CHIEF GENERAL MANAGER GUJARAT TELECOM CIRCLE, BHARAT SANCHAR NIGAM LTD. & ORS. versus MANILAL AMBALAL PATEL & ANR. on 8 March 2019

[2019] 4 S.C.R. 1034SUPREME COURT REPORTS

SUPREME COURT REPORTS

[2019] 4 S.C.R.

ACHIEF GENERAL MANAGER GUJARAT TELECOM CIRCLE,BHARAT SANCHAR NIGAM LTD. & ORS.

v.

MANILAL AMBALAL PATEL & ANR.

(Civil Appeal No.1681 of 2019)

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MARCH 08, 2019

[ASHOK BHUSHAN AND K. M. JOSEPH, JJ.]

Service Law:

Commuted Value of Pension (CVP) – Delayed payment –Interest for – Entitlement to the employee who was paid provisionalpension during pendency of vigilance/disciplinary case – Vigilanceclearance before the date of retirement – Application for CVP madeafter over three years from the date of retirement – Claim forinterest on the CVP from the date of retirement – Denied byDepartment/employer – Administrative Tribunal as well as HighCourt directed grant of interest – On appeal, held: A claim forinterest with regard to CVP may lie when an application has beenmade in time u/r. 13(1) of Commutation Rules and payment isdelayed – Question as to payment of interest would arise based onthe date of application and the reasonableness of the time taken in C

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processing it and the arbitrariness in a particular case in delayingthe matter – The employee was precluded from applying u/r. 13(1)as he was not getting superannuation pension – He was getting aprovisional pension – He was not precluded from makingapplication u/r. 13(3) – In view of acceptance of provisional pen-sion and failure to make application u/r. 13(3), the employee couldnot have been granted interest on CVP from the date of retirement –Central Civil Services (Commutation of Pension) Rules, 1981 –rr. 4, 12, 13(1) and (3) – Central Civil Services (Pension) Rules,1972 – rr. 9 and 69.

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Allowing the appeal, the Court

HELD: 1. In the Central Civil Services (Commutation ofPension) Rules, 1981 there is no provision which contemplatespayment of interest on delayed payment of Commuted Value of H

Pension (CVP). Office Memorandum dated 05.10.1999 does notcontemplate the grant of interest, when CVP is paid belatedly.But on the other hand, the order does not declare that nointerest shall be payable when CVP is paid belatedly. [Para 20][1048-G-H]

2. Commuted Value of Pension (CVP) is inter-linked withpension. Pension is not a bounty. It is a legal as well as afundamental right of a Government servant to receive hispension. It is not an act of grace by the employer but it is theright of the Government servant who has put in the requirednumber of years of service. This is subject to Rule 9 of theCentral Civil Services (Pension) Rules, 1972 under which thereis power to withhold and recover part or whole of the pension. Inregard to pension, it is beyond dispute that for belated paymentof pension, interest can be ordered to be paid. [Para 21][1049-A-C]

3. Commutation of pension is nothing but payment of aportion of the pension calculated on a formula provided in theRules, the result of which is that the employer will be absolvedfrom payment of the pension to the extent it is commuted andthe employee will receive the value of commuted pension in alump sum at one go. No doubt after a certain number of years (15years) the full pension gets restored. Therefore, CVP flows outof his right to receive pension. In fact, it is a part of his pensionwhich is paid in lump sum to the employee. It is entirely optionalfor the officer to commute a part of his pension. [Paras 22 and 23][1049-C-E]

4. The Commutation Rules declare the categories ofpension which would qualify for commutation. Persons who fall inRule 12 of the Commutation Rules, without undergoing anymedical examination can apply for commutation, as provided inRule 13 of Commutation Rules, which includes a person whoreceives superannuation pension. If such a person applies underRule 13 of Commutation Rules , well within the time, he isindeed conferred a legal right under the Statutory Rules toreceive commuted pension. It does not lie in the mouth ofGovernment which is excepted to act as a model employer to sitover the papers and delay the sanctioning or the payment of the

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ACVP. Therefore in a case where Rule 13(3) of Commutation Rulesapplies and the Government servant who is due to retire onsuperannuation applies for getting CVP along with pensionpapers, prior to the date of his retirement as provided and heactually retires on superannuation and his application is withintime, the CVP must be paid immediately after the retirement.B[Paras 29 and 30] [1053-F-H; 1054-A-B]

5. The applicant had moved application on 01.11.2012 wherehe sought commutation of pension without medical examination.He showed his date of retirement as 31.07.2008. He sought themaximum admissible fraction as the proposed commutation. OnCthe basis of same, the appellant was admittedly sanctioned CVPin December, 2012. If the application dated 01.11.2012 is takenas the basis of sanctioning of the CVP then there can be no groundat all to give any interest as CVP has been given within areasonable time. [Para 37] [1057-C-E]

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6. There are three situations. The first category is wherethe pension is finalized immediately upon retirement and on thebasis of the application, the commutation as permissible subjectto the limit of forty percent, is ordered. The second category iswhere there is provisional pension granted under Rule 64 ofEPension Rules. In such a case also commutation is permissiblebut of the provisional pension again subject to the limit underRule 5 of Commutation Rules. In the third category whereprovisional pension is sanctioned on account of pendency ofjudicial or departmental proceeding Rule 4 of Commutation Rulesapplies and it forbids the commutation of “the provisionalFpension” granted under Rule 69 of Pension Rules. Since, in thepresent case the applicant was admittedly sanctioned provisionalpension, while the provisional pension was in place, theapplicant could not have sought commutation of the provisionalpension granted under Rule 69 of Pension Rules in view of theGembargo against such commutation contained in Rule 4 ofCommutation Rules. [Para 35] [1056-C-F]

7. A perusal of Rule 9 of the Pension Rules would showthat Government had a right to withhold the pension or gratuityor both either in full or in part or withdraw a pension in full or inHpart either permanently or for the specified period. Government

is also authorized to order recovery from pension or gratuity ofthe whole or in part of any pecuniary loss caused, if in anydepartmental or judicial proceeding, the pensioner is found guiltyof grave misconduct or negligence during the period of hisservice which includes service after re-employment. Thereafter,sub-rule 9(6) of Pension Rules deals with what constitutes whena departmental or a judicial proceeding will be deemed tocommence. Judicial proceedings are divided into two categories.First category is a criminal proceeding. Second category is civilproceeding. As far as civil proceeding is concerned, it is deemedto be instituted when a plaint is presented. In other words, uponpresentation of a plaint in a civil case judicial proceedingcommences. In the case of a criminal proceeding by the deemingprovision, it is deemed to have been instituted for the purpose ofRule 9 when the complaint or report of a police officer is made,but that is not sufficient. In a case where a complaint or a reportof a police officer is made to a Court, it should culminate incognizance being taken by the Magistrate, for the department tocontend that the date of the complaint or report is to be the dateof institution of the proceedings. [Para 43] [1059-C-F]

