Supreme Court of India
UNITED BANK OF INDIA (NOW PUNJAB NATIONAL BANK)versusSWAPAN KUMAR MULLICK & ORS.
- Citation
- 2025 INSC 881
- Decided
- 22 July 2025
- Disposal
- Disposed off
- Bench
- DIPANKAR DATTA
Holding
Resignation and voluntary retirement are distinct; a resignation does not automatically confer the right to pension, and Regulation 22 is not unconstitutional, so Mullick is not entitled to pension under the 1995 Regulations.
Summary
Swapan Kumar Mullick worked for United Bank of India for 36 years and resigned in 2006 citing mental depression, opting for provident fund benefits rather than pension. A 2010 circular issued under a bipartite settlement offered a new pension option to employees who had not previously opted for pension, and Mullick applied for it, but the bank rejected his claim on the ground that Regulation 22 of the 1995 Pension Regulations disqualified anyone who resigned from pension. The High Court initially granted Mullick pension, but a Division Bench set aside that order and directed the bank to consider amending Regulation 22 and to determine whether his resignation could be treated as voluntary retirement. The Supreme Court held that resignation and voluntary retirement are distinct concepts, that Regulation 22 is not manifestly arbitrary, and that the bank’s directions to amend the regulation exceeded its jurisdiction. Consequently, the Court affirmed the Division Bench’s dismissal of Mullick’s pension claim, set aside the directions to amend Regulation 22, and, using its powers under Article 142, granted Mullick a limited opportunity to opt for pension or receive a financial relief of Rs.5,00,000.
Issues considered
- Whether an employee who resigns after completing qualifying service forfeits the right to opt for pension under the Pension Regulations.
- Whether Regulation 22 of the United Bank of India (Employees’) Pension Regulations, 1995, which disqualifies resigned employees from pension, violates Article 14 of the Constitution.
- Whether a High Court can direct a bank to amend a regulation when the validity of that regulation is not challenged.
- Whether the circular issued under the bipartite settlement can override the statutory distinction between resignation and voluntary retirement.
Legislation cited
Headnote
Issue for Consideration Issue arose to determine whether an employee resigning from service citing mental depression, after having served his employer much in excess of the period stipulated to qualify for being entitled to pension, forfeits his right to opt for pension in terms of in the Pension Regulations for all times to come, or, in view of pension being a social welfare measure for employees in the winter years of their life, adopting a beneficial approach is permissible. Headnotes† Service Law – United Bank of India (Employees’) Pension
Subjects
PensionResignationVoluntary retirementEnactment of law by legislature/executivePolicy decisionsCircular (No.SP/OPTION/2/OM-0293/10-11) dated 16th August, 2010, clauses 2, 3Mental depressionSocial welfare measure for employeesResignation of an employee, who is not pension opteeBipartite settlementVoluntary retirement/compulsory retirement/resignationProvident fundEmployer-employee relationshipEx proprio vigoreJudicial ReviewLegislative policiesExecutive functions
Judgment
[2025] 7 S.C.R. 1642 : 2025 INSC 881
United Bank of India (Now Punjab National Bank)
v.
Swapan Kumar Mullick & Ors.
(Civil Appeal No. 9679 of 2025)
22 July 2025
[Dipankar Datta* and Ujjal Bhuyan, JJ.]
Issue for Consideration
Issue arose to determine whether an employee resigning from
service citing mental depression, after having served his employer
much in excess of the period stipulated to qualify for being entitled
to pension, forfeits his right to opt for pension in terms of a specific
provision in the Pension Regulations for all times to come, or, in
view of pension being a social welfare measure for employees
in the winter years of their life, adopting a beneficial approach is
permissible.
Headnotes†
Service Law – United Bank of India (Employees’) Pension
Regulations, 1955 – Regn 22 – Resignation of an employee,
who is not a pension optee – Benefit of pension on basis
of the circular – Entitlement – Resignation tendered by the
respondent no.1-employee citing mental depression, after 36
years of service – Bank accepted the same and the employee
relieved from service – Few years later, based on bipartite
settlement, Bank issued a Circular extending ‘another option
for pension’ for the employees who had not opted for the
pension scheme under the 1955 Regn – On basis thereof, the
employee claimed pension, however, the Bank returned the
application stating that employees who had left the service
by opting for voluntary retirement/compulsory retirement/
resignation not eligible to opt for pension – Single Judge held
that the employee was entitled to opt for pension – Division
Bench set aside the order and issued certain directions to the
Bank, directing the Board of Directors of the Bank to consider
amending Regn 22 – Correctness:
* Author
[2025] 7 S.C.R. 1643
United Bank of India (Now Punjab National Bank) v.
Swapan Kumar Mullick & Ors.
Held: Employee must be held to have resigned from service and
not retired voluntarily so as to enable him secure the benefit of
a further opportunity to opt for pension in terms of the circular –
Employee while in service had the opportunity to opt for pension
in terms of the 1995 Regulations, however, he opted for provident
fund – Having served the Bank for over 35 years and in service
for more than a decade after introduction of the 1995 Regulations,
he is presumed to have been aware of the same together with the
consequences of tendering resignation instead of seeking voluntary
retirement – Presumption can also be legitimately drawn that
respondent no.1 was satisfied with whatever he received on account
of provident fund dues while demitting office – Respondent no.1 was
suffering from mental depression but that did not prevent him from
being coherent while writing the resignation letter – Not the case
of employee that he signed without being aware of its contents –
Terms of the bipartite settlement are binding on all the employees
of the public sector banks, which were parties thereto, and such
terms cannot be read in a manner to extend its coverage dehors
the statutory regulations – Reg 22 not found to be so manifestly
arbitrary, so as to call for interference – Reg 22 could have been
held to violate Art.14, if employee, upon resigning from service,
were denied dues on account of provident fund – Since by 2006,
when he resigned, respondent no.1 had not shown any inclination to
opt for pension instead of provident fund, Reg 22 did not affect him
at all – To have an entitlement to pension, futuristically speaking,
employee was required to adhere to the 1995 Regulations, which
he did not – Although the Division Bench required the Board of
Directors of the Bank to ‘consider’ an amendment to Regn 22, in
the light of stipulation of a timeline and the other directions for
determining whether resignation tendered by respondent no.1
could be treated as voluntary retirement and to process his claim
for pension upon such determination, user of the word ‘consider’
is really a mandate on the Bank to amend Regn 22, which could
not have been issued – Division Bench overstepped its bounds
by directing the Board of Directors to consider amending Regn 22
even when the vires of such a regulation was not under challenge –
Order passed by the Division Bench upheld and the directions to
‘consider’ an amendment to Regn 22 set aside – In exercise of
power u/Art.142, some relief extended to the employee to assist
him survive in the winter years of his life with a fair measure of
dignity. [Paras 64, 65, 72, 73]
1644 [2025] 7 S.C.R.
Supreme Court Reports
Service Law – Expression ‘voluntary retirement’ and
‘resignation’ – Distinction between:
Held: “Resignation” and “voluntary retirement” are two distinct
concepts with varying consequences on severance of relationship
and that substitution of the two for each other based solely on
the duration of an employee’s service would run counter to the
intendment of statutory regulations and, thus, is improper –
Employees resigning from service and employees retiring from
service voluntarily constitute two different classes – Treating the
two classes differently may not offend Art.14 – Resignation, being
a voluntary relinquishment of employment, is an implied term of
employer-employee relationship – Resignation can be exercised
anytime while the employee is in service – But unless specified
otherwise, resignation is unilateral, majorly, resignation is bilateral
which, to be effective, requires acceptance by the employer – On
the other hand, an employee may seek voluntary retirement if an
option is provided by the employer as a condition of service to
such employee to retire from service on fulfilment of the specified
terms and conditions – Any employee may, thus, offer to retire
voluntarily upon completion of the requisite period of service and
upon fulfilling other requirements – An offer to retire voluntarily,
made by an employee, is normally accepted by the employer
unless, of course, there is any debilitating factor – Importantly,
when a provision for voluntary retirement does exist, yet, an
employee elects to resign, such resignation (irrespective of the
length of service) cannot be treated as voluntary retirement unless,
in a given case, the employee also satisfies the conditions for
voluntary retirement – What is applicable in a case of voluntary
retirement ex proprio vigore may not apply to resignation in all
cases. [Paras 47, 52, 53]
Judicial Review – Legislative policies – Scope of interference:
Held: Judicial review courts should refrain from assessing the
merits of policies formulated by legislative or regulatory authorities
which are codified in statutes/regulations – Any shortcomings in
the policy do not render the regulation ultra vires – Courts cannot
invalidate a regulation merely because in its opinion the policy is
unwise or ineffective – Scrutiny has normally to be restricted to
the process of policy making – As long as the policy is not beyond
[2025] 7 S.C.R. 1645
United Bank of India (Now Punjab National Bank) v.
