Holding

A compassionate appointment is permissible only when the family of the deceased employee is in complete penury; in the present case the family was not penurious, so the appointment was rightly denied.

Summary

The widow of a deceased Record Assistant of State Bank of India applied in February 2000 for a compassionate appointment under the bank's scheme. The bank declined the request, the High Court ordered a reconsideration and eventually allowed the petition, holding that the family’s income was insufficient for basic maintenance. On appeal, the Supreme Court examined whether a compassionate appointment can be made when the family is not in complete penury and whether a scheme framed in 2005 could be applied to an application filed in 2000. The Court held that such appointments are permissible only if the family is in total penury, which was not the case given the terminal benefits, family pension and other income. Consequently, the Court set aside the High Court orders and allowed the bank’s appeal, emphasizing that the competent authority’s factual findings should not be disturbed and that the 2005 scheme could not be applied retroactively.

Issues considered

Whether a compassionate appointment can be granted when the family of the deceased employee is not in complete penury.
Whether the High Court could apply a scheme formulated after the date of the applicant's request.
Whether the Supreme Court may interfere with the factual findings of the bank's competent authority.
Whether a writ of mandamus can be issued contrary to the provisions of the compassionate appointment scheme.

Subjects

compassionate appointmentpenuryservice lawpublic sector bankjudicial reviewfact-finding authoritywrit of mandamusretroactive schemefamily pensionterminal benefits

Judgment

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(

STATE BANK OF INDIA AND ORS. A
v.
JASPALKAUR

FEBRUARY I, 2007

[DR. AR. LAKSHMANAN AND AL TAMAS KABIR, JJ.] B

Service Law:
-~-

Appointment on compassionate ground-Claim for-Held, unless the
financial condition of dependents of deceased employee is entirely penury, C
such appointments cannot be made-Fact finding authority on basis of
financial details having arrived at the conclusion that financial condition
offamily was not penurious and the family was earning sufficient income to
maintain themselves, High Court erred in entertaining and allowing the
claim by applying the scheme formulated much after the application for D
compassionate appointment was made-Constitution of India-Article 226.

Respondent's husband, who was working as Record Assistant with the
appellant-Bank, died in harness. The respondent applied on 5.2.2000 for
compassionate appointment which the Bank declined. On a direction from
the High Court to reconsider her case, the competent authority again declined E
her request by order dated 3.4.2004. The respondent challenged the said
order before the High Court, which allowed her writ petition by its order dated
20.9.2005.

In the present appeal it was, inter a/ia, contended for the appellant-Bank
that the High Court failed to consider that the respondent could be considered F
for compassionate appointment under the Scheme framed by the Bank in the
year 1996 which was in existence at the relevant time, and the provisions of
the said scheme applied only in cases where the deceased had left the family
in penury and without any means of livelihood, and in the instant case, as
there did not exist such circumstances, a writ of mandamus could not be issued G
de hors the scheme. Counsel for the respondent relying upon para 8 of the
Scheme formulated by the Bank and enforced w.e.f. 4.8.2005, contended that
-f_ the Bank in the said scheme laid down criteria for determining penury, i.e, if
the income of the family of deceased employee/dependents was reduced to less

101 H
102 SUPREME COURT REPORTS [2007] 2 S.C.R.

A than 60% of the salary which was drawn by the deceased at the time of his
death. It was submitted that even if assuming the income as Rs.5855/- the
same being less than 40% of the salary last drawn by the deceased, the
Scheme dated 4.8.2005 was not complied with by the Bank while considering
her case.

B Allowing the appeal, the Court

HELD: I. I. A major criterion while appointing a person on
compassionate grounds should be the financial condition of the family the
deceased person left behind. Unless the financial condition is entirely penury,
C such appointments cannot be made. In the present case the financial condition
of respondent's family is not one of destitution, the appellants have already
paid the terminal benefits which would earn i<.s.3800/- p.m. as notional interest;
besides, a sum of Rs.2055/- p.m. was being paid towards family pension and
monthly income under Staff Mutual Welfare Scheme. The competent fact
finding authority on the basis of these financial details had arrived at the
D conclusion that the financial condition of the family is not penurious and that
the family earns sufficient income to maintain themselves. Hence appointment
on compassionate ground was not granted to the respondent. There is no
necessity to interfere with this order of the competent authority on the fact
situation of this case. (Para 22] (108-E-H(

E Umesh Kumar Nagpal v. State of Haryana & Ors., (1994] 4 SCC 138
and General Manager (D&PB) & Ors. v. Kunti Tiwary & Anr., (2004] 7 SCC
271, relied on

L.J.C. of India v. Asha Ramchhandra Ambekar (Mrs) & Anr., (1994] 2
SCC 718 and Bank of India & Anr. v. Dega/a Suranarayana, (1999] 5 SCC
F 762, cited.

