UNION OF INDIA versus R. SETHUMADHAVAN & ANR. on 22 March 2018

[2018] 3 S.C.R. 675

UNION OF INDIA

v.

R. SETHUMADHAVAN & ANR.

(Civil Appeal No. 3173 of 2018)

MARCH 22, 2018

[MADAN B. LOKUR AND DEEPAK GUPTA, JJ.]

Service law: Pension – Railways – Post of Train Examiner –On 30.9.1997, policy resolution was notified by the Government ofIndia relating to the scope and extent of the application of the FifthCentral Pay Commission – On 17.12.1998, an Office Memorandumwas issued that with effect from 1.1.1996, pension of all pensionersirrespective of their date of retirement shall not be less than 50% ofthe minimum pay in the revised scale of pay introduced w.e.f.1.1.1996 of the post last held by the pensioner – On 11.5.2001,another Office Memorandum was issued clarifying the OfficeMemorandum dated 17.12.1998 – The dispute arose whether theOffice Memorandum dated 11.5.2001 overrides Office Memorandum17.12.1998 – Held: The tribunal was right in relying on *K.S.Krishnaswamy case wherein it was held that the recommendationsof the Fifth Pay Commission were accepted by a policy resolutiondated 30.9.1997 that the ceiling on the amount of pension will be50% of the highest pay in the government – The pension of all pre1.1.1996 retirees including pre 1986 retirees shall be consolidatedas on 1.1.1996 but the consolidated pension shall not be broughton to the level of 50% of the minimum of the revised pay of the postheld by the pensioner at the time of retirement – Office Memorandumdated 17.12.1998 and 11.5.2001 are both complementary to eachother – Both clarify the government policy resolution – Thereforethe contention that Office Memorandum dated 11.5.2001 overridesthe original OM dated 17.12.1998 thereby creating two classes ofpensioners is ill founded – High Court erred in not referring to thisjudgment and in holding in favour of the respondent.

*K.S. Krishnaswamy & Ors. v. Union of India & Anr.(2006) 13 SCC 215 : [2006] 9 Suppl. SCR 330 –relied on.

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ACase Law Reference

[2006] 9 Suppl. SCR 330 relied on Paras 11, 13, 16

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 3173of 2018.

BFrom the Judgment and Order dated 02.08.2016 of the High Courtof Judicature at Madras in Writ Petition No. 13207 of 2013.

Ajit Kumar Sinha, Sr. Adv, Ms. Reena Pandey, Mrs. Anil Katiyar,Advs for the Appellant.

Vikas Mahendra, Ms. Pritha Srikumar, Advs for the Respondents.CThe Judgment of the Court was delivered by MADAN B. LOKUR, J. 1. Leave granted.

2. More than 140 years ago, it was said by the Privy Council:

D“These proceedings certainly illustrate what was said byMr. Doyne, and what has been often stated before, that thedifficulties of a litigant in India begin when he has obtained aDecree.”[1]

A somewhat similar fate seems to await government servants –

on getting retired, they have to struggle for the due pension. This is aEclassic case of a railway employee who retired as a Train Examiner on31[st] March, 1991 and his pension woes are being decided after 27 yearsand unfortunately not in his favour.

3. We recommend to the Department of Personnel and Trainingof the Government of India to try and make life after retirement easierFfor a government servant by having appropriate legislation enacted byParliament or applicable Pension Rules rather than a khichdi ofInstructions, Office Memoranda, Clarifications, Corrigenda and so onand so forth.

4. When the respondent retired as a Train Examiner with theGIndian Railways, he was in the pay scale of Rs. 1400–2300. After the5[th] Central Pay Commission was implemented, the replacement scalefor the post of Train Examiner (which was apparently abolished) becameRs.4500-7000.

1General Manager of the Raj Durbhunga, under the Court of Wards v. MaharajahHCoomar Ramaput Sing, (1871-2) Vol. XIV Moo, I.A.605

5. According to the respondent the post of Train Examiner wasre-designated as Junior Engineer Grade-II and the revised pay of a JuniorEngineer Grade-II was recommended by the 5[th] Central Pay Commissionto be Rs. 5000-8000. The difference in the replacement scale of a TrainExaminer as against the revised scale in the case of Junior EngineerGrade–II made a difference of about Rs. 500 per month in the pensionentitlement of the respondent.