Swapan Kumar Mullick & Ors.
the scope of the regulation-making power or does not transgress
the bounds of the parent enactment or is in violation of any of the
limitations imposed by the Constitution, there is little or no scope for
interference by the Courts – Power u/Art.226 cannot be exercised
by a High Court to direct the legislature/executive to enact a law
(primary or subordinate) or frame a regulation/bye-law – These
are executive functions which are to be performed based on policy
decisions taken at the appropriate level – Constitution of India –
Art.226. [Paras 57, 58, 67]
Case Law Cited
LIC v. Shree Lal Meena [2019] 5 SCR 391 : (2019) 4 SCC 479;
State of West Bengal v. Anwar Ali Sarkar [1952] 1 SCR 284 :
(1952) 1 SCC 1 – distinguished.
Bank of Baroda v. S.K. Kool (dead) Through Legal Representatives
[2013] 12 SCR 783 : (2014) 2 SCC 715; Shashikala Devi v.
Central Bank of India [2014] 13 SCR 868 : (2014) 16 SCC 260;
M.R. Prabhakar v. Canara Bank [2012] 8 SCR 1072 : (2012)
9 SCC 671; BSES Yamuna Power Ltd. v. Ghanshyam Chand
Sharma [2019] 14 SCR 546 : (2020) 3 SCC 346; UCO Bank &
Ors. v. Sanwar Mal [2004] 2 SCR 1125 : (2004) 4 SCC 412; Delhi
Transport Corporation v. D.T.C. Mazdoor Congress [1990] Supp.
1 SCR 142 : (1991) Supp. 1 SCC 600; D.S. Nakara v. Union of
India [1983] 2 SCR 165 : (1983) 1 SCC 305; Reserve Bank of
India v. Cecil Dennis Solomon [2003] Supp. 6 SCR 465 : (2004)
9 SCC 461; Sheelkumar Jain v. New India Assurance Co. Ltd.
[2011] 9 SCR 574 : (2011) 12 SCC 197; Sudhir Chandra Sarkar v.
TISCO [1984] 3 SCR 325 : (1984) 3 SCC 369; S. Appukuttan v.
Thundiyil Janaki Amma [1988] 2 SCR 661 : (1988) 2 SCC 372;
Asger Ibrahim Amin v. LIC [2015] 9 SCR 865 : (2016) 13 SCC
797; Mallikarjuna Rao v. State of Andhra Pradesh [1990] 2 SCR
418 : (1990) 2 SCC 707; V.K. Sood v. Department of Civil Aviation
[1993] 3 SCR 772 : (1993) Supp. 3 SCC 9; State of Himachal
Pradesh v. Satpal Saini [2017] 1 SCR 658 : (2017) 11 SCC
42 – referred to.
Books and Periodicals Cited
Administrative Law, H.W.R. Wade, 6th Edition – referred to.
1646 [2025] 7 S.C.R.
Supreme Court Reports
List of Acts
United Bank of India (Employees’) Pension Regulations, 1955;
Constitution of India; Contract Act, 1872.
List of Keywords
Pension; Resignation; Voluntary retirement; Enactment of law by
legislature/executive; Policy decisions; Circular (No.SP/OPTION/2/
OM-0293/10-11) dated 16th August, 2010, clauses 2, 3; Mental
depression; Social welfare measure for employees; Resignation
of an employee, who is not pension optee; Bipartite settlement;
Voluntary retirement/compulsory retirement/resignation; Provident
fund; Employer-employee relationship; Ex proprio vigore; Judicial
Review; Legislative policies; Executive functions.
Case Arising From
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 9679 of 2025
From the Judgment and Order dated 17.06.2020 of the High Court
at Calcutta in FMA No. 4412 of 2016
With:
Civil Appeal No. 9675 of 2025
Appearances for Parties
Advs. for the Appellant:
Tripurari Ray, Laxmi Narayan Sharma, Atul Wadera, Rajinder
Singh, Ms. Shilpa Singh, Rajesh Kumar Gautam, Anant Gautam,
Deepanjal Choudhary, Ms. Likivi Jakhalu, Kushagra Nilesh Sahay.
Advs. for the Respondents:
Puneet Jain, Shekhar G. Devasa, Sr. Advs., Rajesh Kumar
Gautam, Anant Gautam, Deepanjal Choudhary, Ms. Likivi Jakhalu,
Kushagra Nilesh Sahay, Tripurari Ray, Balwant Singh Billowria,
Vivek Gupta, Anirudh Ray, Ms. Payal Rani, Manu Shanker Mishra,
Ms. Christi Jain, Mann Arora, Mrs. Akriti Sharma, Harsh Jain,
Om Sudhir Vidyarthi, Subhasish Mohanty, Mata Prasad Singh,
Bikash Chandra, Ms. Priyanka Thakur, Ankit Bhatnagar, Ms.
Madhusmita Bora, Manish Tiwari, Pawan Shyam, Ms. Thashmitha
Muthanna, Shashi Bhushan Nagar, Vishwanath Chaturvedi, M/s.
Devasa & Co.
[2025] 7 S.C.R. 1647
United Bank of India (Now Punjab National Bank) v.
Swapan Kumar Mullick & Ors.
Judgment / Order of the Supreme Court
Judgment
Dipankar Datta J.
The Appeals
1. Leave granted. These appeals, arise out of a common judgment and
order dated 17th June, 20201 of a Division Bench of the High Court
at Calcutta2. The operative part of the impugned order reads thus:
A) The judgment and order under appeal dated 1st April, 2016 is
set aside.
B) The Board of Directors of the United Bank of India shall
consider amendment of Regulation 22 of the United Bank of
India (Employees’) Pension Regulations, 1995 according to the
circular of the Indian Banks Association dated 30th June, 2015
with or without retrospective effect within 3 months of physical
communication of this order.
C) The appellant bank by constituting an authority shall determine
by 21st October, 2020 upon giving an opportunity to Mullick to
place facts and adduce evidence before it whether he could
be treated as having voluntarily retired from service, strictly
following the judgment of the Supreme Court in Shashikala
case reported in (2014) 16 SCC 260 read with UCO Bank &
Ors. Vs. Sanwar Mal reported in (2004) 4 SCC 412 and Senior
Divisional Manager, Life Insurance Corporation of India &
Ors. Vs. Shree Lal Meena reported in (2019) 4 SCC 479, BSES
Yamuna Power Ltd. Vs. Sh. Ghanshyam Chand Sharma &
Anr. reported in AIR 2020 SC 76 and the observation made
in this judgment and order.
D) Depending on such determination the option form/application
submitted by Mullick dated 23rd August, 2010 in the terms of
the circular dated 16th August, 2010 for availing of the pension
scheme shall be processed by the bank by 20th November,
1 impugned order
2 High Court
1648 [2025] 7 S.C.R.
Supreme Court Reports
2020. The appeal (FMA 4412 of 2016) is disposed of by this
judgment and order.
(bold in original)
2. The appellant - United Bank of India (now Punjab National Bank)3 -
is aggrieved by the directions contained in (B) to (D) supra; hence,
it has preferred the lead appeal.
3. Upon service of notice, the 1st respondent - Shri Swapan Kumar
Mullick4 - has preferred the connected appeal.
Facts
4. The uncontroverted facts giving rise to the present appeals are as
under:
4.1. Mullick joined the services of the Bank as a typist on 23 rd
November, 1970. Subsequently, he was promoted to the post
of machine operator in the year 1978, and later to the post of
head cashier.
4.2. After rendering 36 years of service with the Bank, Mullick
tendered his resignation on 21st August, 2006, citing mental
depression. The Bank accepted Mullick’s resignation on 19th
October, 2006, and relieved him from its service.
4.3. On 27th April, 2010, a bipartite settlement was signed between
the Indian Banks Association5 and various unions of workmen.
Based on this bipartite settlement, the Bank issued a circular
(No.SP/OPTION/2/OM-0293/10-11) dated 16th August, 20106
extending ‘another option for pension’ for the employees who
had not opted for the pension scheme under the United Bank
of India (Employees’) Pension Regulations, 19957.
