LawDistill
Supreme Court of India

INDIAN EX-SERVICES LEAGUE AND ORS. ETC vs UNION OF INDIA AND ORS. ETC on 29 January, 1991

Cites 2 provisionsCites 5 judgmentsCited by 15
Official PDFBench Bankim Chandra Ray, Madhukar Hiralal Kania, Kalmanje Jagannatha Shetty, Lalit Mohan Sharma, Jagdish Sharan Verma
PETITIONER:
INDIAN EX-SERVICES LEAGUE AND ORS. ETC.
Vs.
RESPONDENT:
UNION OF INDIA AND ORS. ETC.
DATE OF JUDGMENT29/01/1991
BENCH:
VERMA, JAGDISH SARAN (J)
BENCH:
VERMA, JAGDISH SARAN (J)
RAY, B.C. (J)
KANIA, M.H.
SHETTY, K.J. (J)
SHARMA, L.M. (J)
CITATION:
1991 AIR 1182 1991 SCR (1) 158
1991 SCC (2) 104 JT 1991 (1) 243
1991 SCALE (1)81
CITATOR INFO :
RF 1992 SC 767 (7)
ACT:
Service-Pension Rules: Pension-Petitioners ex-
servicemen- Relief claimed in substance of ‘one rank, one
pension’ on the basis of Nakara’s case- Claim proceeds on
misreading of Nakara-Rejected.
Gratuity-Same Death-cum-Retirement Gratuity to the pre-
1.4.1979 retires as to the post-1.4. 1979 retires sought-
Petitions dismissed-Central Civil Services (Pension) Rules,
1972.
Dearness allowance-Merger of D.A. Backwards-Claim
untenable.
HEADNOTE:
Petitioners who are ex-servicemen have moved these Writ
in the past.......
Summing-up it can be said with confidence that
pension is not only compensation for loyal service
rendered in the past, but pension also has a
broader significance, in that it is a measure of
socio-economic justice which inheres economic
security in the fall of life when physical and
mental prowess is ebbing corresponding to aging
process and therefore, one is required to fall back
on savings. One such saving in kind is when you
gave your best in the heyday of life to your
employer, in days of invalidity, economic security
by way of periodical payment is assured. The term
has been judicially defined as a stated allowance
or stipend made in consideration of past service or
a surrender of rights or emoluments to one retired
from service. Thus the pension payable to a
Government employee is earned by rendering long and
efficient service and therefore can be said to be a
deferred portion of the compensation or for service
rendered. In one sentence one can say that the most
practical reison d’etre for pension is the
inability to provide for oneself due to old age.
One may live and avoid unemployment but not
senility and penury if there is nothing to fall
back upon.
The discernible purpose thus underlying pension
scheme or a statute introducing the pension scheme
must inform interpretative process and accordingly
it should receive a liberal construction and the
courts may not so interpret such statute as to
render them inane (see American Jurisprudence 2d.
881)".
After summing up the concept of pension as above, the
Constitu-
tion Bench set out the challenge of the petitioners in that
case and indicated that the challenge was merely to that of
the scheme by which its benefits were confined to those who
retired from service after a certain date. Even though,
undoubtedly the benefit of the scheme is available only from
the specified date irrespective of the date of retirement of
the concerned Government servants, it was pointed out that
all pensioners irrespective of the date of their retirement
constitute one class for grant of the benefits of the
liberalised pension scheme and no further classification
within them is permissible for this purpose with reference
to their date of retirement. This was stated thus:
"If it appears to be undisputable, as it does to us
that the pensioners for the purpose of pension
benefits form a class, would its upward revision
permit a homogeneous class to be divided by
arbitrarily fixing an eligibility criteria
unrelated to purpose of revision, and would such
classification be founded on some rational
principle? The classification has to be based, as
is well settled, on some rational principle and the
rational principle must have nexus to the objects
sought to be achieved. We have set out the objects
underlying the payment of pension. If the State
considered it necessary to liberalise the pension
scheme, we find no rational principle behind it
for granting these benefits only to those who
retired subsequent to that date simultaneously
denying the same to those who retired prior to that
date. If the liberalisation was considered
necessary for augmenting social security in old age
to government servants then those who retired
earlier cannot be worst off than those who retired
later. Therefore, this division which classified
pensioners into two classes is not based on any
rational principle and if the rational principle
is the one of dividing pensioners with a view to
giving something more to persons otherwise equally
placed, it would be discriminatory......... The
artificial division stares into face and is
unrelated to any principle and whatever principle,
if there be any, has absolutely no nexus to the
objects sought to be achieved by liberalising the
pension scheme. In fact this arbitrary division
has not only no nexus to the liberalised pension
scheme but it is counter productive and runs
counter to the whole gamut of pension scheme. The
equal treatment guaranteed in Art.14 is wholly
violated inasmuch as the pension rules being
statutory in character, since the specified date,
the rules accord differential and discri-
minatory treatment to equals in the matter of
commutation of pension. A 48 hours difference in
matter of retirement would have a traumatic effect.
Division is thus both arbitrary and unprincipled.
Therefore, the classification does not stand the
test of Art. 14".
(emphasis supplied)
The judgement then proceeded to show that there was no
difficulty or inequity in granting the benefits of the
liberalised pension scheme to all retirees irrespective of
the date of their retirement by indicating as under:
".........Assuming the Government had not
prescribed the specified date and thereby provided
that those retiring pre and post the specified date
would all be governed by the liberalised pension
