari Hitkari Samiti
[1995] INSC 3 (3
January 1995)
Ray,
G.N. (J) Ray, G.N. (J) Sawant, P.B.
CITATION:
1995 SCC (2) 117 JT 1995 (1) 315 1995 SCALE (1)40
ACT:
HEAD NOTE:
1.
Special leave granted.
2. In
this appeal a Division Bench decision of the Rajasthan High Court dated
December 21, 1989 striking down the date i.e. February 29, 1964 mentioned in
Rule 268-H of Rajasthan Service Rules, 1951 as being violative of Article 14 of
the Constitution of India, is under challenge. The respondent, Sevanivatra karamchari
Hitkari Samiti, Jodhpur, an unregistered association of retired employees of
the Government of Rajasthan, moved a Writ Petition in the Rajasthan High Court
inter alia contending that the expression "in service on 29.2.1964 who
is" as used in Rule 268-H of the Rajasthan Service Rules was
discriminatory and violative of Article 14 of the Constitution. It was also
contended that such Rule was also in conflict with the principle laid down in
the decision of this Court rendered in D.S.Nakara V. Union of India (AIR 1983 SC 130). It was also
contended that the said expression being severable from the other part of Rule
268-H, the same should be struck down so that the validity of Rule 268-H
without the aforesaid expression is not affected.
3. By
the impugned judgment, the Rajasthan High Court has held that under Rule 268-H,
the benefit of pension has been given only to the government servants who are
in service on 29.2.1964 but such benefit under Rule 268-H was not extended to
the government servants who had retired prior to that date. The Rajasthan High
Court has held that there is no reasonable classification in excluding
government servants who were not in service on 29.2.1964 and limiting the ben- efit
of liberalised Family Pension Scheme under Rule 268-H only to such government
servants who were in service on 29.2.1964. The High Court has also held that
such classification without any reasonable basis for discrimination cannot be
sustained in view of the decision of this Court rendered in D.S.Nakara's case.
4.
Rule 268-H of Rajasthan Service Rules, 1951 the validity of which was the
subject matter of challenge before the Rajasthan High Court is to the following
effect :- "268-H Options to elect benefits under this Chapter a Government
Servant in service on 29th February, 1964 who is governed by the family pension
rules contained in Chapter XXIII of these Rules shall have option to elect
benefits under this Chapter in substitution of the existing family pension benefits
as admissible under Chapter XXIII or retain their existing benefits. The option
shall be exercised within a period of six months from the date of publication
of the Rajasthan Service (Amendment) Rules, 1964, in the Official Gazette, in
the Form given here- under. An option once exercised shall be final. Persons
who fail to exercise option will be deemed to have elected the benefits under
this Chapter.
318
(2)The option under sub-rule (1) shall be communicated by the Officer concerned
to the Head of Office, if he is a non Gazetted Officer and to the Accountant
General, Rajasthan, Jaipur, if he is a Gazetted Officer. The option when
received from a non- Gazetted Officer shall be counter-signed by the Head of
the office and pasted in the Service Book of the Officer concerned."
5. It
appears that after the formation of the State of Rajasthan, Rajasthan State
Service Rules came into force w.e.f. April 1, 195 1. Chapter XXIII of the said
Rules provides for grant of family pension in accordance with the provisions
contained in Rules 261 to 268. Rule 261 provides :
"A
family pension not exceeding the amount specified in Rule 262 may be granted to
the family of an officer who dies, whether still in service or after retirement
after completion of not less than 20 years' qualifying service for a period of
ten years.
Provided
that the period of payment of family pension will in no case extend beyond a
period of five years from the date on which the deceased officer retired or on
which he would have retired on a superannuation pension in the normal course,
according as the death takes place after retirement or while the officer is in
service."
6.
Thereafter, a new Chapter being XXIII-A containing Rules 268-A to 268H relating
to the New Family Pension Scheme came into force w.e.f March 1, 1964 by
insertion of the said Chapter XXIII-A vide F.D. Notification No.1(12)FDE- R/64
dated September 25, 1964. The said new Family Pension Rules were made
applicable to all government servants on pensionable establishments whether
temporary or permanent who were in service on 29,2.1964 or who would enter
service on or after that date but such family pension shall not apply to :
(a)persons
who retired before March
1, 1964 but may be
re-employed on that date or thereafter
(b) persons
paid from contingencies
(c)
work-charged staff
(d) casual
labour
(e)
Contract Officers
7. The
new Rule 268-H gave option to elect benefits under Chapter XXIII-A to those
government servants who were in service on 29.2.1964 and who were governed by the
Family Pension Rules contained in Chapter XXIII of Rajasthan Ser- vice Rules,
in substitution of the existing family pension benefits as admissible under
Chapter XXIII, or to retain their existing benefits. On January 4, 1965, the
State of Rajasthan again liberalised the existing provisions in regard to the
family pension drawn by the widows or minor children of the employees under the
Family Pension Rules contained in Chapter XXIII who were actually in receipt of
family pension on 29.2.1964, even though such pension would have been stopped
on expiry of five years since the death of the government servant. The State
Government extended the period of eligibility of such family pension upto the
death or re-marriage, whichever is earlier, in the case of widows and the date
of attaining majority in the case of children and until marriage, if earlier,
in case of daughters.