4.4. The circular assumes primacy since it defined retired employees
who would be entitled to pensionary benefits. It is this circular
3 Bank
4 Mullick
5 IBA
6 circular
7 1995 Regulations
[2025] 7 S.C.R. 1649
United Bank of India (Now Punjab National Bank) v.
Swapan Kumar Mullick & Ors.
upon which Mullick based his claim for pension. Clause 2 of
the circular defines retired employees and reads thus:
2. Retired employees means those who were in
service of the Bank on or after 29th September, 1995
and ceased to be in service of the Bank on account
of retirement on Superannuation, Voluntary retirement
or on account of VRS under special scheme prior to
27th April, 2010.
4.5. Clause 3 of the circular lays down the eligibility and terms and
conditions, and reads thus:
3. Eligibility and terms and conditions:
A) This ‘another option for pension’ will be
available to those hitherto non optee retired
employees.
i) Retired from the Bank’s service on
superannuation or on Voluntary retirement on
or after 29th September, 1995.
ii) Retired from the Bank’s service on account
of VRS under special scheme on or after 29th
September, 1995 after rendering a minimum of
15 years service.
iii) Died while in service of the Bank on or after
29th September, 1995 (families of the deceased
employees may opt for getting family pension).
All of the above retired employees/families of the
deceased employees who want to opt for pension
now will have to pay 156% of what they received on
retirement/death on account of the Bank’s contribution
to SPF and interest accrued thereon being his/her
share of 30% initial funding gap.
4.6. Mullick, on 23rd August, 2010, sought to exercise the option
under the circular and filled the form. On 5th October, 2010,
the General Manager (Staff Pension) of the Bank returned the
application stating that employees who had left the service by
opting for voluntary retirement/compulsory retirement/resignation
are not eligible to opt for pension.
1650 [2025] 7 S.C.R.
Supreme Court Reports
4.7. On 24th September, 2012, through his advocate, Mullick made
a representation to the Bank requesting for reconsideration of
his case to opt for pension.
4.8. Having received no response, Mullick filed a writ petition before
the High Court inter alia praying for a writ of mandamus against
the Bank and its officers [respondents 2 to 4 in the connected
appeal] to extend the benefit of pension to him.
4.9. Before the writ court, Mullick advanced two-fold submissions:
first, he submitted that the “resignation letter” submitted by
an employee who has qualified the criteria enabling him
to pensionary benefits is liable to be treated as “retirement
from service”, thereby enabling him to get the said benefit. In
support of the same, reliance was placed on the decisions of
this Court in Bank of Baroda v. S.K. Kool (dead) Through
Legal Representatives8 and Shashikala Devi v. Central Bank
of India9; and secondly, he relied upon Regulation 14 of the
1995 Regulations and asserted that he was entitled to pension
as he had put in qualifying length of service in terms thereof.
For facility of reference, Regulation 14 is reproduced below:
14. Qualifying Service - Subject to the other conditions
contained in these regulations, an employee who
has rendered a minimum of ten years of service in
the Bank on the date of his retirement or the date
on which he is deemed to have retired shall qualify
for pension.
4.10. In contrast, the Bank asserted that Mullick was ineligible for the
claimed benefits in view of Regulation 22 of the 1995 Regulations
which disqualified an employee resigning from service to grant
of pension. Regulation 22 reads as follows:
22. Forfeiture of service - (1) Resignation or dismissal
or removal or termination of an employee from the
service of the Bank shall entail forfeiture of his entire
past service and consequently shall not qualify for
pensionary benefits;
8 (2014) 2 SCC 715
9 (2014) 16 SCC 260
[2025] 7 S.C.R. 1651
United Bank of India (Now Punjab National Bank) v.
Swapan Kumar Mullick & Ors.
4.11. The Single Judge, upon considering the rival contentions,
formulated the following issue:
Whether the petitioner’s claim for pension becomes
barred simply because he had submitted his “resignation”
from service instead of seeking “retirement”?
4.12. Several decisions were cited before the Single Judge who,
after analysing the same, held that Mullick’s case was squarely
covered by the decision in Shashikala Devi (supra). The Court
noted that Mullick had served the Bank for 36 years (which was
far in excess of the qualifying service of 10 years for grant of
pension), had no pending disciplinary proceedings, and had
resigned due to mental depression. In such state of mind, the
use of the term ‘resignation’ by Mullick instead of ‘retirement’
should not deprive him of pensionary benefits to which he was
otherwise entitled.
4.13. Consequent upon such findings, the Single Judge of the High
Court, on 1st April, 2016, held that Mullick was entitled to opt
for pension. The writ petition was allowed with direction to the
Bank to extend the benefit of pension to Mullick and pay him
his admissible dues within 6 months of the order.
4.14. Against the judgment of the Single Judge, the Bank filed an
intra-court appeal10 before a Division Bench of the High Court.
Impugned Order
5. The Division Bench also referred to Shashikala Devi (supra) and
summarised the legal principle propounded therein: if an employee
resigns shortly before superannuation, with an unblemished
service record, and does not expressly waive the right to pension,
a presumption arises that the employee did not intend to forfeit
pension. Furthermore, such resignation should be treated as voluntary
retirement if the employee has rendered the qualifying years of service.
6. Thereafter, the Division Bench noted that if circumstances surrounding
Mullick’s case were covered by those referred to in Shashikala
Devi (supra), then he should be given the benefit thereunder.
Acknowledging the absence of any factual finding by the Single
10 F.M.A. 4412 of 2016
1652 [2025] 7 S.C.R.
Supreme Court Reports
Judge on this aspect, as no arguments in this regard were made, the
Division Bench set aside the order of the Single Judge and ordered
for a decision on Mullick’s case by an appropriate authority in view
of the circular dated 30th June, 2015 of the IBA suggesting that the
banks, who were parties to the bipartite settlement dated 10th April,
2002/27th May, 2002, might consider amendments to Regulation 22 of
the Bank Employees (Pension) Regulations, 1995 as far as workmen
employees are concerned. According to the Division Bench, the main
thrust of the circular dated 30th June, 2015 was that the operation
of Regulation 22 may not divest the employees who had rendered
qualifying service of past service and their entitlement to pension.
The resultant directions given by the Division Bench, premised on
such reasoning, have been noted above.
Proceedings before this Court
7. After notice was issued in the lead appeal, interim applications for
intervention/impleadment were filed by several parties, which were
allowed. The connected appeal, which is in the nature of a cross-appeal,
was also filed by Mullick. Accordingly, we have heard the submissions
advanced on behalf of the Bank, Mullick and the intervenors.
Submissions on behalf of the Bank/appellant in the lead appeal
8. The Division Bench has given a direction to ‘consider’ an amendment
to Regulation 22 of the 1995 Regulations. Though it might seem to
be innocuous, such a direction in effect is in the nature of a mandate,
and such a mandate is in the teeth of several decisions of this Court.
9. Mullick had resigned, and not retired, from service in 2006. He
had not opted for pension under the 1995 Regulations but opted
for provident fund. Further, all terminal benefits payable to Mullick
were paid to him soon after his resignation, in 2006 itself. Mullick,
not having opted for pension and not having retired from the Bank’s
service cannot, as a matter of any legal or statutory right, claim
pensionary benefits under the 1995 Regulations.
10. In its decision in LIC v. Shree Lal Meena11, this Court considered
the difference between ‘resignation’ and ‘retirement’. Paragraph 26 of
11 (2019) 4 SCC 479
[2025] 7 S.C.R. 1653
United Bank of India (Now Punjab National Bank) v.
Swapan Kumar Mullick & Ors.
the decision was referred for the proposition that when the legislature
extends the application of beneficial legislation to a certain class, its
application cannot be extended to classes which are not included.
11. Further, the impugned order is also contrary to the law laid down
in M.R. Prabhakar v. Canara Bank12 and BSES Yamuna Power
Ltd. v. Ghanshyam Chand Sharma13, which followed the dictum
in Shree Lal Meena (supra).
12. Next, the decision of this Court in S.K. Kool (supra) was erroneously
relied upon by the High Court, since the issue there did not concern
resignation of an employee, who is not a pension optee. The issue
was related to interplay of punishment of removal from service with
superannuation benefit, i.e., pension and/or provident fund and
gratuity, as would be due otherwise and without disqualification from
future employment. Thus, such decision is clearly distinguishable
on facts.