scheme, undoubtedly, it would be both prospective
and retroactive. Only the pension will have to be
recomputed in the light of the formula enacted in
the liberalised pension scheme and effective from
the date of revised scheme comes into force. And
beware that it is not a new scheme, it is only a
revision of existing scheme. It is not a new
retrial benefit. It is an upward revision of an
existing benefit. If it was wholly new concept, a
new retrial benefit, one could have appreciated an
argument that those who had already retired could
not except it......"
"It was very seriously contended, remove the event
correlated to date and examine whether the scheme
is workable. We find no difficulty in implementing
the scheme omitting the event happening after the
specified date retaining the more humane formula
for computation of pension. It would apply to all
existing pensioners and future pensioners. In the
case of existing pensioners, the pension will have
to be recomputed by applying the rule of average
emoluments as set out in Rule-34 and introducing
the slab system and the amount worked out within
the floor and the ceiling.
But we make is abundantly clear that arrears are
not required to be made (sic) because to that
extent the scheme is prospective. All pensioners
whenever they retire would be covered by the
liberalised pension scheme, because the scheme is a
scheme for payment of pension to a pensioner
governed by 1972 Rules. The date of retirement is
irrelevant. But the revised scheme would be
operative from the date mentioned in the scheme and
would bring under its umbrella all existing
pensioners and those who retired subsequent to that
date. In case of pensioners prior to the specified
date, their pension would be computed afresh and
would be payable infuture commencing from the
specified date. No arrears would be payable. And
that would take care of the grievances of
retrospectively. In our opinion, it would make a
marginal difference in the case of past pensioners
because the emoluments are not revised......."
(emphasis supplied)
It was then pointed out that there is absolutely no
difficulty in removing arbitrary and discriminatory portion
of the scheme which is only the portion confining its
applicability to retirees subsequent to the specified date
since it could be easily severed. It was held that it would
be just and proper to retain the specified date for
implementation of the liberalised pension scheme while
applying it equally to all pensioners irrespective of their
date of retirement requiring the pension of each to be
recomputed as on the specified date and the future payments
to be made in accordance with fresh computation under the
liberalised pension scheme as enacted in the impugned
memoranda. Thus all retirees irrespective of their date of
retirement were treated as constituting one class entitled
to the benefits of the liberalised pension to be recomputed
as on the specified date according to the liberalised
formula requiring payment to be made prospectively from the
specified date of the revised amount. In other words, the
benefit of the liberalised pension formula was given equally
to all retirees irrespective of the date of their retirement
and for this purpose, recomputation was required to be made
as on the specified date on the basis of the emoluments
payable on the actual date of retirement of each retiree.
The ultimate relief granted in Nakara is as under:
".....Omitting the unconstitutional part it is
delcared that all pensioners governed by the 1972
Rules and Army Pension Regulations shall be
entitled to pension as computed under the
liberalised pension scheme from the specified date,
irrespective of the date of retirement. Arrears of
pension prior to the specified date as per fresh
computation is not admissible. Let a writ to that
effect be issued......."
(emphasis supplied)
Consequent upon the decision in Nakara a G.O.
No.F.1(4)/82/D (Pension/Services) dated 22.11.1983 in
respect of personnel of the Armed Forces below the
Commissioned rank and G.O.No.1(4)/82/I/D(Pension/Services)
dated 3.12.1983 in respect of Commissioned Officers have
been issued by the Government of India recomputing the
revised pension of pre-1.4.1979 retirees of the Armed Forces
as on 1.4.1979 according to the liberalised pension scheme.
This re-computation has been made according to the
liberalised pension scheme contained in the Memorandum No.
B/40725/AG/PS4-C/1816/AD (Pension)/Services dated
28.9.1979, as it stood partially modified by the decision in
Nakara to implement the decision in Nakara giving the same
benefit of the liberalised pension scheme to all retirees
irrespective of their date of retirement. It is these two
G.Os. which are challenged in the present writ petitions.
We may now state the contentions raised in these writ
petitions.
The Armed Forces personnel retiring from Commissioned
ranks were represented by Shri G.Viswanatha Iyer, while
the Armed Forces personnel retiring from ranks below the
Commissioned rank were represented by Shri K.L. Rathee. The
arguments of both of them are substantially the same.
According to learned counsel for the petitioners, the result
of the decision in Nakara is that all retirees who held the
same rank irrespective of their date of retirement must get
the same amount of pension and this should be the amount
which was calculated and shown in the appendices to the
Memorandum (Ex. P-2) challenged in Nakara. Admittedly, the
appendices to that Memorandum specified the computation of
pension for different ranks of retirees on or after 1.4.1979
made on the basis of the reckonable emoluments on 1.4.1979.
It is also admitted that the reckonable emoluments for
corresponding ranks on earlier dates were not the same to
provide identical basis for recomputation of pension
according to the liberalised pension scheme of pre. 1.4.1979
retirees. In substance, even though learned counsel for the
petitioners do not say so, the arguments amount to the claim
