P. N. Shukla vs Union Of India And Ors.
2015 Latest Caselaw 7410 Del

*       IN THE HIGH COURT OF DELHI AT NEW DELHI
                                  Judgment reserved on September 21, 2015
                                 Judgment delivered on September 29, 2015
+                       W.P (C) No. 7775/2013 & CM No.16544/2013

P. N. SHUKLA                                         ..... Petitioner
                             Through:   Mr.Tarun Gupta, Advocate

                             versus

UNION OF INDIA AND ORS.
                                                    ..... Respondents
                             Through:   Mr.Amit Mahajan, CGSC
                                        with Mr.Nitya Sharma, Adv.
                                        for R1
                                        Mr.Naveen R. Nath, Adv.
                                        with Mr.Sharvan, Adv. for
                                        R2 and R3

CORAM:
HON'BLE MR. JUSTICE V.KAMESWAR RAO
V.KAMESWAR RAO, J.

1. The present writ petition has been filed by the petitioner seeking

the following reliefs:

"(a) Issue appropriate writ, order or direction especially in the nature of certiorari quashing the order dated 21.3.2013 issued by Canara Bank (Respondents No.2&3 herein);

(b) Issue appropriate, writ, order or direction especially in the nature of certiorari quashing the letters dated 16.4.2013, 16.5.2013, 10.6.2013, 8.7.2013, 28.8.2013, 11.9.2013 and 3.10.2013 issued by Respondents No.2 & 3;

(c) Issue appropriate, writ, order or direction especially in the nature of certiorari quashing the executive instructions/clarification dated 15th May, 2008 issued by

the Ministry of Finance, Department of Financial Services (Respondent No.1);

(d) issue any such further and other writ, order or direction, as this Hon'ble Court deems appropriate and fit in the facts and circumstances of the case; and

(e) award the costs of the present Writ Petition."

2. Some of the facts as noted from the writ petition are, the petitioner

joined the respondent No. 2-bank as a Special Officer. Being a Special

Officer, he was allowed relaxation upto to the age of 35 years at the time

of his initial recruitment through the Banking Services Recruitment

Board. On September 25, 1999 the Canara Bank (Employees) Pension

Regulations, 1995 ('Pension Regulations, 1995', in short) were

formulated. Regulation 3 of the same deals with application and

eligibility for the Pension Regulations, 1995. The employees who have

opted for pension in view of the Pension Regulations 1995 and exercised

their option within the prescribed time were covered under the Pension

Regulations, 1995. There is no dispute that the petitioner exercised the

option under the said Regulations.

3. The petitioner retired on attaining the age of superannuation on

March 31, 2008. It is the case of the petitioner that at the time of

retirement, the petitioner was given benefit of Regulation 26 of the

Pension Regulations, 1995 inasmuch as he was given benefit of

additional qualifying service of five years and his pension was fixed

accordingly. It is the case of the petitioner that five years after his

retirement, the respondents arbitrarily and whimsically revised the

pension of the petitioner and reduced the same from Rs. 13,448 to Rs.

11,129/- on the ground that the petitioner was not entitled to the benefit

of additional qualifying service. It is his case that no prior notice much

less, opportunity of hearing was ever given to the petitioner before

reducing the pension. The representation of the petitioner to the higher

authorities did not find favour inasmuch as in response to the said

representation, it was the stand of the respondents that Regulation 26 of

the Pension Regulations, 1995 is not applicable to the case of the

petitioner and the benefit of the additional qualifying service was given

to him by mistake.

4. The respondent Nos. 2 and 3, in their response before this Court

has, on merit, taken a stand that the petitioner was wrongly extended the

benefit of five years of additional qualifying service as per Regulation 26

of the Pension Regulations, 1995, inasmuch as, his eligibility was taken

as 29 years instead of 24 years, without taking cognizance of the pre-

conditions mentioned in the Pension Regulations, 1995. However,

noticing the mistake, the respondents have rectified the same by

proportionately reducing the pension payable to the petitioner and

continue to pay him the pension as per his eligibility.

5. There is no dispute to the fact, the respondents have not effected

any recovery of the excess pension paid to the petitioner on the strength

of his eligibility being of 29 years.

