N D P
Namboodripad (Dead) by Lrs Vs. Union Of India & Ors  Insc 255 (8 March 2007)
H K Sema & R V Raveendran
These appeals by special leave are filed against the judgment dated
10.7.1997 in Writ Appeal No.804 of 1992 and the order dated 10.11.1997 in
Review Petition No.299/1997 passed by a Division Bench of the Kerala High
2. The appellant entered the Kerala Higher Judicial Service as a directly
recruited District & Sessions Judge and was later elevated as a Judge of
the Kerala High Court in the year 1972. He retired on 31.7.1980 with 23 years
of pensionable service which included 8 years of service as a Judge of the High
Court. At the time of his retirement, the appellant was in receipt of a total
emolument of Rs.4,237/- comprising Basic Pay of Rs.3,500/-, Dearness Allowance
of Rs.437/- and Special Allowance of Rs.300/-.
3. The pension payable to High Court Judges is governed by Chapter III of
the High Court Judges (Conditions of Service) Act, 1954 (for short 'the Act').
Clause (b) of sub-section (1) of section 15 provides that every Judge who was
not a member of the Indian Civil Service but has held any other pensionable
post under the Union or a State, shall, on his retirement, be paid a pension in
accordance with the scale and provisions in Part III of the First Schedule. The
proviso thereto and sub-section (2) require such Judge to exercise certain
options. The appellant was governed by Part III of the First Schedule to the
Act as he did not opt for pension under Part I of that Schedule. Part III of
the First Schedule is extracted below :
"1. The provisions of this Part apply to a Judge who has held any
pensionable post under the Union or a State (but is not a member of the Indian
Civil Service) and who has not elected to receive the pension payable under
2. The pension payable to such a Judge shall be (a) the pension to which he
is entitled under the ordinary rules of his service if he had not been
appointed a Judge, his service as a Judge being treated as service therein for
the purpose of calculating that pension; and (b) a special additional pension
of Rs.1,600 per annum in respect of each completed year of service for pension
but in no case such additional pension together with the additional or special
pension, if any, to which he is entitled under the ordinary rules of his
service, shall exceed Rs.8,000 per annum.
Provided that the pension under clause (a) and the additional pension under
clause (b) together shall in no case exceed Rs.54,000 per annum in the case of
a Chief Justice and Rs.48,000 per annum in the case of any other Judge."
(Note : The special additional pension was Rs.700/- per annum and the
ceiling was Rs.3500/- per annum under clause (b) and these were substituted as
Rs.1600/- and Rs.8000/- respectively with effect from 1.11.1986) The pension
payable to the appellant was fixed at Rs.17,300/- per annum (comprised of
Rs.13,800/- as ordinary pension and Rs.3,500/- as special additional pension).
4. The Government of India vide Official Memorandum dated 16.4.1987
rationalised the pension structure of the employees who retired prior to
1.1.1986. Clause 4.1 thereof provided for additional relief for existing
pensioners. Clause 5 provided for calculation of pension at 50% of average
emoluments in the case of pensioners whose pension was calculated under the
slab formula. Clause 6.1 related to consolidation of pension and provided that
the pension of existing pensioners will be consolidated with effect from
1.1.1986 by adding together (a) the existing pension, (b) the existing dearness
relief and (c) the additional benefits accruing from Paras 4 and 5 of the said
O. M. dated 16.4.1987. The said O. M. was not applicable to retired High Court
Judges whose pension was governed by separate rules/orders and stated that
necessary orders will be issued in their cases by the respective authorities.
5. By Circular dated 18.12.1987, the Government of India notified the
Accountant Generals of all States that the ordinary pension admissible to High
Court Judges under Para 2(a) of Part III of the First Schedule to the High Court
Judges (Conditions of Service) Act, 1954 may be revised with effect from
1.1.1986 as in the case of the employees of the Central Government. It
permitted the respective State Governments to either adopt the said O.M. or
issue independent orders on similar lines, subject to the maximum stipulated in
Schedule III to the Act. By order dated 19.10.1989, the Government of Kerala
directed that the pension of the Judges of the High Court, who have been
promoted from the State Higher Judicial Service and falling under Part III of
the First Schedule to the Act, shall be revised with effect from 1.1.1986 in
accordance with the rates referred to in the O.M.
dated 16.4.1987 issued by the Government of India.
6. By communication dated 26.10.1989, the office of the Accountant General,
Kerala, informed the Central Government (with copy endorsed to appellant) that
the pension of the appellant who had opted for Part III of the First Schedule
to the Act, was revised and consolidated from 1.1.1986 and 1.11.1986 as follows
(a) Pension (including additional pension) from 1.1.1986 : Rs.32,720 p.a.
