Director
General of Posts & Ors Vs. B. Ravindran & Anr [1996] INSC 1423 (8 November 1996)
S.C.
Agrawal, G.T. Nanavati Nanavati. J.
ACT:
HEAD NOTE:
(With
CA Nos. 4079, 4080, 4042/92, SLP(C) Nos. 10,747/92, 2422/93, 12271/93,
14027/93, 16075/93, 17609/93, 21462/93, 7717/94, C.A. Nos. 4710/94, 3136/95,
7832/95, 2872/93, SLP(C) 17023/92, C.A. Nos. 3864/93, 3865/93, 6226/90,
9384/95, 9416/95, 65/92, 2429/94, 15/91, 7367/93, 4369/90, 75/95, SLPC(C)
16076/93, C.A. No. 4458/96, SLP(C) Nos. 10472/95, 1170/96, 11949/96, 3706/92,
7187/95, 14102/95, 5344/94, 11469/94, 12383/94, 12971/94, CA. Nos.
11376/96,10486/95 10487/95 & 10488/95)(Civil Appeal Nos. 14493-14512/96
against SLPs 10747/92,2422/93 etc. etc. respectively mentioned above)
Leave
granted.
The
point which arises for consideration, in this batch of appeals, is whether an
ex-serviceman, who after his retirement before attaining the age of 55 is
re-employed in civil service, while getting his pay fixed, is entitled to an
advance increment only if his pay plus pension plus pension equivalent of
gratuity is less than The last pay drawn at the time of retirement.
This
question arises in the context of the following facts and circumstances. It is
unnecessary to refer to the facts of all these appeals and therefore, we refer
to the facts of Civil Appeal No. 4077 of 1992 only. Ravindran, Applicant in
O.A. No.3 of 1989, out of which this appeal arises, after his retirement from
Air Force, was re-employed as a Postal Assistant on 29.11.83. He had served in
the Air Force from 4.11.65 to 30.11.80. His last pay in the Air Force was Rs.
400/ per month and his pension on the basis of the said service was fixed at Rs.
187/- per month. The pension equivalent of gratuity was Rs. 20.17. On his re-
employment as a Postal Assistant In the scale of Rs. 260-8- 340-10-360-12-480
his pay was fixed at Rs. 260/- being the minimum of the pay scale. According to
him while fixing his pay and determining hardship the whole of military pension
which he was getting was required to be ignored and he ought to have been
granted one advance increment for each completed year of military service in
view of the Government of India, Ministry of Finance O.M. dated 25.11.58 read
with Government of India Ministry of Defence O.M. dated 8.2.83, as he was
getting Rs. 140/- less than what he was getting at the time of retirement from
military service. As he had put in 11 years' service in equivalent or higher
grade in the Air Force his pay at the time of re-employment on 29.11.83 should
have been fixed at Rs. 350/- per month. He was denied this benefit and his
initial pay was pegged down to the minimum of the pay scale at Rs. 260/- on the
ground that his case cannot be regarded as a case of hardship in view of the
clarification made by the Department of Personnel and Training after consulting
the Ministry of Finance and which is contained in the circular letter dated
30.12.85 issued by The Director General, P & T. The applicant, therefore,
approached the Central 6 Administrative Tribunal and challenged the said
clarification and the letter dated 30.12.85 as arbitrary and against the
provisions of pay taxation of re-employed pensioners. The respondents in other
appeals were also denied the benefit of advance increments for the same reason
and, therefore, they had also challenged before the Tribunal the said
clarification and the letter dated 30.12.85.
The
contention of the applicants before the Tribunal was that it an ex-serviceman
on being re employed in civil service does not get by way of pay plus pension
plus pension equivalent of gratuity less than the last pay drawn by him at the
time of retirement then it cannot be said that fixation of his initial pay at
the minimum of the prescribed pay scale has causes undue hardship to him and,
therefore, his pay was not required to be fixed at a higher stage by allowing
one increment for each year of service which the officer had rendered before
retirement in a post not lower than that in which he is re-employed. This was
the policy of the Government right from 1958 and what was implied was made
clear by department of Personnel and Training after consulting the Ministry of
Finance. Therefore, the said clarification cannot be regarded as arbitrary or
contrary to any statutory provision or a provision having force of law.
