Bombay High Court
Smt. Vandana W/O Eknath Bhondwe vs State Bank Of Bikaner And Jaipur, … on 21 September, 2018
Bench: Ravi K. Deshpande
1Judgment wp2348.17.odt IN THE HIGH COURT OF JUDICATURE AT BOMBAY NAGPUR BENCH, NAGPUR WRIT PETITION NO.2348 OF 2017 Smt. Vandana w/o Eknath Bhondwe, Aged 73 years, Occupation – Retired, Resident of 179/01, Abhyankar Nagar, Opp. Cricket Ground, Nagpur-440010. … Petitioner Versus 1. State Bank of India, (Formerly State Bank of Bikaner & Jaipur), Zonal Office, Zone-1, Kingsway, Nagpur, through its Deputy General Manager. 2. The Chief Manager, Pension, Provident Fund and Gratuity Department, State Bank of Bikaner and Jaipur, Head Office, Tilak Marg, Jaipur. … Respondents Shri Yash Maheshwari, Advocate for Petitioner. Shri S.N. Kumar, Advocate for Respondent No.1. CORAM : R.K. DESHPANDE & ARUN D. UPADHYE, JJ. DATE OF RESERVING THE JUDGMENT : 14th JUNE, 2018 DATE OF PRONOUNCING THE JUDGMENT : 21 SEPTEMBER, 2018 st ::: Uploaded on – 21/09/2018 ::: Downloaded on – 23/09/2018 01:37:30 ::: 2Judgment wp2348.17.odt JUDGMENT (PER R.K. DESHPANDE, J.) :
1. Rule. Heard finally by consent of the learned counsels appearing for the parties.

2. The challenge in this petition is to the communication dated 11-8-2016 issued by the respondent No.1- State Bank of Bikaner & Jaipur informing the petitioner that Regulation 18 of the State Bank of Bikaner & Jaipur (Employees’) Pension Regulations, 1995 (hereinafter referred to as “the Pension Regulations”) does not apply to the petitioner as it is only for the purpose of pension calculation for eligible employees to get pension and not for pension eligibility. According to the respondent-Bank, the petitioner did not complete 15 years of service as stipulated in Clause 3 of Eligibility for Pension under the Scheme, viz. SBBJ Voluntary Retirement Scheme (SBBJVRS), and, therefore, the request of the petitioner for second option for pension cannot be considered.
Facts of the Case :
3. The undisputed factual position is that the petitioner ::: Uploaded on – 21/09/2018 ::: Downloaded on – 23/09/2018 01:37:30 ::: 3Judgment wp2348.17.odt joined the service of the State Bank of Bikaner & Jaipur on 29-4-1986 upon the death of her husband in the year 1985. The petitioner was confirmed in service on 1-11-1986. The Voluntary Retirement Scheme in the respondent-Bank was introduced with effect from 31-1-2001, and Clause 3 regarding eligibility under the Scheme stated that it will be open to all permanent employees of the Bank who have put in 15 years of service or have completed 40 years of age as on 31-1-2001.

