Chairman, Punjab National Bank & others vs Shiv Shanker Awasthi

H.L. Gokhale, CJ

Heard Mr. Tarun Verma, counsel for the appellants in support of this appeal and Mr. K.C. Shukla for the respondent.

This appeal seeks to challenge the judgment and order dated 4th January, 2007 passed by learned Single Judge whereby the learned Single Judge allowed the petition filed by the respondent.

The short facts raised in the petition are that the respondent was appointed in the Punjab National Bank on 8th August, 1986 on the post of ClerkcumCashier. The date of birth of the respondent is 5th October, 1943. At the time when he joined the service and subsequently at all material times, the pensionary benefit of the respondent was governed by the Punjab National Bank (Employees'') Pension Regulations, 1995 (hereinafter referred to as the Regulations). Regulation 14 deals with qualifying service to become eligible to receive the pension and it reads as follows:

"14. Qualifying Service

Subject to the other conditions contained in these regulations, an employee who has rendered a minimum or ten years of service in the bank on the date of his retirement or the date on which he is deemed to have retired shall qualify for pension."

In these Regulations there are different classes of pension provided under Chapter V. Regulations 28 and 29 are relevant for our purpose. Regulation 28 provides for ''''Superannuation Pension'' and Regulation 29 provides for ''''Pension on Voluntary Retirement''. Regulation 28 and Regulation 29 (1) read as follow:

"28 Superannuation Pension

Superannuation pension shall be granted to an employee who has retired on his attaining the age of superannuation specified in the Service Regulations or Settlements.

Pension on Voluntary Retirement

(1) On or after the Ist day of Novermber, 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 appointing authority retire from service.

Provided that...........

Provided that ..........

Provided that.........."

Thus as per the Regulations, as it stood at the relevant time, voluntary retirement was available only after completing 20 years of service.

Sometimes in the year 2000 and to be precise, by the Circular dated 29th September, 2000, the Bank promulgated the ''''PNB Employees Voluntary Retirement Scheme 2000'' (hereinafter referred to as the Scheme). Under Clause 4 of the Scheme it was to remain in operation from 1st November, 2000 to 30th November, 2000. Clause 5 of the Scheme deals with eligibility. Clause 5.1 provides as follows:

"5.1 All permanent full time employees of the bank will be eligible to seek voluntary retirement under the scheme provided they meet the following eligibility criteria on the date of application:

a)they have completed 15 years of service

OR

b) 40 years of age."

Clause 5.2 of the Scheme gives the categories of employees not eligible to seek voluntary retirement.

Thus, as can be seen from this Clause 5 of the Scheme, except the employees mentioned in categories (a) to (f) of Clause 5.2 who have been excluded, all permanent employees would be eligible to seek voluntary retirement after completing 15 years of service or 40 years of age. As far as the respondent is concerned, he was more than 40 years of age when the Scheme came into operation, though he had not completed 15 years of service. Inasmuch as he was eligible on the ground that he had completed 40 years of age, the respondent applied for voluntary retirement under this Scheme on 9th November, 2000 and that application came to be accepted by the Bank on 16th December, 2000. Now so far as the benefits under the Scheme are concerned, they have been laid down in Clause 6 and Clause 7 of the Scheme. Clause 6 provides for exgratia amount and Clause 7 provides for other benefits and these Clauses are as follows:

"6. Amount of Exgratia

An employee seeking voluntary retirement under the scheme will be entitled to the exgratia amount mentioned below in para (a) or (b), whichever is less:

(a)60 days salary (pay stagnation increments plus special pay plus dearness relief) for each completed year of service.

OR

(b)Salary for the number of months service left.

Other benefits

An employee seeking voluntary retirement under the scheme will be eligible for the following benefits in addition to the exgratia amount mentioned in para 6 above of this scheme:

i)Gratuity as per Payment of Gratuity Act 1972 or Gratuity payable under the Service Rules, as the case may be, as per existing Rules.

ii)a) Pension (including commuted value of pension) as per PNB (Employees'') Pension Regulations 1995.

b) Bank''s contribution towards PF as per existing rules.

iii)Leave encashment as per existing rules.

The respondent had opted for pension and, therefore, he was entitled for the pension on superannuation as provided for under the Regulations. He was, however, not entitled for voluntary retirement under Regulation 29 as he had not completed 20 years of service and accordingly he was not entitled for voluntary retirement pension.

It so transpires that later on the Bank amended Regulation 28 of the Regulations and a proviso was inserted in that Regulation with a view to grant more benefits to the employees. The said amendment was notified in the Gazette of India (Extraordinary), PartIII on 8th April, 2002 and was circulated by the Bank by the Circular dated 14th May, 2002. The amended provisions of Regulation 28 now read as follows:

"28. Superannuation Pension

Superannuation pension shall be granted to an employee who has retired on his attaining the age of superannuation specified in the Service Regulation or Settlements.