8. It is not correct to say that there was a departmentalproceeding pending by virtue of the fact that an order ofsuspension was passed within the meaning of Rule 9(6). Whilethe applicant was placed under suspension, in the year 1997, it isequally indisputable that the said suspension was revoked in theyear 1999 well before the date of superannuation of theapplicant. It is not the law that to constitute a departmentalproceeding that a Government servant has been placed undersuspension at some point of time of his career. What iscontemplated is that there must be a suspension when theapplicant would have otherwise retired on superannuation. In thepresent case the suspension stood revoked several years priorto his date of superannuation. Therefore, the suspension whichwas subsequently revoked cannot constitute suspension withinthe meaning of Rule 9(6)(b) of the Pension Rules. [Para 39] [1057-F-H; 058-A-B]

9. It is true that well before the retirement of the applicant,the agency which had no doubt conducted a trap against the AB

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Aapplicant, had itself found that there was no material in view ofsubsequent developments. It could be said that this is a casewhere the applicant was exonerated by the agency well beforethe date of his retirement. No doubt this is not a case where theapplicant has been acquitted honourably after trial. In fact, therewas never a trial and the case was not sent up for trial in view ofBthe submission of A-summary. [Para 42] [1059-A-B]

10. A claim for interest in regard to CVP may lie when anapplication has been made in time under Rule 13(3) ofCommutation Rules and the payment is delayed. But in a casewhere application is made under Rule 13(1) of CommutationCRules which can be made within a period of one year from thedate of retirement, the same would have to be processed andundoubtedly at the earliest it must be brought to its logicalculmination as per the rules. But certainly, in a case falling underRule 13(1) there can be no question of paying interest from theDdate of retirement as the application itself is predicated after thedate of retirement. No doubt the question as to payment ofinterest even in such cases would arise based on the date ofapplication and the reasonableness of the time taken inprocessing it and the arbitrariness in a particular case indelaying the matter. [Para 45] [1060-E-G]E

11. In the present case the applicant has no case even thathe made an application within the meaning of Rule 13(3) of theCommutation Rules as contemplated before three months of hisretirement. Nothing stood in the way of the applicant applyingunder Rule 13(3) of Commutation Rules apparently. If on theFother hand, there was any legal impediment which stood in theway, then also he cannot claim the CVP on retirement. Withouthaving made such an application under the Commutation Rules,it is clear that there can be no question of even becomingentitled to commute pension w.e.f. first day following hisGretirement. The Tribunal and the High Court have completelyoverlooked the conspectus of the Rules. The direction to payinterest on the CVP, as ordered by the Tribunal, from the date ofretirement from 01.08.2008 is clearly erroneous. Rule 13(1) ofCommutation Rules enables a person who is in receipt of a H

pension under Rule 12 of Commutation Rules, to apply afterretirement but within one year thereof for CVP. It is true that theapplicant was not in receipt of any pension under Rule 12 andtherefore, he could not have applied under Rule 13(1) ofCommutation Rules. This is for the reason that as per order dated04.08.2008, he was to be given provisional pension which wasunder Rule 69 of the Pension Rules. The applicant, however,proceeded to accept the provisional pension. It is true that theeffect of the order dated 04.08.2008 of the sanctioning of theprovisional pension under Rule 69 of Pension Rules, was that hewas precluded from applying for commuting the provisionalpension, in view of Rule 4 of Commutation Rules and on the otherhand, as he was not in receipt of superannuation pension, he couldnot have filed an application under Rule 13(1) of CommutationRules. Having issued order dated 04.08.2008, the effect of whichshould interest be ordered on the basis that the applicant wasprevented from applying for CVP under Rule 13(1) ofCommutation Rules. The applicant was not precluded frommaking any application under Rule 13(3) of Commutation Rules.Had he done so, his claim for interest from the date ofretirement could have been considered under Articles 14 and 21of the Constitution. The applicant did not challenge the orderdated 04.08.2008 and he continued to accept the provisionalpension sanctioned thereunder. There could be no question ofgranting interest from the date of retirement in view of theabsence of any application under Rule 13(3) of CommutationRules. [Para 46] [1061-A-H; 1062-A-B]

S.K. Dua v. State of Haryana and Another(2008) 3 SCC 44 : [2008] 1 SCR 395 – relied on.

Case Law Reference

[2008] 1 SCR 395

relied onPara 31

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 1681

of 2019

From the Judgment and Order dated 04.02.2016 of the HighCourt of Gujarat at Ahmedabad in Writ Petition being Special CivilApplication No. 14400 of 2015.

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APradeep Kumar Mathur, Chiranjeev Johri, Ankur Rastogi, Advs.for the Appellants.

Ms. Madhavi Divan, ASG, V. Balaji, Vijay Prakash, Gurmeet SinghMakker, Advs. for the Respondents.

The Judgment of the Court was delivered by B

K.M. JOSEPH, J. 1. This appeal by special leave is directedagainst the judgment of the High Court in Special Civil Application filedunder Articles 226 and 227 of the Constitution of India by the appellantswherein appellants challenged the order dated 29.10.2013 passed by theCentral Administrative Tribunal (hereinafter referred to as the “Tribunal”).CThe Tribunal by the impugned order quashed order dated 12.03.2013and directed the appellants to pay interest at the rate applicable to theProvident Fund deposits for the delay occurred in payment of DCRGand Commuted Value of Pension (hereinafter referred to as the “CVP”)from 01.08.2008 till the date of payment.

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2. The first respondent (hereinafter referred to as the “applicant”),who filed the application before the Tribunal was granted provisionalpension by proceeding dated 04.08.2008. It reads as follows:-

“Sub: Retirement on superannuation of 31.7.2008 A/N-Cases ofofficers of STS of Executive Grade (Ad-hoc) Regarding.

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In accordance with BSNL New Delhi order No. 35/1/2007 Pers-1 date 3.7.2008 and on approval of the competent authority, thefollowing officers of STS of Executive Grade) adhoc permanentlyabscribed in BSNL are permitted to retire from BSNL serviceson attaining the age of superannuation w.e.f. 31.7.2007 (A/N).

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2. The BSNL C.O. ND has intimated that the vigilance clearancein respect of Shri M.A. Paatel, (SL. No. 5) DE, O/o PGMTDSurat has not received from Vigilance Cell of BSNL and thereforethe officer shall be given only provisional pension and the DCRGand CVP shall be withheld till the conclusion of the vigilance/disciplinary case as per CCS (Pension) rules 1972.

