IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 6770 OF 2013
(Arising out of Special Leave Petition (Civil) No. 1427 of 2009)
State of Jharkhand & Ors. ….. Appellant(s)
Vs.
Jitendra Kumar Srivastava & Anr. …..Respondent(s)
WITH
C.A. No. 6771/2013
(arising out of SLP(C) No. 1428 of 2009)
J U D G M E N T
A.K. Sikri, J
1. Leave granted. pensionary
2. Crisp and short question which arises for consideration in these
cases is as to whether, in the absence of any provision in the Pension
Rules, the State Government can withhold a part of pension and/or
gratuity during the pendency of departmental/ criminal proceedings? The
High Court has - answered this question, vide the impugned judgment, in
the negative and hence directed the appellant to release the withheld
dues to the respondent. Not happy with this outcome, the State of
Jharkhand has preferred this appeal.
3. For the sake of convenience we will gather the facts from Civil
Appeal arising out of SLP(Civil) No. 1427 of 2009. Only facts which need
to be noted, giving rise to the aforesaid questions of law, are the
following:
The respondent was working in the Department of Animal Husbandry and
Fisheries. He joined the said Department in the Government of Bihar on
2.11.1966. On 16.4.1996, two cases were registered against him under
various Sections of the Indian Penal Code as well as Prevention of
Corruption Act, alleging serious financial irregularities during the
years 1990-1991, 1991-1992 when he was posted as Artificial Insemination
Officer, Ranchi. On promulgation of the Bihar Reorganisation Act, 2000,
State of Jharkhand (Appellant herein) came into existence and the
Respondent became the employee of the appellant State. Prosecution, in
respect of the aforesaid two criminal cases against the respondent is
pending. On 30th January, 2002, the appellant also ordered initiation of
disciplinary action against him. While these proceedings were still
pending, on attaining the age of superannuation, the respondent retired
from the post of Artificial Insemination Officer, Ranchi on 31.08.2002.
The appellant sanctioned the release and payment of General Provident
Fund on 25.5.2003. Thereafter, on 18.3.2004, the Appellant sanctioned 90
percent provisional pension to the respondent. Remaining 10 percent
pension and salary of his suspension period (30.1.2002 to 30.8.2002) was
withheld pending outcome of the criminal cases/ departmental inquiry
against him. He was also not paid leave encashment and gratuity.
4. Feeling aggrieved with this action of the withholding of his 10
percent of the pension and non-release of the other aforesaid dues, the
respondent preferred the Writ Petition before the High Court of
Jharkhand. This Writ Petition was disposed of by the High Court by
remitting the case back to the Department to decide the claim of the
petitioner for payment of provisional pension, gratuity etc. in terms of
Resolution No. 3014 dated 31.7.1980. The appellant, thereafter,
considered the representation of the respondent but rejected the same
vide orders dated 16.3.2006. The respondent challenged the rejection by
filing another Writ Petition before the High Court. The said petition
was dismissed by the learned Single Judge. The respondent filed C.A.
No.6770/2013 @ SLP (C) No. 1427 of 2009 Intra Court Appeal which has
been allowed by the Division Bench vide the - impugned orders dated
31.10.2007. The Division Bench has held that the question is squarely
covered by the full Bench decision of that Court in the case of Dr. Dudh
Nath Pandey vs. State of Jharkhand and Ors. 2007 (4) JCR 1. In
the said full Bench Judgment dated 28.8.2007, after detailed discussions
on the various nuances of the subject matter, the High Court has held:
“ To sum up the answer for the two questions are as follows:
(i) Under Rule 43(a) and 43(b) of Bihar Pension Rules, there is no power
for the Government to withhold Gratuity and Pension during the pendency
of the departmental proceeding or criminal proceeding. It does not give
any power to withhold Leave Encashment at any stage either prior to the
proceeding or after conclusion of the Proceeding.