4. The petitioner having completed 40 years of age, submitted her application on 31-3-2001 for voluntary retirement under the said Scheme and had opted for the pension benefit, but she was refunded only the employees’ contribution towards Provident Fund upon her retirement. By the communication dated 15-6-2001, the petitioner was informed in response to a query as to whether the employees who have rendered 15 years of service will be entitled to pension under the SBBJVRS, that in terms of the Bank’s Circular No.PER/111/00.01 dated 23-2-2001 Annexure II Para 3, the employees who have not completed 20 years of pensionable service are not eligible for pension. ::: Uploaded on – 21/09/2018 ::: Downloaded on – 23/09/2018 01:37:30 ::: 4
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5. On 27-4-2010, there was a settlement reached between the Indian Banks’ Association and the All India Bank Employees’ Association under Sections 2(p) and 18(1) of the Industrial Disputes Act, 1947. The settlement was to extend the Pension Scheme to those employees who were in service of the Bank prior to 26-3-1995 and retired after that date and prior to the date of the settlement. Accordingly, the respondent-Bank issued the Circular dated 30-11-2015 inviting applications from its retirement employees to seek the benefit of pension as per the said settlement.
6. The petitioner applied on 5-5-2016 for exercising her option for pension as soon as she came to know about the settlement. It was initially rejected on 18-5-2016 stating that it was beyond the time-limit prescribed in the Circular. The petitioner intimated that she did not receive any such Circular and, therefore, could not apply in time. The petitioner was informed on 13-7-2016 that she is ineligible for pension, as she rendered the service of 14 years, 11 months and 3 days, which was short of ::: Uploaded on – 21/09/2018 ::: Downloaded on – 23/09/2018 01:37:30 ::: 5Judgment wp2348.17.odt 15 years. It was confirmed again on 11-8-2016, which is the communication under challenge in this petition.
7. The petitioner was eligible to seek voluntary retirement under the Scheme of 2001, as she was more than 40 years of age as on 31-3-2001. However, she did not complete actual service of 15 years, but rendered 14 years, 11 months and 3 days’ continuous service as on 31-3-2001. The question is whether the Bank was justified in denying the claim of the petitioner for pension on voluntary retirement from service? Before proceeding to deal with the controversy, the relevant provisions and the changes therein need to be seen.
Relevant provisions :
8. The qualifying service for pension was governed by Regulation 14 in Chapter IV of the Pension Regulations, which runs as under :
“14. Qualifying service–Subject to the other conditions contained in these regulations an employee who has rendered a minimum of ten years of service in the Bank’s on the date of ::: Uploaded on – 21/09/2018 ::: Downloaded on – 23/09/2018 01:37:30 ::: 6Judgment wp2348.17.odt his retirement or on the date on which he is deemed to have retired shall qualify for pension.”

Thus, the minimum 10 years of service in the Bank on the date of retirement qualifies an employee to get the pension.
9. Regulation 18 of the Pension Regulations deals with the calculation of broken period of service for the purposes of pension, and it runs as under :
“18. Broken period of service of less than one year–If the period of service of an employee includes broken period of service less than one year, then if such broken period is more than six months, it shall be treated as one year and if such broken period is six months or less it shall be ignored.”

If the broken period of service is less than one year but more than six months, it shall be treated as one year, and if it is of six months or less than it, the same shall be ignored, is the mandate of the aforesaid provision.
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10. Regulation 29 of the Pension Regulations deals with the pension on voluntary retirement and Clause (1) therein, to the extent relevant, is reproduced below :
“29. Pension on Voluntary Retirement– (1) On or after the 1st day of November, 1993 at any time after an employee has completed twenty years of qualifying service he may by giving notice of not less than three months in writing to the competent authority retire from service.”
Thus, in order to qualify for getting superannuation pension on voluntary retirement, the employee has to render twenty years of qualifying service.

11. In order to reduce work force in the Bank, a Scheme for Voluntary Retirement, i.e. SBBJVRS, (“Scheme” for short) was introduced in the year 2001. Clause 3 of the Scheme deals with the eligibility, and the same is reproduced below : ::: Uploaded on – 21/09/2018 ::: Downloaded on – 23/09/2018 01:37:30 ::: 8
Judgment wp2348.17.odt “3. ELIGIBILITY –
The scheme will be open to all permanent employees of the Bank (except those specifically mentioned as “ineligible”) who have put in 15 years of service or have completed 40 years of age as on 31st January, 2001.
Age will be reckoned on the basis of the date of birth as entered in the service record.”
The provision of clause 3 is alternate, and to become eligible to seek voluntary retirement, the permanent employee either should have completed 15 years of service or should have attained the age of 40 years as on 31-1-2001. The fulfillment of any of the two conditions makes an employee entitled not only to seek voluntary retirement from service, unless he is ineligible under any of the provisions.

