Union of India Vs. G. Vasudevan Pillay
[1994] INSC 656 (8 December 1994)
HANSARIA B.L. (J) HANSARIA B.L. (J) KULDIP
SINGH (J)
CITATION: 1995 SCC (2) 32 JT 1995 (1) 417
1995 SCALE (1)9
ACT:
HEADNOTE:
The Judgment of the Court was delivered by
HANSARIA, J.-
1.
This
conglomeration of appeals (some of which arise because of leave already granted
and some came into existence because of leave being granted) require us to
decide three questions:
(1) Whether the decision of the Union of
India not to allow Dearness Relief (DR) on pension to the ex-servicemen on
their re- employment in a civil post is in accordance with law or not;
(2) Whether denial of DR on family pension on
employment of dependants like widows of the ex-servicemen is justified or not;
and (3) Reduction of pay equivalent to enhanced pension of those exservicemen
who were holding civil posts on 1-1-1986, following their re- employment, is
permissible or not.
We would examine these questions seriatim.
Disallowing of DR on pension on re-employment
2.
To
answer the above question involved in some of the appeals, the background
leading to the aforesaid decision may be briefly noted. To start with there was
no provision for payment of DR to the pensioners. Various representations were
made to the Third Pay Commission seeking some recommendations in this regard
for protecting the pension of the government employees from erosion on account
of possible increases in the cost of living in future. The Commission
considered this matter and also the question regarding the manner in which some
relief could be provided to the future pensioners. After having noted the
various suggestions which the Commission received in reply to its
questionnaire, it recommended that all future pensioners, irrespective of the
amount of pension drawn by them, should be given relief @ 5% of their pension
subject to a minimum of Rs 5 per mensem and maximum of Rs 25. The Commission
further recommended that the relief should be given as and when there is a
16-point rise in the 12 35 monthly average of the All-India Working Class
Consumer Price Index. This recommendation of the Commission was accepted by the
Central Government vide its Office Memorandum of even number dated 6-4-1974,
making the relief available to those employees belonging to Classes 11, III and
IV, who retired from service prior to 1-1-1973, as well as those who retired
afterwards.
3.
A
decision wag, however, taken subsequently not to pay DR to reemployed
pensioners. This was made applicable to those ex-servicemen who had come to be
re-employed in civil posts.
Various writ petitions and original
applications were filed in different legal for a of the country, which came to
be decided either by upholding the validity of the decision or by taking a
contrary view. The parties who lost have preferred these appeals.
4.
The
learned Additional Solicitor General appearing for the Union of India submits
that the decision merits our acceptance because of what has been stated in
clause (ii) of Rule 55-A of Central Civil Services (Pension) Rules, 1972, as
amended in 1991. We are, however, of the view that the decision cannot be so
supported for the reason that the aforesaid rules have application to the
persons who were members of Central Civil Services. The ex-servicemen having
apparently not been members of such Services, what has been provided in Rule
55-A(ii) cannot be invoked to deny DR on pension/family pension to the
ex-servicemen on their re- employment.
5.
Had
the aforesaid been the only provision pressed into service to deny DR to the
ex-servicemen, we would have had no difficulty in striking down the decision
inasmuch as the ex-servicemen having been allowed pension and DR on it in
accordance with the conditions of service governing defence personnel, the
provision contained in the aforesaid rule governing service condition of
altogether different class of servicemen could not have impinged on their right
to get DR on the pension. Learned Additional Solicitor General, however,
advances an alternative submission and the same is that there are even army
instructions which, read with office memoranda of Ministry of Finance, will
show that Dearness Relief on pension cannot be paid even to ex- servicemen on
their re-employment. As this point could not be brought home to us well when the
cases were heard, as relevant army instructions had not been brought on record,
we, while reserving the judgment after close of hearing allowed filing of
written submissions, which were done subsequently along with which large number
of documents were filed to establish the point urged in the Court.
6.
A
perusal of the documents shows that the Office Memorandum dated 1-8-1975 of the
Ministry of Finance, Department of Expenditure, which stated that a re-employed
Central Government pensioner is not eligible to draw any relief during the
period of re-employment, was made applicable by the Ministry of Defence vide
letter of even number dated 28-10-1975 to Armed Forces pensioners also.
These documents are pages 17 and 18 of the
written submission, in which it has also been stated that with formation of the
Department of Pension and Pensioners' Welfare under Ministry of 36 Personnel,
Public Grievances and Pension, all orders issued by the Ministry of Finance
were made applicable to Armed Forces pensioners as well. A reference has then
been made to Office Memorandum dated 22-4-1987 on the subject of grant of
Dearness Relief to pensioners on the recommendations of the Fourth Central Pay
Commission, sub-para (v) of Annexure 1 to which states that Dearness Relief will
be suspended when the Central Government pensioner is re-employed in the
department/office of the Central Government.
7.
The
aforesaid shows that dehors what has been laid down in clause (ii) of Rule 55-A
of the aforesaid Pension Rules, there are materials on records to show that any
person, including ex-servicemen, would not be entitled to Dearness Relief on
pension on his re-employment to any department/office of the Central
Government.
8.
It
has, however, been strenuously contended by learned counsel appearing for the
re-employed ex-servicemen that pension being a right (and not a bounty)
available to a retired employee as held in Nakara1 and DR being a part of
pension, right to receive the same could not have been infringed merely because
the incumbent sought re-employment to take care of the hardship which he might
have otherwise faced after retirement. To sustain the submission, strength is
sought to be derived from the decision of the Kerala High Court in Narayanan v.