(ii) The circular, issued by the Finance Department, referring to the
withholding of the leave encashment would not apply to the present facts
of the case as it has no sanctity of law”.
5. Mr. Amarendra Sharan, the learned Senior Counsel appearing for the
petitioner accepted the fact that in so far as the Pension Rules are
concerned, there is no provision for withholding a part of pension or
gratuity. He, however, submitted that there are administrative
instructions which permit withholding of a part of pension and gratuity.
His submission was that when the rules are silent on a particular
aspect, gap can be filled by the - administrative instructions which was
well settled legal position, laid down way back in the year 1968 by the
Constitution Bench Judgment of this Court in Sant Ram Sharma vs. Union of India 1968 (1) SCR 111.
He, thus, argued that the High Court has committed an error in holding
that there was no power with the Government to withhold the part of
pension or gratuity, pending disciplinary/criminal proceedings.
6. The aforesaid arguments of the learned Senior Counsel based on the
judgment in Sant Ram Sharma would not cut any ice in so far as present
case is concerned, because of the reason this case has no applicability
in the given case. Sant Ram judgment governs the field of administrative
law wherein the Constitution Bench laid down the principle that the
rules framed by the authority in exercise of powers contained in an
enactment, would also have statutory force. Though the administration
can issue administrative instructions for the smooth administrative
function, such administrative instructions cannot supplant the rules.
However, these administrative instructions can supplement the statutory
rules by taking care of those situations where the statutory rules are
silent. This ratio of that judgment is narrated in the following
manner:
“It is true that there is no specific provision in the Rules laying down
the principle of promotion of junior or senior grade - officers to
selection grade posts. But that does not mean that till statutory rules
are framed in this behalf the Government cannot issue administrative
instructions regarding the principle to be followed in promotions of the
officers concerned to selection grade posts. It is true that Government
cannot amend or supersede statutory rules by administrative
instructions, but if the rules are silent on any particular point
Government can fill up the gaps and supplement the rules and issue
instructions and inconsistent with the rules already framed”.
There cannot be any quarrel on this exposition of law which is well
grounded in a series of judgments pronounced post Sant Ram Sharma case
as well. However, the question which is posed in the present case is
altogether different.
7. It is an accepted position that gratuity and pension are not the
bounties. An employee earns these benefits by dint of his long,
continuous, faithful and un-blemished service. Conceptually it is so
lucidly described in D.S. Nakara and Ors. Vs. Union of India; (1983) 1
SCC 305 by Justice D.A. Desai, who spoke for the Bench, in his
inimitable style, in the following words:
“The approach of the respondents raises a vital and none too easy of
answer, question as to why pension is paid. And why was it required to
be liberalised? Is the employer, which expression will include even the
State, bound to pay pension? Is there any obligation on the employer to
provide for the erstwhile employee even after the contract of employment
has come to an end and the employee has ceased to render service?
What is a pension? What are the goals of pension? What public interest
or purpose, if any, it seeks to serve? If it does seek to serve some
public purpose, is it thwarted by such artificial division of retirement
pre and post a certain date? We need seek answer to these and
incidental questions so as to render just justice between parties to
this petition.
The antiquated notion of pension being a bounty a gratituous payment
depending upon the sweet will or grace of the employer not claimable as a
right and, therefore, no right to pension can be enforced through Court
has been swept under the carpet by the decision of the Constitution
Bench in Deoki Nandan Prasad v. State of Bihar and Ors.[1971] Su. S.C.R.
634 wherein this Court authoritatively ruled that pension is a right
and the payment of it does not depend upon the discretion of the
Government but is governed by the rules and a Government servant coming
within those rules is entitled to claim pension. It was further held
that the grant of pension does not depend upon any one’s discretion. It
is only for the purpose of quantifying the amount having regard to
service and other allied maters that it may be necessary for the
authority to pass an order to that effect but the right to receive
pension flows to the officer not because of any such order but by virtue
of the rules. This view was reaffirmed in State of Punjab and Anr. V.