6. Mr. Tarun Gupta, learned counsel appearing for the petitioner

would submit that the issue, which arises for consideration in this writ

petition, is, covered by the judgments of the High Court of Madras in

W.P.(C) 14364/1997 P.Thirikooda Rajappan Vs. Chairman &

Managing Director Vijaya Bank, Head Office, Bangalore & Ors.

decided on July 7, 2004 and of the High Court of Judicature of Andhra

Pradesh at Hyderabad in T.V.Chalapathi Raod Vs. The Managing

Director, State Bank of Hyderabad, Hyderabad and Anr. decided on

February 10, 2010. He would further state that the benefit of Regulation

26 has been given to the similarly placed persons like the petitioner, who

were recruited before the formulation of the Pension Regulations, 1995

and also with regard to those persons who were recruited after the

Pension Regulations, 1995 were formulated, wherein, it has been

principally decided that in the case of a Specialist Officer even, without

amending the Recruitment Rules, seeking the approval of the Central

Government, without there being a stipulation in the appointment letter,

the benefit be given. That apart, it is his submission that the pension has

been reduced without issuing a show cause notice and a decision having

been effected, no purpose would be solved on a post decisional hearing.

He would also state, as on date, assuming the benefit of Regulation 26 is

not applicable to the petitioner, still, the respondent Nos. 2 and 3 cannot

reduce the pension of the petitioner in view of the judgment of the

Supreme Court in the case reported as 2010 (12) SCC 405, Union of

India and Anr. Vs. P.N.Natarajan and Ors. He would also rely upon

the judgment of this Court in the case of Union of India Vs. M.L.Mehta,

W.P.(C) 9903/2006 decided on August 8, 2008 to advance similar plea

which he has advanced relying upon the case of P.N.Natarajan and Ors.

(supra).

7. On the other hand, Mr. Naveen Nath, learned counsel for the

respondent Nos. 2 and 3 would state, that the petitioner could not have

been given benefit of the Regulation 26 of the Pension Regulations, 1995

inasmuch as the Regulations contemplate, the benefit, to be given if the

Recruitment Rules stipulates such a benefit, and the Recruitment Rules

which contemplates such a benefit, need to be made with the prior

approval of the Central Government. According to him, there is no

amendment to the Recruitment Rules till date, which requires the

approval of the Central Government. In other words, it is his submission

that the Regulation 26 pre-supposes, certain measures be taken before

the benefit of the same can be given to an Officer. He, on instructions,

would also state that the plea advanced by the learned counsel for the

petitioner that such a benefit has been given to the persons similarly

situated like the petitioner and also to the persons appointed after the

Pensions Regulations, 1995 were formulated, is baseless and not correct.

According to him, the Regulations have come up for interpretation

before various Courts including the High Court of Karnataka at

Bangalore in W.P.(C) 30323/1996, B.Vittal Pai Vs. Syndicate Bank,

Manipal, decided on August 22, 1999, High Court of Gujarat at

Ahmedabad in Special Civil Application Nos. 2650/1999 and 1794 and

1844 of 2002, Bank of Baroda Retired Officers' Association and Anr.

Vs. Chairman and Managing Director, Bank of Baroda and Anr.,

decided on March 4, 2004, and High Court of Punjab and Haryana in

Civil Writ Petition No. 10778/1998, H.S.Sodhi Vs. Oriental Bank of

Commerce, decided on August 18, 2004, wherein, the vires of the

regulation has been upheld.

8. Having heard the learned counsel for the parties, the issue which

arises for consideration is whether, a Specialist Officer, like the

petitioner would be entitled to the benefit of Regulation 26

automatically, without, following the procedures as contemplated in the

said Regulations.