When
O.A. No.3 of 1989 along with O.A. No.15 of 1989 came up for hearing before the
Division Bench of the Tribunal Ernakulam it noticed that a Single Member Bench
of the Tribunal had upheld this contention in an earlier matter. As it was
inclined to take a different view it raised the following two issues and
referred them to a larger Bench:
(a)
Whether for the purpose Of granting advance increments over and above the
minimum of the pay scale or re-employment post in accordance with the O.M . of
25.11.1958, the whole or part of the military pension of the ex- servicemen
which is to be ignored for the purpose of pay fixation, can be taken into
account to reckon that the minimum of the pay scale of the re-employment post
plus pension, is more or less than the last military pay drawn by the re-
employed ex-serviceman for the grant of advance increments on re- employment;
and
(b) If
Yes , i.e., if it is decided that the ignorance pension also has to be reckoned
for the purpose of admissibility or advance increments, whether the order
issued to this effect in 1985 or 1987 can be given retrospective effect so to
adversely affect the initial pay of ex-servicemen who were re-employed prior to
the issue of these instructions." A Full Bench of the Tribunal answered
those questions as follows:
"(a)
We hold that for the purpose of granting advance increments over and above the
minimum of the pay scale of the re-employed post in accordance with the 1958
instructions (Annexures IV in O.A. No.3 of 1989), the whole or part of the
military pension of ex- servicemen which are to be ignored for the purpose of
pay fixation in accordance with the instructions issued in 1964, 1978 and 1983
(Annexures V, V-a, and VI, respectively), cannot be taken into account to
reckon whether the minimum of the pay-scale of the re- employed post plus
pension is more or less than the last military pay drawn by the re employed ex-
servicemen.
(b)
The orders issued by the respondents in 1985 or 1987 contrary to the
administrative instructions of 1964, 1978 and 1983 cannot be given
retrospective effect to adversely affect the initial pay of ex-servicemen who
were re- employed prior to the issue of these instructions." Following the
decision of the Full Bench, O.A.No.3 of 1978 and O.A. No.15 of 1989 were
disposed of by the Division Bench by declaring that the applicants were
entitled to be granted one advance increment for each completed year of their
military service in equivalent grade in fixing their pay in the post of Post
Assistant with effect from the date from which they were appointed if the
minimum of Rs. 250/- in the pay scale of Postal Assistant together with unignorable
part of their pension did not exceed last pay drawn by them in the Armed Force.
The Tribunal also directed the respondents in those applications to exclude the
ignorable part of their pension while deciding whether any undue hardship was
caused to the applicants by fixing their reemployment pay at the minimum of the
pay scale of Postal Assistant. The Tribunal set aside the impugned orders and
also the clarification to the extent they were contrary to the said
declaration. Aggrieved by the orders passed by the Tribunal in those two
applications and similar orders passed in other applications the appellants
have filed these appeals after obtaining special leave of this Court.
The
learned counsel for the appellants submitted that the concept of hardship was
introduce by the Government in O.M. dated 25.11.1958 to ensure that there was
no drop in the total package of pay and pension on re-employment. It was never
the intention of the Government to allow advance increments after comparing the
minimum pay to The pre- retirement pay as that would nave entitled the
ex-serviceman to double and unintended benefit. Thus the G.M. dated 30.12.1985
was clarificatory in nature as it made explicit what was implicit in O.M. dated
25.11.1958. The learned counsel further submitted that the tribunal having
rightly found that the instructions issued in 1964,1978 and 1983 did not deal
with the concept of hardship committed an error in holding that the O.M. dated
30.12.1985 was not clarificatory in nature and was inconsistent with the
statutory provision contained in the Civil Service Regulations and the
instructions issued thereunder which also have equally binding force. As the
O.M. dated 30.12.1985 was clarificatory in nature the question of giving it
retrospective effect did not arise at all. It was submitted that the view taken
by the Tribunal is therefore wholly misconceived. As against these submissions
made on behalf of the appellant the learned counsel appearing for the
respondents have submitted that the tribunal has correctly interpreted the O.Ms.
of 1958, 1964, 1978, 1983 end 1985 and the effect of making a corresponding
amendment in the Civil Service Regulations which are admittedly statutory in
nature.
On
25.11.58 the Government of India took a policy decision in the matter of the
procedure to be adopted in fixing The pay of pensioners re-employed in Central
Civil Departments. It is applicable to all such pensioners. The relevant part
of the said policy decision is as follows:
"(a)
Re-employed pensioners should be allowed only the prescribed scales of pay,
that is, no protected time scales such as those available to pre-1931 entrants
should be extended to them .
(b)
The initial pay, on re- employment should be fixed at the minimum stage of the
scale of say prescribed for the post in which an individual is re-employed.
In
cases where it is felt that the fixation of initial pay of the re- employed
officers at the minimum of the prescribed pay scale will cause undue hardship,
the pay may be fixed at a higher stage by allowing one increment for each year
of service which the officer has rendered before retirement in a post not lower
than that in which he is re-employed.
