Expansive Interpretation Of “Last Pay Drawn”; Term Includes CPF Contributions: Delhi High Court

Background

The petitioners, retired judicial officers and administrators, had been appointed as members of the SCDRC in Delhi. Under the amended Delhi Consumer Protection Rules, 1987, the petitioners were entitled to receive salaries based on the “last pay drawn” minus their pensions. “Last pay drawn” included the basic salary and other emoluments such as allowances received prior to appointment in the SCDRC. However, despite earlier orders of the Delhi High Court in 2019 clarifying that this term encompassed all allowances, the government failed to release CPF contributions for petitioner O.P. Gupta, prompting the present contempt petition.

Arguments

The petitioners contended that their right to CPF contributions arose from the court's prior orders. They argued that during his tenure as a judicial member of the SCDRC, petitioner O.P. Gupta's pay had been calculated as per his prior employment as a Municipal Taxation Tribunal member. Further, appropriate CPF contributions were made by both the government and himself. They emphasized that denying such contributions for his time in the SCDRC was arbitrary, when similar benefits had been granted to other officials. The petitioners also highlighted that the proviso to Rule 4 of the Contributory Provident Fund Rules, allowed government contributions for non-pensionable servants and re-employed pensioners. They argued that CPF contributions were included in emoluments under “last pay drawn.”

The respondents contended that CPF contributions were not applicable as the relevant rules did not specifically mandate them for judicial members of the SCDRC. They argued that Rule 4 of the CPF Rules applied exclusively to non-pensionable servants, and since Mr. Gupta was a re-employed pensioner, the rules didn't cover him. They further submitted that any benefits extended to other officials were irrelevant as they were under different factual circumstances. They further argued that once the court's directions had been implemented, no further relief could be sought in contempt proceedings.

Court's Reasoning

The court reiterated its prior rulings which clarified that “last pay drawn” encompassed included “all other allowances”, including dearness allowance. It emphasized that CPF contributions fell within this broad definition, as these were emoluments the petitioner was entitled to in his prior employment. The court rejected the government's claim that this was a new issue, and held instead that it related directly to the earlier directions.

Further, the court examined Rule 4 of the CPF Rules and its proviso, which allowed CPF contributions for re-employed government servants. It noted that this rule did not exclude re-employed pensioners, provided they were ready to make their contributions (the petitioner here was willing to contribute). The court also pointed out, that during the petitioner's tenure, his CPF contributions were also matched by the government. Additionally, the court took note that similar benefits had been extended to other retired officials, who had also served as members of consumer forums in Delhi.

Lastly, the respondents cited Supreme Court cases such as K. Arumugam v. V. Balakrishnan ((2019) 18 SCC 150) to impress that new claims cannot be raised after compliance with court orders has already taken place. However, the court held these cases to be distinguishable on facts; it explained that they dealt with situations where fresh claims were raised after appropriate compliance. This case, it held, involved non-compliance with specific directions regarding CPF contributions. The court found the government's refusal to be a “deliberate denial” of the petitioner's rights. Consequently, the court found the respondents guilty of contempt and directed them to release the CPF contributions for Mr. Gupta's tenure.

Date Decided: 29 November 2024

Title: Narinder Paul v. Chief Secretary & Ors.

Citation: 2024 LiveLaw (Del) 1317

Counsel for the Petitioners: Mr. Tushar Gupta, Mr. Sumit Mishra & Mr. Parinay Gupta

Counsel for the Respondents: Ms. Avnish Ahlawat with Mr. Nitesh Kumar Singh, Ms. Laavanya Kaushik, Ms. Aliza Alam & Mr. Mohnish Sehrawat

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