of ‘one rank, one pension’ for all retirees of the Armed
Forces irrespective of their date of retirement. It is also
admitted that prior to this liberalised pension scheme, the
pension amount of the earlier retirees from the same rank
was not the same irrespective of their date of retirement or
in other words, the principle of ‘one rank, one pension’ did
not apply earlier. It was stated at the Bar that the demand
of ‘one rank, one pension’ is pending consideration of the
Government of India as a separate issue. It is, therefore,
clear that unless the petitioner’s claim in substance of
‘one rank, one pension’ can be treated as flowing from the
relief granted in
Nakara, the reliefs claimed in these petitions though
differently worded cannot be granted. It is for this reason
that learned counsel avoided describing the reliefs claimed
herein as claim of ‘one rank, one pension’, even though they
were unable to tell us how, if at all, the reliefs claimed
in these petitions can be construed differently.
The learned Solicitor General in reply contended that
the impugned G.Os. in the present case were issued in
implementation of the decision in Nakara and the challenge
to them on the basis of Nakara decision, is untenable. The
learned Solicitor General contended that the petitioner’s
claim herein arises out of a mis-reading of Nakara and the
general observations therein have to be read in the context
in which they were made. The Learned Solicitor General
submitted in all fairness that in spite of this stand of the
Government of India if any error in recomputation of the
revised pension is pointed out, the Government of India
would promptly correct the error, if any, since that is only
a matter of calculation.
Having heard both sides at length and after giving our
anxious consideration to the matter, we have reached the
conclusion that the claim of the petitioners in the present
writ petitions is untenable and it proceeds on a mis-reading
of the Nakara decision.
The conclusion of the Constitution Bench in Nakara was
the benefits of the liberalisation and the extent thereof
given in accordance with the liberalised pension scheme have
to be given equally to all retirees irrespective of their
date of retirement and those benefits can not be confined
only to the persons who retired on or after the specified
date because for the purpose of grant of the benefits of
liberalisation in pension, all retirees constitute one class
irrespective of their date of retirement. In order to give
effect to this conclusion the only relief granted was to
strike down that portion of the memoranda by which the
benefit of the liberalised pension scheme was confined only
to persons retiring on or after the specified date with the
result that the benefit was extended to all retirees,
irrespective of their date of retirement. Once this
position emerging from the decision in Nakara is borne in
mind, the fallacy in the petitioner’s contention in these
writ petitions becomes obvious and their claim based only on
Nakara is untenable.
The liberalised pension scheme in the context of which
the decision was rendered in Nakara provided for computation
of pension according to a more liberal formula under which
"average emolu-
ments" were determined with reference to the last ten
month’s salary instead of 36 months’ salary provided earlier
yielding a higher average, coupled with a slab system and
raising the ceiling limit for pension. This Court held that
where the made of computation of pension is liberalised from
a specified date, its benefit must be given not merely to
retirees subsequent to that date but also to earlier
existing retirees irrespective of their date of retirement
even though the earlier retirees would not be entitled to
any arrears prior to the specified date on the basis of the
revised computation made according to the liberalised
formula. For the purpose of such a scheme all existing
retirees irrespective of the date of their retirement, were
held to constitute one class, any further division within
that class being impermissible. According to that decision,
the pension of all earlier retirees was to be recomputed as
on the specified date in accordance with the liberalised
formula of computation on the basis of the average
emoluments of each retiree payable on his date of
retirement. For this purpose there was no revision of the
emoluments of the earlier retirees under the scheme. It was
clearly, stated that ‘if the pensioners form a class. their
computation cannot be by different formula affording unequal
treatment solely on the ground that some retired earlier and
some retired later’. This according to us is the decision
in Nakara and no more.
Ordinarily, it would suffice to mention the gist of
Nakara decision without extensively quoting therefrom.
However, we have done so for the reason that the impassioned
plea of Shri G.Viswanatha Iyer, learned counsel appearing
for the Army Officers which was reiterated with an added
emotive appeal by Shri K.L, Rathee, appearing for the
remaining ranks of Armed Forces seems to suggest that denial
of petitioner’s claim amounts to mis-reading the Nakara
decision and refusad of the logical relief flowing
therefor. It is only to dispel this incorrect impression we
have quoted from Nakara at some length. We have merely to
decide whether the petitioner’s claim flows from the
decision in Nakara and we are unable to find anything in
Nakara to support such claim.
Nakara decision came up for consideration before
another Constitution Bench recently in Krishena Kumar and
Others v. Union of India and Others, [1990] 4 S.C.C. 207.
The petitioners in that case were retired Railway employees
who were covered by or opted for the Railway Contributory
Provident Fund Scheme. It was held that P.F. retirees and
pension retirees constitute different classes and it was
never held in Nakara that pension retirees and P.F, retirees
formed a homogeneous class, even though pension retirees
alone did constitute