(b) Pension (including additional pension) from 1.11.1986 : Rs.37,220 p.a.
The annexure to the said letter showed the calculation of pension as
follows, by treating the 'emolument' reckoned for pension as Rs.3,500/- per
month and qualifying service as 23 years :
Existing ordinary pension : Rs. 1150/- p.m.
Revised ordinary pension (as per 50% formula) : 3500 x 23 = Rs.1342 p.m.
2 30 Increase due to Revision : Rs. 192/- p.m. or Rs. 2304/- p.a.
"Consolidation of Pension as per O.M. dt. 16.4.1987 Amount Per Annum
1. Existing ordinary pension( 1150 x 12) Rs. 13,800/-
2. Part consolidated ordinary pension as per Para 6.1 of O.M. dt. 16.4.87
Rs. 26,916/- Additional relief as per para 6.1(A) in case of pre 31.3.85
retirees (vide Col.2 of ready reckoner) : (2243 x 12)
3. Increase due to recalculation at 50% of Pay Rs. 2,304/-
4. Total consolidated ordinary pension Rs. 29,220/- from 1.1.1986 ( 2 + 3 )
5. Additional pension admissible from 1.1.1986 Rs. 3,500/- (under para 2(b)
of Schedule III to the Act)
6. Total pension admissible from 1.1.1986 (4 + 5) Rs. 32,720/-
7. Additional pension admissible from 1.11.1986. Rs. 8,000/- (under para
2(b) of Schedule III to the Act) 8. Total pension admissible from 1.11.86 (4 +
7) Rs. 37,220/-"
7. The appellant challenged the said fixation of pension in O.P.
No.203/1990. According to him the ordinary pension ought to have been
calculated, by taking the emoluments drawn at the time of retirement (Rs.4237/-
per month) instead of Rs.3500/-. He also contended that the additional pension
under para 2(b) of Part III of First Schedule to the Act should be without
reference to any ceiling. A learned Single Judge allowed the said petition by
order dated 12.3.1992. He held that the appellant was entitled to a pension of
Rs.35,100/- per annum (that is Rs.2,925x12) from 1.1.1986 and Rs.47,900/- per
annum (that is Rs.35,100 + Rs.12,800) from 1.11.1986.
8. Union of India challenged the said order of the learned Single Judge in
W.A. No.804 of 1992. The said appeal was allowed by judgment dated 10.7.1997.
The Division Bench set aside the order of the learned Single Judge and affirmed
the pension as fixed under communication dated 26.10.1989 (extracted in para 6
above). The Division Bench purported to follow the decisions of this Court in
M.L. Jain (I) [AIR 1985 SC 619] and M.L. Jain (II) [AIR 1989 SC 669]. It,
however, observed that if any excess payment had been made to the appellant on
account of any wrong calculation, such excess need not be refunded by the
appellant. A review petition filed by the appellant was rejected by the Division
Bench by Order dated 10.11.1997.
9. The said judgment of the Division Bench and the rejection of the review
petition, are challenged in these appeals by special leave. The appellant
placed reliance on Rule 62 of Part III of the Kerala Service Rules, in support
of his contention that average emolument of the appellant had to be taken as
Rs.4237/- instead of Rs.3500/- per month for calculating the ordinary pension.
In support of the contention that the special additional pension should be
calculated without any ceiling, reliance was placed on M.L. Jain (III) [AIR
1991 SC 928].
10. This Court, by judgment dated 16.4.2004 (reported in 2004 (5) SCC 259)
held that having regard to Rule 62, 'emolument' for calculating pension, would
include dearness allowance and other special allowances. This Court further
held that the ordinary pension of appellant should be calculated by taking
Rs.4237/- as the monthly emolument instead of Rs.3,500/-. This Court also held
that the special additional pension should be calculated under Clause 2(b) of
Part III of the First Schedule to the Act without any ceiling, in view of the
decision in M.L. Jain (III). The respondents were directed to recalculate the
pension within three months and pay the arrears to the appellant.
11. Aggrieved by the first part of the judgment relating to calculation of
ordinary pension based on the interpretation of Rule 62, the State of Kerala
filed a review petition in R.P.(C) Nos.1482-83/2004. The review petitions were
allowed by order dated 1.4.2005, the judgment dated 16.4.2004 was recalled and
the civil appeals were restored for fresh hearing. We have heard the learned
counsel on both issues.