13. Further, in S.K. Kool (supra), this Court held that an employee, upon
whom the punishment of removal with superannuation benefit is
imposed, would also be entitled to pension. Hence, the letter/circular
of the IBA dated 30th June, 2015 - which made a suggestion to the
banks to amend regulation 22 in terms of the decision in S.K. Kool
(supra) – did not relate to a case where an employee has tendered
resignation and particularly when he is not a pension optee.
14. Even otherwise, Mullick did not challenge any of the provisions of the
regulations or the settlement. Significantly, a challenge to regulation
22 of the UCO Bank (Employees’) Pension Regulations, 1995, which
is a pari materia provision followed by all nationalized banks, has
been rejected by this Court in UCO Bank & Ors. v. Sanwar Mal14.
15. During the pendency of these appeals, a 12th bipartite settlement
dated 3rd March, 2024 has been signed between the management
of various banks represented through the IBA and various Workmen
Unions at the industry level. In terms of clause 37 thereof, employees
who resigned from service have been given an option to opt for
pension under the 1995 Regulations on the terms and conditions
12 (2012) 9 SCC 671
13 (2020) 3 SCC 346
14 (2004) 4 SCC 412
1654 [2025] 7 S.C.R.
Supreme Court Reports
mentioned therein; however, Mullick did not exercise an option in
terms thereof.
16. Resting on the aforesaid submissions, it has been prayed that the
lead appeal be allowed by setting aside the impugned order and the
connected appeal dismissed.
Submissions on behalf of Mullick/appellant in the connected appeal
17. Regulation 22 of the 1995 Regulations is violative of Articles 14 to
16 of the Constitution of India. Although a challenge to the relevant
regulation was not made before the High Court, the same is now
sought to be challenged in the connected appeal.
18. Regulation 22 classifies employees together for the purpose of denial
of pension in violation of Article 14. The classification of employees
who have resigned with delinquent employees who have been
punished/terminated/removed would be improper. An employee
who has resigned would resemble an employee who has availed
voluntary retirement under Regulation 29; and, thus, for the purpose
of pension, he must be classified with an employee who has availed
voluntary retirement, especially when the former has completed 20
years of qualifying service.
19. The decision in Sanwar Mal (supra) is in ignorance of the Constitution
Bench decision of this Court in State of West Bengal v. Anwar Ali
Sarkar15. Further, Shree Lal Meena (supra) only referred to Sanwar
Mal (supra) and did not consider Regulation 22 independently.
20. This Court’s decision in Shashikala Devi (supra), which differentiated
between resignation simplicitor and resignation on health grounds,
was not at all considered in Shree Lal Meena (supra).
21. The relevant paragraph from Shashikala Devi (supra), which was
cited, reads thus:
9. The High Court, as seen earlier, has taken the view
that the letter was one of resignation that resulted
in the forfeiture of past service under Regulation 22
of the Regulations. The High Court appears to have
been impressed by the use of the word ‘resignation’
15 (1952) 1 SCC 1
[2025] 7 S.C.R. 1655
United Bank of India (Now Punjab National Bank) v.
Swapan Kumar Mullick & Ors.
in the employee’s letter dated 8-10-2007. The use
of the expression ‘resignation’, however, is not,
in our opinion, conclusive. That is, in our opinion,
so even when this Court has always maintained a
clear distinction between ‘resignation’ and ‘voluntary
retirement’. Whether or not a given communication
is a letter of resignation simpliciter or can as well be
treated to be a request for voluntary retirement will
always depend upon the facts and circumstances of
each case and the provisions of the rules applicable.
22. Accordingly, based on the aforesaid submissions and referring to the
reasons assigned by the Single Judge to allow Mullick’s writ petition,
it was prayed that the judgment of the Single Judge be restored
upon reversal of the impugned order.
Submissions on behalf of the Intervenors
23. The intervenors, while supporting the claim of Mullick, contended
that the benefit of pension must be extended to employees who
have resigned.
24. There is no provision for workmen to retire from banks before attaining
the age of superannuation. Most banks stipulate a minimum of 25 to
30 years in the Officers’ Service Regulations, 1979, to retire. Thus,
the officers were compelled to resign and not retire.
25. The Bipartite Settlement dated 29th October 1993 triggered the
pension scheme by notification of the 1995 Regulations. While
the settlement does not provide for forfeiture of service in case of
resignation, Regulation 22 provided for forfeiture of service even for
resignation. Regulation 22 cannot be used to take away the benefit
of pension when an employee is otherwise entitled to it.
26. There exists no difference between payment of bank’s contribution of
provident fund to those retired on superannuation/voluntary retirement
and resignation.
27. Reliance was placed on a letter dated 1st October, 2001 issued by the
IBA to show that voluntary retirement was not available to staff under
the bipartite settlement, prior to introduction of the pension scheme.
Even after the introduction of pension scheme, only those who had
opted for pension could retire voluntarily. Thus, the workmen and
1656 [2025] 7 S.C.R.
Supreme Court Reports
officers were compelled to resign, instead of retire. Imposition of such
conditions are unconscionable and in the teeth of the decision of this
Court in Delhi Transport Corporation v. D.T.C. Mazdoor Congress16.
28. Denial of pension to a particular group of employees who resigned is
discriminatory and violative of Articles 14 and 16 of the Constitution
of India. Any employee who has rendered the qualifying period of
service must be held entitled to opt for pension.
29. The bipartite settlement grants the benefit of pension to those
employees who sought voluntary retirement but does not consider
the employees who have resigned and, in that regard, it would be
violative of this Court’s decision in D.S. Nakara v. Union of India17.
30. The bipartite settlement scheme dated 8th March, 2024, enjoins
employees who resigned between 1st January, 1980 and 27th April,
2010. However, it does not stipulate minimum years of service. Despite
that, banks have refused pension to employees who have served
less than 20 years of service, as stipulated under regulation 29.
31. In terms of this Court’s decision in S.K. Kool (supra), the benefit
of pension was extended even to delinquent employees, whose
services were terminated on account of disciplinary action. It would be
discriminatory to allow pension benefits to employees who committed
fraud on the employer-bank but to disallow employees who resigned.
This would result in an anomalous situation and would be arbitrary
and violative of Articles 12, 14, 16 and 21.
32. Lastly, since the terms of employment of these employees are
contractual in nature, the conditions imposed which are contrary to
the provisions of the Indian Contract Act, 1872 are unsustainable in
law. The settlement does not specifically disentitle those who resigned
from its application and thus the banks cannot disallow the benefit
to such employees who have resigned.
The Issue
33. The issue that arises for determination is: whether an employee
resigning from service citing mental depression, after having served
16 (1991) Supp. 1 SCC 600
17 (1983) 1 SCC 305
[2025] 7 S.C.R. 1657
United Bank of India (Now Punjab National Bank) v.
Swapan Kumar Mullick & Ors.
his employer much in excess of the period stipulated to qualify for
being entitled to pension, forfeits his right to opt for pension in terms
of a specific provision in the Pension Regulations for all times to
come, or, in view of pension being a social welfare measure for
employees in the winter years of their life, adopting a beneficial
approach is permissible and/or called for?
Analysis and Reasons
34. Multiple authorities have been cited on either side to persuade us
to answer the question in their favour. A close look at each of the
relevant decisions has to be taken to ascertain whether the issue
we are concerned with is res integra.
35. In Reserve Bank of India v. Cecil Dennis Solomon18, the employees
of the Reserve Bank of India19 had tendered their resignations in
1988 and were getting superannuation benefits under the provident
fund contributory provisions and gratuity schemes. Subsequently, the
RBI Pension Regulations, 1990 were framed. The employees, who
had tendered resignation in 1988, claimed that they were entitled
to pension under these new Pension Regulations and moved the
concerned high court for relief whereupon it was held that RBI
was legally bound to grant pension to such employees. RBI then
challenged the decision of the high court and this Court held that as
the employees had tendered resignation, which was different from
voluntary retirement, they were not entitled to pension under the
Pension Regulations.
36. While allowing the appeal of RBI, a coordinate Bench in Cecil
Dennis Solomon (supra) proceeded to make the following pertinent
observations:
10. In service jurisprudence, the expressions
“superannuation”, “voluntary retirement”, “compulsory
retirement” and “resignation” convey different connotations.