ORIGINAL JURIDICTION: Writ Petition Nos. 13550-55 of 1984.

WITH

Writ Petition Nos. 547-50 and 4524 of 1985.

(Under Article 32 of the Constitution of India)

G. Viswanatha Iyer, K.L. Rathee, S. Balakrishnan, S. Prasad and S.K. Sinha for the Petitioners.

Ashok H.Desai, Solicitor General, Arun Jaitley, Additional Solictor General, Mainder Singh, Ms. Anil Katyar, C.V.S. Rao and Rajan Narain for the Respondents.

The Judgement of the Court was delivered by

VERMA, J. These writ petitions by ex-servicemen are a sequal to the decision in D.S. Nakara & Others v. Union of India,[1983] 2 S.C.R. 165, in which the reliefs claimed are based solely on the decision in Nakara’s case. The real point for decision, therefore, is whether the reliefs claimed in these writ petitions flow as a necessary corollary to the decision in Nakara. This being the sole basis for the reliefs claimed in these writ petitions, the petitioners can succeed only if this assumption by them is correct. Writ Petition Nos. 13550-55 of 1984 are by ex-servicemen who retired from a commissioned rank while Writ Petition Nos. 547-50 of 1985 are by those who retired from below the Commissioned rank. Writ Petition No. 4524 of 1985 by an ex-serviceman has been received by post and is substantially to the same effect. Petitioner No. 1 in the first two sets of writ petitions is a Society representing the ex-servicemen while the other petitioners in these writ petitions are ex-servicemen of the three wings of the Armed Forces, namely, Army, Navy and Air Force. In order to appreciate the contentions in these writ petitions, it would be appropriate to first refer briefly to the decision in D.S. Nakara & Others v. Union of India, [1983] 2 S.C.R. 165.

On May 25, 1979, Government of India, Ministry of Finance, issued Office Memorandum No. F-19(3)-EV-79 whereby the formula for computation of pension was liberalised but made applicable only to civil servants who were in service on March 31, 1979 and retired from service on or after that date. The liberalised pension formula introduced a slab system, raised the ceiling and provided for a better average of emoluments for computation of pension and the liberalised scheme was made applicable to employees governed by the Central Civil Services (Pension) Rules, 1972, retiring on or after the specified date. The pension for the Armed Forces personnel is governed by the relevant regulations. By the Memorandum of the Ministry of Defence bearing No.B/40725/AG/PS4-C/1816/AD (Pension)/Services dated September 28, 1979, the liberalised pension formula introduced for the civil servants governed by the 1972 Rules was extended to the Armed Forces personnel subject to the limitations set out in the Memorandum with a condition that the new rules of pension would be effective from April 1, 1979 and would be applicable to all service officers who become/became non-effective on or after that date. These memoranda were Ex. P-1 and Ex. P-2 in Nakara. Consequently, the liberalised pension formula was made applicable prospectively only to those who retired on or after March 31, 1979 in case of civil servants covered 1972 Rules and in respect of Armed Forces personnel who became non-effective on or after April 1, 1979. The result was that those who retired prior to the specified date were not entitled to the benefits of liberalised pension formula in view of the cutoff date of retirement specified in the Memoranda. This led to the filing of the writ petition by D.S. Nakara and others on behalf of retired civil servants and personnel of the Armed Forces wherein it was contended that differential treatment to the pensioners related to the date of retirement by the revised formula for computation of pension was discriminatory and violative of Article 14 of the Constitution. The question for decision in Nakara was whether the date of retirement is a relevant consideration for eligibility when a liberalised pension formula for computation of pension is introduced and made effective from a specified date resulting in denial of the benefits of the liberalised pension formula to pensioners who had retired prior to the specified date.

A Constitution Bench of this Court in Nakara after elaborately discussing the concept of pension, summed up the position thus:

"Pension to civil employees of the Government and

the defence personnel as administered in India

appeal to be a compensation for service rendered

in the past.......

Summing-up it can be said with confidence that

pension is not only compensation for loyal service

rendered in the past, but pension also has a

broader significance, in that it is a measure of

socio-economic justice which inheres economic

security in the fall of life when physical and

mental prowess is ebbing corresponding to aging

process and therefore, one is required to fall back

on savings. One such saving in kind is when you

gave your best in the heyday of life to your

employer, in days of invalidity, economic security

by way of periodical payment is assured. The term

has been judicially defined as a stated allowance

or stipend made in consideration of past service or

a surrender of rights or emoluments to one retired

from service. Thus the pension payable to a

Government employee is earned by rendering long and

efficient service and therefore can be said to be a

deferred portion of the compensation or for service

rendered. In one sentence one can say that the most

practical reison d’etre for pension is the

inability to provide for oneself due to old age.

One may live and avoid unemployment but not

senility and penury if there is nothing to fall

back upon.

The discernible purpose thus underlying pension

scheme or a statute introducing the pension scheme

must inform interpretative process and accordingly

it should receive a liberal construction and the

courts may not so interpret such statute as to

render them inane (see American Jurisprudence 2d.