Iqbal Singh (1976) IILLJ 377SC”.
8. It is thus hard earned benefit which accrues to an employee and is in
the nature of “property”. This right to property cannot be taken away
without the due process of law as per the provisions of Article 300 A of
the Constitution of India.
9. Having explained the legal position, let us first discuss the rules
relating to release of Pension. The present case is admittedly governed
by -
Bihar Pension Rules, as applicable to the State of Jharkhand. Rule 43(b)
of the said Pension Rules confers power on the State Government to
withhold or withdraw a pension or part thereof under certain
circumstances. This Rule 43(b) reads as under:
“43(b) The State Government further reserve to themselves the right of
withholding or withdrawing a pension or any part of it, whether
permanently or for specified period, and the right of ordering the
recovery from a pension of the whole or part of any pecuniary loss
caused to Government if the pensioner is found in departmental or
judicial proceeding to have been guilty to grave misconduct, or to have
caused pecuniary loss to Government misconduct, or to have caused
pecuniary loss to Government by misconduct or negligence, during his
service including service rendered on re-employment after retirement”.
From the reading of the aforesaid Rule 43(b), following position emerges:-
(i)
The State Government has the power to withhold or withdraw pension or
any part of it when the pensioner is found to be guilty of grave
misconduct either in a departmental proceeding or judicial proceeding.
(ii)
This provision does not empower the State to invoke the said power
while the department proceeding or judicial proceeding are pending.
(iii)
The power of withholding leave encashment is not provided under this
rule to the State irrespective of the result of the above proceedings.
(iv) This power can be invoked only when the proceedings are concluded finding guilty and not before.
10. There is also a Proviso to Rule 43(b), which provides that:-
“A. Such departmental proceedings, if not instituted while the
Government Servant was on duty either before retirement or during
re-employment.
i. Shall not be instituted save with the sanction of the State Government.
ii Shall be in respect of an event which took place not more than four years before the institution of such proceedings.
iii
Shall be conducted by such authority and at such place or places as the
State Government may direct and in accordance with the procedure
applicable to proceedings on which an order of dismissal from service
may be made:-
B. Judicial proceedings, if not instituted while the Government
Servant was on duty either before retirement or during re-employment
shall have been instated in accordance with sub clause (ii) of clause
(a) and
C. The Bihar Public Service Commission, shall be consulted before final orders are passed.
It is apparent that the proviso speaks about the institution of
proceedings. For initiating proceedings, Rule 43(b) puts some
conditions, i.e, Department proceeding as indicated in Rule 43(b), if
not instituted while the Government Servant was on duty, then it shall
not be instituted except:-
(a) With the sanction of the Government,
(b) It shall be in respect of an event which took place not more than four years before the institution of the proceedings.
(c) Such proceedings shall be conducted by the enquiry officer in
accordance with the proceedings by which dismissal of the services can
be made.
Thus, in so far as the proviso is concerned that deals with condition
for initiation of proceedings and the period of limitation within which
such proceedings can be initiated.
11. Reading of Rule 43(b) makes it abundantly clear that even after the
conclusion of the departmental inquiry, it is permissible for the
Government to withhold pension etc. ONLY when a finding is
recorded either in departmental inquiry or judicial proceedings that the
employee had committed grave misconduct in the discharge of his duty
while in his office. There is no provision in the rules for withholding
of the pension/ gratuity when such departmental proceedings or judicial
proceedings are still pending.
12. Right to receive pension was recognized as right to property by the
Constitution Bench Judgment of this Court in Deokinandan Prasad vs. State of Bihar; (1971) 2 SCC 330, as is apparent from the following discussion:
“29. The last question to be considered, is, whether the right to
receive pension by a Government servant is property, so as to attract
Articles 19(1)(f) and 31(1) of the Constitution. This question falls to
be decided in order to consider whether the writ petition is
maintainable under Article 32. To this aspect, we have already adverted
to earlier and we now proceed to consider the same.