Voluntary retirement and resignation involve voluntary acts
on the part of the employee to leave service. Though both
involve voluntary acts, they operate differently. One of the
18 (2004) 9 SCC 461
19 RBI
1658 [2025] 7 S.C.R.
Supreme Court Reports
basic distinctions is that in case of resignation it can be
tendered at any time, but in the case of voluntary retirement,
it can only be sought for after rendering prescribed period
of qualifying service. Other fundamental distinction is that
in case of the former, normally retiral benefits are denied
but in case of the latter, the same is not denied. In case of
the former, permission or notice is not mandated, while in
case of the latter, permission of the employer concerned
is a requisite condition. Though resignation is a bilateral
concept, and becomes effective on acceptance by the
competent authority, yet the general rule can be displaced
by express provisions to the contrary. ...
37. In Sanwar Mal (supra), Sanwar Mal - who was initially appointed in
UCO Bank on 29th December, 1959 and was thereafter promoted
to Class III post in 1980 - resigned from the service of UCO Bank
after giving one month’s notice on 25th February, 1988. Thereafter,
the UCO Bank (Employees’) Pension Regulations, 1995 were
framed and Sanwar Mal opted for the pension scheme under such
regulations. UCO Bank declined to accept his option to admit him
into the pension scheme. Sanwar Mal filed a suit for a declaration
that he was entitled to pension under the Pension Regulations and
for a mandatory injunction directing UCO Bank to make payment of
arrears of pension along with interest. The suit was decreed and the
decree was affirmed in first appeal and, thereafter, by the relevant
high court in second appeal. UCO Bank carried an appeal to this
Court, which was allowed and the judgment of the high court set
aside. This Court differentiated the expressions “resignation” from
“voluntary retirement” by ruling as follows:
9. ... The words “resignation” and “retirement” carry
different meanings in common parlance. An employee can
resign at any point of time, even on the second day of his
appointment but in the case of retirement he retires only
after attaining the age of superannuation or in the case of
voluntary retirement on completion of qualifying service.
The effect of resignation and retirement to the extent that
there is severance of employment (sic is the same) but in
service jurisprudence both the expressions are understood
differently. Under the Regulations, the expressions
“resignation” and “retirement” have been employed for
[2025] 7 S.C.R. 1659
United Bank of India (Now Punjab National Bank) v.
Swapan Kumar Mullick & Ors.
different purpose and carry different meanings. The
Pension Scheme herein is based on actuarial calculation;
it is a self-financing scheme, which does not depend
upon budgetary support and consequently it constitutes
a complete code by itself. The Scheme essentially
covers retirees as the credit balance to their provident
fund account is larger as compared to employees who
resigned from service. Moreover, resignation brings about
complete cessation of master-and-servant relationship
whereas voluntary retirement maintains the relationship
for the purposes of grant of retiral benefits, in view of
the past service. Similarly, acceptance of resignation
is dependent upon discretion of the employer whereas
retirement is completion of service in terms of regulations/
rules framed by the Bank. Resignation can be tendered
irrespective of the length of service whereas in the case
of voluntary retirement, the employee has to complete
qualifying service for retiral benefits. Further, there are
different yardsticks and criteria for submitting resignation
vis-à-vis voluntary retirement and acceptance thereof.
Since the Pension Regulations disqualify an employee,
who has resigned, from claiming pension, the respondent
cannot claim membership of the fund. In our view,
Regulation 22 provides for disqualification of employees
who have resigned from service and for those who have
been dismissed or removed from service. Hence, we do
not find any merit in the arguments advanced on behalf
of the respondent that Regulation 22 makes an arbitrary
and unreasonable classification repugnant to Article 14 of
the Constitution by keeping out such class of employees.
The view we have taken is supported by the judgment of
this Court in the case of Reserve Bank of India v. Cecil
Dennis Solomon. Before concluding we may state that
Regulation 22 is not in the nature of penalty as alleged.
It only disentitles an employee who has resigned from
service from becoming a member of the fund. Such
employees have received their retiral benefits earlier.
The Pension Scheme, as stated above, only provides
for a second retiral benefit. Hence there is no question
of penalty being imposed on such employees as alleged.
1660 [2025] 7 S.C.R.
Supreme Court Reports
The Pension Scheme only provides for an avenue for
investment to retirees. They are provided avenue to put in
their savings and as a term or condition which is more in
the nature of an eligibility criterion, the Scheme disentitles
such category of employees as are out of it.
38. The difference between ‘resignation’ and ‘retirement’, though
discussed by this Court in Cecil Dennis Solomon (supra) and
Sanwar Mal (supra) in extenso, we find such distinction not to have
been applied by another coordinate Bench in Sheelkumar Jain v.
New India Assurance Co. Ltd.20. Sheelkumar was an employee
of an insurance company governed by a pension scheme which
provided forfeiture of the entire service of an employee should
he resign from his employment. Sheelkumar submitted a letter of
resignation which resulted in denial of his service benefits under
such scheme. The Bench was, thus, called upon to decide the issue
whether the termination of the services of the appellant in 1991
amounted to resignation or voluntary retirement. It was held that
since the employee had completed the qualifying service and was
entitled to seek voluntary retirement under the scheme, he could
not be said to have resigned so as to lose his pension. Referring to
the decisions in Cecil Dennis Solomon (supra) and Sanwar Mal
(supra), the Bench ruled that the Courts there had not been called
upon to decide whether the termination of services of the employee
was by way of resignation or voluntary retirement. For the reasons
assigned, the Bench proceeded to hold that:
25. Para 22 of the 1995 Pension Scheme states that
the resignation of an employee from the service of the
corporation or a company shall entail forfeiture of his
entire past service and consequently he shall not qualify
for pensionary benefits, but does not define the term
“resignation”. Under sub-para (1) of Para 30 of the 1995
Pension Scheme, an employee, who has completed 20
years of qualifying service, may by giving notice of not less
than 90 days in writing to the appointing authority retire
from service and under sub-para (2) of Para 30 of the
1995 Pension Scheme, the notice of voluntary retirement
20 (2011) 12 SCC 197
[2025] 7 S.C.R. 1661
United Bank of India (Now Punjab National Bank) v.
Swapan Kumar Mullick & Ors.
shall require acceptance by the appointing authority. Since
“voluntary retirement” unlike “resignation” does not entail
forfeiture of past services and instead qualifies for pension,
an employee to whom Para 30 of the 1995 Pension Scheme
applies cannot be said to have “resigned” from service.
39. Close on the heels of the aforesaid decision came the decision in
M.R. Prabhakar (supra). A further coordinate Bench was seized of
appeals concerned with the legality of the claim for pension in lieu
of contributory provident fund of some officers of Canara Bank who
had resigned and stood relieved from their respective posts prior to
3rd June, 1993, i.e., prior to signing of the statutory settlement dated
29th October, 1993 under the Industrial Disputes Act, 1947, the joint
note of even date, followed by the Canara Bank (Employees’) Pension
Regulations, 1995, which were notified in the Gazette of India on
29th September, 1995. Although the employees succeeded before
the single judge, the division bench of the relevant high court held
otherwise resulting in the appeals. While repelling the submission that
Sanwar Mal (supra) requires reconsideration and that Sheelkumar
Jain (supra) ought to be followed, the Bench observed as follows:
18. The learned counsel appearing for the appellants have
placed heavy reliance on Sheelkumar Jain and submitted
that in the light of that judgment, the decision rendered in
Sanwar Mal requires reconsideration. We find it difficult
to accept the contention raised by the learned counsel
appearing for the appellants.
19. We may point out that in Sheelkumar Jain this Court
was dealing with an insurance scheme and not the pension
scheme, which is applicable in the banking sector. The
provisions of both the scheme and the Regulations are not
in pari materia. In Sheelkumar Jain case, while referring to
Para 5, this Court came to the conclusion that the same
does not make distinction between “resignation” and
“voluntary retirement” and it only provides that an employee
who wants to leave or discontinue his service amounts
to “resignation” or “voluntary retirement”. Whereas,
Regulation 20(2) of the Canara Bank (Officers’) Service
Regulations, 1979 applicable to banks, had specifically
referred to the words “resignation”, unlike Para 5 of the
1662 [2025] 7 S.C.R.
Supreme Court Reports
Insurance Rules. Further, it is also to be noted that, in that
judgment, this Court in para 30 held that the Court will
have to construe the statutory provisions in each case to
find out whether the termination of service of an employee
was a termination by way of resignation or a termination
by way of voluntary retirement.
