Holding

The Supreme Court held that the High Court’s extension of time made the appellant’s occupation a litigious possession, not unauthorized, and that a 5% pension deduction was disproportionate, ordering instead a reasonable rent for the period of illegal occupation.

Summary

The appellant, a retired foreman of the Jharkhand State Electricity Board, failed to vacate the Board's quarters after retirement and sought extensions from the High Court, which were eventually granted up to 1 November 1999. He finally vacated the premises on 6 January 2000, after which the Board imposed a permanent 5% deduction from his pension under Rule 43(a) of the Bihar Pension Rules, 1950, alleging misconduct. The appellant challenged the penal order, arguing that Rule 43(b) does not apply post‑retirement and that the deduction was disproportionate. The Supreme Court held that the High Court’s extension rendered the occupation a litigious possession, not unauthorized, and that a 5% pension cut was excessive; instead, the appellant should pay reasonable rent for the period of illegal occupation. Consequently, the Court set aside the High Court’s order, modified the penalty to a rent of Rs. 500 per month for the illegal occupation period, and disposed of the appeal.

Issues considered

The applicability of Rule 43(b) of the Bihar Pension Rules, 1950 to a retired employee.
Whether the High Court's extension of time for vacating government accommodation converts the occupation into unauthorized possession.
The propriety and proportionality of a permanent 5% pension deduction as a penal measure for alleged misconduct.
The appropriate remedy for the period of illegal occupation after the extended deadline.

Legislation cited

Bihar Pension Rules, 1950s. Rule 43(a), s. Rule 43(b)
Constitution of Indias. Article 136

Subjects

pension deductiongovernment accommodationmisconductRule 43(a)Rule 43(b)litigious possessionbalance of convenienceirreparable lossextension of time

Judgment

A RAM DAY AL RAI
\'. . •• : +

JHARKHAND STATE ELECTRICITY BOARD AND ORS ..
h :-

MARCH 9, 2005

B [ASHOK BHAN AND DR. AR. LAKSHMANAN, JJ.]

Service Law:

Pension-Bihar Pen~ion Rules, 1950-Rule 43(a) and (bi-Government
C · accommodation-Retention of by ex-employee, after retirement-Extension of
time by High Court-Vacation of quartei· not within the specified period but
two months later-Deparimental proceedings-'-Penal order withholding
permanently 5% of the 'pensi;nfor the misconduct conimitted-On appeal
held : Occupation of quarter during period extended by Courf is litigiou~
D possession-Deduction ofpensionary benefit .disproportionate to the misconduct
alleged-Balance ofconvenience and prime facie case in favour ofex-employee
as he would suffer irreparable loss and injwy-However, occupation after the
period allowed by High Court illegal-Employee directed to pay Rs. 500 p.11:1.
as rent for the period ofillegal occupation to meet ends ofjustice-Constitution
of India, 1950-Article 136.
E
Appellant-ex employee of the respondent-Electricity Board did not
vacate the Board's quarter after retirement. High Court issued direction5
for vacation and thereafter, on humanitarian ground granted extension
upto 1.11.1999. Appellant sought further extension of time. Division Bench
of High Court rejected the same. Appellant vacated the Board's quarter
F on 6.1.2000 and also informed the respondents. Thereafter, respondent-
Board issued penal order withholding permanently 5% of pension of the
appellant under Rule 43(a) of Bihar Pension Rules, 1950. Appellant
challenged the penal order. Single Judge of High Court dismissed the writ
petition. Division Bench also dismissed the Letter Patent Appeal. Hence
G the present appeal.

Disposing of the appeal, the Court

HELD : l.l The extension of time granted by High Court and the
occupation of the quarter during that period as per the orders of the Court
H 576
R.D. RAI 1·. .IHARKHAND STATE ELECTRICITY BOARD [LAKSllMANAN . .I] 577

cannot be treated as or construed as an unauthorized occupation. The A
continuance thereof in the quarter can, therefore, be treated only as
litigious possession. Furthermore, the balance of convenience and the prima
facie case is also in favour of the appellant. If the pensioner's benefit is
cut by 5% , the appellant will suffer an irreparable loss and injury since
after the retirement, the pensionary benefit is the only amount available B
to eke out livelihood for the retired employees of the Government.
1583-C, El

1.2. Also the penal order directing 5% cut in pensionary benefits
under Rule 43(a) of Bihar Pension Rules, 1950 is disproportionate for the
misconduct alleged against the appellant. But the fact remains that the C
appellant-ex employee vacated the Board's quarter on 6.1.2000 whereas
as per order of the High Court he ought to have vacated the same on
1.11.1999. The occupation of the quarter after 1.11.1999 is illegal. Justice
would be amply met if the appellant is directed to pay a sum of Rs. 500
per month for the period of illegal occupation. 1583-A-B, D)

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1599 of2005. D
From the Judgment and Order dated 10.4.2003 of the Jharkhand High
Court at Ranchi in L.P.A. No. 88 of 2003.

