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Supreme Court of India

VASANT GANGARAMSA CHANDANversusSTATE OF MAHARASHTRA AND ORS.

Citation
1996 INSC 744
Decided
15 July 1996
Disposal
Appeal(s) allowed

Holding

The clause must be read down to "whichever earlier," so qualifying service is computed from the date of initial appointment, as the pension is a right attached to the office and denial would violate Article 14.

Summary

Vasant Gangaram Sa Chandan was appointed as Peon‑cum‑Watchman in the Hyderabad Agricultural Committee on 1 April 1957 and, after the reorganisation of states, transferred to the Krishi Utpadan Bazar Samiti, retiring on 1 April 1991 after about 35 years of service. The pension scheme of the Market Committee stipulated that qualifying service would commence from the later of the date of first appointment or the date the employer began deducting Provident Fund contributions. The appellant claimed his qualifying service should be counted from his initial appointment, but the authorities computed it only from 1 October 1969, when PF deductions started. The Supreme Court examined whether the "whichever later" rule violated Article 14 of the Constitution by arbitrarily denying pension benefits for the earlier period of service. It held that the rule must be read down to "whichever earlier" so that qualifying service includes the entire period of actual service, emphasizing that pension is a right attached to the office, not a State bounty. Consequently, the appellant’s pension was to be calculated from 1 April 1957, with arrears to be paid within two months. The appeal was allowed.

Issues considered

  • Whether the clause in the pension scheme that qualifying service commences from the later of the date of first appointment or the date PF contributions began violates Article 14 of the Constitution.
  • Whether pension benefits can be denied for service rendered before the commencement of PF deductions.

Legislation cited

Subjects

service lawpensionqualifying serviceArticle 14equalitystate reorganisationprovident fundread downadministrative law

Judgment

                    VASANT GANGARAMSA CHANDAN                                       A
                                           v.
                   STATE OF MAHARASHTRA AND ORS.

                                  JULY 15, 1996

               [K. RAMASWAMY AND G.B. PATTANAIK, JJ.]                               B

          Constitution of India, 1950: A1ticle 14.

           Service Law-Pension-Hyderabad Agricultural Commit-
    1ee---Employee---Reorganisation of States-Joining se1vice of Krishi Utpadan
    Bazar Samiti in Maharashtra-Retirement-Claim for qualifying se1vice from
                                                                                    c
    date of initial appointment-Pennissibility of-Pension scheme providing for
    computation of qualifying service from the date of first appointment or from
    the date employer stmted deducting P.F. contribution whichever occwred
    later--He/d Rule whichever is 'later' nutst be read down to lvhichever is
    'earlier'-So read the Rule is valid othe1wise violative of Article 14-Held      D
    employee's qualifying se1vice should be computed from the date of his initial
    appointment-Pension is not a bounty of State-It is a 1ight attached to office
    and cannot be arbitrafily denied.

          CIVIL APPELLATE JURISDICTION : Civil Appeal No. 9860 of
    ~.                                                                              E

         From the Judgment and Order dated 9.11.93 of the Bombay High
    Court in W.P. No. 3505 of 1993.

          S.K.C. Pasi for the Appellant.
                                                                                    F
          A.M. Khanwilkar for the Respondents.

          The following Order of the Court was delivered :

          Leave granted.
                                                                                    G
          Heard both sides.

          This appeal by special leave arises from the judgment and order of
    the Bombay High Court, Aurangabad Bench made on November 11, 1993
    in Writ Petition No. 3505/93. The appellant was working as on April 1, 1957
    as Peon-cum-Watchman in the Hyderabad Agricultural Committee. Con- H
                                         595
•
    596                    SUPREME COURT REPORTS [1996] SUPP. 3 S.C.R.

A sequent upon the State's reorganisation, the appellant had gone to and
  joined the service of the Krishi Utpadan Bazar Samiti at Jalna district. He
  retired from service on April 1, 1991 after completing about 35 years of
  service. His qualifying service was computed w.e.f. October 1, 1969. He
  claimed the service from the date of his appointment. It was denied on the
B !,'l'Ound that he started contributing towards Provident Fund w.e.f. the
  aforesaid date and, therefore, his pcnsionary benefit required to be com-
  puted from that date.

          Clause 23 of Chapter VI in the scheme reads as under :

c            "Qualifying service of a Market Committee employee shall com-
             mence from the date he takes charge of the post to which he is
             first appointed or fr9m the date the employer started deducting
             the P.F. contribution for the employee whichever later."

D        A reading clearly indicates that the qualifying service is from the date
  he takes charge of the post to which he was first appointed or from the
  date the employer started deduction of provident fund from the employee,
  whichever is later. Pension is not a bounty of the State. It is earned by the
  employee for service rendered to fall back, after retirement. lt,is a right
E attached to the office and cannot be arbitrarily denied. Therefore, we read
  down the rule. We hold that reading the rule which is "later" must be read
  to whichever is "earlier". If so read, the rule is vaHd. Otherwise, it would
  be arbitrary offending Article 14 of the Constitution. Mr. Khanwilkar,
  learned counsel for the respondent contended that the appellant is not
  entitled to the D.A.; on the other hand, learned counsel for the appellant
F contended that pursuant to the order passed by the High Court to pay D.A.
  resolution had already been passed by the Committee and the D.A. has
  already been paid to him.

          The pensionary benefit will be computed from April 1, 1957 within
G two months from the date of receipt of this order and payment of arrears
    be paid accordingly.

          The appeal is allowed accordingly. No costs.

H T.N.A.                                                        Appeal allowed.


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