6. On 30[th] September, 1997 a Policy Resolution was notified bythe Government of India relating to the scope and extent of the applicationof the recommendations of the 5[th] Central Pay Commission and itsacceptance. This was followed by a large number of representationsfrom pensioners and resulted in the Government of India issuing an OfficeMemorandum on 17[th] December, 1998 to the following effect:- “The President is now pleased to decide that w.e.f. 1.1.1996,pension of all pensioners irrespective of their date of retirementshall not be less than 50% of the minimum pay in the revisedscale of pay introduced w.e.f. 1.1.1996 of the post last held by thepensioner.”

7. It appears that the confusion continued and once again an OfficeMemorandum was issued by the Government of India on 11[th] May, 2001clarifying the earlier Office Memorandum. The clarification reads asfollows:- “In the course of implementation of the above order, clarificationshave been sought by Ministries/Departments of the “post last held”by the pensioner at the time of his/her superannuation. The secondsentence on O.M. dated 17.12.1998, i.e. “pension of all pensionersirrespective of their date of retirement shall not be less than 50%of the minimum pay in the revised scale of pay w.e.f. 1.1.1996 ofthe post last held by the pensioner”, shall mean that pension of allpensioners irrespective of their date of retirement shall not beless than 50% of the minimum of the corresponding scale as01.01.96, of the scale of pay held by the pensioner at the time ofsuperannuation/ retirement.”

8. The grievance of the respondent is directed against theclarification dated 11[th] May, 2001 since the respondent felt the impact ofthe clarification on his pension. He, therefore, preferred an Original A

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AApplication before the Central Administrative Tribunal for his rightfulpension. The question raised by the respondent as indeed by some otherswas referred to a larger Bench of the Tribunal and the question referredreads as follows:- “When, the pre-revised pay scale of Rs. 1400-2300 attached toBthe post of JE. II (TXR) in the Railways was revised toRs. 5000-8000 (while the normal replacement pay scale for thepre-revised pay scale of Rs. 1400-2300 is Rs. 4500-7500) whetherthe pension admissible to the pre 01.01.1996 retirees should bebased on the pay scale of Rs. 5000-8000 or should be restrictedCto that calculated on the basis of the pay scale of Rs. 4500-7000/-.”9. By an elaborate judgment and order dated 31[st] October, 2011the Tribunal took the view that the respondent held the post of TrainExaminer on the date of his superannuation and his pension had beencorrectly fixed on that basis. The replacement scale for the post of DTrain Examiner was Rs. 4500-7000 with effect from 1[st] January, 1996.It was held that the pension of the respondent could not be on par withthe pay scale of a Junior Engineer Grade-II. The reference was answeredaccordingly.

10. While coming to this conclusion the Tribunal adverted to 20 orEmore decisions rendered by various Benches of the Tribunal, severalHigh Courts and also few decisions of this Court. This is an indicationof the contest in store for pensioners when a claim for pension is madeagainst the State.

11. Be that as it may, the Tribunal eventually relied upon the decisionFof this Court in K.S. Krishnaswamy & Ors. v. Union of India & Anr.[2]to dismiss the Original Application.

12. Feeling aggrieved by the judgment and order of the Tribunal,the petitioner preferred W.P. No. 13207 of 2013 in the Madras HighCourt. By the impugned judgment and order dated 2[nd] August, 2016 theGHigh Court allowed the writ petition and quashed the order passed bythe Tribunal. It is under these circumstances that the Union of India isbefore us.

2(2006) 13 SCC 215H

13. We have heard learned counsel for parties and find that theTribunal was right in relying upon the judgment and order passed by thisCourt in Krishnaswamy. In this decision, the very question that arosefor consideration before the Tribunal and the High Court was dealt with,though with reference to some other posts of the Government of India.The question formulated by this Court in Krishnaswamy related to thescale of pay recommended by the 5[th] Central Pay Commission and theacceptance of the recommendations by the Government of India by apolicy decision dated 30[th] September, 1997 and the Office Memorandumdated 17[th] December, 1998 clarified by the Office Memorandum dated11[th] May, 2001. The basic question that arose for consideration waswhether the Office Memorandum dated 11[th] May, 2001 overrides theOffice Memorandum dated 17[th] December, 1998 clarifying the policyresolution of the Government of India dated 30[th] September, 1997.