A.N. Deo and Ms. S. Janani for the Appellant.

S.B. Upadhyay, Pawan Upadhyay, Shiv Mangat Sharma and Gopal
E
Prasad for the Respondents.

The Judgment of the Court was delivered by

DR. AR. LAKSHMANAN, J. Leave granted.
F
This appeal is directed against the final judgment and order dated
10.4.2003 passed by the High Court of Jharkhand, Ranchi in LP.A. No. 88
of 2003 dismissing the appeal filed by the appellant against the judgment and
order dated 19.12.2002 passed by the learned single Judge in W.P.(S) No.
3159of2001.

Before proceeding to consider the matter on merits, the facts can be
G
stated briefly for the purpose of the present appeal.

The appellant is an ex-employee of the respondent-Board. He retired
on 28.2.1998 from the post of Foreman, Grade I. The appellant after retirement
did not choose to vacate the Board's quarter. He initially moved before the H
-
S78 SUPREME COURT REPORTS [2005) 2 S.C.R.

A High Court in C.W.J.C. No. 1405 of 1998 (R) wherein the High Court by
order dated 19.2.1999 directed the appellant to vacate the·quarterwithin one
month from the date ofteceipt of the retiral benefits. Thereafter, the appellant
having not vacated the Board's quarter, ,the High Court vide order dated
31.8.1999 by which date all retiral benefits including gratuity stood paid,
B directed the appellant to vacate the Board's quarter by 30.9.1999 as per the
earlier order...

The appellant even thereafter did not choose to vacate the quarter and
filed a petition for extension of period. The High Court, taking humanitarian
view, extended the period up to 1.11.1999 vide order dated 4.10.1999 and
directed the appellant to vacate the Board's quarter. by 1.11.1999 observing
.c as under:

"However, taking a humanitarian view of the· matter; this Court, as a
matter of last chance, extends the time. Under the order of this Court
passed today, the petitioner is direc~ed to vacate the quarter in question
by I st November, 1999. It is made clear that if the petitioner does not
D vacate the quarter by that date, the re5pondents are entitled to take,
if necessary, the help of the police,"

The appellant being not satisfied filed an L.P.A. No. 460 of 1999 (R)
In the said L.P.A., the Division Bench of the High Court observed that ifthe
appellant had not vacated the Board's quarter by 1.11.1999, the authority
E · should have taken immediate steps for vacating the quarter, if necessary with
the help of police. The appellant's prayer for further extension of time was
also rejected by the Division Bench. The Bench also observed that once the
appellant has retired, he has no right to remain in the quarter after the statutory
period and therefore, there is no question of extending_,the perio9.

F· The appellant wrote a letter to the .Executive. Engineer, Transmission
Division, Ranchi -on 4.1.2000 requesting him to take charge of the articles
belonging to the Board. On 6.1.2000, the Board took th~ charge of the articles
lying in the quarter and issued receipt for the same. On 17 .1.2000, the :
Executive Engineer, Electricity Board, Ranchi filed a petition for.eviction of
G the appellant from quarter in question before the sub-Divisional Officer,
Sadar, Ranchi which ·was registered as Eviction Case No. 95 of 1999. The
appellant infonned the Court that he has already vacated the Board's quarter
and information to this effect was already given to the .Executive Engineer.
On such application filed by the appellant, the S.D.O. Sadar, Ranchi dropped
the proceedings on 17.1.2000 and matter came to an end.
H
R.D. Ri\11'. .IHARKHAND STA TE ELECTRICITY BOARD [LAKSMMANAN.'.1 ] 579