3. It may please be ensured that there is no Vig/ Disc case pendingor contemplated against any of the above officer mentioned aboveas on the date of retirement. If any such case comes to notice,only provisional pension shall be granted to the officer (s) and hisDCRG and CVP shall be withheld till the Vigilance clearance isaccorded.

4. Copy of the charge relinquishing report may be sent to thisoffice in respect of all concerned.”

Though, the Anti-Corruption Bureau (hereinafter referred to asthe “ACB”) had registered a case against the applicant, the investigatingofficer, however, had found no evidence against him. Investigating officerhad submitted A-summary before the Principal District Sessions, Judge,Banaskantha, Palanpur, who refused to accept the summary. The Stateof Gujarat thereupon challenged the order. On 30.03.2012 the criminalrevision application, filed by the State, was allowed according sanctionto the investigating officer to file A-summary report before the trial Court.The applicant applied for interest on pensionary benefits i.e. DCRG andCVP, which, was rejected, on the basis that the criminal revision petition,filed by the State, against the order of the trial Court refusing to acceptthe A-summary was disposed of and that after the order of the HighCourt and Vigilance clearance the amounts were paid. He approachedthe Tribunal and the Tribunal directed payment of interest. The HighCourt in the writ petition, filed by the appellants, has reasoned that on01.08.2008 (the applicant was to retire on superannuation on 31.07.2008),there were no criminal proceedings against him. The High Court, interalia, held as follows:

“We are unable to accept the said submission as narratedhereinabove. There were no criminal proceedings on 01.08.2008.All that the High Court in its order has done directing the authoritybelow, which is produced at page no.219 at Para 14, which readas under; A

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14. The report made to the Court below by the investigatingofficer was, therefore, made under Section 173 of the Codeand the Court was required to pass an order under Section173(4) of the Code, which the Special Court has failed to do.The order passed by the learned Principal District and SessionsJudge, Banaskantha at Palanpur, dated 03.05.2006 is, therefore,set aside. The prayer sought by the investigating officer forSummary “A” is allowed. Accordingly, present revisionapplication is allowed. Rule is made absolute to the aforesaidextent. Muddamal currency note be confiscated to the State.

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It will relate back to the date of filing of A-Summary, which isprior to the date when the respondent retired. More particularly,in the year 2007, when the Criminal Revision Application wasfiled before this High Court.”

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3. It was found that it related back to the A-summary, which isprior to the date, when the applicant retired, more particularly, in theDyear 2007, when the revision was filed in the High Court.

4. This we understand to mean that the High Court takes theview that the investigating officer submitted A-summary report, whichis initially not accepted by the District Court which on revision by theState was directed to be accepted by the High Court. The report submittedEby the agency, finding no material against the applicant, would date backto the date on which the report was submitted which would further meanthat as on the date when the applicant retired, there was no criminalproceeding against the applicant. Thereafter, the High Court reasonedthat there is a delay of huge period and the applicant was given clearanceFby the Vigilance that there was no case pending as the State has alreadyfiled A-summary in the ACB trap case. There was no disciplinary actiontaken by the State. It was against Article 14 of the Constitution of Indiaand the interest also was found not unreasonable. The High Court, in thepetition filed under Article 227, found no infirmity in the order of theTribunal and dismissed the same.G

5. We heard the learned counsel for the appellants as well as thelearned Additional Solicitor General. Though service is complete on theapplicant, none appears on his behalf.

6. Learned counsel for the appellants drew our attention to theCentral Civil Services (Commutation of Pension) Rules, 1981 (hereinafterreferred to as the “Commutation Rules”). Therein he relied upon Rule 4of the Commutation Rules.

7. It is his contention that in so far as judicial proceeding waspending against the applicant and the same came to be disposed of onlyin the year 2012, applicant cannot claim interest as the applicant is noteven entitled to commutation of pension as is clear from Rule 4 of theCommutation Rules. He further submits that the District and SessionsJudge did not accept the A-summary report which led to the revisionbefore the High Court in the year 2007 and the revision petition waspending as on 01.08.2008 when the applicant superannuated. Therefore,there was a judicial proceeding and this disentitled the applicant to CVPwithin the meaning of Rule 4. It is the further case that due to thependency of the vigilance clearance, DCRG and CVP was withheld andonly provisional pension was granted vide order dated 04.08.2008 andlater sanction was accorded for provisional pension vide order dated02.09.2008. When the criminal revision was allowed by the High Courtand the request for summary-A was allowed by judgment dated30.03.2012, the respondent No.1 was accorded vigilance clearance andvide order dated 25.10.2012, approval was granted to regularize hispension and to release other retirement benefits. Thereafter, it is thecase of the appellants that, as seen from the written submissions, byorder dated 17.10.2012 the applicant was permitted to retire on attainingthe age of superannuation w.e.f his date of retirement i.e. 31.07.2008.The said order was also produced before us. It is the further case thatthe applicant thereupon made an application dated 01.11.2012 under theCommutation Rules seeking commutation. The said application was alsoproduced along with the written submissions. It is submitted that,accordingly, the applicant was paid the CVP and retirement gratuityvide revised pension calculation sheet dated 31.12.2012. It is the case ofthe appellants that the application made for commutation by the applicantwas within the period of one year, as contemplated in Rule 13(1) proviso(a). CVP is only an advance payment of pension and does not accrue asof right and is governed by the relevant Rules. Applicant was paidprovisional pension which is the maximum admissible pension since hisretirement and there was no monetary loss.

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A8. The learned Additional Solicitor General made two furthersubmissions apart from apparently adopting the arguments advanced bythe learned counsel for the appellants. It is submitted that Court maynotice that the applicant has been given provisional pension and provisionalpension has been enjoyed by the applicant right from the beginning.Therefore, necessary adjustment would have to be made even if theBarguments based on Rule 4 is not found acceptable. In other words,commutation of pension involves the payment of a lump sum in lieu ofmonthly payments in the future by way of pensionary benefits. Whenthe applicant was in receipt of provisional pension, necessarily adjustmentswould have to be made by reckoning the amount and then calculatingCthe CVP. Therefore, when the applicant was in receipt of the provisionalpension, in the same breath ordering the appellants to pay interest wouldamount to conferment of double benefit on the applicant. In other words,applicant cannot on the one hand enjoy the provisional pension and alsocannot be given interest on CVP. The second argument, which is pressedbefore us, was that there were departmental proceedings against theDapplicant. This is on the basis of the concept of departmental proceedingsto be found in Rule 9 of the CCS (Pension) Rules, 1972 (hereinafterreferred to as the “Pension Rules”). Rule 9(6)(a) of the Pension Rulesreads as follows:

“9(6)(a) departmental proceedings shall be deemed to be institutedEon the date on which the statement of charges is issued to theGovernment servant or pensioner, or if the Government servanthas been placed under suspension from an earlier date, on suchdate; and

9. Learned ASG would point that the applicant has been placedFunder suspension and therefore that would suffice to deny the benefit ofcommutation of pension in which case interest could not be ordered tobe paid.