1.2. The competent authority of the bank had to consider the case of the
respondent as per the parameters laid down in the Scheme. Accordingly, while
deciding on the financial condition of the respondent the relevant factors were
taken into consideration by the competent authority and based on these details
G
appointment was declined to the respondent on compassionate ground. (Para
23] (108-H; A-DJ

1.J. The specially constituted authorities in the rules or regulations
like the competent authority iR this case are better equipped to decide the
H cases on facts of the case and their objective finding arrived on the appreciation
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I

STATE BANK OF INDIA v. JASPAL KAUR [LAKSHMANAN, J.] 103
-;- of the full facts should not be disturbed. Both the single Judge and the Division A
Bench of the High Court erred in entertaining and allowing the claim of the
respondent. [Para 24] [109-E-F]

Union Bank of India & Ors. v. M T.Latheesh, [2006] 7 SCC 350, relied
on.
B
2. On facts, the respondent applied for compassionate appointment in
the appellant Bank on 05.02.2000 but claimed the benefit of the Scheme which
.Ir was formulated in 2005. The High Court also erred in deciding the matter in
favour of the respondent applying the Scheme formulated. on 04.08.2005. A
dispute arising in 2000 cannot be decided on the basis of a Scheme that came C
into place much after the dispute arose, in the present matter in 2005.
Therefore, the claim of the respondent that the income of the family of deceased
is less than 40% of the salary last drawn by the deceased in contradiction to
the 2005 Scheme does not hold water. [Para 25] [109-G-H; 110-A-B]

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 409 of 2007.
D
From the Final Judgment/Order dated 20.9.2005 of the High Court of
Punjab and Haryana at Chandigarh in C.W.P. No. 9629/2004.
_,
I
Mukul Rohtagi, Sanjay Kapur, Shubhra Kapur, Rajiv Kapur and Arti
singh for the Appellants.
E
P.N. Puri, Reeta Diwan Puri, Dhiraj and R.D. Bawa for the Respondents.

The Judgment of the Court was delivered by

DR. AR. LAKSHMANAN, J. 1. Leave granted.
F
' 2. On 07 .08.1996, the Government of India, Ministry of Finance, issued
guidelines regarding scheme of appointment of dependents of deceased
employees on compassionate grounds, which were entirely based on the
observations of this Court in Umesh Kumar Nagpal v. State of Haryana &
Ors., [1994] 4 SCC 138. Subsequently, on 23.08.1996, the Indian Banks
G
Association issued a circular suggesting to all Public Sector Banks, certain
amendments to the scheme on compassionate appointment, while taking into
-{
account the financial condition of the family, the family pension, gratuity,
proceeds of LIC, etc should be taken into consideration. Based on the
guidelines issued by the Government of India and the Indian Banks Association,
the appellant Bank framed a scheme for appointment on compassionate grounds H
104 SUPREME COURT REPORTS [2007] 2 S.C.R.

A for dependent of deceased employees. A memorandum of the same was
presented before the Central Board of the Bank, which was approved on
16.11.1996.

3. On 01.08.1999, Record Assistant (Cash & Accounts) in the Dhab
Wasti Ram, Amritsar branch, Sri. Sukhbir lnder Singh (late), passed away. The
B respondent, widow of Sri. Sukhbir Inder Singh applied for compassionate
appointment in the appellant Bank on 05.02.2000. On 07.01.2002, the competent
authority of the Bank declined the application of the respondent in view of
the scheme vis-'-vis the financial position of the family. Against this decision
of the authority the respondent filed Civil Misc. Writ Petition No. 307712002
C before the Punjab and Haryana High Court.

