1996 JTR(SC) 1849
1997 AIR(SC) 2607 ; 1997 AIR(SCW) 2564 ; 1997 1 CLR 376 ; 1998 78 FLR 548 ; 1996 10 JT 371 ; 1996 Supp JT 242 ; 1997 10 JT 371 ; 1997 LIC 2646 ; 1997 1 LLN 125 ; 1997 2 RSJ 718 ; 1996 8 Scale 66 ; 1997 1 SCC 208 ; 1997 SCC(L&S) 444 ; 1996 SCR 472 ; 1997 1 SCT 435 ; 1997 1 SLR 22 ; 1997 WBLR 49 ; 1997 KHC 645 ; 1996 8 Supreme 633
1996(8) Supreme 633
SUPREME COURT OF INDIA
B.P. Jeevan Reddy & Suhas C. Sen, JJ.
Commander Head Quarter, Calcutta & Ors. -Appellants
versus
Capt. Biplabendra Chanda -Respondent
Civil Appeal No. 14172 of 1996
(Arising out of S.L.P. (C) No. 11208 of 1995)
Decided on 5-11-1996
Counsel for the Parties :
For the Appellants : P.P. Malhotra, Sr. Adv. Wasim A. Qadri and Ms. Anil Katiyar, Advocates.
For the Respondent : Bijan Ghosh, Advocate.
IMPORTANT POINT
New and revised pensionary benefits Rules for armed forces that came into force w.e.f. January 1, 1986 were not given retrospective effect.
Act Referred :SERVICE LAW : .
(A) The Service Law provisions governing pension eligibility for Commissioned Officers were in contention, where the pre-commissioned service was initially counted as two-thirds for qualifying service under the rules in force at the time of retirement. The respondent, having retired prior to 1986, was found ineligible as only two-thirds of service was considered under the then-prevailing rules. Subsequent revision of the rules with effect from January 1, 1986, provided that full pre-commissioned service would be counted for pension eligibility, but these revised rules were held not to have retrospective application. The Division Bench of the Calcutta High Court had allowed the writ petition relying on the decision in D.S. Nakara, which this bench distinguished as not being applicable to a scenario where no discrimination exists but rather a temporal discrepancy in the applicability of rules.
(B) The core legal principle is that revised pension rules cannot be given retrospective effect to make a person eligible for pension who was otherwise not eligible at the time of retirement. The State has the power to specify a cut-off date for revised benefits, and such specification is valid if it is not arbitrary or discriminatory between similarly situated persons. A distinction between pre-1979 retirees and post-1979 retirees does not arise in a case where the ineligibility is based on the rules in force at the time of retirement, not on class discrimination.
Facts of the case:
The respondent was a Commissioned Officer who retired on May 18, 1982. Under the rules in force at that time, only two-thirds of pre-commissioned service counted towards qualifying service for pension, rendering him ineligible. Around four years later, rules were amended effective January 1, 1986, to count full pre-commissioned service. The respondent sought pension under the revised rules, which was denied, leading to a writ petition. The Single Judge and later the Division Bench of the Calcutta High Court allowed the petition, citing D.S. Nakara.
Findings of Court:
The court held that D.S. Nakara does not prohibit the application of revised rules where the ineligibility arises from the rules in force at the time of retirement and not from class discrimination. The revised rules were not given retrospective effect, and the respondent cannot be made eligible by virtue of subsequent liberalized rules. The court emphasized the State's power to specify a date for revised rules prospectively without it being arbitrary or discriminatory.
Issues:
Whether revised pension rules counting full pre-commissioned service can be applied retrospectively to a person who retired when only partial counting was applicable.
Ratio Decidendi:
The revised rules cannot operate retrospectively to cure earlier ineligibility. The State can prescribe a cut-off date for new rules, and such prescription is not arbitrary if it does not create discrimination between similarly situated persons at the relevant time.
Result:
Appeal allowed. The Division Bench judgment is set aside. The writ petition is dismissed, and no costs are awarded.
(A) The Service Law provisions governing pension eligibility for Commissioned Officers were in contention, where the pre-commissioned service was initially counted as two-thirds for qualifying service under the rules in force at the time of retirement. The respondent, having retired prior to 1986, was found ineligible as only two-thirds of service was considered under the then-prevailing rules. Subsequent revision of the rules with effect from January 1, 1986, provided that full pre-commissioned service would be counted for pension eligibility, but these revised rules were held not to have retrospective application. The Division Bench of the Calcutta High Court had allowed the writ petition relying on the decision in D.S. Nakara, which this bench distinguished as not being applicable to a scenario where no discrimination exists but rather a temporal discrepancy in the applicability of rules.
(B) The core legal principle is that revised pension rules cannot be given retrospective effect to make a person eligible for pension who was otherwise not eligible at the time of retirement. The State has the power to specify a cut-off date for revised benefits, and such specification is valid if it is not arbitrary or discriminatory between similarly situated persons. A distinction between pre-1979 retirees and post-1979 retirees does not arise in a case where the ineligibility is based on the rules in force at the time of retirement, not on class discrimination.
Facts of the case:
The respondent was a Commissioned Officer who retired on May 18, 1982. Under the rules in force at that time, only two-thirds of pre-commissioned service counted towards qualifying service for pension, rendering him ineligible. Around four years later, rules were amended effective January 1, 1986, to count full pre-commissioned service. The respondent sought pension under the revised rules, which was denied, leading to a writ petition. The Single Judge and later the Division Bench of the Calcutta High Court allowed the petition, citing D.S. Nakara.
