Differentiating Between Single Class Of Pensioners Based On Date Of Retirement To Deny Revised Pay Is Arbitrary: Madras High Court
The Madras High Court has observed that persons belonging to the same class cannot be discriminated against by creating an artificial class between them on the basis of date of retirement. The order of Justice C Saravanan came as a relief to the retired employees of various State Transport Undertakings (STU) who had approached the Court seeking implementation of the recommendations of the...
The Madras High Court has observed that persons belonging to the same class cannot be discriminated against by creating an artificial class between them on the basis of date of retirement.
The order of Justice C Saravanan came as a relief to the retired employees of various State Transport Undertakings (STU) who had approached the Court seeking implementation of the recommendations of the VII Central Pay Commission and for revision of their pension.
"The STUs revision of pension of those pensioners who retired prior to 01.01.2016 and after 01.01.2016 by treating them as a separate class belonging to the same group is not permissible. The respondents cannot differentiate them. This act of the respondents is arbitrary and violation of Article 14, 16, 21, 300-A of the Indian Constitution," it said.
The petitioners, who retired from service between 01.09.1998 and 31.03.2018, approached the Court claiming that the benefits of upward revision of pensions have been given selectively only to a section of the pensioners who retired after a particular date and thus there was discrimination.
The petitioners claimed that the respondent STUs, while implementing the Government Order directing the Transport Department to adopt revised pay Rules 2017, revised the pay of employees of Managerial Cadre only. Further only those employees who were in service after the issuance of the above G.O dated 09.04.2018 were considered for the revised pay.
The petitioners claimed that the act of the respondents differentiating between pensioners was arbitrary and in violation of Article 14, 16, 21 and 300A of the Indian Constitution.
During the pendency of the proceedings, another Government Order was issued dated 26.08.2019 by the Transport (E) Department. However, it was confined to pensioners who retired as Managerial Staff between 01.01.2016 and 31.03.2018. The revision was with notional effects from 01.01.2016 and with monetary benefit prospectively with effect from 26.08.2019.
It was also brought to the attention of the Court that the respondents had not extended the benefit of Dearness Allowance to the retired pensioners. This was stated to be arbitrary and also a violation of Article 14, 16, 21 of the Indian Constitution. Even as per Rule 20A of the Tamil Nadu State Transport Corporation Employees' Pension Fund Rules, it was argued that retired Employees of the Transport Corporation are entitled for payment of pension and Dearness Allowance. As per the Rule, they are eligible for Dearness Allowance similar to the employees in Service. Therefore, there was no justification in not revising the Dearness Allowance of Superintendents who retired before 01.01.2016.
The Court opined that such discrimination by the respondent was impermissible. It relied on the decision of the Supreme Court in B.J Akkra vs Government of India, (2006) 11 SCC 709, where it was held that "discrimination in the introduction of a benefit retrospectively or prospectively by fixing a cut-off date arbitrarily thereby driving a single homogenous class of petitioners into two groups and subjecting them to different treatment was held impermissible."
The Court also looked into the decision of the Apex Court in All Manipur Pensioners Association represented by its Secretary v. The State of Manipur and others (2019) wherein the court had observed that all pensioners belong to one class and bringing a classification or cut-off date would amount to treating equals as unequals. The Apex court had also held that such classification had no nexus with the object and purpose of the revision of pension and was thus unreasonable, discriminatory and arbitrary.
Applying the above legal precedents in the present case, the High Court ruled that the action of the respondents was indeed arbitrary and a uniformity needed to be maintained between all the employees who were drawing pension from and out of the fund.
It added,
"Even if the pension was to be paid from and out of the pension fund, reality is that the pension fund is being paid and funded by the State Government as the amount of pension fund is not sufficient to meet the requirements. Therefore, a uniformity has to be maintained to all the employees who were drawing pension from and out of the fund which is supported by the Government contributions."
The Court also observed that the State Transport Undertaking were part of the State Transport Department. Thus, there was an understanding that the salaries and pensions of the employees in STUs will be on par with their counterparts in Government Services. Thus, there was no reason to discriminate those employees who have retired earlier.
The Court was therefore of the opinion that the benefits of the revised pay commission should be made applicable to Managerial Staffs, Administrative Staffs and Technical Supervisory Staffs uniformly.
Thus, it directed the respondents to pay the arrears of pension and Dearness Allowance to the petitioners as made applicable to the pensioners who retired between 01.01.2016 and 31.03.2018 within a period of six months.
Case Title: Federation of Retired Officers of Transport Corporations v Chief Secretary to Government and others
Case No: W.P No 21348 of 2019 etc batch
Citation: 2022 LiveLaw (Mad) 233
Counsel for Petitioners: Mr.A.R.L.Sundaresan, Senior Counsel for Mr.J.James, Mr.V.Ajoy Khose, Mr.S.T.Varadarajalu, Mr.D.Soundar Raj, Mr.P.Paramasivadoss
Counsel for the Respondents: Mr.L.S.M.Hasan Fizal, Government Advocate (For State), Mr.G.Saravanakumar, Standing Counsel (For Transport)