10. There is no dispute that CVP has been paid to the applicantafter the conclusion of the vigilance proceedings, clearing the applicant,Gbut the question to be considered by us as to whether the applicant wasentitled to be paid interest for the period immediately after retirement tillthe date on which the CVP was actually paid to him. The scheme of thePension Rules, inter alia, indicate that under Rule 59, the authorities areduty bound to set in motion, the proceedings for calculating and payingHthe pension by the due date. Rule 59 would indicate that the said procedure is divided into three stages; first stage - verification of service; secondstage – making good omission in the service book; third stage- as soonas the second stage is completed, but not later than eight months prior tothe date of retirement of the Government servant various steps are to beundertaken. Rule 61 contemplates that after complying with therequirement of Rules 59 and 60, pension papers are to be forwarded tothe accounts officer. Rule 64 contemplates provisional pension beingpaid for reasons other than departmental or judicial proceedings.

11. In the backdrop of these provisions, let us examine the schemeof the Commutation Rules. Rule 12 of the Commutation Rules declareswho are the eligible persons to apply for commutation of a percentageof the pension without medical examination. In fact, Rule 11 providesthat the Chapter applies to those who are eligible to commute their pensionwithout medical examination. The person may be a person who isauthorized to receive a superannuation pension under Rule 35 of thePension Rules. Likewise, superannuation pension is defined in the PensionRules and Rule 35 of the Pension Rules declares that superannuationpension shall be granted to a Government servant who is retired onattaining the age of compulsory retirement. Rule 12 of the CommutationRules further renders eligible a person who has been given a retiringpension under Rule 36 of the Pension Rules. A retiring pension underRule 36 of the Pension Rules is granted, inter alia, to a Governmentservant who retires or is retired in advance of the age of compulsoryretirement. The next person who is declared eligible is a person to whompension is authorized on his absorption in or under a corporation orcompany or body in terms of Rule 37 of the Pension Rules and whoelects to receive monthly pension and retirement gratuity. The nextcategory of persons rendered eligible to commute is a person authorizedto receive compensation pension on abolition of a permanent post underRule 39 of the Pension Rules. Finally, under Rule 12 of the CommutationRules, a person authorized to receive pension in whole or in part on thefinalization of departmental or judicial proceedings referred to in Rule 9of the Pension Rules and issue of final orders is entitled to commute thepension.

12 Rule 13 provides for the application to be made for commutationof pension. We will advert to the Rule when it is found necessary at alater stage. Under Rule 14 of the Commutation Rules on receipt ofapplication under Rule 13, the Head of Office has to take action as AB

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Aprovided therein. Rule 15 provides for authorization of commuted valueby the Accounts Officer. He is to verify whether the information furnishedby the Head of Office is correct and applicant is eligible to commute apercentage of his pension without medical examination. Sub-rule (2) ofRule 15 provides that the Accounts Officer shall after necessaryverification issue authority for payment of CVP to the DisbursingBAuthority, inter alia.

13. Rule 18 of the Commutation Rules deals with another categoryof officers who are declared entitled to apply for commutation of theirpension. The difference between Rule 12 which we have referred toand the persons mentioned in Rule 18 is that in the case of personsCrendered eligible under Rule 18, they must undergo a medical examinationwhereas persons mentioned in Rule 12, as aforesaid, do not have toundergo any medical examination. Under Rule 18 of the CommutationRules, the following categories of pension qualify:

(1) Invalid pension under Rule 38 of the Pension Rules.D(2) Pension granted under Rule 40 of the Pension Rules to a personwho is compulsorily retired from service as penalty.

(3) Compassionate allowance given under Rule 41 of the PensionRules.

E14. Be it noted that compassionate allowance under Rule 41 ofthe Pension Rules is contemplated in respect of a Government servantwho is dismissed or removed from service. Rule 41 of the Pension Rulesgives power to the authority competent to dismiss or remove aGovernment servant from service to sanction a compassionate allowance,Fif the case is deserving of special consideration and the sum is notexceeding two-thirds of the pension or gratuity or both which wouldhave been admissible to him if he had retired on compensation pension.Compensation pension is dealt with in Rule 39 of the Pension Rules. It,inter alia, provides that if a Government servant is selected for dischargeowing to the abolition of his permanent post then unless he is appointedGto another post which is deemed equal to that of his own, the Governmentservant will have the option to take compensation pension for the servicehe had rendered. The last category of persons under Rule 18 of theCommutation Rules, who is declared eligible to commute after undergoingmedical examination, is a Government servant who has retired fromservice on one of the pensions which are mentioned in Rule 12 but hisH

application for commutation has not been received by the Head of Officewithin one year of his retirement. There are other provisions which dealwith the action to be taken which include provision for medical examinationof the applicant falling under Rule 18, appeal against the finding of medicalauthority, withdrawal of his application etc.

15. The above discussion relate to the persons who are eligible tocommute and the pension which qualify. As we have noted ordinarily bythe time the person is to retire, papers are to be got ready so that hebecomes entitled to the CVP. Thus, if application is made and if all goeswell, a person eligible, on his applying, as provided in the Rules, wouldbecome entitled to the pension without delay after the retirement.

16. There are two situations which may result in a Governmentservant not being sanctioned the final pension upon his retirement. Rule3(l) of the Commutation Rules defines provisional pension to be thepension referred to in Rule 64 or 69 of the Pension Rules, as the casemay be. Rule 64 of the Pension Rules provides for sanctioningprovisional pension in a case where there is no departmental or judicialproceeding. In other words, Rule 64 of the Pension Rules contemplatesa situation where the pension is not finalized for reasons other thandepartmental or judicial proceeding. When a person is so grantedprovisional pension under Rule 64 of the Pension Rules then Rule 9 ofthe Commutation Rules provides for commutation of a fraction of theprovisional pension which is to be subject to the limit specified in Rule 5.It may be noticed that Rule 5 of the Commutation Rules, inter alia,provides that a Government servant shall be entitled to commute for alump sum payment of an amount not exceeding forty percent of hispension. Therefore, this limit is applicable in respect of full pension andalso cases of provisional pension. Even if a person is in receipt of onlyprovisional pension but which is granted under Rule 64, which as ex-plained earlier, deals with a case which is not covered by a departmentalor judicial proceeding, the Government servant is entitled to commutefraction of the provisional pension subject to the limit, as provided underRule 5 of the Commutation Rules. Rule 31 of the Commutation Rulesprovides that when final assessment of the pension is done in regard toan employee to whom commuted value of the percentage of theprovisional pension has been given under Rule 9, then he will be paid thedifference of the amount between commuted value determined on finalassessment of the pension and the commuted value already paid.