Re : Ordinary Pension :
12. The State Government contended that the term 'emolument' (for
ascertaining the 'average emolument' which is the basis for determination of
ordinary pension) used in Rule 62 of Part III of Kerala Services Rules,
included only basic pay and dearness pay, if any, and did not include dearness
allowance or any other allowances. It is further contended that as the
appellant was not receiving any dearness pay, his last drawn basic pay of
Rs.3500/- per month alone constituted the 'emolument' for calculating the
pension of the appellant.
13. On the other hand, it is contended on behalf of the Appellant that the
word "includes" in Rule 62 is not equivalent to "means" or
According to the Appellant, the word "includes" when used in the
definition of a word or phrase in a Statute, enlarges the meaning of the word
or phrase and such words or phrase must be construed as comprehending not only
such things as they signify according to their natural meaning, but also those
things which the interpretation or definition clause declares that they shall
include (vide The Regional Director, ESI Corporation vs. High Land Coffee Works
- AIR 1992 SC 129). The Appellant contends that 'emolument' in its natural and
ordinary sense, refers to the pay and all allowances; and the inclusive
definition in Rule 62 is intended to further expand it by specifically
including 'dearness pay'. It is submitted that what is already included in the
general meaning of the word 'emolument', that is dearness allowance and special
allowances in addition to basic pay, could not be excluded because of the addition
of some other item like 'dearness pay'. The Appellant, therefore, contends that
'emolument' for purpose of pension, consists of basic pay, dearness allowance,
other allowances and dearness pay.
14. As the entire argument of the appellant is based on Rule 62, it is
useful to extract it. It reads thus :
"62. The term emolument when used in this part means the emolument
which the employee was receiving immediately before his retirement and includes
(a) pay as defined in Rule 12(23) in Part I of these Rules and/or pay of the
appointment under Rule 9 or Rule 31 of the Kerala State and Subordinate Service
(b) the dearness pay the employee was actually in receipt of."
Rule 12(23) in Part I of the Kerala Service Rules defines 'pay' thus :
"Pay :- Means the amount drawn monthly by an officer as - (i) the pay,
other than special pay or pay granted in view of his personal qualifications,
which has been sanctioned for a post held by him substantively or in an
officiating capacity or to which is entitled by reason of his position in a
cadre, and (ii) personal pay and special pay, and (iii) any other emoluments
which may be specially classed as pay by the Government.
The appellant was not receiving any Dearness Pay. It is also not in dispute
that dearness allowance and special allowance were not specially classed as
'pay' by the State Government under Rule 12(23). Therefore dearness allowance
and special allowances, do not form part of pay. The word 'emolument' no doubt
is a wider term than basic pay. It generally refers to the salary or profits
from employment or office. But the word 'emolument' is not used in the general
sense in the service Rules relating to pension. The word is defined for
purposes of pension. In fact, all rules governing pension, define the word
'emolument' by giving a special or specific meaning, for purposes of pension
calculation. Where a word is defined, there can be no reference or reliance on
any general meaning. To bring in 'generality' instead of 'specificity' in
defining the term 'emolument' will defeat the very purpose of defining
'emolument' for purposes of pension. Therefore, contextually the definition of
'emolument' should be specific and not 'expansive' or general.
15. The word 'includes' has different meanings in different contexts.
Standard Dictionaries assign more than one meaning to the word 'include'.
Webster's Dictionary defines the word 'include' as synonymous with
'comprise' or 'contain'. The Illustrated Oxford Dictionary defines the word
'include' as : (i) comprise or reckon in as a part of a whole; (ii) treat or
regard as so included. The Collins Dictionary of English Language defines the
word 'includes' as : (i) to have as contents or part of the contents; be made
up of or contain; (ii) to add as part of something else; put in as part of a
set, group or a category; (iii) to contain as a secondary or minor ingredient
or element. It is no doubt true that generally when the word 'include' is used
in a definition clause, it is used as a word of enlargement, that is to make
the definition extensive and not restrictive. But the word 'includes' is also
used to connote a specific meaning, that is, as 'means and includes' or
'comprises' or 'consists of'.