9. Insofar as the judgment in P.Thirikooda Rajappan (supra) relied

upon by the learned counsel for the petitioner is concerned, there, the

facts were, the petitioner was directly recruited as an officer in South

India Bank Ltd. After completing nearly ten years of service, he applied

for the post of Officer in Vijaya Bank Ltd. The petitioner was appointed

as Junior Level officer permanently on April 21, 1975. Vijaya Bank Ltd.

was nationalized on 1980. After completing nearly 21 years and 4

months of service in Vijaya Bank, the petitioner reached the age of

superannuation in December 1996 and hence, he was retired on

December 31, 1996. On his retirement, he became eligible for pension as

per the provisions of Vijaya Bank Employees' Pension Regulations,

1995. The petitioner opted to come under the Pension Regulations. The

petitioner's request for giving the benefit of five years of additional

qualifying service as per Regulation 26 of the Bank was rejected. The

stand of the Bank in that case was that the petitioner does not satisfy the

conditions laid down in Regulation 26, and therefore, he would not be

eligible for additional five years of qualifying service for superannuation

pension. It was held, Regulation 26(a) would be applicable only if the

service or post is one for which certain special qualification or

experience-scientific, technological or professional field is required; the

post to which he was appointed, never required any special qualification

or experience. It was also the stand of the respondent bank that the

petitioner does not qualify to get the benefit of Regulation 26 and that,

the second proviso to Regulation 26 would apply only if the recruitment

rules contained specific provisions that the service or post is one which

carried the benefit of this regulation. Neither the earlier rules, under

which the petitioner was recruited, nor the present rules stipulate that the

post of 'Officer' shall carry the benefit of Regulation 26. The third

proviso stipulates that the benefit would apply only if the recruitment

rules in respect of service or post, which carried the benefit of the

regulation, were made with the approval of the Central Government.

The Madras High Court was of the view that a Proviso is an exception or

additional requirement to the main rule, it carves out a field to which the

main provision would not apply, the provision can only be subsidiary in

nature and it cannot be contradictory to the main rule. In other words, it

was held that the Proviso cannot be such as to directly oppose to the

main provision. Thus, it was the conclusion of the Madras High Court

that the Regulation confers the benefit for the first time in the year 1995;

a maximum of five years of qualifying service is added for certain

category of persons. That cannot be nullified by the proviso. That is , the

main proviso gives the benefit to a class of persons and that benefit

cannot be nullified by the third proviso inasmuch as the third proviso

would nullify the benefit conferred under the main Regulation 26 insofar

as it relates to the employees who are already in service, and thus, the

Madras High Court granted relief to the petitioner in the said case.

10. In the case of T.V.Chalapathi Raod (supra), the High Court of

Andhra Pradesh even though dealing with the case of State Bank of

Hyderabad, by placing reliance on the judgment of the Madras High

Court in P.Thirikooda Rajappan's case (supra) by stating that the

Regulations are, para-materia the same, held, the petitioners would be

entitled to the benefits of Regulation 26 of the Regulations.

11. Insofar as the judgments relied upon by Mr. Naveeen Nath are

concerned, in B.Vittal Pai's case (supra), the High Court of Karnataka

has, on Regulation 26, held as under:

"As it can be seen from clause (a) of Regulation 26, an employee is entitled for the benefit of the extended service of five years, provided he was appointed to a post for which postgraduate research, or specialist qualification or experience in scientific, technological or professional fields, was required. The order of appointment of the petitioner in the respondent-Bank, a copy of which has been produced as Annexure-C, does not state that the petitioner was appointed on account of the postgraduate research, specialist qualification or experience in scientific, technological or professional fields. The said order simply states that the petitioner was appointed as an officer of the Bank. There is no material placed before me by the petitioner to show that the petitioner was appointed keeping in mind his specialist qualification or experience. Therefore, as observed by me earlier, I am of the view that the petitioner, on facts, is not entitled for the benefit of Regulation 26 of the Pension Regulations. Even otherwise, in my view, Regulation 26 is

prospective in nature. As rightly contended by Sri Ramadas, while benefit of pension is made retrospective, the provisions contained in Regulation 26 are made prospective. This is clear from the provisos given to Regulation 26.