4. The High Court ordered reconsideration of the case of Jaspal Kaur,
respondent herein by its order dated 11.12.2003. On 05.03.2004, the Deputy
General Manager of the Bank reconsidered the case of the respondent and
declined appointment to the respondent on compassionate ground after taking
D into consideration the financial condition of the family. The Competent
Authority thereafter declined the request of the respondent on 03.04.2004.
This decision was conveyed to the respondent by the appellants on 05.04.2004.

5. Thereafter, the respondent filed one more Civil Misc. Writ Petition No. ~
9629/2004 before the Punjab and Haryana High Court praying for quashing
E of the order dated 03.04.2004. The appellants filed their reply on 03.05.2005.
On 20.09.2005, the High Court allowed the writ petition filed by the respondents
and of'-served that, "the aforesaid kitty of Rs. 4,57,607/- granted to the family
on account of terminal benefits could not be accepted to be sufficient . The
said amount was naturally in the shape of a security for the marriage of the
F daughtersln our considered view the aforesaid income is not sufficient for the
bare maintenance of the family". "

6. It is against this order and judgment of the Punjab and Haryana High
Court, this Civil Appeal by way of Special Leave Petition is preferred by the
appellant Bank in this Court.
G 7. Learned senior counsel Mr. Mukul Rohtagi appeared on behalf of the
appellant Bank and learned Counsel Mr. P.N.Puri appeared for the respondent.

8. It was submitted by Mr. Mukul Rohtagi, that the High Court has
failed to appreciate that the respondent could be considered for compassionate
H appointment only under the scheme framed by the Banlc Hence the provisions
STATEBANK OF INDJA v. JASPAL KAUR [LAKSI-IMANAN, J.] 105
of the scheme viz. compassionate appointment applies only in cases wherein A
the deceased has left the family in penury and without any means of livelihood
are required to be taken into consideration. Also the appellant-Bank, as per
the Scheme, is required to look at the penurious condition/indigent
circumstances existing at the time of death of the sole breadwinner, warranting
such compassion. And in any case if there does not exist any such
circumstances, a writ of mandamus, cannot be issued, de hors the scheme. B
9. It was submitted that, the High Court failed to appreciate that in the
present case the family of the deceased employee consists of widow, twin
daughters and one son, and the financial condition of the family is as under:

(a) a sum of Rs.4,57,607/- as tenninal benefits has been paid (after
deducting Rs.19,183/- towards liabilities);
(b) a sum of Rs.2055/- p.m. was being paid towards family pension
and monthly income under Staff Mutual Welfare Scheme.
(c) The total monthly income of the family comes to Rs.5855/- (monthly
pension of Rs.2055/- + Rs.3800/- p.m. as notional interest on the
investment of Rs.4,57,607 /-).

10. It was further submitted that the High Court failed to appreciate the
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fact that the terminal benefit of Rs.4,57,607/- paid to the family is an integral
part of the financial security made available to the family of the deceased.
The payment of terminal benefits are an important factor and cannot be left
out while considering the financial condition of the family.

11. Mr. Mukul Rohtagi submitted that the Division Bench of the High
Court erred in substituting its views with the views/findings of the competent
authority, by holding that the family income "is not sufficient for the bare
maintenance of the family".

12. Learned senior counsel relied on the decisions of this Court in
support of his contentions. He submitted that this Court has held that the
Court exercising the jurisdiction of judicial review should not interfere with
findings of fact arrived by the competent authorities, except in the case of
ma/a jides or perversity as held in the case of Bank of India & Anr. v. Degala
Suranarayana, [ l 999] 5 SCC 762. He also relied on a recent decision of this
Court in the case of Union Bank of India & Ors. v. M. TLatheesh, [2006] 7
SCC 350, (Dr. AR. Lakshmanan and Tarun Chatierjee, JJ) where this Court held
that, "the specially constituted authorities in the rules or regulations like the
106 SUPREME COURT REPORTS [2007] 2 S.C.R.

A competent authority in this case are better equipped to decide the cases on ,,...
facts of the case and their objective finding arrived on the appreciation of the
full facts should not be disturbed".

13. The learned senior counsel also made the following submissions:

B It is well established that the High Court, while exercising jurisdiction
under Art. 226 of the Constitution of India, does not act as a Court of appeal.