881)". After summing up the concept of pension as above, the Constitution Bench set out the challenge of the petitioners in that case and indicated that the challenge was merely to that of the scheme by which its benefits were confined to those who retired from service after a certain date. Even though, undoubtedly the benefit of the scheme is available only from the specified date irrespective of the date of retirement of the concerned Government servants, it was pointed out that all pensioners irrespective of the date of their retirement constitute one class for grant of the benefits of the liberalised pension scheme and no further classification within them is permissible for this purpose with reference to their date of retirement. This was stated thus:

"If it appears to be undisputable, as it does to us

that the pensioners for the purpose of pension

benefits form a class, would its upward revision

permit a homogeneous class to be divided by

arbitrarily fixing an eligibility criteria

unrelated to purpose of revision, and would such

classification be founded on some rational

principle? The classification has to be based, as

is well settled, on some rational principle and the

rational principle must have nexus to the objects

sought to be achieved. We have set out the objects

underlying the payment of pension. If the State

considered it necessary to liberalise the pension

scheme, we find no rational principle behind it

for granting these benefits only to those who

retired subsequent to that date simultaneously

denying the same to those who retired prior to that

date. If the liberalisation was considered

necessary for augmenting social security in old age

to government servants then those who retired

earlier cannot be worst off than those who retired

later. Therefore, this division which classified

pensioners into two classes is not based on any

rational principle and if the rational principle

is the one of dividing pensioners with a view to

giving something more to persons otherwise equally

placed, it would be discriminatory......... The

artificial division stares into face and is

unrelated to any principle and whatever principle,

if there be any, has absolutely no nexus to the

objects sought to be achieved by liberalising the

pension scheme. In fact this arbitrary division

has not only no nexus to the liberalised pension

scheme but it is counter productive and runs

counter to the whole gamut of pension scheme. The

equal treatment guaranteed in Art.14 is wholly

violated inasmuch as the pension rules being

statutory in character, since the specified date,

the rules accord differential and discri-

minatory treatment to equals in the matter of

commutation of pension. A 48 hours difference in

matter of retirement would have a traumatic effect.

Division is thus both arbitrary and unprincipled.

Therefore, the classification does not stand the

test of Art. 14".

The judgement then proceeded to show that there was no difficulty or inequity in granting the benefits of the liberalised pension scheme to all retirees irrespective of the date of their retirement by indicating as under:

".........Assuming the Government had not

prescribed the specified date and thereby provided

that those retiring pre and post the specified date

would all be governed by the liberalised pension

scheme, undoubtedly, it would be both prospective

and retroactive. Only the pension will have to be

recomputed in the light of the formula enacted in

the liberalised pension scheme and effective from

the date of revised scheme comes into force. And

beware that it is not a new scheme, it is only a

revision of existing scheme. It is not a new

retrial benefit. It is an upward revision of an

existing benefit. If it was wholly new concept, a

new retrial benefit, one could have appreciated an

argument that those who had already retired could

not except it......"

"It was very seriously contended, remove the event

correlated to date and examine whether the scheme

is workable. We find no difficulty in implementing

the scheme omitting the event happening after the

specified date retaining the more humane formula

for computation of pension. It would apply to all

existing pensioners and future pensioners. In the

case of existing pensioners, the pension will have

to be recomputed by applying the rule of average

emoluments as set out in Rule-34 and introducing

the slab system and the amount worked out within

the floor and the ceiling.

But we make is abundantly clear that arrears are

not required to be made (sic) because to that

extent the scheme is prospective. All pensioners

whenever they retire would be covered by the

liberalised pension scheme, because the scheme is a

scheme for payment of pension to a pensioner

governed by 1972 Rules. The date of retirement is

irrelevant. But the revised scheme would be

operative from the date mentioned in the scheme and

would bring under its umbrella all existing

pensioners and those who retired subsequent to that

date. In case of pensioners prior to the specified

date, their pension would be computed afresh and

would be payable infuture commencing from the

specified date. No arrears would be payable. And

that would take care of the grievances of

retrospectively. In our opinion, it would make a

marginal difference in the case of past pensioners

because the emoluments are not revised......."

It was then pointed out that there is absolutely no difficulty in removing arbitrary and discriminatory portion of the scheme which is only the portion confining its applicability to retirees subsequent to the specified date since it could be easily severed. It was held that it would be just and proper to retain the specified date for implementation of the liberalised pension scheme while applying it equally to all pensioners irrespective of their date of retirement requiring the pension of each to be recomputed as on the specified date and the future payments to be made in accordance with fresh computation under the liberalised pension scheme as enacted in the impugned memoranda. Thus all retirees irrespective of their date of retirement were treated as constituting one class entitled to the benefits of the liberalised pension to be recomputed as on the specified date according to the liberalised formula requiring payment to be made prospectively from the specified date of the revised amount. In other words, the benefit of the liberalised pension formula was given equally to all retirees irrespective of the date of their retirement and for this purpose, recomputation was required to be made as on the specified date on the basis of the emoluments payable on the actual date of retirement of each retiree. The ultimate relief granted in Nakara is as under:

".....Omitting the unconstitutional part it is

delcared that all pensioners governed by the 1972

Rules and Army Pension Regulations shall be

entitled to pension as computed under the

liberalised pension scheme from the specified date,

irrespective of the date of retirement. Arrears of

pension prior to the specified date as per fresh

computation is not admissible. Let a writ to that

effect be issued......."