On 22.6.200 I, the Electrical Executive Engineer vide his letter No. 365 A
dated 22.6.200 I informed the appellant about the Office Order No. 2970 of
the Joint Secretary contained in Memo No. 788 dated 15.6.200 I, whereby the
Joint Secretary, Bihar State Electricity Board, Patna passed an order directing
permanent deduction of 5% from the total amount of pension payable to the
appellant under the provisions of Rule 43(a) of the Bihar Pension Rules,
1950 without taking into consideration the fact that the appellant was permitted B
by the High Court to continue his stay in the quarter in question and vacate
the same by 1.11.1999 and the appellant vacated the quarter on 1.11. 1999
itself and informed the authorities of the Board in writing on 2.11.1999. The
appellant submitted his representation to the General Manager for granting
the benefit of fixation of new pay scale and also requested him to pay the C
pension after determining the quantum of pension which becomes payable
after fixation of new pay scale applicable from 1.4.1997. The appellant
submitted that the order under challenge is unreasonable, unwarranted, without
jurisdiction and beyond the scope of Rule 43(a) and (b) of the Bihar Pension
Rules, 1950. The appellant filed W.P.(S) No. 3159 of 200 I in the High Court
of Jharkhand, Ranchi. The main plea of the appellant before the High Court D
was that Rule 43(b) of the Bihar Pension Rules, 1950 relates to misconduct
committed during the service period and thus the respondents have no
jurisdiction to pass any order under Rule 43(b) for retention of quarter after
his retirement. The learned single Judge by order dated 19.12.2002 dismissed
the writ petition filed by the appellant holding as under: E
"It is true that the action as alleged against the petitioner does not
relate to any misconduct while the petitioner was in service. Therefore,
Rule 43(b) of the Bihar Pension Rules, 1950 is not applicable in the
case. However, as 'future good conduct' is an implied condition for
every grant of pension under Rule 43(a) of the Bihar Pension Rules, F'
1950, the competent authority has a right to withhold or withdraw a
pension or any part of it, if the pensioner is found guilty of serious
and grave misconduct. The impugned order dated 15th June, 2001,
thus can be saved under the aforesaid Rule 43(a) of the Bihar Pension
Rules, 1950. Mere citatiOn of a wrong provision of law will not
render the order illegal." G

Aggrieved thereby, the appellant filed L.P.A. No. 88 of 2003 in the
High Court of Jharkhand, Ranchi. The Division Bench of the High Comt
vide impugned order dated I0.4.2003 dismissed the L.P.A. filed by the
appellant holding as under:
H
580 SUPREME COURT REPORTS [2005) 2 S.C.R.

A "Admittedly, after retirement, the appellant did not choose to vacate
the quarter of the Electricity Board even inspite of repeated direction
of this Court and, ultimately, it was got vacated through police force.
The learned single Judge considered this aspect of th~ matter in detail
in the impugned order and rightly held that violation of orders of this
Court certainly amounted to misconduct on the part of the appellant
B and as such penal order issued on 15.6.2001 after giving sufficient
opportunity to him was justified. We also find no·reason to interfere
with the said order. There is no merit in this appeal. It is dismissed."
. ..
Aggrieved by the said order, the appellant filed an appeal by ~ay of
C special leave petition in this Court.

We have heard Mr. A.N. Deo, learned counsel for the appellant and
Mr. ·s.B. Upadhyay, learned counsel for the respondents and perused the
orders and annexures filed along with the appeal by both the parties.
'
Learned counsel appearing for the appellant made the following
·D
submissions:

.(a) Rule 43(b) of the Bihar Pension Rules, 1950 is not applicable to
·a retired employee of the Sta~e.
(b) The earlier orders of the High Court granting extension of time
E for vacating the quarter was binding upon the respondents.
(c) The respondents were not justified in initiating the departmental
proceedings when the appellant had complied with the order of
the High Court and vacated the quarter.

(c) The respondents cannot withhold the retiral dues and benefits of
F pension after fixation 'of new pay scale by the Board when there
was no misconduc~ on the part of the appellant in not vacating
the quarter in question in obedience to the. order passed by the
High Court.
(d) The punishment imposed is excessive.
·G
Learned counsel appearing for the respondents submitted that the
appellant did not vacate the Board's quarter as directed by the High Court
and within the specified period mentioned in the order and, therefore,
instituting the departmental enquiry was justified. He would further submit
H that the action alleged agains\ the appellant does not relate to any misconduct
R.D. RA! 1·. .IHARKHAND STATE ELECTRICITY BOARD [LAKSllMANAN, .I] 58 J

while the appellant was in service. But however, as "future good conduct" is A
an implied condition for every grant of pension under Rule 43(a) of the Bihar
Pension Rules, 1950, the competent authority has a right to withhold or
withdraw a pension or any pa1t of it, if the pensioner is found guilty of
serious and grave misconduct. Therefore, he submitted that the impugned
order dated 15.6.2001, thus can be saved under the aforesaid Rule 43(a) of B
the Bihar Pension Rules, 1950.

The main plea taken by the appellant is that as per Rule 43(b) of Bihar
Pension Rules, 1950 relates to misconduct, if committed, during the service
period so, the responder-lts have no jurisdiction to pass any order under Rule
43(b) for retention of quarter after his retirement. C
Rule 43(a) - and (b) of the Bihar Pension Rules, 1950 are reproduced
hereunder for the sake of convenience :

"Rule 43(a) - Future good conduct is an implied condition of every
grant of pension. The Provincial Government reserve to themselves D
the right of withholding or withdrawing a pension or any part of it,
if the pensioner is convicted of serious crime or be guilty of grave
misconduct. The decision of the Provincial Government on any
question of withholding or withdrawing the whole or any part of a
pension under this rule, shall be final and conclusive."
E
"Rule 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 a 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 petitioner is found in departmental
or judicial proceeding to have been guilty of grave misconduct; or to F
have caused pecuniary loss to Government by misconduct or
negligence, during his service including service rendered on re-
employment after retirement:

Provided that
G
(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; H
582 SUPREME COURT REPORTS [2005] 2 S.C.R.