Provided that, with effect from Ist September, 2000 pension shall be granted to an employee who opts to retire before attaining the age of superannuation, but after rendering service for a minimum period of 15 years in terms of any Scheme that may be framed for such purpose by the Board with the approval of the Government."

Thus, under the amended Regulation 28, employees who opted to retire before attaining the age of superannuation in terms of any Scheme became entitled to pension with effect from 1st September, 2000 provided they had put in 15 years of service.

The respondent filed a petition with a prayer that he was entitled to pension from the date when he was granted voluntary retirement under the Scheme. It was submitted on his behalf, amongst others, that under Regulation 14 of the Regulations, the qualifying service was 10 years and since he had put in more than 10 years of service he was entitled to receive pension. This was a specific ground (J) taken by him in his writ petition. The matter was heard by the learned Single Judge who accepted this contention and, therefore, allowed the writ petition and a direction was given to the appellant Bank to pay pension.

Being aggrieved by that judgment and order dated 4th January, 2007, this appeal has been filed. When the appeal came for admission, a Division Bench admitted the appeal but did not grant any stay on payment of pension in view of the statement made by the counsel for the respondent that in the event the appeal was allowed, the respondent would refund the amount of pension received by him. Feeling aggrieved by that order, the appellantBank filed Special Leave Petition before the Supreme Court. The Supreme Court observed that the interim order virtually amounted to final order which ought not to have been passed. Civil Appeal No.87 of 2008, was accordingly allowed by the judgment and order dated 7th January, 2008 and the matter was remanded to this Court to hear and decide the Appeal within 3 months.

Mr. Verma, learned counsel for the appellant submitted that the learned Single Judge has committed an error in applying Regulation 14 dealing with qualifying service to hold that the respondent was eligible to receive the pension. He pointed out that under Regulation 29, voluntary retirement was available only after completing 20 years of service. On the introduction of the Scheme in the year 2000, voluntary retirement became available to those employees who had completed 15 years of service or 40 years of age. Since the respondent was more than 40 years of age he had opted for voluntary retirement under the Scheme. Under Clause 7 it was clearly provided that pension would be available as per the Regulations. Mr. Verma, therefore, submitted that under Regulation 29 pension could be paid on voluntary retirement only if the employee had completed 20 years of service and since the respondent had not completed 20 years of service it could not be paid to him under the Regulations. He further submitted that even under the amended Regulation 28 which came into effect from 1st September, 2000, the respondent was not entitled to pension as he had not put in 15 years of service.

Mr. Shukla, learned counsel for the respondent, on the other hand, submitted that the Regulation 14 dealing with qualifying service provides that an employee who had rendered a minimum of 10 years of service on the date of his retirement or on the date on which he is deemed to have retired shall qualify for pension. In the instant case, the respondent should be deemed to have retired and, therefore, in his submission he was entitled to pension as he had completed 10 years of service.

We have considered the submissions of both the learned counsel. The submission of the learned counsel for the respondent does initially appear to be attractive but on a close scrutiny of the Regulation, we are unable to accept it. In our opinion the entire Regulations will have to be read together. Regulation 29 specifically provides for voluntary retirement which is available after completing 20 years of service and in that case the pension would be available. The concept of qualifying service is for pensions of all types and there are different classes of pension which are mentioned in the Regulations. When there is a specific provision for payment of pension on voluntary retirement requiring 20 years of service the same would be applicable in the present case and not Regulation 14. Thus, though the respondent had not applied for voluntary retirement under Regulation 29, but even if he had applied for voluntary retirement under this Regulation he could be granted voluntary retirement only if he had put in twenty years of service but the respondent had not put in 20 years of service when he had submitted the application or when the application was accepted. It is only later on that the requirement of the 20 years of service was reduced to 15 years when Regulation 28 was amended. The respondent unfortunately did not fulfill that requirement also as he had not put in 15 years of service. Obviously he could not be granted the voluntary retirement pension under this provision. We can only say that it is a hard case, but pension can be paid only in accordance with the Regulations and the Scheme.

In these circumstances, in our view, the learned Judge has erred in coming to the conclusion which he arrived at on the basis of Regulation 14. We, therefore, allow this appeal and set aside the judgment and order of the learned Single Judge and dismiss the writ petition.

Although the respondent had succeeded before the learned Single Judge who gave his judgment on 4th January, 2007, the order dated 14th February, 2007 passed in this Appeal was stayed by the Supreme Court on 16th April, 2007 and the appeal was subsequently allowed. Counsel for the parties state that the respondent, in such circumstances, had not received any amount of pension under the impugned judgment and order. Therefore, no further orders are required to be passed.