12. Clause 7 under the Scheme pertains to “Other Benefits” and sub-clause (iii) therein being relevant, reads as under :
“(iii) Pension in terms of State Bank of Bikaner & Jaipur (Employees’) Pension Regulations, 1995 on the relevant date ::: Uploaded on – 21/09/2018 ::: Downloaded on – 23/09/2018 01:37:30 ::: 9Judgment wp2348.17.odt (including commuted value of pension). However the benefit of increased qualifying service as provided under Regulation 29(5) of SBBJ Pension Regulations 1995 will not be applicable to those who seek voluntary retirement under this scheme.”
In terms of the aforesaid provision, the pension is payable as per the Pension Regulations.

13. In the settlement reached on 27-4-2010, the Pension Scheme was extended to those employees, who were in service of the Bank prior to 29-9-1995 in case of Naionalized Banks/ 26-3-1996 in case of Associate Banks of State Bank of India and retired after that date and prior to the date of the settlement. Clauses (4) and (5) of the settlement being relevant, are reproduced below :
“(4) Employees who ceased to be in service on or after 29 th September 1995 in case of Nationalized Banks/ 26th March 1996 in case of Associate Banks of State Bank of India on account of voluntary retirement under special scheme after rendering service for a period of ::: Uploaded on – 21/09/2018 ::: Downloaded on – 23/09/2018 01:37:30 ::: 10Judgment wp2348.17.odt 15 years, shall be eligible to exercise an option to join the Pension Scheme subject to the terms and conditions mentioned for retiring employees opting for joining the Scheme.” “(5) Pension/Family Pension to those who opt to join the pension scheme complying with the terms of this Settlement shall be payable with effect from 27 th November 2009, provided that employees who retired after that date shall get pension from the respective dates of their retirement. All the Regulations of the Bank Employees’ Pension Regulations, 1995/1996 shall be applicable to those who opt for the Pension Scheme in terms of this Settlement except to the extent mentioned in the foregoing Clauses of this Settlement.”

In terms of clauses (4) and (5) above, the employees, who ceased to be in service on or after 26-3-1996 from the respondent-Bank on account of voluntary retirement from service under special scheme after rendering service for a period of 15 years, are made eligible to exercise option to join the Pension Scheme and the pension shall become payable to them with effect from 27-11-2009. It is clarified in clause (5) that all the Regulations of the Bank Employees’ Pension Regulations, ::: Uploaded on – 21/09/2018 ::: Downloaded on – 23/09/2018 01:37:30 ::: 11Judgment wp2348.17.odt 1995/1996 shall be applicable to those who opt for the Pension Scheme in terms of the Settlement, except to the extent mentioned in the clauses of Settlement.

14. By the notification dated 8-10-2014, the Pension Regulations were extensively amended and below Regulation 18 titled as “Broken period of Service of less than one year”, proviso was added as under :
“Provided that provisions of this Regulation shall not apply for determining the minimum service required to make an employee eligible for pension”

According to the respondent-Bank, the proviso clarifies the object and purpose of Regulation 18, to calculate the pension payable to the eligible employees.