(c) In
addition to (b) above the Government servant may be permitted to draw
separately any pension sanctioned to him and to retain any other form of
retirement benefit for which he is eligible e.g., Government's contribution to
a Contributory Provident Fund, gratuity, commuted value of pension, etc.
provided that the total amount of initial pay as at (b) above, plus the gross
amount of pension and/or the pension equivalent of other forms of retirement
benefit does not exceed :-
i) the
pay he drew before his retirement (pre-retirement pay); or
ii) Rs.
3,000/-, whichever is less.
Note 1
:
In all
cases where either of these limits is exceeded, the pension and other
retirement benefits may be paid in full and the necessary adjustments made in
the pay 50 as to ensure that the total of pay and pensionary benefits is within
the prescribed limits.
Where,
after the pay is fixed at the minimum or any higher stage, it is reduced below
the minimum as a result of the said adjustments, increase in pay may be allowed
after each year of service at the rates of increments admission, as if the pay
had been fixed at the admission minimum or the higher stage as the case may
be." The Government of India felt that the capacity and usefulness of a person
could not be greater than what it was at the time of retirement but this
consideration became irrelevant when applied to persons who retired much
earlier than the normal age of retirement of 58 years.
Moreover,
some of the lower rank in the Defence Services, e.g., sepoys who retired at a
very early age qualified themselves for various trades and professions after
undergoing some training. It therefore thought that a distinction between
officers who retired at the normal age of 58 and those who retired at an early
age was desirable.
taking
into account the difficulties of low paid pensioners who retire at an early
age. It decided that in case of persons retiring before attaining the age of 55
years, a part of the pension may be ignored in computing pay on re employment.
Accordingly an O.M. was issued directing Civil pensions upto Rs. 10 p.m. and
Military pension upto Rs. 15 p.m. should be ignored in fixing pay on
re-employment. An amendment to that effect was also made in Articles 521 and
526 of the Civil Service Regulations. As declared by the dated 19.1.1964 the
Government again raised the limit in the following terms :- (i) in the case of
pensions not exceeding Rs. 50/- per mensum the actual pension, (ii) in other
cases, the first Rs. 50/- of the pension.
A
corresponding amendment in the Civil Service Regulation was also made. This
limit was further raised from Rs. 50/- to Rs. 125/- by Ministry of Finance O.M.
dated 19.7.1978. By its O.M. dated 8.2.1983 Ministry of Defence issued an order
by raising the limit of pension to be ignored in fixing of pay from Rs. 125/ to
Rs. 250/ in the case of Service Officers and declaring that the entire pension
should be ignored in the case of personnel below Commissioned Officer's rank.
All these orders were made effective from the dates on which they were issued.
We have referred to only those orders which are relevant for the purpose of
these appeals.
It
appears that the effect of making the entire pension ignorable in certain cases
was examined by the Department of Personnel and Training in consultation with
the Ministry of Finance. It was decided to issue the following clarification
with respect to the mode of pay fixation of re-employed pensioner :- "
When a re-employed pensioner askes for refixation of pay under the 1983 orders,
his pay has to be fixed at the minimum of the scale.
The
question of granting him advance increments arises only if there is any
hardship. Hardship is seen from the point (whether pay plus pension plus
pension equivalent of gratuity whether ignorable or not) is less than the last
pay drawn at the time of retirement. If there is no hardship no advance
increments can be granted." The said clarification was brought to the
notice of all the concerned authorities of the postal department by the
Assistant Director General of Posts by circular dated 30.12.1985 and they were
directed to review all such previous cases in which the pay of the re-employed
pensioners/ex-serviceman were otherwise fixed under the Ministry of Defence
order dated 8.2.1983. As stated earlier this circular and the consequent action
were the subject matter of the applications filed by the respondents before the
tribunal.
The
effect of the order dated 8.2.1983 and the circular dated 30.12.1985 was that
in case of a pensioner who was re employed on or after 8.2.1983 his pay was to
be refixed in terms of the said order and the clarification. In respect of
those ex-servicemen who opted to come under those orders their pay was also to
be fixed in the same manner.
It is
not in dispute that the original order for fixation of pay of re-employed
pensioners was contained in O.M. dated 25.11.1958. In the matter of fixation of
pay of such re-employed pensioners the first step required to be taken was to
fix his initial pay at the minimum stage of scale of pay prescribed for the
post on which he was re- employed. The next step to be taken was to find out
whether his pay thus fixed plus pension (including other pensionary benefits)
exceeded the pay which he drew before his retirement or Rs. 3000/-. If it
exceeded either of those limits then necessary adjustment was to be made in the
pay by reducing it below the minimum stage so as to ensure that the total pay
including pension was within the prescribed limits. If the initial pay plus the
pension was found to be less then it was to be regarded as a case of undue
hardship and his pay was required to be fixed at higher stage by allowing one
increment for each year of service which the officer had rendered before
retirement in a post not lower than in which he was re-employed. However, when
it was noticed that this formula was not fair and just in cases of pensioners
who retired at an early age that is before 55 years, the Government in
relaxation of the policy contained in the 1958 order decided to grant some
benefits to such re- employed pensioners and issued an order directing that
civil pension upto Rs. 10 per month and military pension up to Rs.15 per month
should be ignored in fixing pay on reemployment. Thus while totalling up the
initial pay and the pension for the purpose of finding out whether the
pensioner on re-employment was likely to get more or less then what he was
getting earlier Rs. 10/- in case of civil Pensioners and Rs. 15/- in case of
military pensioners were to be ignored. In other words the amount of pension to
be added to the initial Pay was to be reduced to that extent.