30. According to the petitioner the right to receive pension is property
and the respondents by an executive order dated June 12, 1968 have
wrongfully withheld his pension. That order affects his fundamental
rights under Articles 19(1)(f) and 31(1) of the Constitution. The
respondents, as we have already indicated, do not dispute the right of
the petitioner to get pension, but for the order passed on August 5,
1966. There is only a bald averment in the counter-affidavit that no
question of any fundamental right arises for consideration. Mr. Jha,
learned counsel for the respondents, was not prepared to take up the
position that the right to receive pension cannot be considered to be
property under any circumstances. According to him, in this case, no
order has been passed by the State granting pension. We understood the
learned counsel to urge that if the State had passed an order granting
pension and later on resiles from that order, the latter order may be
considered to affect the petitioner's right regarding property so as to
attract Articles 19(1) (f) and 31(1) of the Constitution.
31. We are not inclined to accept the contention of the learned counsel
for the respondents. By a reference to the material provisions in the
Pension Rules, we have already indicated that the grant of pension does
not depend upon an order being passed by the authorities to that effect.
It may be that for the purposes of quantifying the amount having regard
to the period of service and other allied matters, it may be necessary
for the authorities to pass an order to that effect, but the right to
receive pension flows to an officer not because of the said order but by
virtue of the Rules. The Rules, we have already pointed out, clearly
recognise the right of persons like the petitioner to receive pension
under the circumstances mentioned therein.
32. The question whether the pension granted to a public servant is
property attracting Article 31(1) came up for consideration before the
Punjab High Court in Bhagwant Singh v. Union of India A.I.R. 1962 Pun
503. It was held that such a right constitutes "property" and any
interference will be a breach of Article 31(1) of the Constitution. It
was further held that the State cannot by an executive order curtail or
abolish altogether the right of the public servant to receive pension.
This decision was given by a learned Single Judge. This decision was
taken up in Letters Patent Appeal by the Union of India. The Letters
Patent Bench in its decision in Union of India v. Bhagwant Singh I.L.R.
1965 Pun 1 approved the decision of the learned Single Judge. The
Letters Patent Bench held that the pension granted to a public servant
on his retirement is "property" within the meaning of Article 31(1) of
the Constitution and he could be deprived of the same only by an
authority of law and that pension does not cease to be property on the
mere denial or cancellation of it. It was further held that the
character of pension as "property" cannot possibly undergo such mutation
at the whim of a particular person or authority.
33. The matter again came up before a Full Bench of the Punjab and
Haryana High Court in K.R. Erry v. The State of Punjab I.L.R. 1967 P
& H 278. The High Court had to consider the nature of the right of
an officer to get pension. The majority quoted with approval the
principles laid down in the two earlier decisions of the same High
Court, referred to above, and held that the pension is not to be treated
as a bounty payable on the sweet will and pleasure of the Government
and that the right to superannuation pension including its amount is a
valuable right vesting in a Government servant It was further held by
the majority that even though an opportunity had already been afforded
to the officer on an earlier occasion for showing cause against the
imposition of penalty for lapse or misconduct on his part and he has
been found guilty, nevertheless, when a cut is sought to be imposed in
the quantum of pension payable to an officer on the basis of misconduct
already proved against him, a further opportunity to show cause in that
regard must be given to the officer. This view regarding the giving of
further opportunity was expressed by the learned Judges on the basis of
the relevant Punjab Civil Service Rules. But the learned Chief Justice
in his dissenting judgment was not prepared to agree with the majority
that under such circumstances a further opportunity should be given to
an officer when a reduction in the amount of pension payable is made by
the State. It is not necessary for us in the case on hand, to consider
the question whether before taking action by way of reducing or denying
the pension on the basis of disciplinary action already taken, a further
notice to show cause should be given to an officer. That question does
not arise for consideration before us. Nor are we concerned with the
further question regarding the procedure, if any, to be adopted by the
authorities before reducing or withholding the pension for the first
time after the retirement of an officer. Hence we express no opinion
regarding the views expressed by the majority and the minority Judges in
the above Punjab High C.A. No.6770/2013 @ SLP (C) No. 1427 of 2009
Court decision, on this aspect. But we agree with the view of the
majority when it has approved its earlier decision that pension is not a
bounty payable on the sweet will and pleasure of the Government and
that, on the other hand, the right to pension is a valuable right
vesting in a government servant.