15. The case of the petitioner is that though the service rendered by her falls short of actual 15 years, the provision of Regulation 18 of the Pension Regulations requires the Bank to count notionally such service for the purposes of pension and it ::: Uploaded on – 21/09/2018 ::: Downloaded on – 23/09/2018 01:37:30 ::: 12Judgment wp2348.17.odt cannot be construed in such a fashion to deny the pension to those who are qualified to seek voluntary retirement under the Rules. The case of the Bank is that though the petitioner completed 40 years of age on the date of her retirement, i.e. on 31-3-2001, and was qualified in terms of clause (3) of the Scheme to seek voluntary retirement, she was not qualified to get pension, as she did not render actual service for a period of 15 years. According to the Bank, Regulation 18 of the Pension Regulations would not make the petitioner entitled to pension. Reliance is also placed upon the proviso below Regulation 18, introduced by the notification dated 8-10-2014, which clarifies that Regulation 18 shall not apply for determining the minimum service required to make an employee eligible for pension. Undisputed position :
16. It is not in dispute that the petitioner having rendered more than 10 years of service in the Bank as on 31-3-2001, she was qualified for getting pension in terms of Regulation 14 of the Pension Regulations. The petitioner did not complete 20 years of qualifying service to seek voluntary ::: Uploaded on – 21/09/2018 ::: Downloaded on – 23/09/2018 01:37:30 ::: 13Judgment wp2348.17.odt retirement in terms of Regulation 29 of the Pension Regulations, but completed 14 years, 11 months and 3 days’ service on the date of her voluntary retirement from service on 31-3-2001. The petitioner became qualified to seek voluntary retirement under the Scheme, as she had completed the age of 40 years as on 31-1-2001. It is not the case of the Bank that if an employee is qualified and seeks voluntary retirement under the Scheme, the past service rendered by him or her stands forfeited. Questions for determination :
17. In the light of the aforesaid undisputed position, the following questions arise in the present matter for determination : (1) Whether the respondent-Bank was justified in denying the pension to the petitioner on the ground that the petitioner did not complete 15 years of service as on 31-3-2001, i.e. the date on which she sought voluntary retirement from service?, and (2) Whether the respondent-Bank was justified in denying the pension to the petitioner on the ground that Regulation 18 of the Pension Regulations does not apply ::: Uploaded on – 21/09/2018 ::: Downloaded on – 23/09/2018 01:37:30 ::: 14Judgment wp2348.17.odt to make an employee eligible for pension?
Position of law settled by the Apex Court :
18. In the case of State of Jharkhand & Ors. v. Jitendra Kumar Srivastava & Anr., reported in AIR 2013 SC 3383, the Apex Court was dealing with the pension granted to the employees in public employment where the pension is made available by way of statutory provisions. In this context, it holds that the pension is hard earned benefit which accrues to an employee and is in the nature of ‘property’, which cannot be taken away without the due process of law as per the provision of Article 300A of the Constitution of India. There was no provision in the statutory rules for withholding of pension or gratuity in a particular situation, but by issuing executive instructions, the pension was withheld on the ground, which was not available under the statutory provisions. The Court holds that the attempt on the part of the Government to take away a part of pension without any statutory provision and under the umbrage of administrative instruction cannot be countenanced.
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19. No doubt, where the pension is governed by the statutory rules, its grant is not left to the discretion of the Government. It becomes a matter of right to property, within the meaning of Article 300A of the Constitution of India. The antiquated notion of pension being a bounty a gratituous payment depending upon the sweet will or grace of the employer not claimable as a right, which is enforceable, has been swept under the carpet by the decision of the Constitution Bench of the Apex Court in the case of Deoki Nandan Prasad v. State of Bihar and Ors., reported in (1971) 2 SCC 330, which has been taken into consideration by the Apex Court in the case of Jitendra Kumar Srivastava, cited supra. The Apex Court ultimately holds in para 14 of the decision in the case of Jitendra Kumar Srivastava, as under : “14. Article 300-A of the Constitution of India reads as under : “300-A. Persons not to be deprived of property save by authority of law.– No personal shall be deprived of his property save by authority of law.” Once we proceed on that premise, the answer to the question posed by us in the beginning of this ::: Uploaded on – 21/09/2018 ::: Downloaded on – 23/09/2018 01:37:30 ::: 16Judgment wp2348.17.odt judgment becomes too obvious. A person cannot be deprived of this pension without the authority of law, which is the mandate enshrined in Article 300-A of the Constitution. It follows that attempt of the appellant to take away a part of pension or gratuity or even leave encashment without any statutory provision and under the umbrage of administrative instruction cannot be countenanced.”
20. Thus, the pension being in the nature of ‘property’, as contemplated by the provision of Article 300A of the Constitution of India, it cannot be taken away without the authority of law. The law has developed on this point to the extent that once an employee qualifies for getting the pension under the statutory provisions, the right to get the pension not only becomes a statutory right but it assumes the character of a fundamental right to livelihood, enshrined under Article 21 of the Constitution of India, which cannot be taken away without following due procedure of law. Any attempt to take away the pension without authority of law, would be contrary to the equality of law, enshrined under Article 14 of the Constitution of India, which cannot be countenanced. It is in the light of ::: Uploaded on – 21/09/2018 ::: Downloaded on – 23/09/2018 01:37:30 ::: 17Judgment wp2348.17.odt such mandate the various provisions under the Pension Regulations, the Scheme, and the Settlement will have to be construed.