The High Court failed to appreciate that clause (I) of the Scheme
provides that in order to determine the financial condition of the family, the ,....
amounts paid towards terminal benefits, investments, income from other sources
c and size of the family etc. are required to be taken into account. However, '
in the present case while holding the condition of the family is not sufficient
for the bare maintenance of the family, the High Court has failed to appreciate
that the monthly income of Rs.2055/- p.m. and the terminal benefits of
Rs.4,57,607/- has been paid to the family of the deceased.
D The High Court also failed to appreciate a well settled principle of law
laid down by this Court in the case of L.I.C. of India v. Asha Ramchhandra
Ambekar (Mrs) & Anr., (1994] 2 SCC 718 that the Court cannot order
appointment on compassionate ground, de hors the provisions of the statutory
regulations and instructions and that hardship of the candidate does not
E entitle him to compassionate appointment de hors the statutory provisions.
The High Court also failed to appreciate that the appointment under the
scheme of compassionate appointment was at the discretion of the authority
'
which was to be exercised keeping in view the scheme and the object/
rationale behind it. It was submitted that compassionate appointment cannot
F be claimed as a matter of right. Moreover the public office is not heritable.
1-

The High Court failed to appreciate the ratio in General Manager
(D&PB) & Ors. v. Kunti Tiwary & Anr., (2004] 7 SCC 271 case where it was
held that the criteria of penury has to be applied and only in cases where the
condition of the family is "without any means of livelihood" and "living hand
G to mouth''' that compassionate appointment was required to be granted.

14. The learned counsel appearing for the respondents submitted that
the touchstone of compassionate employment is a stage of penury and
destitution to which the family is reduced to as a result of the death of an
employee in harness. Late Shri. Sukhbir Inder Singh was drawing a monthly
H
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STATE BANK OF INDIA v. JASPAL KAUR [LAKSHMANAN, J.] 107
--r salary of Rs. 15000/- when he died. On his death, besides his widow he left A
behind three minor children including two 15 years old daughters and a son
who was 8 years of age. The respondents contented that the bank has not
considered the case of dependent of Sukhbir lnder Singh keeping in view the
size of the family and liabilities.

15. Further the respondents relied on para 8 of the Scheme which reads B
as under:-

--l "(8) EX-GRATIA:

Ex-gratia on compassionate grounds in lieu of compassionate
appointment may be granted to the family of the employee and subject c
to the ceilings specified below, if the monthly income of the family
from all sources calculated in the manner shown below in paragraph
9 (B) is less than 60% of the last drawn gross salary (net of taxes) of
the employee. The family shall be deemed to be eligible for ex-gratia
payment if the income so arrived at is below 60% of the gross salary
D
I (net of taxes) last drawn, and ineligible ifit is 60% or more of the gross
• salary (net of taxes). Ex-gratia will be paid to the family of the deceased
employee or the employee who has retired due to incapacitation of
_;, eligible under the Scheme within three months of the receipt of
application, complete in all respect".
E
... It was submitted that the Bank in its policy issued in 2005 laid down
criteria for determining penury i.e. the income of the family of the deceased
employee/dependents have been reduced to less than 60% of the salary
which was drawn by the deceased at the time of death. In the present case,
as have been stated above, the income of the family of deceased is Rs.3000/
- only, but even according to the finding given in order dated 03.04.2004, the
F
i•.
said income is Rs.5855/- which is less than 40% of the salary last drawn by
Late Shri. Sukhbir Inder Singh. The respondents claimed that this scheme
formulated on 18.08.2005, was not complied with by the appellant bank while
deciding her claim for appointment in the Bank on compassionate ground.
G

-
16. Concluding his submissions, Mr. P.N.Puri, submitted that the stage
of penury and destitution is to be determined after balancing the assets vis-
~ a-vis liability which was not done in this case by the appellant bank.

17. We heard both the parties in detail. We have also perused through
all the documents presented in the Court and both the judgments passed by H
108 SUPREME COURT REPORTS [2007) 2 S. C.R.

A the High Court of Punjab and Haryana.
18. We are now of the view that, the submissions made by the appellants
deserve favourable consideration and merit acceptance.

19. The law with regard to employment on compassionate grounds for
B dependents of a deceased employee was laid down by this Court in case of
Umesh Kumar Nagpal v. State of Haryana & Ors. (supra), where this Court
observed that, "Appointments in the public services are made strictly on the
basis of op.:n invitati_on of applications and merit. However, exceptions are
,,_
made in favour of dependents of employees dying in harness and leaving
c their family in penury and without any means of livelihood".