8. The
State of Rajasthan further liberalised the existing provisions contained 319 in
Chapter XXIII by providing relief to the widows of government
servants/pensioners who expired before March 1, 1964 and ceased to draw their
family pension in terms of the Chapter XXIII of Rajasthan Service Rules. For
such pensioners, the State Government allowed family pension w.e.f March 1, 1978,
9. On
April 1, 1988, the State Government extended the benefits of the provisions of
new Family Pension Rules, 1964 as contained in Chapter XXIII-A of the Rajasthan
Service Rules w.e.f April 1, 1988 to the widows of government ser- vants of pensionable
establishments who retired or died before March 1, 1964 or who opted for the
family pension benefits as admissible under Chapter XXIII of Rajasthan Service
Rules.
10.
The said Sevanivatra Karamchari Hitkari Samiti challenged the vires of Rule
268-H in Chapter XXIII-A of Rajasthan Service Rules by contending that the said
Rule was violative of Article 14 being discriminatory between two sets of
government employees entitled to get family pension only on the basis of such
government servant's remaining in service on 29.2.1964 and thereafter. In the
case of the government servant who was not in service on 29.2.1964, the benefit
of liberalised pension as contained in Rule 268-H in Chapter XXIII-A was not
made available initially but such government servant or his dependent family
members were entitled to draw family pension only under the old Family Pension
Scheme under Chapter XXIII.
11. At
the hearing of this appeal, Mr.Aruneshwar Gupta, learned counsel for the
appellant, has contended that Rule 268-H under Chapter XXIII-A merely provides
for option to elect benefits under this Chapter i.e. Chapter XXIII-A "to
the government servants in service on 29.2.1964" in substitution of the
existing family pension benefits as admissible under Chapter XXIII or retain their
existing benefits.
12. Mr.Gupta
has submitted that Rule 268-H although introduced in 1964 was never challenged
as being unconstitutional until 1988 by moving the aforesaid Writ petition. He
has submitted that the government servants and/or their family members continued
to take benefits of the family pension under Chapter XXIII even when there was liberalisation
of the existing provisions contained in Chapter XXIII vide Memorandum dated
January 4, 1965 and no grievance was made on the score of alleged discrimination
for introducing the benefits of Rule 268-H under Chapter XXIII-A. Similarly, no
grievance was also made regarding Rule 268-H when there was further liberalisation
under the provisions contained in Chapter XXIII as introduced in 1978.
There
was also no grievance regarding Rule 268-H when by order dated December 31,
1982, the benefit of ex-gratia pension to families of those government servants
who retired before March 1, 1964 and whose family members did not get any
family pension under the rules in force i.e. the provisions of Chapter XXIII,
was given.
13. Mr.Gupta
has submitted that it is really unfortunate and also surprising that when the
government of Rajasthan decided to give further benefit to the families of the
government servants who had retired or died before March 1, 1964 and covered by
the provisions contained in Chapter XXIII of the Rajasthan Service Rules 320 by
extending the benefit of new Family Pension Rules contained in Chapter XXIIIA w.e.f
April 1, 1988 vide order dated July 18, 1988, that the said Writ Petition was
filed by the respondent making a belated grievance regarding Rule 268-1-1.
14. Mr.Gupta
has contended that the Writ Petition was filed by D.S.Nakara and others
challenging the validity of the of- fice Memorandum No.F. 19(3)-EV-79 dated May
25, 1979 issued by the Government of India, Ministry of Finance whereby the
formula of computation of pension was liberalised and it was made applicable
only to those government servants who were in service on March 31, 1979 and
retired from service on or after that date. By the said government order, a
slab system for computation of pension was introduced. Such liberalised formula
was made applicable to the government employees governed by the 1972 rules
retiring on or after the specified date.
15.