21. In the present case, the qualifying service for getting the pension is of 10 years’ duration, as prescribed under Regulation 14 of the Pension Regulations. The right to get the pension accrues as soon as an employee completes 10 years of his service. It cannot be denied to him unless it is shown that he is either disqualified for getting the pension or the past service rendered by him is forfeited under any of the statutory provisions. Under the service jurisprudence, normally an employee, who is terminated, dismissed or removed from service by way of punishment, is disqualified for getting the pension. On tendering resignation upon rendering qualifying service, an employee incurs forfeiture of his past service. The voluntary retirement, after rendering qualified service, or compulsory retirement, would not result either in disqualification for getting the pension or forfeiture of the past service rendered.
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22. The petitioner has rendered 14 years, 11 months and 3 days’ continuous service as a permanent employee. In terms of Regulation 14 of the Pension Regulations, the fundamental right to livelihood enshrined under Article 21 of the Constitution of India has accrued in her favour. The petitioner was qualified to seek voluntary retirement from service in terms of clause 3 under the Scheme, as she completed 40 years of age as on 31-1-2001. It is not the stand of the respondent-Bank that the petitioner is disqualified for getting the pension under any of the statutory provisions. In the absence of any statutory provision entailing the consequences of forfeiture of past qualified service rendered to seek voluntary retirement under the statutory provisions, the denial of pension to the petitioner, in our view, was violative of the fundamental right to livelihood enshrined under Article 21 of the Constitution of India and in breach of the constitutional mandate contained under Article 300A of the Constitution of India. The respondent-Bank was, therefore, in our view, not justified in denying the pension to the petitioner on the ground ::: Uploaded on – 21/09/2018 ::: Downloaded on – 23/09/2018 01:37:30 ::: 19Judgment wp2348.17.odt that the petitioner has not rendered 15 years of service. The question No.(1) is answered accordingly.

23. Our attention is invited to clause 3 of eligibility under the Scheme, which makes the Scheme open to all the permanent employees of the respondent-Bank, who have put in 15 years of service or have completed the age of 40 years as on 31-1-2001. The provision is alternate and fulfillment of any one of the two conditions qualifies an employee to seek voluntary retirement from service. It is not the provision prescribing the qualifying service to get the pension. The provision cannot be construed to hold that an employee, who qualifies to seek voluntary retirement upon completion of 40 years of age as on 31-1-2001, is also required to show that he has put in 15 years of service to become entitled to the pension. We have not been pointed out any provision under this Scheme, which would make it inapplicable to those who voluntarily retired from service on 31-3-2001. The action of denial of pension to the petitioner, in our view, was violative of Article 14 of the Constitution of India, being based upon ::: Uploaded on – 21/09/2018 ::: Downloaded on – 23/09/2018 01:37:30 ::: 20Judgment wp2348.17.odt irrelevant consideration of law.

24. Clause (4) of the Settlement dated 27-4-2010 is pressed into service to urge that it contains a requirement of completion of 15 years of service on the date of seeking voluntary retirement to become eligible to exercise an option to join the Pension Scheme. The very object of introducing clause (4) is to extend the benefit of the Pension Scheme to the employees who ceased to be in service on or after 29-9-1995 and did not exercise an option to join the Pension Scheme. It cannot be read to make an employee disqualified or ineligible to get the pension, particularly in the light of the position of law pointed out earlier. In our view, unless there is a provision contained either under the Pension Regulations or under the Scheme to forfeit the past service rendered on seeking voluntary retirement from service, the right to receive pension accrued in terms of Regulation 14 of the Pension Regulations cannot be defeated.
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25. Our attention is also invited to the proviso added below Regulation 18 of the Pension Regulations by the notification dated 8-10-2014 to urge that the provision of Regulation 18 is only for the purpose of pension calculation for eligible employees to get the pension and not for pension eligibility. According to the respondent-Bank, the petitioner is, therefore, not entitled to the benefit of rounding-off of his 14 years, 11 months and 3 days’ service to 15 years of service to become qualified for getting the pension.

