A.N. Sachdeva by LRs. & Ors. v. Maharshi Dayanand University, Rohtak & Anr.

(i) The advice issued vide letter No.18/44-2001 UNP (1) dated

24.12.2001 was in respect of service rendered by the employees of Maharshi Dayanand University, Rohtak in Kurukshetra University, Kurukshetra and Punjab University. It is as well as known that initially, it was Kurukshetra University, Kurukshetra and what constitutes Maharshi Dayanand University, Rohtak now was a regional centre of Kurukshetra University, Kurukshetra earlier. Similarly the employees also has rendered service in the Punjab Page 10 University and were subsequently allocated to Kurukshetra University, Rohtak. That being the situation the advice was with regard to that service which the employees had rendered initially in the Punjab University followed by Maharshi Dayanand University, Rohtak. This pattern follows in the same manner as the employees of the joining Punjab were allocated to Haryana Govt. at the time of the creation of the Haryana State. Hence the service rendered by these employees who continued to remain in suit but there was a change of employer on account of division of jurisdiction after a period of time. In their case, the previous service rendered was agreed to be countable for the purpose of pension in Maharshi Dayanand University, Rohtak.

(ii) To the extent the employees of Kurukshetra University, Kurukshetra fall in the same category, their service may also be counted for the purpose of pension at the time of retirement from Kurukshetra University, Kurukshetra subject to fulfillment of the conditions mentioned in letter dated 24.12.2001 (copy enclosed) in respect of Maharshi Dayanand University, Rohtak.

(iii) As regards service rendered by the employees elsewhere such as

Central Govt./State Govt./Autonomous Body, the same is not countable for the purpose of pensionary benefits as there is no provision to this effect in the pension scheme of Kurukshetra University, Kurukshetra. In case the Kurukshetra University, Kurukshetra is keen to count such service for pensionary benefits, they should be advised to first consider amendment in their pension scheme for which a separate self-contained proposal should be submitted for approval of the State Govt. It is, therefore requested that the cases may be decided accordingly. Sd/- 5.6.02 Deputy Director Colleges-I, For Higher Education Commissioner, Haryana, Chandigarh.” Page 11

12. It is apparent from the memorandum dated 24.12.2001 that the first requirement to count the services rendered in Punjab University/Kurukshetra University/M.D. University by the appellants were without break and continuous. It is also not in dispute that after rendering the services in Punjab University/Kurukshetra University, the aforesaid employees had been directly appointed on the very next day in M.D. University. Earlier, the employees of Punjab University were allocated to Kurukshetra University and it is not in dispute that present M.D. University used to be the regional centre of Kurukshetra University prior to its establishment as full-fledged University.

13. Second requirement of the memorandum dated 24.12.2001 is that the employer’s share of the CPF has to be transferred to the pension fund with respect to services rendered in Punjab University/Kurukshetra University. The appellants had expressed their willingness in their representation to fulfil the aforesaid requirement of the memorandum dated 24.12.2001 including all other requirements of the pension scheme.

14. The question which arises for consideration is whether it is a case of upward revision of existing benefits or a new scheme floated by the respondents, while issuing the memorandum dated 24.12.2001. The appellants have placed reliance on a Constitution Bench decision of this Court in D.S. Nakara & Ors. v. Union of India [1983 (1) SCC 305] in which this Court has laid down that reasonable classification is permissible. The Page 12 classification must be founded on an intelligible differentia and that must have a rational relation to the object sought to be achieved. This Court has laid down that even though the scheme is prospective, the benefit of liberalised pension scheme should be applied equally to all and they are required to be paid the upward revision commencing from the specified date. No arrears would be payable. This Court has laid down thus:-

15. In M.C. Dhingra v. Union of India & Ors. [1996 (7) SCC 564], the question arose with respect to the counting of the previous service for grant of pension. The circular dated 31.3.1982 which came up for consideration provided the benefit thereof only to the persons retiring on or after the date of issuance of circular was held to be arbitrary. This Court has laid down thus:-

16. In State of Punjab v. Justice S.S. Dewan (Retd.) & Ors. [1997 (4) SCC 569], this Court held that benefit extended was new one. However, this Court has observed thus:- “7. Therefore, what we have to consider is what is the nature of the change made by the amendment. Is it by way of upward revision of the existing pension scheme? Then obviously the ratio of the decision in D.S. Nakara case [1983 (1) SCC 305] would apply. If it is held to be a new retiral benefit or a new scheme then the benefit of it cannot be extended to those who retired earlier”.