Referring to the decision rendered by this Court in D.S.Nakara's case (supra), Mr.Gupta
has contended that the questions formulated by this Court in the said case were
to the following effect :- "(i) Do pensioners entitled to receive su- perannuation
or retiring pension under Civil Services(Pension) Rules, 1972, form a class as
a whole? (ii)Is the date of retirement a relevant consideration for eligibility
when a revised formula for computation of pension is ushered in and made
effective from a specified date? (iii)Would differential treatment to pen- sioners
related to the date of retirement qua the revised formula for computation of
pension attract Article 14 of the Constitution and the element of
discrimination is liable to be declared unconstitutional as being violative of
Article 14.
16.It
has been held by this Court in the decision in D.S.Nakara's case that :
(a) that
pensioners entitled to receive su- perannuation or retiring pension under
Central Civil Services(Pension) Rules, 1972 form one class.
(b)
Date of retirement is irrelevant. But the revised scheme would be operative
from the date mentioned in the Scheme and would bring under its umbrella all
retiring pensioners and those who retired subsequent to that date. In case of
pensioners who retired prior to the specified date, their pension would be
computed afresh and would be payable in future commencing from the specified
date. No arrears would be payable. If the date is wholly removed, revised
pensions will have to be paid from actual date of retirement of each pensioner.
That is impermissible.
(c)
that the words being in service on the specified date and retiring subsequent
to that date violates Article 14 and is un- constitutional and as such should
be struck down.
17. Mr.Gupta
has further submitted that in the said decision it has been specifically held
by this Court that "unquestionably pension is linked to length of service
and the last pay drawn but the last pay does not imply the pay on the last day
of retirement but average emoluments as de- fined in the Scheme." It has
also been held in the said decision that :
"only
the pension will have to be recomputed in the light of the formula enacted in
the liberalised pension scheme and effective from the date the revised Scheme
321 comes into force and beware that it is not a new Scheme... It is only a
revision of existing Scheme. It is not a new retiral benefit. It is an upward
revision of an existing benefit. If it was a wholly new concept, a new retiral
benefit, one could have appreciated an argument that those who had already
retired could not expect it.
(Emphasis
supplied)
18. Mr.Gupta
has contended that the member"s of the respondent-Association were
governed by the provisions of rules contained in Chapter XXIII of Rajasthan Service
Rules as amended from time to time. The new Family Pension Rules as contained
in Chapter XXIII-A have been introduced for the benefit of government servants
in service on a particular date and retiring on or after that date. Such
benefit under Chapter XXIII-A was not introduced in substitution of the
existing provision of family pension rules as on March 1, 1964. Hence, the decision rendered in D.S.Nakara's case is not
applicable in the case of the members of the respondent Samiti. Mr.Gupta has
submitted that unfortunately the Rajasthan High Court has failed to appreciate
the basic distinctive feature, namely, the members of the said Samiti were
governed by the existing pension rules under Chapter XXIII, but the government
servants who were in service on 29.2.1964 were entitled to be governed by a new
Family Pension Rules as contained in Chapter XXIII-A if they had elected for
the new Scheme. Mr.Gupta has further submitted that after the impugned decision
was given by the Rajasthan High Court, there had been occasions for this Court
to consider the import of the decision rendered in D.S.Nakara's case. Mr.Gupta
has referred to the Constitution Bench decision of this Court in Krishna Kumar
etc. v. Union of India and others ( 1990 (4) SCC 207). In this case, this Court
has pointed out that in the decision in D.S.Nakara's case, this Court has
considered a case where an artificial date was specified classifying the
retirees governed by the same rules and similarly situated into two different
classes, depriving one of such class of the benefit of liberalised pension
rules. It was found in that case that the specification of the date for which liberalised
pension rules were to come into force was arbitrary and as such the same was
struck down as offending Article 14 of the Constitution. in Krishna Kumar's
case, this Court pointed out that the employees retiring prior to April 1, 1977 and those retiring thereafter were
governed by different sets of rules. Accordingly, different pension schemes
were permissible for the said two classes of government servants.