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A17. Time is now ripe to notice Rule 4 of the Commutation Rules,which is relied upon by the appellant and the Government of India. Thesame reads as follows:

“4. Restriction on commutation of pension–

No Government servant against whom departmental or judicialBproceedings, as referred to in Rule 9 of the Pension Rules, havebeen instituted before the date of his retirement, or the pensioneragainst whom such proceedings are instituted after the date of hisretirement, shall be eligible to commute a percentage of hisprovisional pension authorised under Rule 69 of the Pension RulesCor the pension, as the case may be, during the pendency of suchproceedings.”

18. Rule 4 deals with a case where provisional pension has beengranted under Rule 69 of the Pension Rules. Rule 69 of the PensionRules contemplates sanctioning provisional pension when there is aDdepartmental or judicial proceeding against the Government servant. Itis when provisional pension is granted under the said Rule on account ofthe fact that there is a departmental or judicial proceeding pending thatRule 4 declares that the Government servant will not be entitled tocommute the provisional pension so granted under Rule 69 during thependency of the proceeding.E

19. In this case, admittedly the applicant was sanctioned aprovisional pension under Rule 69 on the basis that there was a judicialproceeding pending. We have set out the broad scheme of theCommutation Rules. First we should ascertain what is the nature ofCVP. Is there legal right to receive CVP? Can there be cases whereFfor delayed payment of CVP, interest can be ordered? Is there anyprovision which provides for interest?

20. A scanning of the Commutation Rules reveals that there is noprovision which contemplates payment of interest. In fact, the appellantshave produced Office Memorandum dated 05.10.1999 and the contentionGappears to be raised that it does not contemplate the grant of interest.We have gone through the said Office Memorandum. On the one handthe Office Memorandum does not contemplate grant of interest whenCVP is paid belatedly. But on the other hand, we notice that the orderdoes not declare that no interest shall be payable when CVP is paidbelatedly.H

21. The next exercise is to ascertain the true nature of CVP. Aswe have noticed from the Commutation Rules that CVP is inter-linkedwith pension. Pension is not a bounty. It is a legal as well as a fundamentalright of a Government servant to receive his pension. It is not an act ofgrace by the employer but it is the right of the Government servant whohas put in the required number of years of service. This is subject nodoubt to Rule 9 of the Pension rules under which there is power towithhold and recover part or whole of the pension. In regard to pension,it is beyond dispute that for belated payment of pension, interest can beordered to be paid. What is the position as far as CVP is concerned?

22. Commutation of pension is nothing but payment of a portionof the pension calculated on a formula provided in the Rules, the resultof which is that the employer will be absolved from payment of thepension to the extent it is commuted and the employee will receive thevalue of commuted pension in a lump sum at one go. No doubt after acertain number of years (15 years) the full pension gets restored.Therefore, CVP flows out of his right to receive pension. In fact, it is apart of his pension which is paid in lump sum to the employee. Havingculled out the essential nature of CVP, we must consider whether thereis a legal right to receive the CVP or is it discretionary and it may bewithheld.

23. It is undoubtedly true that it is entirely optional for the officerto commute a part of his pension. In that sense it can be said that withoutan application, he has no right to get commuted value. But that does itmean, when an application is made, as contemplated in the rules, noright is enshrined in the rules to get the committed value?

24. It is important to advert to Rule 13 in its entirety. Rule 13provides for the application to be made by the eligible persons fallingunder Rule 12, whereas Rule 19 deals with the application, to be madeby persons, who are eligible under Rule 18. It will be remembered thatRule 12 deals with persons who are eligible for commutation of theirpension without medical examination, whereas Rule 18 deals with personswho are in receipt of pension or other amounts and who become eligibleonly on undergoing medical examination.

25. Coming to Rule 13 it reads as follows:

“13. Application for commutation of pension - A

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SUPREME COURT REPORTS

(1) An applicant, who is in receipt of any pension referred to inRule 12 and desires to commute a percentage of that pension anytime after the date following the date of his retirement from servicebut before the expiry of one year from the date of retirement,shall- A

B(a) apply to the Head of Office in Form 1after the date of hisretirement; (b) ensure that the application in Form 1, duly completed , isdelivered to the Head of Office as early as possible but not laterone year of the date of his retirement :

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Provided that in the case of an applicant - (a) referred to in Clause (iii) of Rule 12, where order retiring himfrom Government service had been issued from a retrospectivedate, the period of one year referred to in this sub-rule shall reckonfrom the date of issue of the retirement orders ; D

(b) Referred to in Clause (v) of Rule 12, the period of one yearreferred to in this sub-rule shall reckon from the date of the issueof the orders consequent on the finalization of the departmentalor judicial proceedings.

(2) An applicant who applies for commutation of pension withinEone year of the date of his retirement but his application in Form1is received by the Head of Office after one year of the date ofhis retirement, shall not be eligible to get his pension commuted,without medical examination. Such an applicant, if he desires tocommute a fraction of his pension, shall apply afresh in Form 2 inFaccordance with the procedure laid down in Chapter IV.

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(3) Government servant who is due to retire on superannuationand desires payment of the commuted value of pension beingauthorized at the time of issue of the pension payment order, shallbe eligible to apply for commutation of a fraction of pension alongwith pension papers prior to the date of retirement provided that - G

(a) the Government servant retires on superannuation pensiononly;

(b) the application is submitted to the Head of Office inForm 1-A, so as to reach the Head of Office not later than threemonths before the date of superannuation ;

(c) no such application shall be entertained if the period is lessthan three months from the date of superannuation of theGovernment servant ; and (d) the Government shall have no liability for the payment of thecommuted value of pension if the Government servant dies beforethe date of superannuation or forfeits claim to pension beforesuch retirement.

26. Rule 13(1) contemplates that the applicant for commutationmay be a person who is in receipt of pension under Rule 12 and he isdesirous of commuting a percentage of pension mentioned in Rule 12.The Rule further provides that in such a contingency he may at any timeafter the date following the date of his retirement from service but beforethe expiry of one year from retirement apply in Form 1 to the Head ofOffice. He must ensure that the application duly completed is deliveredto the Head of Office at the earliest but not later than one year of dateof retirement. Sub-rule (3) of Rule 13 on the other hand picks out oneout of the several categories falling in Rule 12, namely, a person whoretires on superannuation pension for a special treatment. Sub-rule (3)of Rule 13 contemplates that the Government servant who is due toretire on superannuation and desirous that the payment of the CVP besanctioned or authorized at the time of the pension payment order shallapply for commutation along with pension papers. He must apply priorto the date of retirement. The application is to be submitted in Form1A. It is to reach the Head of Office not later than three months beforethe date of superannuation. Secondly, he must actually retire onsuperannuation pension only.