20. This Court has further observed in General Manager (D&PB) &
-
Ors. v. Kunti Tiwary & Anr. (supra), that, "the particulars of their income have
been noted in their application and it certainly could not be said on the basis
thereof that the respondents were living hand to mouth. The Division Bench
D erred in diluting this criteria of penury to one of "not very well to do".

21. It was again observed in 2005 by this Court in the case of SB/ v.
Vikas Dubey, (Civil Appeal No.7003/05 dated 21.11.2005), also followed the
decision in Kunti Tiwary (supra) case.

E 22. Hence a major criterion while appointing a person on compassionate
grounds should be the financial condition of the family the deceased person
left behind. Unless the financial condition is entirely penury, such appointments •
cannot be made. In the present case the fmancial condition of the respondents
family is not one of destitution, the appellants have already paid a sum of
Rs.4,57,607/- as terminal benefits (after deducting Rs.19,183/- towards liabilities);
F a sum of Rs.2055/- p.m. was being paid towards family pension and monthly
income under Staff Mutual Welfare Scheme and in addition the total monthly ...
income of the family comes to Rs.5855/- (monthly pension of Rs.2055/- +
Rs.3800/- p.m. as notional interest on the investment of Rs.4,57,607/-). The
competent fact finding authority on the basis of the above financial details
G had arrived at the conclusion that the financial condition of the family is not
penurious and that the family earns sufficient income to maintain themselves.
Hence appointment on compassionate ground was not granted to the
respondent. We however, do not feel the necessity to interfere with this order ).-
...
of the Bank Authority on the fact situation of this case.
H 23. The competent authority of the bank had to consider the case of the
c::
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STA TE BANK OF INDIA v. JASPAL KAUR [LAKSHMANAN. J.] I 09

respondent as per the laid down parameters laid down in the scheme. A
Accordingly, while deciding on the financial condition of the respondent
factors like:

(a) Family Pension
(b) Gratuity
B
(c) Employee's/Employer's contribution to the Provident Fund
(d) Any compensation paid by the Bank or its Welfare Fund
-1
(e) Proceeds of UC Policy & other investments of the deceased
employee
c
(t) Income for family from other sources
(g) Employment of other family members
(h) Size of the family and liabilities, if any, etc.

were taken into consideration by the Competent Authority and based on D
these details appointment was declined to the respondent on compassionate
ground.

24. Also we are of the view that the specially constituted authorities in
the rules or regulations like the competent authority in this case are better

- equipped to decide the cases on facts of the case and their objective finding
arrived on the appreciation of the full facts should not be disturbed. Both
the Benches of the High Court that heard this present matter have erred in
E

entertaining the claim of the respondent and allowing the claim of the
respondent. This was the view taken in a recent decision of this Court in
Union Bank of India and Ors. v. M.T Latheesh (supra), where the court F
observed that, "Learned Single Judge and the Division Bench by directing
appointment has fettered the discretion of the appointing and selecting
authorities. The Bank had considered the application of the respondent in
terms of the statutory scheme framed by the Bank for such appointment".

25. Finally in the fact situation of this case, Sri. Sukhbir Inder Singh G
(late), Record Assistant (Cash & Accounts) on 01.08.1999, in the Dhab Was ti
Ram, Amritsar branch, passed away. The respondent, widow of Sri. Sukhbir
Inder Singh applied for compassionate appointment in the appellant Bank on
05.02.2000 under the scheme which was formulated in 2005. The High Court
also erred in deciding the matter in favour of the respondent applying the
scheme formulated on 04.08.2005, when her application was made in 2000. A H
110 SUPREME COURT REPORTS [2007] 2 S.C.R.

A dispute arising in 2000 cannot be decided on the basis of a scheme that came
into place much after the dispute arose, in the present matter in 2005. Therefore,
the claim of the respondent that the income of the family of deceased is
Rs.5855/- only, which is less than 40% of the salary last drawn by Late Shri.
Sukhbir Inder Singh, in contradiction to the 2005 scheme does not hold water.

B 26. In the result, we allow the appeal filed by the appellant the Bank in
this case and set aside the order passed by the two Benches of the High
Court of Punjab and Haryana. However, there shall be no order as to costs.

RP. Appeal allowed.

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