17. In State of Rajasthan & Anr. v. Prem Raj [1997 (10) SCC 317], this Court rejected the submission that decision in D.S. Nakara (supra) has given a complete go-by. This Court has laid down thus:- “12. In State of W.B. v. Ratan Behari Dey [1993 (4) SCC 62], this Court considered the question whether in providing a pension scheme the State could fix up a particular date and make it applicable to those who retired on or after that date. The Court distinguished Nakara case [1983 (1) SCC 305] by holding that in Nakara case an Page 17 artificial date had been specified classifying the retirees governed by the same rules and similarly situated into two different classes depriving one such class of the benefit of the liberalised pension rules and that was held to be bad. Following the decision of the Court in Krishena Kumar case [1990 (4) SCC 207] it was held that the State can specify a date with effect from which the Regulations framed or amended conferring the pensionary benefits shall come into force but the only condition is that the State cannot pick a date out of its hat and the date has to be prescribed in a reasonable manner having regard to all the facts and circumstances.

13. In State of Rajasthan v. Sevanivatra Karamchari Hitkari Samiti [1995 (2) SCC 117] the provisions contained in Rule 268-H of Rajasthan Service Rules came up for consideration as to whether the aforesaid provisions restructuring the rights of government servants in service on 29-2-1964 can be held to be violative of Article 14. The Court applied the principle in Krishena Kumar case and Indian Ex-Services League case [1991 (2) SCC 104] and held that the fixation of 29-2-1964 as the cut-off date with effect from which the new liberalised pension scheme in Chapter XXIII-A was introduced cannot be said to be arbitrary or violative of Article 14 of the Constitution. As has been stated earlier for deciding the present controversy it is not necessary for us to further delve into the question as to the extent to which the decision of this Court in Nakara case has been followed or explained. But suffice it to say that the contention of Mr Gupta, the learned counsel for the appellant, that the decision of this Court in Nakara case has been given a complete go-by cannot be sustained”.

18. In Dhan Raj & Ors. v. State of J&K & Ors. [1998 (4) SCC 30], this Court considered the case where the appellants who had retired from the services of Corporation prior to 9.6.1981 claimed to be entitled to pensionary benefits by virtue of G.O. dated 3.10.1986. The contention of the State that the benefit Page 18 could not be extended to the appellants was rejected. The relevant portion is extracted hereunder:- “14. Even otherwise, we do not find any justifiable criteria for the State Government to draw the line between those who retired earlier and those who retired after 9-6-1981. Both such set of employees were equally placed in the same Undertaking/Corporation temporary in character and all having served in the organisations for more than 20 years. In fact, the appellants have served with the Government for more than 30 to 40 years. The person serving for such a long period earns his legitimate expectation. It is not something which he seeks with a begging bowl. It is inappropriate for a State Government to take up a stand to get its own order to be held illegal, by giving restrictive interpretation to deny benefit to its own employees who had worked for such a long period. In fact, in the Constitution Bench decision of this Court in D.S. Nakara v. Union of India [1983 (1) SCC 305] this Court held that criterion of date of enforcement of the revised scheme entitling benefits of the revision to those retiring after specified date while depriving the benefits to those retiring prior to that date was violative of Article 14. Even otherwise, while considering the question of grant of pensionary benefits the State has to act to reach the constitutional goal of setting up a socialist State as stated and the assurance as given in the Directive Principles of State Policy. A pension is a part and parcel of that goal, which secures to a person serving with the State after retirement of his livelihood. To deny such a right to such a person, without any sound reasoning or any justifiable differentia would be against the spirit of the Constitution. We find in the present case the stand taken by the State Government to be contrary to the said spirit. In the aforesaid D.S. Nakara this Court has very clearly recorded the following:

19. This Court in Union of India & Ors. v. K.G. Radhakrishna Panickar & Ors. [1998 (5 SCC 111] again considered the question of classification and differential treatment. It was held that conferment of new benefit from a particular date cannot be held to be violative of Article 14. The benefit in question was held to be a new benefit conferred on the casual labour. This Court held that:-