27. At this juncture, it is necessary to notice Rule 6. Rule 6 providesfor the time when the commutation of pension is to become absolute. Itreads as follows:

“6.Commutation of pension to become absolute-

(1) The commutation of pension shall become absolute in the caseof an applicant referred to- AB

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[2019] 4 S.C.R.

(i) in sub-rule (1) of Rule 13, on the date on which the applicationin Form 1 is received by the Head of Office ; (i-a) in sub-rule (3) of Rule 13, on the date following the date ofhis retirement;

(ii) in Chapter IV, on the date on which the medical authoritysigns the medical report in Part III of Form 4; Provided that - (a) in the case of an applicant who is drawing his pension from atreasury or Accounts Officer, the reduction in the amount of pensionon account of commutation shall be operative from the date ofreceipt of the commuted value of pension or at the end of threemonths after issue of authority by the Accounts Officer for thepayment of commuted value of pension, whichever is earlier, and (b) in the case of an applicant who is drawing pension from abranch of a nationalized bank, the reduction in the amount ofpension on account of commutation shall be operative from thedate on which the commuted value of pension is credited by thebank to the applicant’s account to which pension is being credited.

(c) in the case of an applicant governed by sub-rule (3) of Rule 13in whose case the commuted value of pension becomes payableon the day following the date of his retirement, the reduction inthe amount of pension on account of commutation shall be operativefrom its inception. Where, however, payment of commuted valueof pension could not be made within the first month after the dateof retirement, the difference of monthly pension for the periodbetween the day following the date of retirement and the datepreceding the date on which the commuted value of pension isdeemed to have been paid in terms of Rule 49 of the CentralGovernment Accounts (Receipts and Payments) Rules, 1983, shallbe authroized by the Accounts Officer]

(2) In the case of an applicant referred to in Rule 9 or Rule 10, thecommuted value is paid in two or more stages, the reduction inthe amount of pension shall be made from the respective dates ofthe payments as laid down in Clause (a) or Clause (b) of theproviso to sub-rule (1).

(3) The date on which the payment of the commuted value ofpension was made to the applicant or the commuted value wascredited to the applicant’s account shall be entered in both halvesof the Pension Payment Order by the disbursing authority underintimation to the Accounts Officer who authorized the paymentof commuted value of pension.”

(Emphasis Supplied)

28. Rule 6 declares that the commutation in regard to a personcovered by Rule 13(1) is to become absolute when Form 1 is receivedby the Head of Office. In the case of application under sub-rule (3) ofRule (13), it becomes absolute on the date following the date of hisretirement. We are not to be detained by Chapter 4 which deals withcases where medical examination is necessary. It is important to noticeClause (c) to the proviso to Rule 6. It clearly contemplates that in thecase of person who applied under Rule 13(3), the CVP becomes payableon the date following the date of his retirement. This interpretation isinevitable having regard to the express language of the said Rule. Infact, it contemplates that the reduction in the amount of pension on accountof commutation shall be operative from its inception. This means thatconsequent upon commutation, the full pension which he would otherwisereceive would suffer a diminution and it is to take effect from the veryfirst day following his retirement. In fact, Clause (c) proviso to Rule 6does contemplate a situation where the CVP is not made within the firstmonth from the date of retirement as it provides that the difference ofmonthly pension for the period between the day following the date ofretirement and the date preceding the date on which the CVP is deemedto have been paid in terms of the Central Government Account (Receiptsand Payments) Rules, 1983.

29. We have noticed the Rules. We have found out that the Rulesdeclare the categories of pension which would qualify for commutation.In other words, those persons who fall in Rule 12 of the CommutationRules, without undergoing any medical examination can apply forcommutation, as provided in Rule 13, which includes a person whoreceives superannuation pension. If such a person applies under Rule13, well within the time, he is indeed conferred a legal right under theStatutory Rules to receive commutated pension. It does not lie in the AB

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Amouth of Government which is excepted to act as a model employer tosit over the papers and delay the sanctioning or the payment of the CVP.

30. Therefore in a case where Rule 13(3) applies and theGovernment servant who is due to retire on superannuation applies forgetting CVP along with pension papers, prior to the date of his retirementBas provided and he actually retires on superannuation and his applicationis within time, the CVP must be paid immediately after the retirement. Itmay be true that in the case of a person covered by Rule 18 which dealswith the cases, which we have mentioned, like invalid pension, pensionunder Rule 40 of the Pension Rules on being compulsorily retired byway of penalty or compassionate allowance on being dismissed orCremoved he must undergo a medical examination. Therefore, applicationsby a person covered under Rules 12 and 18 stand on a different footing.As far as application by a person governed by Rule 12, provided hemakes an application as contemplated under Rule and the applicationgives details of the amount of percentage of commutation which heDrequires subject to the maximum of forty percent, he is entitled to demandthe payment of CVP. We have already noticed that the Rule does notprovide the payment of interest. The Office Memorandum dated05.10.1999 does not prohibit payment of interest. The question wouldthen arise on what basis the Government servant can seek interest.

E31. In S.K. Dua Vs. State of Haryana and another, (2008) 3 SCC44, this Court was dealing with a case where the appellant was paidprovisional pension but other retirement benefit were not given includingCVP, leave encashment, gratuity etc. There was a disciplinary proceedingand ultimately the appellant was found exonerated from all the charges.In the said circumstances, the benefits were given after four years. AsFregards the question, as to on what basis interest would be granted fordelayed payment, we notice the following statement of law made by thisCourt:

“14. In the circumstances, prima facie, we are of the view thatthe grievance voiced by the appellant appears to be well- foundedGthat he would be entitled to interest on such benefits. If there areStatutory Rules occupying the field, the appellant could claimpayment of interest relying on such Rules. If there areAdministrative Instructions, Guidelines or Norms prescribed for the purpose, the appellant may claim benefit of interest on thatbasis. But even in absence Statutory Rules, AdministrativeInstructions or Guidelines, an employee can claim interest underPart III of the Constitution relying onArticles 14, 19 and 21 of theConstitution. The submission of the learned counsel for theappellant, that retiral benefits are not in the nature of bounty is, inour opinion, well-founded and needs no authority in support thereof.In that view of the matter, in our considered opinion, the HighCourt was not right in dismissing the petition in limine even withoutissuing notice to the respondents.”