11. Now, the last question is as to whether the second and third provisos given to Regulation 26 of the Pension Regulations are required to be struck down as discriminatory in nature as contended by Sri Rajagopal. Even on this question, I am unable to accede to the submission of Sri Rajagopal. As noticed by me earlier, when the Pension Scheme is made operative retrospectively, Regulation 26 of the Pension Regulations, in my view, is prospective in operation. Further, payment of pension was not one of the conditions of service, which was applicable to the employees of the Bank till passing of the Pension Regulations. Therefore, merely because the benefit of Regulation 26 is not given to all the employees including the employees who have retired from service, it is not possible to take the view that the second and third provisos given to Regulation 26 are liable to be struck down as discriminatory in nature. The benefit of previous service is an additional concession given by the Pension Regulations; and that too limited number of posts which satisfy the requirements laid down in the said regulations. While framing the Pension Regulations, since new benefits are extended, in my view, it is open to the Bank to make it prospective in operation. It is not the case where the petitioner and other employees of the Bank were entitled for the benefit of the Pension Scheme and an additional benefit under the scheme is sought to be given to the existing benefits. Therefore, Sri Rajagopal cannot derive any assistance from the decision of the Supreme Court in the case of D.S. Nakara, supra. As observed by me earlier, in the instant case, the benefit of the Pension Scheme was introduced for the first time after the retirement of the petitioner from service. In my view, while introducing the Pension Scheme for the first time, as it has been done in the instant case, while the scheme was made to come into operation with effect from 1986, it was open to the authorities to impose certain conditions to make the scheme applicable in respect of part of the additional benefit given under the

scheme prospective in operation. In such cases, there is no question of discrimination or any scope for making a grievance that such provisions are violative of Article 14 of the Constitution of India. The provision in the scheme has to be understood in the backdrop of the timing and object of the introduction of the scheme. The two provisos impugned, which impose certain conditions for the benefit of additional service of five years, in my view, cannot be considered as either unreasonable or arbitrary."

12. In the case of Bank of Baroda Retired Officers' Association and

Anr. (supra), the High Court of Gujarat has held as under:

"6. As is mentioned in the letter dated 10th December, 1996, the matter was referred to Indian Banks Association, which, in turn, had referred the matter to the Central Government. Finally, it was clarified that the employees, employed by the Bank prior to the implementation of the Pension Scheme, are not covered under pension regulation-26. The learned Advocate for the petitioners submitted that the regulations in question are made, as is mentioned in the Notification dated 29th September, 1995, in exercise of the powers conferred by Clause (f) of sub.section (2) of Section 19 of the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970 (5 of 1970), by the Board of Directors of Bank of Baroda, after consultation with the Reserve Bank of India and with the previous sanction of the Central Government. In that view of the matter, there was no reason for referring the matter to the Central Government on the question as to whether petitioner no. 2 and the officers similarly situated are entitled to get the benefits under regulation-26 or not. This submission of Mr. Jani does not find favour with this Court for the simple reason that the management of the Bank was never against its own officers, but then, as the question involved financial repercussions, the matter was required to be referred to the Central Government so as to ensure that the interpretation of the management is not incorrect. This act of referring the matter to the Central Government for

guidance on the question of applicability of regulation-26, can never be said to be uncalled for, much less mala fide on the part of the Bank. On the contrary, it is clear from the record that if the Government had accepted the demand of petitioner no. 2 and other officers, the management would not and could not have denied the same.

13. Further, in H.S.Sodhi's case (supra), the High Court of Punjab

and Haryana has held as under:

"15. True it is that as per sub-clause (c) above, an employee "shall be eligible" to add to his service qualifying for pension, a period of 5 years if the service or post to which he is appointed is one for which the candidate was given age relaxation over and above the maximum age limit fixed by the Bank on account of his possessing higher qualifications or experience. However, the aforementioned benefit is subject to three pre-conditions including the one incorporated in the third proviso that the recruitment rules in respect of any service or post which carries the benefits of this regulation "shall be made with the approval of the Central Govt." It has been asserted by Shri Arora, learned counsel for the Bank that clause 26 is prospective in nature and its benefit will be admissible to the serving employees of the Bank only if there exist a specific provision in the recruitment rules to the effect that the said service/post "is one which carries benefits of this regulation" and/or the recruitment rules in respect of such service/post are amended with the approval of the Central Govt. According to Shri Arora, none of these eventualities exists in the present Clause 26 itself, as in para 3 of its written statement, the Bank has specifically disputed the fact that the petitioner was recruited as Manager attaching any special consideration with regard to his age, etc.

