Right To Pension Cannot Be Taken Away By A Mere Executive Fiat Or Administrative Instruction: SC [Read Judgment]

The Supreme Court has observed that the right to pension is covered under a right to property protected under Article 300A of the Constitution of India and it cannot be taken away by a mere executive fiat or administrative instruction.

The issue considered by the Apex Court in this appeal was whether the State of Bihar was justified in withholding 10% pension and full gratuity of its employee under Circulars, and Government Resolution issued by it , on the ground of pending criminal proceedings?

Rule 43(b) of the Bihar Pension Rules, as it existed during the relevant period,empowered the Government to withhold or withdraw the whole or part of the amount of pension, permanently or for a specified period, if the pensioner was "found to be guilty of grave misconduct" in any departmental or judicial proceeding, or to have "caused pecuniary loss to Government by misconduct or negligence", during the tenure of his service. But it did not cover a situation where judicial or departmental proceedings were pending. However, the state issued two Circulars on 22.08.1974 and 31.10.1974 and Government resolution dated 31.07.1980, under which a provision was made to pay 75% pension to an employee, who was facing a departmental or judicial proceeding at the time of retirement. The Circulars provided that no gratuity or death-cum retiral gratuity would be paid during the pendency of the proceedings.

The contention raised in this appeal was that the Circular and Government Resolution, being executive instructions had no force of law, and could not take away the right to receive pension, which is recognised as a constitutional right under Article 300A of the Constitution

Agreeing with this contention, the bench comprising Justices Uday Umesh Lalit and Indu Malhotra observed that the State was unjustified in withholding 10% pension of the Appellant under administrative Circulars. It said that the Circulars dated 22.08.1974 and 31.10.1974, and Government Resolution No. 3104 dated 31.07.1980, were merely administrative instructions/executive orders as they were not issued in exercise of the power under Article 309 of the Constitution and cannot be said to have the force of law.

The bench, referring to the Constitution bench judgment in Deokinandan Prasad v. State of Bihar, observed thus:

Pension and gratuity are not mere bounties, or given out of generosity by the employer. An employee earns these benefits by virtue of his long, continuous, faithful and unblemished service.The right to receive pension of a public servant has been held to be covered under the "right to property" under Article 31(1).

The right to receive pension has been held to be a right to property protected under Article 300A of the Constitution even after the repeal of Article 31(1) by the Constitution (Forty-Fourth Amendment) Act, 1978 w.e.f. 20.06.1979.

However, taking note of the fact that Rule 43(c) was inserted in the Bihar Pension Rules and brought into force on 19.07.2012, the bench observed that the State is empowered to deduct 10% from the pension amount w.e.f. 19.07.2012, subject to the outcome of the criminal proceedings.  

Case name: DR. HIRA LAL vs. STATE OF BIHAR & ORS. 
Case no.: Civil Appeal No.1677-1678 of 2020
Coram: Justices Uday Umesh Lalit and Indu Malhotra

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