19. Mr.Gupta
has also referred to another Constitution Bench decision of this Court in
Indian Ex-Services League and others v. Union of India (AIR 1991 SC 1182). In
the said case, retirees of Armed Force prior to April 1, 1979 claimed same
benefit by contending that there should be one pension for one rank and they
relied on the decision rendered in Nakara's case. This Court considered the
import of the decision rendered in Nakara's case and pointed out that the
decision in D.S.Nakara's case had a limited application and there was no scope
for enlarging the ambit of the said decision to cover all claims made by the
pension retirees or a demand for an identical claim of pension to any retiree
from the same rank irrespective of the date of retirement. Mr.Gupta has also
relied on a decision of this Court 322 in State of Rajasthan v. Rajasthan
Pensioner Samaj (AIR 1991 SC 1743). In the said case, this Court considered
whether contributory provident fund retirees and the employees opting for
pension scheme form one class or they can be treated differently. This Court
has held in the said de- cision that the decision in Nakara's case is not
applicable because contributory provident fund retirees and the employees opting
for pension scheme belong to different classes and contributory provident fund
retirees cannot as of right switch over to the pension scheme and get benefit
of the pension scheme retirees. In that case, however, the proposal of the
government to grant ex-gratia payment of Rs.110/- per month to the widows
covered by the contributory provident fund scheme on the suggestion of this
Court was appreciated and accepted.
20. Mr.Gupta
has, therefore, submitted that the ratio of the decision in Nakara's case has been
noticed by this Court in the aforesaid decisions and it has been clearly
indicated that the scope and ambit of the decision in Nakara's case should not
be extended and the said decision does not cover the case of the government
employees who are governed by two different sets of retiral benefit rules. Mr.Gupta
has sub- mitted that in the instant case, the government servants who were in
service on or after 29.2.1964 were governed by a new retiral benefit scheme
under Chapter XXIII-A whereas the retirees prior to 29.2.1964 were governed by
a different retiral benefit scheme under Chapter XXIII. It was quite open to
the government to introduce a new retiral benefit scheme for the government
servants who were in service on or after 29.2.1964. Accordingly, Rule 268-H was
constitutionally valid and was not liable to be struck down.He has submitted
that the appeal should be allowed and the impugned judgment should be set
aside.
21. Mr.Surya
Kant, learned counsel for the respondent has submitted that after the
Notification dated April 1, 1988 the benefit under Chapter XXIII-A has also
been made applicable to the government servants or the family members who had
retired prior to 29.2.1964. But upto April 1, 1988, the government servants or
their family members were deprived of the liberalised pension scheme under
Chapter XXIII-A because of the words appearing in Rule 268-h to the following effect
: 'in service on 29th February, 1964 who is'.
22. Mr.Surya
Kant has contended that the government servant who was in service on 29.2.1964
and the government servant who retired or died prior to 29.2.1964 constitute
the same class because both were government servants and both were governed by
the family pension rules contained in Chapter XXIII. Mr.Surya Kant has contended
that the whole purpose of making Chapter XXIII-A of Rajasthan Service Rules was
that the legislature felt that family of a government servant who had given
best part of his life in the service of the State should not be left destitute
more so because the widow of the government servant will have hardly any thing
to fall back upon. It was felt that social justice will not be advanced by
providing a family pension as stipulated in Chapter XXIII and the families of
the deceased government servants will need benign protection of the State under
the liberalised pension rules. Viewed from this angle, there will be hardly any
justification to limit the benefit under Chapter XXIII-A only to gov- 323 ernment
servants who were in service on 29.2.1964. Mr.Surya Kant has submitted that
except that the date 29.2.1964 coin- cides with the date on which the rule 268H
was made, there is no discernible factor in fixing 29.2.1964 as the cut off
date on which the government servant should be in service so as to be entitled
to get the benefit of liberalised pension under Chapter XXIII-A. He has
submitted that the discrimination made between these two classes of government
servants must be held as violative of Articles 14 and 16 of the Constitution
inasmuch as the government servants who were in service on 29.2.1964 and those
who ceased to be in service before that date basically belong to the same class
of persons, namely, the class of persons who served government of Rajasthan for
a specified period for becoming eligible to pension. Both the said groups,
therefore, form one class and the artificial distinction sought to be made
under Rule 268-H has no intelligible criterion having nexus to the object for
which such distinction was sought to be made. He has, therefore, submitted that
in the facts of the case, the impugned decision of the Rajasthan High Court
should be held to be correct and the appeal should be dis- missed.
23.
After considering the respective contentions made by the learned , counsel for
the parties, it appears to us that after the impugned decision was made by the
Rajasthan High Court, this Court has considered the import of the decision
rendered in D.S. Nakara's case. This court has noticed the ratio in D.S.Nakara's
case as indicated in Krishna Kumar's case (supra) and in Indian Ex-Services
League's case (supra) and also in Rajasthan Pensioners Samajs case (supra), it
has been clearly indicated by this Court that the government servants can be
governed by different sets of retiral benefit rules with a reference to their
holding of office from a cut off date. In Krishna Kumar's case, it has been
indicated that in D.S.Nakara's case this Court considered a case where an
artificial date was specified classifying the retirees into two different
classes even though they were governed by the same rules and were similarly;
situated.