16. Justice G. P. Singh in his treatise 'Principles of Statutory Interpretation',
(Tenth Edition, 2006), has noticed that where a word defined is declared to
'include' such and such, the definition is prima facie extensive, but the word
'include' when used while defining a word or expression, may also be construed
as equivalent to 'mean and include' in which event, it will afford an
exhaustive explanation of the meaning which for the purposes of the Act must
invariably be attached to the word or expression. [vide pages 173 and 175
referring to and relying on the decisions of this Court in The Municipal
Council, Raipur v. State of Madhya Pradesh [AIR 1970 SC 1923], South Gujarat
Roofing Tile Manufacturers Association vs. State of Gujarat [AIR 1977 SC 90],
Hindustan Aluminum Corporation vs. State of Uttar Pradesh [AIR 1981 SC 1649],
and Reserve Bank of India v. Peerless General Finance and Investment Co. Ltd.
[1987 (1) SCC 424]. It is, therefore, evident that the word 'includes' can be
used in interpretation clauses either generally in order to enlarge the meaning
of any word or phrase occurring in the body of a Statute, or in the normal
standard sense, to mean 'comprises' or 'consists of' or 'means and includes',
depending on the context.
17. If the words 'and includes' were intended to rope in certain items which
would not be part of the meaning, but for the definition, then Rule 62 would
have specified only 'dearness pay' as the item to be included but not 'pay'. If
pay, dearness allowance and other allowances were already included in
'emolument' with reference to its general or normal meaning, as contended by
appellant, there was no reason to specifically again include 'pay' in Rule
62. Inclusion of 'pay' and 'dearness pay' and non-inclusion of 'dearness
allowance or other allowances' in the definition of 'emolument' is significant.
The definition in Rule 62 is intended to clarify that only pay and dearness
pay would be considered as 'emolument' for purposes of calculating pension.
The words 'and includes' have been used in Rule 62, as meaning 'comprises'
or 'consists of'.
18. In the view we have taken, it is unnecessary to consider the following
two amendments to Rule 62 of Part III of the Kerala Service Rules, made during
the pendency of this appeal, in exercise of power conferred by section 2(1) of
the Kerala Public Services Act, 1968 :
(i) Substitution of the words 'comprises only' in place of 'includes' in
Rule 62, by Kerala Service (Amendment) Rules 2004, with effect from 1.3.1997.
(ii) Further substitution of the words 'comprises only the following' in
place of the words 'comprises only' in Rule 62 of Part III of Kerala Service
Rules by Kerala Service (Amendment) Rules, 2005, with effect from 14.11.1966.
The explanatory notes to the two amendments clarify that the State
Government decided to amend the Service Rules to give more clarity and to avoid
ambiguity in calculating pension and the term 'emolument' for the purpose of
calculation of pension will comprise of only pay and dearness pay. We have
already held accordingly while interpreting unamended Rule 62. The amendments
merely reinforce our view.
19. We, therefore, accept the contention of the State Government that Rule
62 does not enable the addition of dearness allowance and special allowance to
the pay for purposes of pension. The 'emolument' of the appellant was rightly
taken as Rs.3500/- per month. We find no error in calculation of the
consolidated ordinary pension at Rs.29,220/-.
Re : Special Additional Pension :
20. Special additional pension is provided for under Para 2(b) of Part III
of first Schedule to the Act. In M.L. Jain (III) - AIR 1991 SC 928, the ceiling
prescribed under para 2(b) was held to be unconstitutional being violative of
Article 14 of Constitution of India. Therefore, neither the ceiling of
Rs.8,000/- introduced with effect from 1.11.1986, nor the earlier ceiling of
Rs.3500/- is valid. As a consequence, the special additional pension should be
taken as Rs.5,600/- per annum (that is Rs.700x8) instead of Rs.3500/- from
1.1.1986 and Rs.12,800/- per annum (that is Rs.1600x8) instead of Rs.8,000/-
from 1.11.1986. In fact, neither Union of India, nor State Government dispute
21. We, therefore, allow these appeals in part and hold as follows :
(i) that for the purpose of calculation of pension, the 'emolument' received
by the appellant was Rs.3,500/- per month and not Rs.4,237/-. Consequently,
determination of consolidated ordinary pension as Rs.29,220/- per annum from
1.1.1986 is upheld.
(ii) As the ceiling on the amount to be added under clause 2(b) of Part III
of First Schedule to the Act is invalid, the special additional pension per
annum would be Rs.5600/- per annum from 1.1.1986 and Rs.12,800/- per annum from
1.11.1986 in the case of appellant.
(iii) Therefore, the total pension was Rs.34,820/- p.a. from 1.1.1986 and
Rs. 42,020/- per annum from 1.11.1986.
22. We direct that the pension due be recalculated and settled accordingly.
If any excess payment has been made to the appellant, it shall not, however,
be recovered from the Legal Representatives of the deceased appellant.
Parties to bear their respective costs.