Consequent upon the decision in Nakara a G.O. No.F.1(4)/82/D (Pension/Services) dated 22.11.1983 in respect of personnel of the Armed Forces below the Commissioned rank and G.O.No.1(4)/82/I/D(Pension/Services) dated 3.12.1983 in respect of Commissioned Officers have been issued by the Government of India recomputing the revised pension of pre-1.4.1979 retirees of the Armed Forces as on 1.4.1979 according to the liberalised pension scheme. This re-computation has been made according to the liberalised pension scheme contained in the Memorandum No. B/40725/AG/PS4-C/1816/AD (Pension)/Services dated 28.9.1979, as it stood partially modified by the decision in Nakara to implement the decision in Nakara giving the same benefit of the liberalised pension scheme to all retirees irrespective of their date of retirement. It is these two G.Os. which are challenged in the present writ petitions. We may now state the contentions raised in these writ petitions.

The Armed Forces personnel retiring from Commissioned ranks were represented by Shri G.Viswanatha Iyer, while the Armed Forces personnel retiring from ranks below the Commissioned rank were represented by Shri K.L. Rathee. The arguments of both of them are substantially the same. According to learned counsel for the petitioners, the result of the decision in Nakara is that all retirees who held the same rank irrespective of their date of retirement must get the same amount of pension and this should be the amount which was calculated and shown in the appendices to the Memorandum (Ex. P-2) challenged in Nakara. Admittedly, the appendices to that Memorandum specified the computation of pension for different ranks of retirees on or after 1.4.1979 made on the basis of the reckonable emoluments on 1.4.1979. It is also admitted that the reckonable emoluments for corresponding ranks on earlier dates were not the same to provide identical basis for recomputation of pension according to the liberalised pension scheme of pre. 1.4.1979 retirees. In substance, even though learned counsel for the petitioners do not say so, the arguments amount to the claim of ‘one rank, one pension’ for all retirees of the Armed Forces irrespective of their date of retirement. It is also admitted that prior to this liberalised pension scheme, the pension amount of the earlier retirees from the same rank was not the same irrespective of their date of retirement or in other words, the principle of ‘one rank, one pension’ did not apply earlier. It was stated at the Bar that the demand of ‘one rank, one pension’ is pending consideration of the Government of India as a separate issue. It is, therefore, clear that unless the petitioner’s claim in substance of ‘one rank, one pension’ can be treated as flowing from the relief granted in Nakara, the reliefs claimed in these petitions though differently worded cannot be granted. It is for this reason that learned counsel avoided describing the reliefs claimed herein as claim of ‘one rank, one pension’, even though they were unable to tell us how, if at all, the reliefs claimed in these petitions can be construed differently.

The learned Solicitor General in reply contended that the impugned G.Os. in the present case were issued in implementation of the decision in Nakara and the challenge to them on the basis of Nakara decision, is untenable. The learned Solicitor General contended that the petitioner’s claim herein arises out of a mis-reading of Nakara and the general observations therein have to be read in the context in which they were made. The Learned Solicitor General submitted in all fairness that in spite of this stand of the Government of India if any error in recomputation of the revised pension is pointed out, the Government of India would promptly correct the error, if any, since that is only a matter of calculation.

Having heard both sides at length and after giving our anxious consideration to the matter, we have reached the conclusion that the claim of the petitioners in the present writ petitions is untenable and it proceeds on a mis-reading of the Nakara decision.

The conclusion of the Constitution Bench in Nakara was the benefits of the liberalisation and the extent thereof given in accordance with the liberalised pension scheme have to be given equally to all retirees irrespective of their date of retirement and those benefits can not be confined only to the persons who retired on or after the specified date because for the purpose of grant of the benefits of liberalisation in pension, all retirees constitute one class irrespective of their date of retirement. In order to give effect to this conclusion the only relief granted was to strike down that portion of the memoranda by which the benefit of the liberalised pension scheme was confined only to persons retiring on or after the specified date with the result that the benefit was extended to all retirees, irrespective of their date of retirement. Once this position emerging from the decision in Nakara is borne in mind, the fallacy in the petitioner’s contention in these writ petitions becomes obvious and their claim based only on Nakara is untenable.

The liberalised pension scheme in the context of which the decision was rendered in Nakara provided for computation of pension according to a more liberal formula under which "average emoluments" were determined with reference to the last ten month’s salary instead of 36 months’ salary provided earlier yielding a higher average, coupled with a slab system and raising the ceiling limit for pension. This Court held that where the made of computation of pension is liberalised from a specified date, its benefit must be given not merely to retirees subsequent to that date but also to earlier existing retirees irrespective of their date of retirement even though the earlier retirees would not be entitled to any arrears prior to the specified date on the basis of the revised computation made according to the liberalised formula. For the purpose of such a scheme all existing retirees irrespective of the date of their retirement, were held to constitute one class, any further division within that class being impermissible. According to that decision, the pension of all earlier retirees was to be recomputed as on the specified date in accordance with the liberalised formula of computation on the basis of the average emoluments of each retiree payable on his date of retirement. For this purpose there was no revision of the emoluments of the earlier retirees under the scheme. It was clearly, stated that ‘if the pensioners form a class. their computation cannot be by different formula affording unequal treatment solely on the ground that some retired earlier and some retired later’. This according to us is the decision in Nakara and no more.