12. In its judgment dated 8-2-1991 the Tribunal has held that exclusion of period of service rendered as Project Casual Labour before they were regularly absorbed prior to 1-1-1981 results in such employees being discriminated against as compared to Project Casual Labour who were employed subsequently and whose service as Project Casual Labour prior to absorption is counted for the purpose of qualifying service. The said finding of the Tribunal is based on the decision of this Court in D.S. Nakara [1983 (1) SCC 305]. In this regard, it may be stated that the Tribunal was in error in invoking the principle laid down in D.S. Nakara in the present case. The decision in D.S. Nakara has been considered by this Court in subsequent decisions and it has been laid down that the principle laid down in D.S. Nakara can have application Page 20 only in those cases where there is discrimination in the matter of existing benefit between similar set of employees and the said principle has no application where a new benefit is being conferred with effect from a particular date. In such a case the conferment of the benefit with effect from a particular date cannot be held to be violative of Article 14 of the Constitution on the basis that such a benefit has been conferred on certain categories of employees on the basis of a particular date. (See: Krishena Kumar v. Union of India [1990 (4) SCC 207]; State of W.B. v. Ratan Behari Dey [1993 (4) SCC 62] and State of Rajasthan v. Sevanivatra Karamchari Hitkari Samiti [1995 (2) SCC 117]) In the present case, the benefit of counting of service prior to regular employment as qualifying service was not available to casual labour. The said benefit was granted to Open Line Casual Labour for the first time under order dated 14-10-1980 since Open Line Casual Labour could be treated as temporary on completion of six months’ period of continuous service which period was subsequently reduced to 120 days under para 2501(b)(i) of the Manual. As regards Project Casual Labour this benefit of being treated as temporary became available only with effect from 1-1-1981 under the scheme which was accepted by this Court in Inder Pal Yadav [1985 (2) SCC 648]. Before the acceptance of that scheme the benefit of temporary status was not available to Project Casual Labour. It was thus a new benefit which was conferred on Project Casual Labour under the scheme as approved by this Court in Inder Pal Yadav and on the basis of this new benefit Project Casual Labour became entitled to count half of the service rendered as Project Casual Labour on the basis of the order dated 14-10-1980 after being treated as temporary on the basis of the scheme as accepted in Inder Pal Yadav. We are, therefore, unable to uphold the judgment of the Tribunal dated 8-2-1991 when it holds that service rendered as Project Casual Labour by employees who were absorbed on regular permanent/ temporary posts prior to 1-1-1981 should be counted for the purpose of retiral benefits and the said judgment as well as the judgment in which the said judgment has been followed have to be set aside. The judgments in which the Tribunal has taken a contrary view have to be affirmed. Page 21

20. In V. Kasturi v. Managing Director, State Bank of India & Anr. [1998 (8) SCC 30], this Court considered the prospective amendment and the question whether earlier retirees were eligible for benefit of such amendment. It was held that where the amendment enhanced the pension or provided for a new formula of pension even the earlier retirees who at the time of retirement were eligible for pension and survived till the amendment would be eligible for the benefit from the date it came into effect, however, where the amendment extended the benefit of the pension scheme to a new class of persons, the earlier retirees at the time of retirement who were not eligible for pension cannot get the benefit of amendment. This Court has laid down thus:-

Page 22

21. In Subrata Sen & Ors. v. Union of India & Ors. [2001 (8) SCC 71], this Court has laid down thus:- “18. Further, in All India Reserve Bank Retired Officers Assn. v. Union of India [1992 supp. (1) SCC 664], Ahmadi,

22. In John Vallamattom & Anr. v. Union of India [2003 (6) SCC 611], this Court considered the decision in D.S. Nakara (supra) and has observed thus:- “62. Article 14 of the Constitution states that the State shall not deny to any person equality before the law or the equal protection of the laws within the territory of India. The first part of Article 14 of the Constitution of India is a declaration of equality of civil rights for all purposes within the territory of India and basic principles of republicanism and there will be no discrimination. The guarantee of equal protection embraces the entire realm of “State action”. It would extend not only when an individual is discriminated against in the matter of exercise of his right or in the matter of imposing liabilities upon him, but also in the matter of granting privileges etc. In all these cases, the principle is the same, namely, that there should be no discrimination between one person and another if as regards the subject-matter of the legislation their position is the same. In my view, all persons in similar circumstances shall be treated alike both in privileges and liabilities imposed. The classification should not be arbitrary; it should be reasonable and it must be based on qualities and characteristics and not any other who are left out, and those qualities or characteristics must have reasonable relations to the object of the legislation. x x x x x

64. It has also been observed in the above judgment that in the very nature of things, the society being composed of unequals, a welfare State will have to strive by both executive and legislative action to help the less fortunate in the society to ameliorate their condition so that the social and economic inequality in the society may be bridged and in the absence of the doctrine of classification such Page 24 legislation is likely to flounder on the bedrock of equality enshrined in Article 14 of the Constitution”.

