Determination of Pension to be governed by the rule as it existed at the time of joining or the rule in force at the time of retirement? SC answers 

Supreme Court: The Division Bench of M.R. Shah and B.V. Nagarathna*, JJ., held that the action of the selectively applying the proviso to Rule 25(a) in relation  to one person, while not applying the said proviso in relation to similarly situated persons, is arbitrary and therefore illegal. The Bench stated,

“We accept the settled position of law that the rule applicable in matters of determination of pension is that which exists at the time of retirement, we are unable to find any legal basis in the action of the respondent University of selectively allowing the benefit of Rule 25 (a).”

Factual Matrix

The appellant joined as a Lecturer in the School of Legal Studies in Cochin University of Science and Technology on 07-09-1984. Prior to such appointment, the appellant was a lawyer practising in the District Court and Subordinate Courts and High Court of Kerala. The appellant made a representation before the Registrar of the University, requesting to reckon his practice of eight years at the Bar for the purpose of determining his pensionary benefits payable to him on his superannuation as provided under Rule 25 (a), Part III of Kerala Service Rules.

The respondent rejected the request of the appellant on the ground that the proviso to Rule 25 (a), Part III, KSR provides that the benefit under Rule 25 (a) would be available only to such employees who are recruited when practising at the Bar, to those posts requiring a qualification in law and experience at the Bar. Therefore, the respondent opined that since experience at the Bar was not essential for appointment to teaching posts at the University, the question of reckoning previous experience at the Bar would not arise in relation to the appellant.

The appellant stated in his appeal petition before the Chancellor that the proviso to Rule 25 (a), Part III, KSR was inserted in said Rule with effect from 12th February 1985. The appellant contended that the proviso could not be made applicable to him as the same was not in force as on the date on which he joined service at the respondent University. On the other hand, the respondent maintained that the Government or any other statutory body has the right to modify the service conditions, even retrospectively. The respondent further stated that since the proviso was introduced in Rule 25 (a) while the appellant was still in service, the proviso would apply to him.

Findings of the Court

Noticeably, in the case of one Dr. P. Leela Krishnan, a Professor of Law who was similarly situated as the appellant, the respondent University had duly considered the period of practice at the Bar as a part of qualifying service for the purpose of determining pension payable on superannuation, as perusal of extracts from the pension book of Dr. P. Leela Krishnan, revealed that his experience of practice at the Bar of 7 years, 2 months and 26 days was added to the period of his service at the  University, being 26 years, 9 months and 2 days. Accordingly, the respondent University had in determining his superannuation pension, considered 33 years, 7 months and 4 days as the qualifying period of service.

“Considering that no argument had been advanced on behalf of the respondents as to the manner in which the case of the appellant is different from that of Dr. P. Leela Krishnan and on what basis the benefit of Rule 25 (a) was granted to Dr. P. Leela Krishnan but was withheld in relation to the appellant.”

Pointing out the similarities between the two, the Bench stated, both these individuals were appointed as teaching faculty at the respondent University after practicing as advocates in various Courts of Kerala. They were both appointed before the proviso to Rule 25 (a) came into effect, i.e. before 12-02-1985 and retired after the said proviso came into force.

“In the circumstances, we find no valid ground to sustain the application of the proviso in relation to the appellant, thereby denying the benefit of Rule 21 25(a), when the same was not applied in the case of Dr. P. Leela Krishnan, thereby allowing the benefit of Rule 25(a).”

The law, as recognized in Deoki Nandan Prasad v. State of Bihar, (1971) 2 SCC 330, and Government of Andhra Pradesh v. Syed Yousuddin Ahmed, (1997) 7 SCC 24, states that the pension payable to an employee on retirement shall be determined on the rules existing at the time of retirement. However, the Bench stated, law does not allow the employer to apply the rules differently in relation to persons who are similarly situated. Therefore, the Bench opined that if the respondent University sought to deny the benefit of Rule 25 (a), in light of the proviso which was subsequently inserted thereby limiting the benefit of the Rule, it ought to have done so uniformly; as the proviso could have been made applicable in relation to all employees who retired from service of the respondent University following the introduction of the proviso, i.e. after 12-02-1985.

Conclusion

In the light of above, the Bench held that the denial of the benefit under Rule 25 (a), KSR, to the appellant was arbitrary and not in accordance with law. Consequently, the appellant was held entitled to receive pension having regard to his total qualifying service, inclusive of the period of his service at the respondent University and the period of his practice as an Advocate in various Courts of Kerala.

Accordingly, the impugned judgment of the High Court, whereby it was approved the action of respondent university was set aside. The respondent University was directed to calculate the amount of pension short paid to the appellant from the date of his superannuation and disburse such amount together with interest at the rate 5% p.a. till date of payment in favour of the appellant.

[G. Sadasivan Nair v. Cochin University of Science and Technology, 2021 SCC OnLine SC 1155, decided on 01-12-2021]


Kamini Sharma, Editorial Assistance has put this report together 


Appearance by:

For the Appellant: K.P. Kylasanatha Pillay, Senior Counsel along with Sajith P. Warrier, Counsel

For the Respondents: Malini Poduval, Counsel

For the State: G. Prakash Counsel


*Judgment by: Justice B.V. Nagarathna

 

Tags: Service Law, Government Servant, University, Teacher, Bar Council, Experience, Retirement, Superannuation, Pension

Join the discussion

Your email address will not be published.

This site uses Akismet to reduce spam. Learn how your comment data is processed.