Pension Can Be Claimed Only When It Is Permissible Under Relevant Rules : Supreme Court

While dealing with a batch of civil appeals filed by former employees of Uttar Pradesh Roadways seeking pensionary benefits, the Supreme Court recently held that pension can be claimed only under relevant rules or scheme. If an employee is covered under the Provident Fund Scheme and is not holding a pensionable post, he cannot claim pension.

"pension is a right and not a bounty. It is a constitutional right for which an employee is entitled on his superannuation. However, pension can be claimed only when it is permissible under the relevant rules or a scheme. If an employee is covered under the Provident Fund Scheme and is not holding a pensionable post, he cannot claim pension, nor the writ court can issue mandamus directing the employer to provide pension to an employee who is not covered under the rules," said the bench of Justices Hrishikesh Roy and Prashant Kumar Mishra.

On perusal of relevant government orders, the court noted that the appellant-employees were not holding any permanent post or pensionable post. Moreover, they had already availed retiral benefits including the benefit under Employees Provident Fund Scheme.

As such, it opined that they could not be permitted to turn round and contend that they should also be given pension: "a party to the litigation cannot be permitted to approbate and reprobate".

Factual Background

In 1947, UP Roadways was created as a temporary department of the State Government for providing public transport facilities. The employees thereunder were appointed temporarily.

On September 16, 1960, a Government Order (GO) was issued providing service conditions of the Roadways employees. These were different from the service conditions of employees working in different Government departments.

Another GO was issued on October 28, 1960 under Note 3 of Article 350 of the U.P. Civil Service Regulations. This GO provided for pension to permanent employees of Roadways. As per Article 350, service in non-gazetted posts in Government Technical and Industrial Institutions in UP does not qualify for pension and will be covered under Contributory Provident Fund Scheme. 

On June 1, 1972, the UP State Roadways Transport Corporation (UPSRTC) was constituted, and thereafter, a GO was issued on July 5, 1972, treating all Roadways employees on deputation with the Corporation (without specifying the period). The GO also assured them that their service conditions in the Corporation will not be inferior compared to those prior to their absorption. 

On April 28, 1982, certain Rules were framed providing for absorption of all employees of the Roadways in the service of the Corporation wef July 28, 1982.

Immediately after retirement, the appellant-employees received their entire post-retiral benefits, without any protest or claim that they hold a pensionable post. However, relying on subsequent judgments delivered by the Allahabad High Court in U.P.S.R.T.C. v. Mirza Athar Beg, The Managing Director, U.P.S.R.T.C v. S.M. Fazil & 03 others, and U.P.S.R.T.C & Ors. v. Shri Narain Pandey, they filed representations claiming pension.

When the representations were rejected, the appellants approached the High Court. Their claims were dismissed both by the Single Judge and the Division Bench, on the view that they did not hold any pensionable post, and thus, were not entitled for receiving pension. Challenging the High Court decision, the appellants then approached the Supreme Court.

Issue

Whether former employees of Uttar Pradesh Roadways, a temporary department of the State Government, held any pensionable post before or after their absorption into UPSRTC?

Court Observations

After going through the material, the court was of the view that the pension entitlement of Roadways employees was controlled by GO dated October 28, 1960. To be covered by the same, it was necessary for them to plead and establish that they were holding permanent posts in Roadways and fell in the 3 categories of employees referred to in para 1 of the GO.

However, the court noted that it was not the appellants' case that they were made permanent by any express order issued by the Roadways management, nor they claimed to be working in any of the 3 posts referred to in para 1 of GO dated October 28, 1960.

Also, since para 2 of the GO clearly provided that rest of the permanent non-gazetted employees, as well as temporary employees, shall be treated as non-pensionable, the court declared the appellants not entitled to pension.

Further, the appellants were opined to not be covered under Article 350, inasmuch as despite amendment in the first part thereof, Note 3 did not suffer amendment. "Since the Roadways is considered to be Technical and Industrial Institution, the appellants are covered under Note 3 of Article 350, and they are not entitled for pension," the court said.

Insofar as the appellants cited Allahabad High Court's decisions in Mirza Athar Beg, S.M. Fazil & 03 others and Shri Narain Pandey in their favor, it was held that the reliance was misplaced. 

"in the said matters, the respective appellants were found to be holding permanent posts which were pensionable whereas in the present case, the appellants were neither holding permanent posts nor holding any pensionable posts as per GO dated 28.10.1960," the court said.

Accordingly, most of the appeals were dismissed.

Employees promoted to pensionable post after 1982

Notably, certain appeals were preferred by UPSRTC, against the High Court's ruling in favor of Roadways Karmchari Sanyukta Parishad, Uttar Pradesh (RKSP), whereby it was directed to extend pensionary benefits and pay pension to certain employees post-1982 in light of GO dated July 5, 1972.

The issue in these pertained to extension of pensionary and other benefits in respect of such employees who were promoted on pensionable posts after 1982 ie when Roadways employees were absorbed into UPSRTC.

After hearing the parties, the court opined that Roadways employees who were not holding any pensionable post prior to their deputation or absorption in the Corporation, were not entitled to pension, as their service conditions in the erstwhile Roadways did not provide that they are entitled to pension. Thus, they have not been put to any inferior service conditions on their joining the services in the Corporation, it said.

"In our considered opinion, the Division Bench of the High Court was not correct in holding that the members of the RKSP are entitled to pension even if they have been promoted after the cutoff date of 27.08.1982...the members of the Union of RKSP for whose benefit the writ petition was preferred, who were promoted on a pensionable post after the cutoff date, are not entitled for pension".

Accordingly, the decision of the High Court was set aside. The appeals filed by UPSRTC were allowed and those filed by RKSP dismissed.

Appearance: Senior Advocates Rakesh Khanna (for RKSP), BK Mishra (for Uttarakhand RTC) and UK Uniyal (for private parties); Senior Advocate Garima Prashad assisted by AoR Nishit Agrawal (for UPSRTC)

Case Title: UP ROADWAYS RETIRED OFFICIALS AND OFFICERS ASSOCIATION VERSUS STATE OF U.P. & ANR, CIVIL APPEAL NO. 894 OF 2020 (and connected cases)

Citation : 2024 LiveLaw (SC) 517

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