Thereafter
his pay was to be adjusted depending upon whether the pensioner would thus get
more or less on his re- employment. This relaxation was obviously in the nature
of a modification of the earlier policy. As narrated above the said limits to
be ignored were increased from time to time and by the O.M. dated 8.2.1983 in
case of ex-serviceman the limit was raised to Rs. 250/- in case of service
officers and in case of personnel belonging to Commissioned Officer ranks the
entire pensionery benefits were to be ignored.
Though
in the beginning, according to the original policy contained in the 1958 order
the entire pension was to be added to the initial pay to find out whether it
gave unintended advantage or caused undue hardship to the re- employed
pensioner the position did not remain the same after the passing of the orders
in 1963 and 1964 and thereafter. The modifications thus made by the 1963 and
1954 orders were given legal status by amending Articles 521 and 526 of the
Civil Service Regulations accordingly.
However
it was submitted by the learned counsel for the appellants that the orders
which were issued in 1963, 1964,1978 and 1983 did not deal with the aspect of
hardship and were not intended to replace or change the basic policy contained
in the 1958 instructions. They were intended as relaxations and, therefore,
they cannot be said to have the effect of altering or modifying the 1958
policy. When the entire pension was made ignorable in the case of personnel
below Commissioned Officers rank the position substantially changed and
therefore the Government was obliged to clarity that as contemplated by the
1958 instructions hardship is to be seen from the point whether pay plus
pension plus pension equivalent of gratuity (whether ignorable or not) was less
than the e time of retirement. What the Government thereby did was to reiterate
that it there was no hardship no advance increment should be granted. What is
overlooked by the learned counsel is that he intention behind the orders issued
in 1963, 1964, 1978 and 1983 was to give some more benefit to the re-employed
pensioner/ex-servicemen. The effect of the benefit was to be given at a stage
prior to the consideration of hardship. The ignorable part of the pension was
to be ignored while totalling up the initial pay plus the pension in order to
find out whether the retired pensioner thereby was likely to get more or less
than what he was getting at the time of the retirement. To that the 1958 policy
stood altered or modified. Though the said four order did not directly deal
with the aspect of hardship they did by widening the gas between the initial
pay plus the non-ignorale part of the pension and the pay he drew before his
retirement and thereby further necessitated giving of advance increments to
alleviate hardship. It is, therefore, not correct to say that those orders had
no concern with the aspect of hardship. What the contention raised on behalf of
the appellants further overlooks is that pursuant to the orders issued in 1963
and 1964 corresponding amendments were made in Articles 521 and 526 of Civil
Service Regulations.
The
said Regulations were some time prior to 1914 and had acquired statutory authority
under Section 96-B(4) of the government of India Act, 1919 and have been
continued in force by virtue of Article 313 of the Constitution. They are,
therefore. statutory in nature. After its amendment in 1964 it read as under:-
"526(a) .... .... ....
(b)
.... .... ....
(c) In
case of service personnel who retire from the Forces before attaining the age
of 55 and are re- employed in civil posts on or after 16th January 1964 the
pension shown below shall be ignored in fixing their pay on re-employment- (i)
in the case of pensions not exceeding Rs. 50 Per mensem, the actual pension;
(ii)
In other case the first Rs. 50 of the pension.
The
subsequent orders issued in 1978 and 1983 were supplementary in nature and did
have a binding force. Under these circumstances, the Government could not have,
under the guise of a clarificatory order, taken away the right which had
accrued to such re-employed pensioners with retrospective effect by declaring
that while considering hardship the last pay drawn at the time or retirement
was to be compared with the initial pay plus pension whether ignorable or not.
The 1985 clarificatory instructions were not only in consistent with the
relevant provisions of the Civil Service Regulations and the 1978 and 1983
orders but its effect was to supersede the said provision and the orders. The
Tribunal was, therefore, right in holding the said instructions in so far as it
directed to take into consideration the ignorable part of the pension also
while considering hardship invalid and without any authority of law. These
appeals are, therefore, dismissed with no order as to costs.
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