40. In Shashikala Devi (supra), heavily relied on by the Division Bench
in the impugned order, the short question that fell for consideration
in an appeal before yet another coordinate Bench was whether the
letter dated 8th October, 2007 sent by late Mauzi Ram, husband of
Shashikala, was in essence a letter seeking premature retirement
on medical grounds or a letter of resignation from the service of the
Central Bank of India21. The decisions in Cecil Dennis Solomon
(supra) and Sanwar Mal (supra) were duly considered. It was noted
that the orders under challenge in the appeal had taken the view
that the letter given by Mauzi Ram was one of resignation that
resulted in the forfeiture of past service under Regulation 22 of the
relevant regulations of the CBoI. The Bench then expressed its view
of the relevant high court being impressed by the use of the word
“resignation” in the employee’s letter dated 8th October, 2017. The
use of the expression “resignation”, however, was held not to be
conclusive. In the opinion of the Bench, it was not so even when
this Court had maintained a clear distinction between “resignation”
and “voluntary retirement”. Whether or not a given communication
is a letter of resignation simplicitor or can as well be treated to be a
request for voluntary retirement was held to be always dependent
upon the facts and circumstances of each case and the provisions
of the rules applicable. After considering several decisions including
Sudhir Chandra Sarkar v. TISCO22 and S. Appukuttan v. Thundiyil
Janaki Amma23, wherein law has been laid down to the effect
that pension is a right and payment of it does not depend on the
discretion of the employer and also that while interpreting a statute
the Court ought to keep the legislative intent in mind and eschew
an interpretation which tends to restrict, narrow down or defeat its
beneficial provisions, it was held that:
21 CBoI
22 (1984) 3 SCC 369
23 (1988) 2 SCC 372
[2025] 7 S.C.R. 1663
United Bank of India (Now Punjab National Bank) v.
Swapan Kumar Mullick & Ors.
18. It is, in our opinion, abundantly clear that the beneficial
provisions of a Pension Scheme or Pension Regulations
have been interpreted rather liberally so as to promote the
object underlying the same rather than denying benefits
due to beneficiaries under such provisions. In cases where
an employee has the requisite years of qualifying service
for grant of pension, and where he could under the service
conditions applicable seek voluntary retirement, the benefit
of pension has been allowed by treating the purported
resignation to be a request for voluntary retirement. We
see no compelling reasons for not doing so even in the
present case, which in our opinion is in essence a case
of the deceased employee seeking voluntary retirement
rather than resigning.
Ultimately, having appreciated the attendant circumstances in which
Mauzi Ram resigned as well as on consideration of the decision in
Sheelkumar Jain (supra), the Bench proceeded to rule that for a
waiver of a legally enforceable right earned by an employee, it is
necessary that the same is clear and unequivocal, conscious and
with full knowledge of the consequences and that no such intention
could be gathered from the facts and circumstances of such case.
Relief was thus granted to Shashikala by allowing the appeal and
setting aside the judgments under challenge.
41. Next, a somewhat similar issue came up for consideration in Asger
Ibrahim Amin v. LIC24 before a coordinate Bench. The question which
fell for consideration is: whether the appellant is entitled to claim
pension even though he resigned from service of his own volition
and, if so, whether his claim on this count had become barred by
limitation or laches? After referring to Sheelkumar Jain (supra), the
coordinate Bench observed that the appellant had put in more than
20 years’ service and that he ought not to be deprived of pension
benefits merely because he styled his termination of services as
“resignation” or because there was no provision to retire voluntarily
at that time. It was also observed that the Court would be failing in
its duty, if it were to go by the letter and not by the laudatory spirit of
statutory provisions and the Fundamental Rights guaranteed under
Article 14 of the Constitution of India.
24 (2016) 13 SCC 797
1664 [2025] 7 S.C.R.
Supreme Court Reports
42. Although what is expressed in Asger Ibrahim Amin (supra) could
provide succour to Mullick, we note that a subsequent coordinate
Bench had the occasion to disagree with the view expressed therein,
resulting in a reference vide order dated 26th November, 2015.
43. The conflicting conclusions drawn from similar facts and laws, evident
in earlier decisions of coordinate Benches comprising two-Judges,
came up for resolution before a larger Bench in Shree Lal Meena
(supra) premised on such reference. The divergence of judicial views
of this Court having necessitated examination of the issue by a larger
Bench, the law was declared in clear terms. Three sets of appeals
were before the larger Bench in which one set pertained to employees
of Andhra Bank and the rest pertained to employees of public sector
insurance companies. The common thread running through all sets of
appeals was that the concerned employees had tendered resignation
from service when, admittedly, the Pension Regulations had not
been introduced. After its introduction with retrospective effect, the
said employees had successfully ventilated their grievance before
the respective high courts. Pertinent observations from the said
decision read thus:
26. There are some observations on the principles of public
sectors being model employers and provisions of pension
being beneficial legislations25. We may, however, note that
as per what we have opined aforesaid, the issue cannot
be dealt with on a charity principle. When the legislature,
in its wisdom, brings forth certain beneficial provisions in
the form of Pension Regulations from a particular date
and on particular terms and conditions, aspects which
are excluded cannot be included in it by implication.
The provisions will have to be read as they read unless
there is some confusion or they are capable of another
interpretation. We may also note that while framing such
schemes, there is an important aspect of them being of a
contributory nature and their financial implications. Such
financial implications are both, for the contributors and for
the State. Thus, it would be inadvisable to expand such
beneficial schemes beyond their contours to extend them
25 Shashikala Devi (supra) and Asger Ibrahim Amin (supra)
[2025] 7 S.C.R. 1665
United Bank of India (Now Punjab National Bank) v.
Swapan Kumar Mullick & Ors.
to employees for whom they were not meant for by the
legislature.
44. Although the larger Bench in Shree Lal Meena (supra) did not
expressly overrule the decision in Asger Ibrahim Amin (supra),
what appears from a bare reading of the decision in BSES Yamuna
Power Ltd. v. Sh. Ghanshyam Chand Sharma26 rendered by another
coordinate Bench is this:
13. The view in Asger Ibrahim Amin was disapproved
and the Court held that the provisions providing for
voluntary retirement would not apply retrospectively by
implication. In this view, where an employee has resigned
from service, there arises no question of whether he has
in fact “voluntarily retired” or “resigned”. The decision
to resign is materially distinct from a decision to seek
voluntary retirement. The decision to resign results in the
legal consequences that flow from a resignation under the
applicable provisions. These consequences are distinct
from the consequences flowing from voluntary retirement
and the two may not be substituted for each other based
on the length of an employee’s tenure.
45. Asger Ibrahim Rahim (supra) had followed the decision in
Sheelkumar Jain (supra). BSES Yamuna Power Ltd. v. Sh.
Ghanshyam Chand Sharma seems to be right in holding that Shree
Lal Meena (supra) disapproved Asger Ibrahim Rahim (supra). For
the same reasons, once could say that Sheelkumar Jain (supra)
too stands disapproved.
46. Although we would ordinarily be bound by what the larger Bench
in Shree Lal Meena (supra) has ruled, one noticeable factual
dissimilarity is that the employees there had resigned prior to
introduction of the Pension Regulations and that is why one finds,
from the following passage, one additional reason to deprive the
employees of pension. It reads:
19. What is most material is that the employee in this case
had resigned. When the Pension Rules are applicable, and
an employee resigns, the consequences are forfeiture of
26 (2020) 3 SCC 346
1666 [2025] 7 S.C.R.
Supreme Court Reports
service, under Rule 23 of the Pension Rules. In our view,
attempting to apply the Pension Rules to the respondent
would be a self-defeating argument. As, suppose, the
Pension Rules were applicable and the employee like the
respondent was in service and sought to resign, the entire
past service would be forfeited, and consequently, he would
not qualify for pensionary benefits. To hold otherwise would
imply that an employee resigning during the currency of the
Rules would be deprived of pensionary benefits, while an
employee who resigns when these Rules were not even
in existence, would be given the benefit of these Rules.
(underlining ours)
47. Be that as it may, the consistent trend of the decisions from Sanwar
Mal (supra) to BSES Yamuna Power Ltd. (supra) with the exception
of Sheelkumar Jain (supra) and Shashikala Devi (supra), which
were decided considering the respective factual matrix, has been to
hold “resignation” and “voluntary retirement” as two distinct concepts
with varying consequences on severance of relationship and that
substitution of the two for each other based solely on the duration
of an employee’s service would run counter to the intendment of
statutory regulations and, therefore, is improper. We see no reason
to take a different view.