(Emphasis Supplied)

32. Coming to the facts of this case, we notice that the applicantwas given provisional pension under Rule 69 of the Pension Rules. Thisimmediately attracts Rule 4 of the Commutation Rules prohibitingcommutation of the provisional pension. In fact, Rule 69 of the PensionRules contemplates sanctioning of provisional pension which is to beequal to the maximum pension which would have been admissible on thebasis of the qualifying service upto the date of retirement of theGovernment servant or if he was under suspension on the date ofretirement upto the date immediately before being placed undersuspension. This brings us to Rule 9(4) of the Pension Rules, which isthe basis for applying Rule 69. Rule 9(4) reads as follows:

“9(4).In the case of Government servant who has retired onattaining the age of superannuation or otherwise and against whomany departmental or judicial proceedings are instituted or wheredepartmental proceedings are continued under sub-rule (2), aprovisional pension as provided in Rule 69 shall be sanctioned.

33. To fully appreciate the scheme of the Rules, we may alsorefer to Rule 9(6), which reads as follows:

“9(6) For the purpose of this rule -

(a) departmental proceedings shall be deemed to be institutedon the date on which the statement of charges is issued to theGovernment servant or pensioner, or if the Government servanthas been placed under suspension from an earlier date, on suchdate; and

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A9(6)(b) judicial proceedings shall be deemed to be instituted-

(i) in the case of criminal proceedings, on the date on which thecomplaint or report of a Police Officer, of which the magistratetakes cognizance, is made, and

(ii) in the case of civil proceedings, on the date the plaint isBpresented in the Court.”

34. The learned counsel for the appellants and the learned ASGare no doubt correct in contending that there is prohibition againstcommuting of pension but we must notice one aspect. What Rule 4taboos is commutation of provisional pension which is granted underCRule 69 during the pendency of the proceedings.

35. As we have noticed, there are three situations. The firstcategory is where the pension is finalized immediately upon retirementand on the basis of the application, the commutation as permissible subjectto the limit of forty percent, is ordered. The second category is whereDthere is provisional pension granted under Rule 64. In such a case alsocommutation is permissible but of the provisional pension again subjectto the limit under Rule 5. In the third category where provisional pensionis sanctioned on account of pendency of judicial or departmentalproceeding Rule 4 applies and it forbids the commutation of “theEprovisional pension” granted under Rule 69. Since, in this case the applicantwas admittedly sanctioned provisional pension, while the provisionalpension was in place, the applicant could not have sought commutationof the provisional pension granted under Rule 69 in view of the embargoagainst such commutation contained in Rule 4.

F36. On 17.10.2012, the following order was passed:

“Subject: Retirement on superannuation on 31.07.2008 (A/N) -Case of officers of STS of Executive Grade (Adhoc) - Regarding.

In continuation to this office Order No.354-1/2007-Pers-I dated31.07.2008, the following officer of Adhoc STS of Executive GradeG(Telecom/TTS/TFS) permanently absorbed in BSNL is permittedto retire from BSNL Services on attaining the age ofsuperannuation w.e.f. the date indicated against his name.

2. It has been certified that retirement order is being issued onthe basis of Vigilance Clearance received from the CVO, BSNL.

3. This has the approval of the Competent Authority.

4. Copy of Charge Relinquishing report may be sent to this officein respect of all concerned.”

37. On the basis of the same, apparently the applicant movedapplication on 01.11.2012 where he sought commutation of pensionwithout medical examination. He showed his date of retirement as31.07.2008. He sought the maximum admissible fraction as the proposedcommutation. On the basis of same, the appellant was admittedlysanctioned CVP in December, 2012. If the application dated 01.11.2012is taken as the basis of sanctioning of the CVP then there can be noground at all to give any interest as CVP has been given within areasonable time.

38. The question, however, arises whether as has been found byboth, the Tribunal and the High Court, this should be treated as a casewhere the applicant should be granted interest from the date of hisretirement on account of the fact that on the date of his retirement therewas neither the departmental proceeding nor a judicial proceeding.

39. As far as the argument of the learned ASG that there was adepartmental proceeding pending by virtue of the fact that an order ofsuspension was passed within the meaning of Rule 9(6), which we havealready referred to, we are of the view that there is no merit in the saidcontention. While the applicant was placed under suspension, in the year1997, it is equally indisputable that the said suspension was revoked inthe year 1999 well before the date of superannuation of the applicant. Itis not the law that to constitute a departmental proceeding that aGovernment servant has been placed under suspension at some point oftime of his career. What is contemplated is that there must be a suspension A

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Awhen the applicant would have otherwise retired on superannuation. Inthis case the suspension stood revoked several years prior to his date ofsuperannuation. Therefore, the suspension which was subsequentlyrevoked cannot constitute suspension within the meaning of Rule 9(6)(b)of the Pension Rules and we have no hesitation in repelling the argumentof learned ASG.B

40. A case under the Prevention of Corruption Act was lodgedagainst the applicant. However, the ACB, in the course of investigationapparently was not able to muster enough material to prosecute thecase. This resulted in the agency filing what is described as A-summary.The A-summary came to be dealt with in the following manner by theCSessions Judge:

“Heard.

Accused is traceable. There is no question of granting “A”Summary. it is nobody’s case that accused is absconding. If at all,DI.O. fact that evidence is not sufficient to prosecute the accused.He may apply under Section 169 of Cr.P.C. Hence rejected as itis not tenable at law.”

41. This order was passed prior to the date of superannuation ofthe applicant. It is, therefore, that Criminal Revision Application No.52Eof 2007 came to be filed before the High Court of Gujarat. By orderdated 30.03.2012, the revision came to be allowed. It is noticed that theapplicant opposed the revision. The A-summary was to be given in acase where the case is found to be true but the accused is absconding.Further, if the evidence against the accused is not sufficient to prosecutethe accused, also A-summary could be given. The High Court took theFview as follows:

“The report made to the Court below by the investigating officerwas, therefore, made under Section 173 of the Code and the Courtwas required to pass an order under Section 173(4) of the Code,which the Special Court has failed to do. The order passed by theGlearned Principal District and Sessions Judge, Banaskantha atPalanpur, dated 03.05.2006 is, therefore, set aside. The prayersought by the investigating officer for Summary “A” is allowed.Accordingly, present revision application is allowed. Rule is madeabsolute to the aforesaid extent. Muddamal currency note beconfiscated to the State.”H

42. It is true that well before his retirement the agency which hadno doubt conducted a trap against the applicant, had itself found thatthere was no material in view of subsequent developments. It could besaid that this is a case where the applicant was exonerated by the agencywell before the date of his retirement. No doubt this is not a case wherethe applicant has been acquitted honourably after trial. In fact, therewas never a trial and the case was not sent up for trial in view of thesubmission of A-summary.