Such
classification where both the groups were governed by the same rules amounted
to deprivation of one group of the benefit of liberalisation of pension rules.
It was only in that situation it was held in D.S.Nakara's case that
specification of the date from which the liberalisation pension rules were to
come into force was arbitrary. This Court, in D.S.Nakara's case, clearly
indicated that it was not a new scheme but only a revision of the existing
scheme and it was not a new retiral benefit but it was a case of upward
revision of existing benefit. In D.S.Nakara's case, it was pointed out that if
it was wholly a new concept, a new retiral benefit, one could have appreciated
an argument that those who had already retired could not expect it. The
Constitution Bench in Krishna Kumar's case has upheld different sets of retiral
benefits being made applicable to the employees retiring prior to April 1, 1977
and retiring thereafter. It has been indicated by the Constitution Bench in
Krishna Kumar's case that any argument to the contrary would mean that the
government can never change the condition of service relating to retiral
benefits w.e.f. a particular date. It has, however, been pointed out that the
State cannot back a date out of its hat but it has to prescribe a date in a
reasonable manner having regard to the relevant facts and circumstances. 324
24. In
the instant case, the date 29.2.1964in Rule 268-H under Chapter XXIII-A has not
been taken out of hat. The government had taken into consideration the need for
a liberalised pension scheme for those government servants who were in service
on 29.2.1964 and who would be retiring thereafter and the new liberalised
pension scheme under Chapter XXIII-A was introduced with effect from March,
1964.
25. It
is not necessary to go into the question as to whether the liberalised benefit
for pension should have also been accorded to the government servants retiring
prior to 29.2.1964 because such exercise being a matter of policy decision for
the executive, must be left to the consider- ation of the State Government. The
wisdom in a policy decision of the Government, as such, is not justiceable
unless such policy decision is wholly capricious, arbitrary and whimsical
thereby offending the Rule of Law as enshrined in Article 14 of the
Constitution or such policy decision offends any statutory provisions or the
provisions of the Constitution. Save as aforesaid, the Court need not embark on
unchartered ocean of public policy.
26. It
does not appear to us that the cut off date mentioned in Rule 268-H was only an
ipsi dixit of the State Government and introduced in an arbitrary and
capricious manner taking out of hat without any basis whatsoever. It is
permissible to introduce different retiral benefit schemes for government
servants on the basis of the date of retirement as indicated in the decisions
of this Court in Krishna Kumar's case, Indian Ex-Services League's case and
Rajasthan Pensioners Samaj's case. Rule 268-H cannot, therefore, be held violative
of Article 14 of the Constitution as indicated in the impugned decision of
Rajasthan High Court. We, therefore, allow this appeal and set aside the
impugned decision rendered by the Rajasthan High Court.
27. Before
we conclude, we may indicate that the State Government of Rajasthan has given
the benefit of the liberalised pension scheme under Rule 268-H from 1988 to the
pensioners even if the concerned government servant had retired prior to
29.2.1964 because the government must have felt that such pensioners deserve
the benefit of liberalised pension scheme. The learned counsel for the parties
have not been able to enlighten us about the number of persons who would be
benefited if the liberalised pension scheme under Rule 268-H is made effective
even from a date prior to 1988 and made available to those government servants
including their family members who had retired prior to 29.2.1964. We may
reasonably assume that the number of such pensioners must not be high because
of long lapse of time.
In
view of inflation and escalating cost of living, it does not require any
special imagination to hold that government servants retiring before 29.2.1964,
particularly the widows and dependent family members of such retirees must have
been suffering from financial hardship and they deserve sympathetic
consideration in the matter of granting liberalised retiral benefits including pensionary
benefits.
We
hope and trust that the State Government being fully alive to the hard
realities of the conditions of retirees prior to 29.2.1964 will review the
question of antidating the benefits under Rule 268-H to such retirees after
taking into consideration all relevant factors. With this observation, the
appeal is allowed without any order as to costs.
361
having regard to the fact that the amount concerned herein is very small and
also because the company is already under liquidation for a number of years,
this Court may not interfere with the orders of the High Court even though it
may declare the law correctly. But this is a case where as a result of our
order, the assesses is not being asked to refund any amount which has already
been received by it; it would only be disabled from claiming any further amount
from the Revenue. In such a case, we see no reason to adopt the course
suggested by learned counsel, assuming that such a course is permissible in
law, upon which aspect we express no opinion.
9.For
the above reasons the appeal is allowed, the Judgment of the High Court is set
aside and the order of the Commis- sioner of Income-tax is restored. No costs.
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