26. In our view, the proviso below Regulation 18 operates prospectively and it cannot be construed to take away the right to pension accrued. Be that as it may, once an eligibility for pension is attained, the pension payable can be calculated as per Regulation 18. Even in terms of clause (5) under the Settlement dated 27-4-2010 stipulating that all the Regulations of the Bank Employees’ Pension Regulations, 1995/1996 shall be applicable to those who opt for the Pension Scheme in terms of the Settlement, Regulation 18 can be invoked to count the rounded-off service to calculate the pension and the ::: Uploaded on – 21/09/2018 ::: Downloaded on – 23/09/2018 01:37:30 ::: 22Judgment wp2348.17.odt respondent-Bank was not justified to deny the benefit of it to the petitioner. Ultimately even if the benefit of Regulation 18 is not given, the pension will have to be fixed on the basis of number of years’ service rendered and the last pay drawn, but the option for pension cannot be denied. The question No.(2) is answered accordingly.

27. The petitioner rendered more than 10 years of service in the respondent-Bank as on 31-3-2001 and she was, therefore, qualified for getting the pension in terms of Regulation 14 of the Pension Regulations. The petitioner was qualified to seek voluntary retirement from service under the Scheme in terms of clause 3 therein, as she had completed 40 years of age on 31-1-2001. There is no provision under the Pension Regulations or under the Scheme forfeiting the past service rendered by an employee seeking voluntary retirement from service. It is not the stand of the respondent-Bank that the service of 14 years, 11 months and 3 days’ rendered by the petitioner stood forfeited under any of the statutory provisions. Clause (4) of the Settlement dated 27-4-2010 extended the ::: Uploaded on – 21/09/2018 ::: Downloaded on – 23/09/2018 01:37:30 ::: 23Judgment wp2348.17.odt benefit under the Scheme to the employees who ceased to be in service on or after 26-3-1996 to exercise an option to join the Pension Scheme. The petitioner upon rendering qualifying service sought voluntary retirement under the Scheme with effect from 31-3-2001 and she exercised an option given to her in terms of the Settlement. In view of the law laid down in this judgment, the petitioner cannot be deprived of the benefit of exercising the second option for pension in terms of the Settlement.

28. In the result, this petition is allowed and the order is passed as under :
(1) The order dated 11-8-2016 passed by the respondent-Bank rejecting the request of the petitioner for exercise of second pension option under VRS-2001, is hereby quashed and set aside. (2) The petitioner is held entitled to exercise second option for pension under VRS-2001 and she would be entitled to it along with all other consequential benefits as if she has completed the qualifying service of 15 years as on 31-3-2001. ::: Uploaded on – 21/09/2018 ::: Downloaded on – 23/09/2018 01:37:30 ::: 24
Judgment wp2348.17.odt (3) If the petitioner has received any amount of the Bank’s contribution towards provident fund, the same will have to be returned to the Bank. (4) The petitioner would be entitled to interest at the rate of 6% per annum on the arrears of pension after expiry of one month from the date of acceptance of the voluntary retirement by the respondent-Bank. (5) All the arrears and consequential benefits be paid to the petitioner within a period of four months from today; failing which, the interest at the rate of 12% per annum shall become payable thereafter till the realization of the amount. 29. Rule is made absolute in the aforesaid terms. No order as to costs.

(Arun D. Upadhye, J.) (R.K. Deshpande, J.)PD Lanjewar,PS ::: Uploaded on – 21/09/2018 ::: Downloaded on – 23/09/2018 01:37:30 :::

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