14. While dealing with this question, this Court held in paragraphs17 and 27 of the Report as follows:

“17. The main thrust of the submissions of learned counsel forthe appellants is that the OM dated 11-5-2001 overrides the originalOM dated 17-12-1998 and creates two classes of pensioners.We are unable to accept this contention. As noticed above, therecommendations of the Fifth Pay Commission were accepted tothe extent of policy resolution dated 30-9-1997. The aforesaidPolicy Resolution was further clarified by issuing instructions inOM dated 17-12-1998, which were clarified by another executiveinstructions in OM dated 11-5-2001. It is well-settled principle oflaw that recommendations of the Pay Commission are subject tothe acceptance/rejection with modifications of the appropriateGovernment. It is also well-settled principle of law that a policydecision of the Government can be reviewed/altered/modified byexecutive instructions. It is in these circumstances that a policydecision cannot be challenged on the ground of estoppel. In thepresent case, the recommendations of the Fifth Pay Commissionwere accepted by a Policy Resolution dated 30-9-1997 that theceiling on the amount of pension will be 50% of the highest pay inthe Government. The pension of all pre-1-1-1996 retirees includingpre-1986 retirees shall be consolidated as on 1-1-1996, but theconsolidated pension shall not be brought on to the level of 50%of the minimum of the revised pay of the post held by the pensioner AB

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Aat the time of retirement. The subsequent OM dated 17-12-1998clarified the Policy Resolution dated 30-9-1997 by executiveinstructions in OM dated 17-12-1998 and further clarified in theform of OM dated 11-5-2001 clarifying the contents of PolicyResolution of the Government dated 30-9-1997. They are bothcomplementary to each other. Both clarify the government PolicyBResolution dated 30-9-1997. The appellants are not aggrieved bythe executive instructions in OM dated 17-12-1998. In our view,therefore, the contention of the appellant that the OM dated11-5-2001 overrides the original OM dated 17-12-1998, therebycreating two classes of pensioners is absolutely ill-founded andCuntenable.

27. For the reasons aforestated, the view taken by the MadrasHigh Court that the clarificatory executive instructions in OMdated 11-5-2001 are an integral part of the OM dated 17-12-1998clarifying the policy resolution of the Government dated 30-9-1997 and do not override the original OM dated 17-12-1998 iscorrect law and it is, accordingly, affirmed. The view taken by theDelhi High Court that OM dated 11-5-2001 overrides the originalOM dated 17-12-1998 and creates two classes of pensioners doesnot lay down the correct law and is, hereby, set aside.”

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E15. Unfortunately, the High Court has not even referred to thisjudgment while taking a decision in favour of the respondent. Since theissue is squarely covered by the decision of this Court in Krishnaswamy,the appeal must be allowed.

16. Yet another error made by the High Court is in assuming thatFthe post of Train Examiner was re-designated as Junior EngineerGrade-II. There is nothing on record to suggest the re-designation. Infact the conclusion of re-designation is the sole basis on which the writpetition was allowed by the High Court and as mentioned above, we donot find any material on record to suggest the re-designation.Consequently, the entire basis of the decision of the High Court isGerroneous, apart from the fact that the High Court did not advert to thedecision of this Court in Krishnaswamy on the subject.

17. In the circumstances, we have no option but to set aside theimpugned judgment and order of the Madras High Court and we do soaccordingly. The appeal is allowed.H

UNION OF INDIA v. R. SETHUMADHAVAN & ANR.[MADAN B. LOKUR, J.]

18. In case any payments have been made to the respondent,there will be no recovery of these amounts.

19. A copy of this order be sent to the Secretary, Department ofPersonnel and Training of the Government of India.

Appeal allowed.

Devika Gujral

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