Union of India2 in which a view has been taken that the DR became an integral
part of pension, because of which it could not have been discontinued on re-
employment. As against this, the view of the Delhi High Court in Civil Writ No.
1699 of 1992 (disposed of on 23-2- 1993) is that the DR is different from
pension. For the disposal of the present cases it is not necessary to express
any opinion on this aspect of the matter inasmuch as, according to us, even if
Dearness Relief be an integral part of pension, we do not find any legal inhibition
in disallowing the same in cases of those pensioners who get themselves
re-employed after retirement. In our view this category of pensioners can
rightfully be treated differently from those who do not get re-employed; and in
the case of the reemployed pensioners it would be permissible in law to deny DR
on pension inasmuch as the salary to be paid to them on re-employment takes
care of erosion in the value of the money because of rise in prices, which lay
at the back of grant of DR, as they get Dearness Allowance on their pay which
allowance is not available to those who do not get re- employed.
9.
We,
therefore, hold that the ex-servicemen were rightly debarred from Dearness
Relief on their pensions after they got themselves re-employed to any civil
post under the Government of India.
Denial of DR on family pension
10.
In
some of the cases, we are concerned with the denial of Dearness Relief on
family pension on employment of dependants like widows of the ex-servicemen.
This decision has to be sustained in view of what has been 1 D.S. Nakara v.
Union of India, (1983) 1 SCC 305: 1983 SCC (L&S) 145: AIR 1983 SC 130 2
1994 (1) KLT 897 37 stated above regarding denial of DR on pension on re-
employment inasmuch as the official documents referred on that point also
mention about denial of DR on family pension on employment. The rationale of
this decision is getting of Dearness Allowance by the dependants on their pay,
which is drawn following employment, because of which Dearness Relief on family
pension can justly be denied, as has been done.
Reduction of enhanced pension from pay of
those ex- servicemen who were holding civil posts on 1-1-1986 following their
re-employment
11.
The
aforesaid reduction, which is the subject-matter of some appeals, is the fall
out of Office Memorandum dated 11- 9-1987 according to which the pay of the
ex-servicemen who were in employment in a civil post as on 1-1-1986 following
their re-employment, is required to be reduced by an amount equivalent to the
enhanced pension made available pursuant to the report of the Fourth Pay
Commission.
12.
The
ground of attack is that the aforesaid decision violates Articles 14 and 16 of
the Constitution inasmuch as there is no rational basis for classifying the
employees for the aforesaid purpose on the basis of their being in employment
on 1-1-1986. This submission has been advanced because the reduction of the
aforesaid nature has not been made in respect of those who have been in
employment since 1-1-1986. The additional affidavit filed on behalf of
Respondent 1 in SLP (C) No. 17456 of 1991 on 25-8-1994 contains some names of
those who were re-employed after 1-1- 1986 and are being paid both the revised
pay and revised pension. This factual position has been admitted in the
aforesaid written submissions filed on behalf of the Union of India inasmuch as
it has been stated in page 9 that the pensioners who are re-employed after
1-1-1986 enjoy the benefit of revised pay and also revised pension with effect
from 1-1-1986.
13.
Reliance
has been placed in support of aforesaid submission on a two-Judge Bench
decision of this Court, to which one of us (Kuldip Singh, J.) was a party. That
decision was in the case of TS. Thiruvengadam v. Secy. to Govt. of India3. The
facts of that case are, however, different inasmuch as there the Memorandum
dated 16-6-1967 stating that revised pensionary benefits would be made
available only to those Central Government servants who have been absorbed in
public sector undertakings after that date was not found to be constitutional
because the very object of bringing to the existence the revised terms and
conditions by the memorandum was to protect the pensionary benefits which the
Central Government servants had earned before their absorption into the public
sector undertakings.
It was, therefore, held that restricting the
applicability of the revised memorandum only to those who are absorbed after
coming into force of the same would not only defeat the very object and purpose
of the memorandum but would be contrary to fair play and justice also.
14.
Despite
the aforesaid decision being of no aid in the present cases, we find no logic
and basis for classifying the re-employed persons on the 3 (1993) 2 SCC 174 38
basis of their being in employment on 1-1-1986. Indeed, no justification has
been canvassed before us. The decision which held the field before the impugned
memorandum in not taking note of pension while fixing pay of the ex-servicemen
on re-employment, which was based on good reasons, had no good reason for its reversal,
as enhanced pension was not confined to those who were in employment on
1-1-1986. The impugned decision is, therefore, arbitrary and is hit by Articles
14 and 16 of the Constitution. We, therefore, declare the same as void.
15.
Our
conclusions on the three questions noted in the opening paragraph are that
denial of Dearness Relief on pension/family pension in cases of those
ex-servicemen who got re-employment or whose dependants got employment is legal
and just. The decision to reduce the enhanced pension from pay of those
ex-servicemen only who were holding civil posts on 1-1-1986 following their
re-employment is, however, unconstitutional.
16.
The
appeals are disposed of accordingly. IA Nos. 16, 30- 46 in appeals arising out
of SLP (C) Nos. 1585-95 of 1994 stand disposed of. No order asto costs.
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