48. Having distilled the legal principle from the precedents, we now
consider it appropriate to examine how convincing the arguments
advanced on behalf of Mullick by his learned counsel are.
49. Omission of the several previous Benches to consider the ratio of the
decision in Anwar Ali Sarkar (supra) has been advanced by learned
counsel for Mullick to persuade us not to follow the precedents.
According to him, to group employees who resign together with
employees who are dismissed or removed or terminated from service,
in the light of the dicta in Anwar Ali Sarkar (supra) is violative of
Article 14 of the Constitution.
50. In Anwar Ali Sarkar (supra), the vires of Section 5(1) of the West
Bengal Special Courts Act, 195027 and certain notifications issued
27 1950 Act
[2025] 7 S.C.R. 1667
United Bank of India (Now Punjab National Bank) v.
Swapan Kumar Mullick & Ors.
thereunder were under challenge on the ground that the same
were violative of Article 14 of the Constitution. The accused were
convicted by the Special Court constituted under the 1950 Act and
sentenced. Thereafter, the accused approached the High Court with
a writ petition claiming that the Special Court had no jurisdiction
to try them. The challenge succeeded before the High Court. In
appeal, the Constitution Bench by a clear majority upheld the
judgment of the High Court. This was perhaps the first decision by
this Court where, for an enactment under challenge to pass the test
of ‘reasonable classification’, the twin conditions of ‘the classification
being based on an intelligible differentia which distinguishes those
that are grouped together from others’ and ‘that differentia must have
a rational relation to the object sought to be achieved by the Act’
were laid down [per Hon’ble S.R. Das, J. (as the Chief Justice then
was)]. The majority held that the unbridled power conferred on the
State by Section 5 to place any case before the Special Court for
trial wherein the procedure prescribed is less advantageous to the
accused was discriminatory and violative of Article 14.
51. We have considered the ratio of Anwar Ali Sarkar (supra) having
regard to the contention urged touching Article 14 and in the light
of the fervent appeal of Mullick — that the resignation he tendered,
arising out of mental depression was never intended to result in a
forfeiture of his right to opt for pension, should an option exercise
be made available in future, and that for all intents and purposes,
such resignation was nothing but an exercise to voluntarily retire
from service — with the care and attention the same deserve, but
regret our inability to comprehend as to how the ratio of such decision
could be of any help to Mullick.
52. Although the concepts of “resignation” and “retirement” have
engaged the consideration of this Court in multiple proceedings,
some of which have been referred to above, it is necessary at this
stage (even at the cost of repetition) to understand the expressions
“resignation” and “voluntary retirement”. A public servant, who is
in permanent employment, is entitled to continue in service till
his retirement on superannuation. However, any such employee
may sever his relationship with his employer prior to the date of
superannuation by any of the two modes, i.e., resignation and
voluntary retirement. Notwithstanding that both are modes bringing
about an early severance of employer-employee relationship,
1668 [2025] 7 S.C.R.
Supreme Court Reports
there exists clear distinction between the two. Resignation, being
a voluntary relinquishment of employment, is an implied term of
employer-employee relationship. As noticed in the cited precedents,
resignation can be exercised anytime while the employee is in
service. But unless specified otherwise, say cases where resignation
is unilateral28, majorly, resignation is bilateral which, to be effective,
requires acceptance by the employer. Nowadays, it is not uncommon
to find clauses in offers of employment providing the conditions for
a resignation to take effect. In changing times, resignation tendered
soon after entry in service and before completion of the mandatory
period of service mentioned in the offer, does come with a price. On
the other hand, an employee may seek voluntary retirement if an
option is provided by the employer as a condition of service to such
employee to retire from service on fulfilment of the specified terms and
conditions. Any employee may, thus, offer to retire voluntarily upon
completion of the requisite period of service and upon fulfilling other
requirements. An offer to retire voluntarily, made by an employee, is
normally accepted by the employer unless, of course, there is any
debilitating factor. Further, if the employer introduces a scheme for
voluntary retirement and the pre-conditions are satisfied upon receipt
of any offer, the employee may be permitted to retire voluntarily in
accordance therewith. Importantly, when a provision for voluntary
retirement does exist, yet, an employee elects to resign, such
resignation (irrespective of the length of service) cannot be treated
as voluntary retirement unless, in a given case, the employee also
satisfies the conditions for voluntary retirement. What is applicable
in a case of voluntary retirement ex proprio vigore may not apply
to resignation in all cases. Also, if an employee does not wish
to continue in service, whatever be the reason therefor, and any
provision/scheme for voluntary retirement is non-existent, the only
mode open to him for severing the relationship, if he so desires, is
resignation; and once he does resign, he agrees to submit to the
consequences thereof as are applicable.
53. Conceptually, therefore, “resignation” and “voluntary retirement” are
different. Employees resigning from service and employees retiring
from service voluntarily constitute two different classes. Treating the
two classes differently may not offend Article 14; and there is no
28 provisions in Articles 124 and 217 of the Constitution
[2025] 7 S.C.R. 1669
United Bank of India (Now Punjab National Bank) v.
Swapan Kumar Mullick & Ors.
justification to hold so, on facts and in the circumstances. However,
creating a class within several accused, who are similarly placed,
without reason is not permissible and that is precisely why Section
5 of the 1950 Act was rightly found in Anwar Ali Sarkar (supra) to
be violative of Article 14. Thus, the two situations - the one before
us and the other before the Constitution Bench - do not attract any
comparison.
54. Insofar as Regulation 22 of the 1995 Regulations is concerned, it
deals with forfeiture of service. Clubbing of resignation with dismissal,
removal and termination of service leading to forfeiture of past
service and consequent disentitlement to pensionary benefits per se
do not offend Article 14. We may observe that such regulation is a
signal to the employees warning them of the consequences should
there be severance of relationship by any of the modes, referred
to therein. While a resignation, when asked for by an employee,
may be accepted upon exercise of discretion by the employer, the
other modes are referable to punitive measures. It is as a matter of
policy that forfeiture of past service and disentitlement to pension
have been provided.
55. Whether the policy is wise or prudent is not a matter for the courts
to be concerned with. We may profitably quote Prof. Wade29:
“The doctrine that powers must be exercised reasonably
has to be reconciled with the no less important doctrine
that the court must not usurp the discretion of the public
authority which Parliament appointed to take the decision.
Within the bounds of legal reasonableness is the area in
which the deciding authority has genuinely free discretion.
If it passes those bounds, it acts ultra vires. The court
must therefore resist the temptation to draw the bounds
too tightly, merely according to its own opinion. It must
strive to apply an objective standard which leaves to the
deciding authority the full range of choices which the
legislature is presumed to have intended. Decisions which
are extravagant or capricious cannot be legitimate. But if
the decision is within the confines of reasonableness, it is
no part of the court’s function to look further into its merits.
29 Administrative Law, H.W.R. Wade, 6th Edition, pg.407
1670 [2025] 7 S.C.R.
Supreme Court Reports
‘With the question whether a particular policy is wise or
foolish the court is not concerned; it can only interfere if
to pursue it is beyond the powers of the authority’…”
56. It is settled law that judicial review courts should refrain from assessing
the merits of policies formulated by legislative or regulatory authorities
which are codified in statutes/regulations. Such codified policy may be
wise or flawed, the policy may be effective in achieving the objectives
or could warrant a revision by way of an improvement. However, any
shortcomings in the policy do not render the regulation ultra vires.
Courts cannot invalidate a regulation merely because in its opinion
the policy is unwise or ineffective. The scrutiny has normally to be
restricted to the process of policy making. As long as the policy is
not beyond the scope of the regulation-making power or does not
transgress the bounds of the parent enactment or is in violation of
any of the limitations imposed by the Constitution, there is little or
no scope for interference by the Courts.
57. None of these vitiating factors are shown to exist in the present case.
58. In any event, we do not find Regulation 22 to be so manifestly arbitrary,
so as to call for interference. Regulation 22 could have been held
to violate Article 14 if Mullick, upon resigning from service, were
denied dues on account of provident fund. Since by 2006, when he
resigned, Mullick had not shown any inclination to opt for pension
instead of provident fund, Regulation 22 did not affect him at all. To
have an entitlement to pension, futuristically speaking, Mullick was
required to adhere to the 1995 Regulations, which he did not.