Ordinarily, it would suffice to mention the gist of Nakara decision without extensively quoting therefrom. However, we have done so for the reason that the impassioned plea of Shri G.Viswanatha Iyer, learned counsel appearing for the Army Officers which was reiterated with an added emotive appeal by Shri K.L, Rathee, appearing for the remaining ranks of Armed Forces seems to suggest that denial of petitioner’s claim amounts to mis-reading the Nakara decision and refusad of the logical relief flowing therefor. It is only to dispel this incorrect impression we have quoted from Nakara at some length. We have merely to decide whether the petitioner’s claim flows from the decision in Nakara and we are unable to find anything in Nakara to support such claim.

Nakara decision came up for consideration before another Constitution Bench recently in Krishena Kumar and Others v. Union of India and Others, [1990] 4 S.C.C. 207. The petitioners in that case were retired Railway employees who were covered by or opted for the Railway Contributory Provident Fund Scheme. It was held that P.F. retirees and pension retirees constitute different classes and it was never held in Nakara that pension retirees and P.F, retirees formed a homogeneous class, even though pension retirees alone did constitute a homogeneous class within which any further classification for the purpose of a liberalised pension scheme was impermissible. It was pointed out that in Nakara, it was never required to be decided that all the retirees for all purposes formed one class and no further classification was permissible. We have referred to this decision merely to indicate that another Constitution Bench of this Court also has read Nakara decision as one of limited application and there is no scope for enlarging the ambit of that decision to cover all claims made by the pension retirees or a demand for an identical amount of pension to every retiree from the same rank irrespective of the date of retirement, even though the reckonable emoluments for the purpose of computation of their pension be different.

At attempt was made by learned counsel for the petitioners to confine this meaning of Nakara only to civilian retirees. It was contended that the position in the case of ex-servicemen was different. It was urged that for the ex-servicemen, the relevant Memorandum (Ex. p-2) dated 28.9.1979 which contained appendices showing the calculation of pension for each rank had to be equally applied to pre-1.4.1979 retirees since the only portion struck down in the Memorandum was the offending cut-off date confining the grant of the benefits of the liberalised pension scheme to those retiring after the specified date. In our opinion, no such distinction in the case of exservicemen can be made. A perusal of the Memorandum dated 28.9.1979 shows that it was consequent action to liberalisation of the pension formula for civil servants extending the same benefit to the Armed Forces with no further addition. Appendices ‘A’ , ‘B’ and ‘C’ to this Memorandum merely indicated the computation of the pension made for each rank according to the revised liberalised pension formula, the rates being calculated on the basis of emoluments payable for those ranks on 1.4.1979 since the Memorandum was confined in application only to service officers retiring on or after 1.4.1979. In that Memorandum, therefore, no occasion arose for computaton of revised pension for pre-1.4.1979 retirees. It is only as a result of the Nakara decision holding that the same liberalised pension formula for computation would apply to all pre1.4.1979 retirees also that the question of re-computation of the pension of the earlier reitrees also that the question of re-computation of the pension of the pension of the earlier retiree on the basis of the liberalised formula arose and this is what has been done in the G.Os. dated 22.11.1983 and 3.12.1983 challenged in these writ petitions. It is a mis-reading of the Memorandum dated 28.9.1979 to contend that the appendices to that Memorandum became automatically applicable even to pre-1.4.1979 retirees as a result of the Nakara decision. That amounts to reading something in that decision which would be contrary to its ratio.

The Memorandum dated 28.9.1979 which was Ex.P.2 in Nakara and on which the petitioners’ claim rests is as under:

No.B/40725/AC/PS4(c)/1816/A/D/(Pension/Services)

Government of India/Bharat Sarkar, Ministry of

Defence/Raksha Mantralaya, New Delhi,. the 28th

September, 1979.

To

The Chief of the Army Staff.

The Chief of the Naval Staff.

The Chief of the Air Staff.

Subject: Liberalisation of the Pension Formula-

Introduction of Slab System in respect

of Army Officers (Other than Officers of

the Military Nursing Services) and

Corresponding Officers of the Navy and

Air Force.

Sir.

I am directed to state that Government have

issued orders vide Ministry of Finance (Department

of Expenditure) O.M. No.F. 19(3)-EV/79, dated the

25th May, 1979 for detrermining pension of the

Central Government Civil servants on slab system

given below:

Amount of monthly pension

(a) Upto first Rs.1000 50% of average emoluments

of average emoluments

reckonable for pension

(b) Next Rs.500 of 45% of average

average emoluments emoluments

(c) Balance of average 40% of average

emoluments emoluments

Consequent upon the introduction of the slab system

for determining pension as above, the President is

pleased to

modify, the rates of pension of Army Officers

(excluding the Officers of the Military Nursing

Services) and corresponding officers of the Navy

and Air Force as given in A 13/9/76 and

corresponding Naval and Air Force Instructions, and

Ministry of Defence letter No. F.1(8)/70/D

(Pension/Services), dated the 17th July, 1975 in

case of rate of pension in respect of Chiefs of

Staff, on the same basis and the revised rates of

pension are as shown in Appendices ‘A’, ‘B’ and

‘C’ respectively, attached to this letter.

2. Then new rates of pension are effective from 1st

April, 1979 and will be applicable to all service

officers who became/become non-effective on or

after that date.

3. The Pension Regulations for the three Services

will be amended in due course.

4. This issues with the concurrence of the

Ministry of Finance (Defence) vide their u.o. No.

2682/Pen of 1979.