16. In my view, Shri Arora is right in contending that the benefit provided in clause 26 of the Pension Regulations is pre-conditional and unless these conditions are satisfied, the benefit under this regulation cannot be claimed. Firstly, there is no material on record to suggest that the petitioner was

recruited by granting the "age relaxation" only on account of his possessing higher qualifications or the experience. Secondly, no provision of recruitment rules, amended or enforced after the pension scheme of 1995 came into force, has been brought to my notice which prescribe the grant of such benefit to the members of the service and/or holder of a post. Thirdly, it is not the case of the petitioner that any amendment in the recruitment rules, conferring this benefit, has been brought into force with the approval of the Central Govt. In the absence of any such material on record, I am unable to accept the second contention of Shri Patwalia as well."

14. Having considered the judgments relied upon by the learned

counsel for the parties, more specifically, with regard to the applicability

of Regulation 26 of the Pension Regulations 1995, suffice to state, a

proviso to a Regulation (in this case) is an exception to the main

Regulation. It has been held by the Supreme Court in the case reported

as AIR 1959 SC 713, The Commissioner of Income Tax, Mysore,

Travancore-Cochin and Coorg Bangalore vs. The Indo-Mecantile

Bank Ltd, that the proper function of a proviso is that it qualifies the

generality of the main enactment by providing an exception and taking

out as it were from the main enactment a portion which but for the

proviso would fall within the main enactment. Ordinarily it is foreign to

the proper function of a proviso to read it as providing something by way

of an addendum or dealing with a subject which is foreign to the main

enactment. It is also held by the Supreme Court in the case Ram Narain

Sons Ltd vs. Assistant Commissioner of Sales Tax 1955 SCR 483 as

under:-

"It is cardinal rule of interpretation that a proviso to a particular provision of a statute is only embraces the field which is covered by the main provision. It carves out an exception to the main provision to which it has been enacted as a proviso and to no other".

A proviso must be read with relation to the substantive provision to

which it stand as a proviso. The substantive provision and the proviso

need to be read harmoniously, otherwise, the very purpose of the proviso

gets defeated. In fact, if the intent of the rule making authority was to

give effect to the substantive provision only, there was no reason to

incorporate the provisos. Having formulated/incorporated the provisos,

the effect thereof must be given. In the case in hand, on a harmonious

reading of Regulation 26 of the Regulations of 1995, there is no

repugnancy. I note for benefit the following observation of the High

Court of Gujarat in Bank of Baroda Retired Officers' Association and

Anr. (supra), which is reproduced as under:

"This regulation is having three provisos. While determining the applicability of a regulation the provisos attached to it cannot be overlooked or brushed aside. Therefore, it is necessary to take into consideration the contents of these provisos......"

15. Similar is the reasoning given by the High Court in the case of

H.S. Sondhi (supra) with which reasoning I agree, wherein, the High

Court has rightly held, the benefits of Regulation 26 can only be given if

the recruitment rules in respect of any service or post carries the benefit

of Regulation and made with the approval of the Central Government.

16. That apart, I agree with the conclusion drawn by the High Court of

Karnataka in B.Vittal Pai's case (supra), wherein, the High Court of

Karnataka has held that the two provisos, which were impugned,

imposed certain conditions for the benefit of additional service of five

years which according to the Court, was not unreasonable and arbitrary.

The conclusion must be drawn is, Regulation 26 would be effective only

if recruitment rules contain specific provision that the service or post is

one which carries benefit of the Regulation and the recruitment rules in

respect of the service or post has been made with the approval of the

Central Government, which is not the case here. Hence, the Regulation

26, has no applicability to the petitioner.