59. Be that as it may, we have noticed that in Sanwar Mal (supra) an
argument premised on Article 14 came to be rejected. We share the
view expressed therein and, thus, find no merit in the contention
urged on behalf of Mullick relying on Anwar Ali Sarkar (supra).
60. We record having considered the contention urged touching validity
of Regulation 22 even though no formal challenge by Mullick to such
regulation was laid before the High Court.
61. Next, it has been contended on behalf of Mullick that Shree Lal
Meena (supra) did not have the occasion to consider Shashikala
Devi (supra). This contention is plainly misconceived. There appears
to be numerous references to Shashikala Devi (supra) in the order
of reference dated 26th November, 2015 and the larger Bench too
[2025] 7 S.C.R. 1671
United Bank of India (Now Punjab National Bank) v.
Swapan Kumar Mullick & Ors.
referred to it in paragraph 26, extracted above. The contention being
equally unmeritorious deserves outright rejection.
62. Before moving ahead, we feel it expedient to refer to S. K. Kool
(supra). The factual matrix of such case is singularly singular.
Following disciplinary proceedings, S.K. Kool was removed from
service of the appellant bank with superannuation benefits as would
be due otherwise and without disqualification from future employment.
The relevant bipartite settlement was read in a manner as if it were
to prevail over statutory regulations. In any event, we hold that
whatever has been laid down there by the coordinate Bench turns
on the facts of that case and cannot be cited as a precedent in a
case where the order of punishment of removal imposed on the
delinquent does not entitle him to any financial benefit.
63. The contention of the intervenors, which are in similar line as urged
on behalf of Mullick, do not survive for the reasons assigned above;
and, therefore, we see no reason to entertain their grievance. In
any event, the bipartite settlement dated 8th March, 2024 has taken
substantial care of the grievances of employees who resigned and,
hence, nothing further is called for in the circumstances.
64. Adverting to the factual matrix, in the case at hand, Mullick while
in service had the opportunity to opt for pension in terms of the
1995 Regulations. He, however, opted for provident fund. At the
time of severance of relationship with the Bank upon acceptance
of resignation, he received his own contribution of Rs.2,21,554.00
and the Bank’s contribution of Rs.5,91,987.00 towards provident
fund dues. Having served the Bank for over 35 years and in service
for more than a decade after introduction of the 1995 Regulations,
he is presumed to have been aware of the same together with the
consequences of tendering resignation instead of seeking voluntary
retirement by giving a 3 months’ notice on the date he tendered
resignation. Presumption can also be legitimately drawn that Mullick
was satisfied with whatever he received on account of provident fund
dues while demitting office. True it is, Mullick was suffering from
mental depression but that did not prevent him from being coherent
while writing the resignation letter. It has not been the case of Mullick
that he signed without being aware of its contents. Mullick seems
to have had a change of mind only when options were again called
for from employees who had superannuated/retired, pursuant to the
1672 [2025] 7 S.C.R.
Supreme Court Reports
bipartite settlement dated 27th April, 2010 followed by the circular
dated 16th August, 2010. While it is equally true that the relevant
Bank official could have appropriately advised Mullick not to resign
but to seek voluntary retirement, which could have enabled him to
reap the benefits of the aforesaid settlement dated 27th April, 2010
and the consequent circular dated 16th August, 2010 issued by the
IBA, at the same time such official cannot also be blamed for not
visualizing a future event. We conclude this chapter by holding that
the terms of the bipartite settlement are binding on all the employees
of the public sector banks, which were parties thereto, and such
terms cannot be read in a manner to extend its coverage dehors
the statutory regulations. The issue formulated by us, thus, stands
answered in favour of the Bank and against the appellant.
65. For all the reasons aforesaid, Mullick must be held to have resigned
from service and not retired voluntarily so as to enable him secure
the benefit of a further opportunity to opt for pension in terms of
the circular dated 16th August, 2010. Relief that the Single Judge
granted to Mullick based on consideration of the decisions in S.K.
Kool (supra) and Shashikala Devi (supra) was correctly set at
naught by the Division Bench vide direction in (A) extracted at the
beginning of this judgment, which we hereby affirm.
66. However, the lead appeal tasks us to consider the validity of the
other directions of the Division Bench as in (B), (C) and (D), extracted
supra, which are impugned before us. Mallikarjuna Rao v. State of
Andhra Pradesh30, V.K. Sood v. Department of Civil Aviation31 and
State of Himachal Pradesh v. Satpal Saini32 are some decisions
of this Court which have a material bearing in this connection.
67. It is elementary but requires to be restated that the power under
Article 226 of the Constitution cannot be exercised by a high court to
direct the legislature/executive to enact a law (primary or subordinate)
or frame a regulation/bye-law. These are executive functions which
are required to be performed based on policy decisions taken at
the appropriate level. The jurisdiction of a high court is limited to
the extent of pointing out why a law, in the given circumstances, is
30 (1990) 2 SCC 707
31 (1993) Supp. 3 SCC 9
32 (2017) 11 SCC 42
[2025] 7 S.C.R. 1673
United Bank of India (Now Punjab National Bank) v.
Swapan Kumar Mullick & Ors.
necessary for regulating the affairs of the public/society and/or to
remedy a particular mischief that is noticed in course of proceedings;
but in such a case too, it is only a nudge in the form of a request
that could be made to the executive to consider the desirability of
enacting/framing such a law or to amend an existing law.
68. Bearing in mind the above well-settled principle of law, it is now time
to examine the directions [(B) to (D)] given by the Division Bench of
the High Court. Although the Division Bench required the Board of
Directors of the Bank to ‘consider’ an amendment to Regulation 22
of the 1995 Regulations in view of the circular of the IBA dated 30th
June, 2015, learned counsel for the Bank is right in his submission
that viewed in the light of stipulation of a timeline and the other
directions for determining whether resignation tendered by Mullick
could be treated as voluntary retirement and to process his claim
for pension upon such determination, user of the word ‘consider’ is
really a mandate on the Bank to amend Regulation 22 of the 1995
Regulations. No such mandate could have been issued and we
hold that the Division Bench overstepped its bounds by directing the
Board of Directors of the Bank to consider amending Regulation 22
even when the vires of such a regulation was not under challenge
in Mullick’s writ petition.
Conclusion
69. The connected appeal of Mullick, thus, stands dismissed.
70. While direction (A) is affirmed, the directions given by the Division
Bench [(B) to (D)] being the operative part of the impugned order
stand set aside. The lead appeal is partly allowed and shall stand
disposed of with directions as follows.
Relief
71. We appreciate Mullick’s candour in not continuing in service despite
his mentally depressed state of mind. Being the head cashier and
dealing with public money, of which the Bank was the custodian,
Mullick by tendering resignation averted a crisis situation which could
have ensued had he, because of mental depression, mishandled
cash and failed to perform his duty as before. Since Mullick had
served the Bank without blemish for more than 35 years and is now
a septuagenarian, we consider it appropriate to extend some relief
1674 [2025] 7 S.C.R.
Supreme Court Reports
to him in exercise of our power under Article 142 of the Constitution
of the India to assist him survive in the winter years of his life with
a fair measure of dignity.
72. The Bank has referred to clause 37 of the bipartite settlement dated
8th March, 2024. Though Mullick may not have exercised option in
terms thereof, we grant him a fortnight’s time more to opt for pension
as a very special case. Opting for pension would mean that Mullick
would abide by all the terms and conditions of such settlement. If
Mullick returns the sum received by him on account of provident fund
together with the applicable rate of interest within the time stipulated
by the Bank, he will be entitled to pension at such rate and on such
terms as are provided in the settlement.
73. However, in the unlikely event of Mullick not being eligible in terms
of the settlement to receive pension or he being unable to refund
the sum received by him on account of provident fund together with
the applicable rate of interest, as the case may be, he may instead
request for financial relief within a fortnight. If such a request is
received, the Bank shall, as a model employer, proceed to pay to
Mullick relief in a sum of Rs.5,00,000/- (Rupees five lakh) only within
two months from date of its receipt. This particular grant of financial
relief is, however, not to be treated as a precedent.
74. We, therefore, dispose of the lead appeal on the aforesaid terms.
75. The applications filed by the intervenors stand dismissed.
76. Other connected applications, if any, stand closed.
Result of the case: Appeals disposed of.
†
Headnotes prepared by: Nidhi Jain
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