Yours faithfully,

Sd/-

(Shiv Raj Nafir)

Under Secretary to the Govt. of India".

The significant words in this Memorandum after referring to the Memorandum dated 25.5.1979 for determining pension of the civil servants according to the liberalised pension formula on the slab system based on ‘average emoluments reckonable for pension’ are as under:

"Consequent upon the introduction of the slab

system for determining pension as above, the

President is pleased to modify the rates of pension

of Army Officers......and corresponding officers of

the Navy and Air Force....on the same basis.

The above words leave no doubt that by this Memorandum the personnel of Armed Forces were extended the same benefit of liberalised pension formula for computation of their pension as was given to the civil servants ‘on the same basis’. The words which follow thereafter indicate the appendices ‘A’, ‘B’and ‘C’ attached to the Memorandum specified the revised rates of pension calculated on the liberalised basis for each rank on the basis of reckonable emoluments payable as on 1.4.1979 since the memorandum when issued confined the benefits of the liberalised scheme only to post 1.4.1979 retirees. There is no scope for reading these appendices torn out of the context of the Memorandum in its original from to which they were appended. So read, it is obvious that the calculations given in the appendices ‘A’ ‘B’ and ‘C’ to this Memorandum contain the computation according to the liberalised formula for each rank of the three wings of the Armed Forces for post 1.4.1979 retirees only. It follows that a result of the Nakara decision when the benefit of the liberalised pension scheme was made applicable even to pre- 1.4.1979 retirees of the Armed Forces, computation according to the liberalised formula for pre 1.4.1979 retirees had to be made in the same manner as it was done for post 1.4.1979 retirees and shown in appendices ‘A’ ‘B’ and ‘C’ to this memorandum. This was done by the impugned G.Os. dated 22.11.1983 and 3.12.1983.

The petitioners’ claim that all pre-1.4.1979 retirees of the Armed Forces are entitled to the same amount of pension as shown in appendices ‘A’ ‘B’ and ‘C’ for each rank is clearly untenable and does not flow from the nakara decision.

We may now deal with the remaining contentions. It Writ Petition No. 4524 of 1985, one of the reliefs claimed is for family pension. It has been pointed out by the learned Solicitor General that provision has been made for the same by the Government of India (Ministry of Defence) in memorandum No. F. 6(2)/85/1689/B/D (Pension/Services) dated 8.8.1985 which has been issued in compliance of this Court’s decision in Smt. Poonamal and Others v. Union of India and Others, [1985] 3 S.C.C. 345). That grievance no longer survives. Other reliefs claimed in this writ petition by an ex-serviceman are the same as in other writ petitions.

One of the prayers made in these writ petitions is for grant of same Death-cum-Retirement Gratuity to the pre1.4.1979 retirees as to the post-1.4.1979 retirees. A similar claim was rejected by this Court in State Government Pensioners’ Association and Others v. State of Andhra Pradesh, [1986]3 S.C.C. 501 on the ground that the claim for gratuity can be made only on the date of retirement on the basis of the salary drawn on the date of retirement and being already paid on that footing the transaction was completed and closed. It could then not be reopened as a result of the enhancement made at a later date for persons retiring subsequently. This concept of gratuity being different form pension has also been reiterated by the Constitution bench in krishena Kumar’s case. With respect, we are in full agreement with this view. This claim of the petitioners also, therefore, fails.

Another claim made is for merger of D.A. backwards also. From 1.1.1973 everyone is being paid D.A. in addition to the pension. The reckonable emoluments which are the basis for computation of pension are to be taken on the basis of emoluments payable at the time of retirement and, therefore, there is no ground to include D.A. at a time when it was not paid. This claim also in untenable.

Learned counsel for the petitioners referred to certain decisions which it is unnecessary to consider at length since they where cited only for reading the Nakara decision in the manner suggested by petitioners. The decision of this Court Union of India v. Bidhubhushan Malik and Others, [1984]3 S.C.C. 95 by which special leave petition was dismissed against the decision of the Allahabad High Court reported in AIR 1983 Allahabad 209 is also of little assistance in the present case. This Court while dismissing the special leave petition upheld the Allahabad High Court’s view that the liberalised pension became operative under the High Court Judges (Conditions of Service) (Amendment) Act, 1976, from 1.10.1974 and applied to all retired High Court Judges irrespective of the date of their retirement and there is no question of payment of arrears of pension for the period preceding 1.10.1974. We are unable to appreciate the relevance of this case to support the petitioners’ claim in these writ petitions.

The learned Solicitor General has stated that the impugned G.Os. dated 22.11.1983 (Annexure I) and dated 3.12.1983 (Annexure II) issued by the Government of India (Ministry of Defence) in the present case are based on recomputation of pension of pre 1.4.1976 retirees of Armed Forces according to the liberalised pension scheme consequent upon the decision in Nakara. He also added that if any error in computation is pointed out in respect of any particular person or rank or otherwise, the same would be promptly corrected. On the above view taken by us, the prayer made in these writ petitions for quashing these orders has to be rejected. For the same reason, its corollary that the same amount of pension be paid to all pre 1.4.1979 retirees of Armed Forces as to post- 1.4.1979 retirees must also be rejected.

Consequently, these writ petitions fail and are dismissed. No costs R.N.J. Petitions dismissed