Findings of Court:
The court held that D.S. Nakara does not prohibit the application of revised rules where the ineligibility arises from the rules in force at the time of retirement and not from class discrimination. The revised rules were not given retrospective effect, and the respondent cannot be made eligible by virtue of subsequent liberalized rules. The court emphasized the State's power to specify a date for revised rules prospectively without it being arbitrary or discriminatory.
Issues:
Whether revised pension rules counting full pre-commissioned service can be applied retrospectively to a person who retired when only partial counting was applicable.
Ratio Decidendi:
The revised rules cannot operate retrospectively to cure earlier ineligibility. The State can prescribe a cut-off date for new rules, and such prescription is not arbitrary if it does not create discrimination between similarly situated persons at the relevant time.
Result:
Appeal allowed. The Division Bench judgment is set aside. The writ petition is dismissed, and no costs are awarded.
ORDER
Heard the counsel for both the parties.
Leave granted.
2. This appeal is preferred against the judgment of a Division Bench of the Calcutta High Court dismissing the writ appeal preferred by the appellants. The respondent was a Commissioned Officer. He retired on May 18, 1982. According to the Rules then in force, only 2/3rd of the pre-commissioned service was allowed to be counted towards qualifying service for earning pensionary benefits. A minimum period of qualifying service was also provided for becoming eligible for pension. On the basis of the said Rule, the respondent was found ineligible for grant of pension and accordingly no pension was granted to him. About four years later, the Rules relating to qualifying service were changed (with effect from January 1, 1986) based upon the recommendations of the Fourth Pay Commission. One of the features of these Rules was that full pre-commissioned service was to be taken into count for working out the qualifying service required for earning pensionary benefits. In other words, whereas previously only 2/3rd of the pre-commissioned service was to be taken into count for determining the eligibility and the quantum of pension, the entire pre-commissioned service could be taken into count as per the Rules which came into force with effect from January 1, 1986. The respondent laid a claim for grant of pension on the basis of the said new Rules or revised Rules, as they may be called. That was denied whereupon he approached the High Court by way of a writ petition. The learned Single Judge allowed the writ petition relying upon the decision of this Court in D.S. Nakara & Ors. v. Union of India1, which order has been affirmed by the Division Bench.
3. We are of the opinion that the ratio of D.S. Nakara has no application here. D.S. Nakara prohibits discrimination between pensioners forming a single class and governed by the same Rules. It was held in that case that the date specified in the liberalised pension Rules as the cut-off date was chosen arbitrarily. That is not the case here. No pension was granted to the respondent because he was not eligible therefor as per the Rules in force on the date of his retirement. The new and revised Rules (it is not necessary for the purpose of this case to go into the question whether the Rules that came into force with effect from January 1, 1986 were new Rules or merely revised or liberalised Rules) which came into force with effect from January 1, 1986 were not given retrospective effect. The respondent cannot be made retrospectively eligible for pension by virtue of these Rules in such a case. This is not a case where a discrimination is being made among pensioners who were similarly situated. Accepting the respondent s contention would have very curious consequences even a person who had retired long earlier would equally become eligible for pension on the basis of the 1986 Rules. This cannot be.
4. The decision in D.S. Nakara has indeed been explained by two subsequent Constitution Bench decisions of this Court in Krishna Kumar & Ors. v. Union of India & Ors.2 and Indian Ex-Services League & Ors. etc. v. Union of India & Ors. etc.3. In the latter decision, it has been held that "the petitioners claim that all pre-1.4.1979 retirees of the Armed Forces are entitled to the same amount of pension as shown in appendices A , B and C for each rank is clearly untenable and does not flow from the Nakara decision". We may also refer in this connection to the observations in another decision of this Court in State of West Bengal v. Ratan Behari Dey4 to the following effect :
"...it is open to the State or to the Corporation, as the case may be, to change the conditions of service unilaterally. Terminal benefits as well as pensionary benefits constitute conditions of service. The employer has the undoubted power to revise the salaries and/or the pay scales as also terminal benefits/ pensionary benefits. The power to specify a date from which the revision of pay scales or terminal benefits/pensionary benefits, as the case may be, shall take effect is a concomitant of the said power. So long as such date is specified in a reasonable manner, i.e., without bringing about a discrimination between similarly situated persons, no interference is called for by the court in that behalf....the power of the State to specify a date with effect from which the Regulations framed, or amended, as the case may be, shall come into force is unquestioned. A date can be specified both prospectively as well as retrospectively. The only question is whether the prescription of the date is unreasonable or discriminatory. Since we have found that the prescription of the date in this case is neither arbitrary nor unreasonable, the complaint of discrimination must fail."
5. The learned counsel for the respondent relied upon a recent decision of this Court in M.C. Dhingra v. Union of India & Ors.5 but that was also a case where a distinction was sought to be made between the same class of pensioners. The said decision, therefore, cannot come to the rescue of the respondent.
6. For the above reasons, this appeal is allowed. The judgment of the Division Bench of the High Court affirming the decision of the learned Single Judge is set aside. The writ petition filed by the respondent is dismissed. No costs.
Appeal allowed.
*******