17. Having held so, the question, which arises is, whether the

petitioner's pension need to be revised by upholding the action of the

respondent Nos. 2 and 3. In the case of P.N.Natarajan and Ors. (supra)

on which reliance was placed by Mr. Gupta, the Supreme Court has held

as under:

"15. We have considered the respective submissions and carefully scrutinised the records. Although neither the learned Single Judge nor the Division Bench considered

the issue of violation of the rules of natural justice, having given serious thought to the entire matter, we are convinced that the retiral benefits payable to the respondents could not be revised to their disadvantage without giving them action-oriented notice and opportunity of heawring. By virtue of the option exercised by them under Section 12-A(4)(b) and consequential action taken by the competent authority to fix their pension, etc., the private respondents acquired a valuable right to accordingly receive the financial benefits and the same could not have been reduced without complying with one of the basic rules of natural justice that no one shall be condemned unheard. The rule of audi alteram partem has been treated as fundamental to the system established by rule of law and any action taken or order passed without complying with that rule is liable to be declared void-State of Orissa vs. Dr. Binapani Dei and Sayeedur Rehman vs. State of Bihar.

16. It is not in dispute that before directing revision of the pension, etc. payable to the private respondents, the Central Government did not give them action-oriented notice and opportunity of showing cause against the proposed action. Therefore, it must be held that the direction given by the Central Government to revise the retiral benefits including the pension payable to the respondents was nullity."

18. That the aforesaid judgment of the Supreme Court in P.N.

Natarajan & Ors. (supra) was considered by the Supreme Court in its

later opinion in the case reported 2013 (12) SCC 433 Union of India &

Ors. vs. Shri Bhanwar Lal Mundan, wherein the Supreme Court has

held as under:-

"17. The aforesaid conclusion was arrived at as the Union of India as such could not have invoked the terms of the memorandum of settlement to justify the directives and retiral benefits payable to the respondents. The

aforesaid decision has to be read in the context of its facts and not to be construed as a precedent for the proposition that if the pay has been erroneously fixed that cannot be revised even if the facts are absolutely clear and undisputed."

19. From the above, it is clear that the Supreme Court in Shri

Bhanwar Lal Mundan's (supra) has held that its decision in P.N.

Natarajan & Ors. (supra) has to be read in the context of its facts and

not to be construed as a precedent for the proposition that if the pay has

been erroneously fixed that cannot be revised even if the facts are

absolutely clear and undisputed. In the present case, except the fact that

the petitioner was not given a show cause notice before revising the

pension, it is not in dispute that the petitioner was not entitled to the

benefit of Regulation 26 of the Pension Regulations, 1995. Even if a

direction is given to issue a show cause notice to the petitioner in

compliance with the principles of natural justice, the same would be an

empty formality inasmuch as in view of the conclusion of this Court that

the petitioner was not entitled to the benefit of Regulation 26. The

benefit having been given under a mistake, which is sought to be

rectified by the respondent Nos.2 & 3, no fault can be imputed to such an

action. It is a conceded case of the parties that the respondent Nos.2 & 3

even though revised the pension but had not effected the recovery of the

excess amount paid to the petitioner, which this Court is of the view

rightly so when the petitioner was not at fault to get the higher pension

on the basis of extra-qualifying service of 5 years added to his actual

service.

20. In view of the above, I am of the view that the reliance placed by

the petitioner in the case of M.L. Mehta's (supra) would also be of no

benefit to the petitioner.

21. I note for benefit the following conclusion of the Supreme Court

in Shri Bhanwar Lal Mundan's (supra):-

"22. In the case at hand, as stated earlier, the respondent was getting higher scale of pay in the post while he was holding a particular post as a deputationist. After his repatriation to the parent cadre on selection to a higher post he was given higher scale of pay as it was fixed keeping in view the pay scale drawn by him while he was working in the ex-cadre post. Such fixation of pay, needless to say, was erroneous and, therefore, the authorities were within their domain to rectify the same. Thus analysed, the irresistible conclusion is that the tribunal and the High Court have fallen into error by opining that the respondent would be entitled to get the pension on the basis of the pay drawn by him before his retirement."

22. In view of the discussion above, I am of the view that the

petitioner is not entitled to any relief as prayed for in the petition. The

writ petition is dismissed. No costs.

CM No.16544/2013

In view of the order passed in the writ petition, the present

application is dismissed as infructuous.

(V.KAMESWAR RAO) JUDGE SEPTEMBER 29, 2015 akb