23. In State Bank of India v. L. Kannaiah & Ors. [2003 (10) SCC 499], this Court considered fixation of cut-off date for applicability of pension scheme. Minimum service was prescribed 20 years and cut-off date for such induction was fixed as 1.1.1965. This Court held minimum qualifying service being the essential consideration. There is no rationale to exclude employees confirmed earlier who have put in more than 20 years of service. This Court has laid down thus:-

24. In Union of India & Anr. v. SPS Vains [2008 (9) SCC 125], decision of this Court in D.S. Nakara has been followed. It was held that there could not be disparity of pension within the same rank. It was held thus:-

Page 26 the same class equally. To hold otherwise would cause violence to the provisions of Article 14 of the Constitution. It could not also have been the intention of the authorities to equate the pension payable to officers of two different ranks by resorting to the step-up principle envisaged in the fundamental rules in a manner where the other officers belonging to the same cadre would be receiving a higher pension”.

25. In K.J.S. Buttar v. Union of India & Anr. [2011 (11) SCC 429], this Court considered the question when some new retiral benefits were introduced and measurement to calculate disability was changed pursuant to recommendation made by the 5th Pay Commission and same was implemented with effect from 1.1.1996. The appellant was denied retiral benefits on account of his retirement in 1979. This Court held the treatment to be discriminatory and laid down that restriction of benefit to only officers who were invalided out of service after 1.1.1996 is violative of Article 14 of the Constitution and hence illegal. In the case of liberalisation of existing scheme all pensioners are to be treated equally. The appellant was entitled to all retiral benefits with effect from 1.1.1996. This Court has laid down thus:-

26. Reliance has been placed by the respondents on a decision in State of Punjab & Anr. v. J.L. Gupta & Ors. [2000 (3) SCC 736] in which this Court referring to the decision in State of Punjab & Ors. v. Boota Singh & Anr. [2000 (3) SCC 733] held that when financial implication is there, the benefit conferred by notification dated 9.7.1985 can be claimed by those who retired after the date of stipulation in the notification and those who have retired prior to the date of stipulation, as the notifications are governed by different rules. It was a case of pensionary benefits, i.e., pension, gratuity/DCRG, internal gratuity. Hence, the decision is clearly distinguishable. Moreover, in the instant case, employees are governed by same set of rules.

27. Considering the principles enunciated under Articles 14 and 16 of the Constitution, and that the benefit is not an ex gratia payment but a payment in recognition of past service, in our opinion, discrimination could not have been Page 28 made between those employees who have been absorbed/allocated are entitled to count their services as qualifying service for the purpose of pension and not those who have been appointed directly. Fact remains that all these employees have served in Punjab University/Kurukshetra University/MD. University without any break. M.D. University, prior to its establishment, was the regional centre of Kurukshetra University. Expectation had arisen to compute the period of service rendered in Punjab University/Kurukshetra University which cannot be unreasonably deprived of. Merely because a person has been appointed and others have been absorbed/allocated makes no difference as to the service rendered. Even otherwise, it is a case of upward revision of benefit and the classification which is sought to be created by the aforesaid method of not extending benefit to persons appointed directly and by fixing cut-off date cannot be said to be intelligible one; same is discriminatory and thus, the appellants would be entitled for the benefit from the date decision has been taken on 24.12.2001 to compute the previous service rendered in Punjab University/Kurukshetra University as qualifying service. In other words, they would be entitled for the benefit prospectively from the date of issuance of memorandum dated 24.12.2001. The employees have expressed their willingness to deposit/adjustment of the employer’s contribution of CPF as required in the memorandum dated 24.12.2001. Page 29

28. In yet another case of M.D. University v. Dr. Jahan, this Court did not interfere in the decision of the High Court of Punjab and Haryana at Chandigarh on 26.5.2009 in LPA No.27 of 2006, however, the question of law was kept open. Hence, we have examined the case on merits and found the case of the appellants on better footing as compared to Dr. Jahan and even otherwise the appellants are entitled for the benefit.

29. In view of aforesaid discussion, the appellants are entitled for the benefit of counting the services rendered in Punjab University/Kurukshetra University as qualifying service for the purpose of pension subject to fulfilment of the conditions specified in the memorandum dated 24.12.2001 etc. and in case the amount payable by the appellants towards contributory provident fund is less than the amount payable to them as pension, it would be adjusted by the respondents without insisting for its refund from the amount payable to the appellants. Let the exercise be completed within a period of three months from today.

30. The appeals are allowed, impugned judgment is set aside. We leave the parties to bear their own costs ........................................... J. (M.Y. Eqbal) New Delhi; .......................................... J. August 10, 2015. (Arun Mishra)