A (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 o.f
B 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 instituted in accordance with sub-
clause (ii) of clause (a); and
c (c) the Bihar Public Service Commission, shall be consulted before
final orders are passed."

As already noticed, the respondents have issued the penal order
withholding permanently 5% of the pension of the appellant. It is not in
dispute that the BSEB adopted Bihar Pension Rules, 1950 mutatis mutandis
D for its employees. Under Chapter III of Bihar Pension Rules, 1950, "general
provision relating to grant of pension" has been laid down. While under Rule
43(b), the competent authority reserve to themselves the right of withholding
or withdrawing a pension or any part of it, whether permanently or for
specified period, future good conduct .is also implied as a condition for every
E grant of pension under Rule 43(a) of the Bihar Pension Rules, 1950.
Admittedly, the appellant, after retirement, did not choose to vacate the Board's
quarter. He initially moved before the High Court by filing a writ petition
and the High Court vide order dated 19.2.1999 directed the appellant to
vacate the Board's quarter within one month from the receipt of retiral benefits.
Even thereafter, the appellant having not vacated the quarter, the High Court
F vide order dated 31.8.1999, directed the appellant to vacate the Board's quarter
by 30.9.1999 as per earlier order. Admittedly, the appellant, even thereafter,
did not choose to vacate the quarter and filed a petition for extension of
period. Taking humanitarian view, the High Court extended the period up to
1.11.1999 and directed the appellant to vacate the Board's quarter by
G 1.11.1999. Even thereafter, the appellant being not satisfied moved LP.A.
No. 460 of 1999. The Division Bench of the High Court rejected the prayer
for further extension of time. Thereafter, the appellant vacated the Board's
quarter only on 6.1.2000. Therefore, it is thus crystal clear that the Court's
order was violated and such action of the appellant being a misconduct, the
impugned penal order was issued on 15.6.200 I after giving opportunity to
H the appellant on the basis of the evidence.
R.D. RAJ'" .IHARKHAND STATE ELECTRICITY BOARD (LAKSHMANAN, J.] 583

In the instant case, the appellant vacated the quarter in question within A
the period specified by the High Court and he informed the respondents
about the vacation of the quarter and even after this information the appellant
was penalized. The punishment of 5% cut in pensionary benefits, in our
opinion, is disproportionate for the miscor1duct alleged against the appellant.
the appellant vacated the Board's quarter on 6.1.2000 whereas he ought to
have vacated the same on 1.11.1999 as per order dated 4.10.1999 of the High B
Court. The High court, on various occasions, ordered extension of period on
humanitarian grounds. Therefore, extension of time granted by the High Court
and the occupation of the quarter during that period as per the orders of the
Court cannot be treated as or construed as an unauthorized occupation. The
continuance thereof in the quarter in question can, therefore, be treated only C
as litigious possession. But the fact remains that he has not vacated the
quarter on 1.11.1999 but in fact vacated only on 6.1.2000.

We are, therefore, of the opinion that the impugned order does call for
interference by this Court and modification of the same in order to meet the
ends of justice. The occupation of the quarter after I.I 1.1999 is illegal. When D
a question was put, the learned counsel appearing for the appellant submitted
that he was paying the monthly rent of Rs. 25. Justice would be amply met
if we direct the appellant to pay a sum of Rs. 500 per month for the entire
period of illegal occupation (from 1.11.1999 to 6.1.2000). The balance of
convenience and the primafacie case is also in favour of the appellant. If the E
pensioner's benefit is cut at 5% out of the total amount of pension payable
to the appellant, the appellant will suffer an irreparable loss and injury since
after the retirement, the pensionary benefit is the only amount available to
eke out livelihood for the retired employees of the Government.

For the aforesaid reasons, we set aside the order passed by the High F
court in LP.A. No. 88 of 2003 dated 10.4.2003 and modify the order as
indicated above. The appeal is disposed of accordingly. However, there shall
be no order as to costs.

The rent now fixed at Rs. 500 per month shall be deposited with
respondents within two weeks from the date of receipt of the copy of the G
judgment failing which the penal order dated 15.6.2001 whereby 5% cut out
of total pension amount payable to the appellant was withheld permanently
shall come into force.

N.J. Appeal disposed of.
H