43. The other question also must be considered and that questionis whether there was a judicial proceeding pending at the time of theretirement. A perusal of Rule 9 of the Pension Rules would show thatGovernment had a right to withhold the pension or gratuity or both eitherin full or in part or withdraw a pension in full or in part either permanentlyor for the specified period. Government is also authorized to orderrecovery from pension or gratuity of the whole or in part of any pecuniaryloss caused, if in any departmental or judicial proceeding, the pensioneris found guilty of grave misconduct or negligence during the period of hisservice which includes service after reemployment. Thereafter, sub-rule 9(6) deals with what constitutes when a departmental or a judicialproceeding will be deemed to commence. Judicial proceedings are dividedinto two categories. First category is a criminal proceeding. Secondcategory is civil proceeding. As far as civil proceeding is concerned, it isdeemed to be instituted when a plaint is presented. In other words, uponpresentation of a plaint in a civil case judicial proceeding commences. Inthe case of a criminal proceeding by the deeming provision, it is deemedto have been instituted for the purpose of Rule 9 when the complaint orreport of a police officer is made, but that is not sufficient. In a casewhere a complaint or a report of a police officer is made to a Court, itshould culminate in cognizance being taken by the Magistrate, for thedepartment to contend that the date of the complaint or report is to bethe date of institution of the proceedings.

44. From the order of the Sessions Judge which alone is produced,it is not clear that cognizance was taken. The criminal revision is a criminalproceeding. But the case was about the ‘A’ diary not being accepted. Ifthe criminal revision was dismissed then the matter would have beenproceeded with by the Sessions Judge. It is in the region of conjectureas to what would have followed suit. At the time of the retirement, theauthorities could not have divined what would happen in the revision. No A

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Adoubt, the purport of the revision petition was that the State wanted the‘A’ Summary to be accepted. The acceptance of ‘A’ Summary which,in fact, was ordered by the High Court would have brought the litigationas against the applicant to an end. Insofar as, we later propose to renderour finding on the effect of no application being filed under Rule 13(3)and also keeping in mind that the applicant did not take steps to challengeBthe order dated 04.08.2008,we would think that much may not turn onour even accepting the view of the High Court, that there was no criminalproceeding as on the date of the retirement. It also must be noted thatthe present is not a case where the authorities acted without any materialat all even. We proceed on the basis that the criminal revision petition isCnot criminal proceeding under Rule (9) of the Pension Rules. A viewwas taken by the authorities regarding the same at the point of timewhich could not be said to have been taken without any basis at all. This,we say as the basis for interest on CVP can only be state action whichis arbitrary. It is relevant to note that both sides proceeded on the basisthat there was a proceeding within the meaning of Rule 9 and 69 of theDPension Rules. Further, even at the time when the order dated 04.08.2008was passed it was open to the applicant to complain that there was nojudicial proceeding, having regard to the nature of the proceeding pendingin the High Court. The applicant instead chose not to question thesanctioning of provisional pension under Rule 69 and continued to receiveEthe provisional pension. We will notice the consequences of the saidorder on his right to apply under Rule 13(1).

45. We have noticed that a claim for interest in regard to CVPmay lie when an application has been made in time under rule 13(3) andthe payment is delayed. But in a case where application is made underFRule 13(1) which can be made within a period of one year from the dateof retirement, the same would have to be processed and undoubtedly atthe earliest it must be brought to its logical culmination as per the rules.But certainly, in a case falling under Rule 13(1) there can be no questionof paying interest from the date of retirement as the application itself ispredicated after the date of retirement. No doubt the question as toGpayment of interest even in such cases would arise based on the date ofapplication and the reasonableness of the time taken in processing it andthe arbitrariness in a particular case in delaying the matter. This we sayfor the reason that as held in by this Court in S.K. Dua (supra) thepremise on which interest can be granted in the case of CVP also is theH

breach of Articles 14 and 21 and it is a matter to be decided on the factsof each case.

46. It is significant to note that in this case the applicant has nocase even that he made an application within the meaning of Rule 13(3)of the Commutation Rules as contemplated before three months of hisretirement. Nothing stood in the way of the applicant applying underRule 13(3) apparently. If on the other hand, there was any legalimpediment which stood in the way, then also he cannot claim the CVPon retirement. Without having made such an application under theCommutation Rules, it is clear that there can be no question of evenbecoming entitled to commute pension w.e.f. first day following hisretirement. The Tribunal and the High Court have completely overlookedthe conspectus of the Rules. The Tribunal, in fact, has proceeded toconsider the matter from the standpoint of interest payable on gratuitywhich also was claimed by the applicant and has not focused on thequestion relating to the point of time when CVP becomes payable, andthat the nature of CVP being one dependent entirely on an applicationfrom the Government servant and therefore we have no hesitation incoming to the conclusion that the direction to pay interest on the CVP, asordered by the Tribunal, from the date of retirement from 01.08.2008 isclearly erroneous. Now, as far as Rule 13(1) is concerned, it enables aperson who is in receipt of a pension under Rule 12, to apply afterretirement but within one year thereof for CVP. It is true that theapplicant was not in receipt of any pension under Rule 12 and therefore,he could not have applied under Rule 13(1). This is for the reason that asper order dated 04.08.2008, he was to be given provisional pension whichas we have noted was under Rule 69 of the Pension Rules. Theapplicant, however, proceeded to accept the provisional pension. It istrue that the effect of the order dated 04.08.2008 of the sanctioning ofthe provisional pension under Rule 69, was that he was precluded fromapplying for commuting the provisional pension, in view of Rule 4 and onthe other hand, as he was not in receipt of superannuation pension, hecould not have filed an application under Rule 13(1). Thus, a questionmay arise. Having issued order dated 04.08.2008, the effect of whichwe have clarified, should interest be ordered on the basis that theapplicant was prevented from applying for CVP under Rule 13(1). Wehave already found that the applicant was not precluded from makingany application under Rule 13(3). Had he done so, his claim for interest A

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Afrom the date of retirement could have been considered under Articles14 and 21. We also take note of the fact that the applicant did notchallenge the order dated 04.08.2008and he continued to accept theprovisional pension sanctioned thereunder. There could be no questionof granting interest from the date of retirement in view of the absence ofany application under Rule 13(3). We make it clear that we are notBpronouncing about the liability to interest on DCRG amount which is notsubject matter of controversy before us and the direction to pay intereston gratuity is not being interfered with.

47. In the light of this, we are of the view, the appeal is to beallowed as above. We do so. The impugned order will stand set-asideCand the order of the Tribunal directing payment of interest on CVP shallstand set-aside. No order as to costs.

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Kalpana K. Tripathy

Appeal allowed.

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