34. This Court in State of Madhya Pradesh v. Ranojirao Shinde and Anr.
MANU/SC/0030/1968 : [1968]3SCR489 had to consider the question whether a
"cash grant" is "property" within the meaning of that expression in
Articles 19(1)(f) and 31(1) of the Constitution. This Court held that it
was property, observing "it is obvious that a right to sum of money is
property".
35. Having due regard to the above decisions, we are of the opinion that
the right of the petitioner to receive pension is property under
Article 31(1) and by a mere executive order the State had no power to
withhold the same. Similarly, the said claim is also property under
Article 19(1)(f) and it is not saved by Sub-article (5) of Article 19.
Therefore, it follows that the order dated June 12, 1968 denying the
petitioner right to receive pension affects the fundamental right of the
petitioner under Articles 19(1) (f) and 31(1)of the Constitution, and
as such the writ petition under Article 32 is maintainable. It may be
that under the Pension Act (Act 23 of 1871) there is a bar against a
civil court entertaining any suit relating to the matters mentioned
therein. That does not stand in the way of a Writ of Mandamus being
issued to the State to properly consider the claim of the petitioner for
payment of pension according to law”.
13. In State of West Bengal Vs. Haresh C. Banerjee and Ors. (2006) 7 SCC
651, this Court recognized that even when, after the repeal of Article
19(1)(f) and Article 31 (1) of the Constitution vide Constitution
(Forty- Fourth Amendment) Act, 1978 w.e.f. 20th June, 1979, the right to
property was no longer remained a fundamental right, it was still a
Constitutional right, as provided in Article 300A of the Constitution.
Right to receive pension was treated as right to property. Otherwise,
challenge in that case was to the vires of Rule 10(1) of the West Bengal
Services (Death-cum-- Retirement Benefit) Rules, 1971 which conferred
the right upon the Governor to withhold or withdraw a pension or any
part thereof under certain circumstances and the said challenge was
repelled by this Court. Fact remains that there is an imprimatur to the
legal principle that the right to receive pension is recognized as a
right in “property”.
14. Article 300 A of the Constitution of India reads as under:
“300A Persons not to be deprived of property save by authority of
law. - No person shall be deprived of his property save by authority of
law.”
Once we proceed on that premise, the answer to the question posed by us
in the beginning of this judgment becomes too obvious. A person cannot
be deprived of this pension without the authority of law, which is the
Constitutional mandate enshrined in Article 300 A of the Constitution.
It follows that attempt of the appellant to take away a part of pension
or gratuity or even leave encashment without any statutory provision and
under the umbrage of administrative instruction cannot be
countenanced.
15. It hardly needs to be emphasized that the executive instructions are
not having statutory character and, therefore, cannot be termed as
“law” within the meaning of aforesaid Article 300A. On the basis of such
a circular, which is not having force of law, the appellant cannot
withhold - even a part of pension or gratuity. As we noticed above, so
far as statutory rules are concerned, there is no provision for
withholding pension or gratuity in the given situation. Had there been
any such provision in these rules, the position would have been
different.
16. We, accordingly, find that there is no merit in the instant appeals
as the impugned order of the High Court is without blemish. Accordingly,
these appeals are dismissed with costs quantified at Rs. 10,000/-
each.
[Justice K.S. Radhakrishnan]
[JusticeA.K. Sikri]
New Delhi
August 14, 2013
