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

DR.HIRA LAL VS. STATE OF BIHAR AND ORS. CIVIL APPEAL NO.1677-1678 OF 2020 (ARISING OUT OF SLP (C)NOS.4722-4723/2020 @ D.NO.37355/2017) – February 18, 2020

CORAM: The bench comprised of Justice Uday Umesh Lalit and Justice Indu Malhotra.

The Appellant was appointed to the post of Touring Veterinary Officer (TVO) by the Respondent Bihar State. While in service, the appellant was in active service, he was made an accused in the Fodder Scam lodged by the CBI in RC Case No.48A/1996 wherein a Charge-Sheet was filed against him in 2003. Consequently Appellant was placed under suspension under Rule 49(a) of the Civil Services (Classification, Control & Appeal) Rules, 1930, which were in force prior to the enforcement of the Bihar Government Servant (Classification, Control & Appeal) Rules, 2005. Appellant was under suspension till he attained the age of superannuation in 2008. The State Government order in 2008 sanctioned payment of 90% of the provisional pension of the Appellant, and withheld 10% of the pension, entire gratuity, leave encashment and GPF on account of pending criminal proceedings. The Appellant was aggrieved by the action of withholding 10% on pension and other retiral benefits, filed a Writ Petition before The Patna HC praying for a writ of mandamus directing the Respondent State to pay full pension, Gratuity, Leave encashment and General provident Fund along with interest.

Whether the State of Bihar was justified in withholding 10% pension and full gratuity of the Appellant under Circulars dated 22.08.1974 and 31.10.194, and Government Resolution dated 31.07.1980, on the ground of pending criminal proceedings was the pertinent issue for consideration.

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, as held in State of West Bengal v. Haresh C. Banerjee and Ors.

The Court noted that reading of Rule 43(b) would indicate that the State Government was empowered 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.

In the case of Jharkhand and Ors. vs. Jitendra Kumar Srivastava, The court held that State had no authority or power to withhold the full amount of pension or gratuity of a Government servant during the pendency of judicial or departmental proceeding. Pension is ‘property’ within the meaning of Article 300A of the Constitution, and executive instructions which do not have any statutory sanction cannot be termed as “law” within the meaning of Article 300A. It was further held that in the absence of statutory rules permitting withholding of pension or gratuity, the State could not do so by way of executive instructions. It is well settled that the right to pension cannot be taken away by a mere executive fiat or administrative instruction. 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 un-blemished service.4 The right to receive pension of a public servant has been held to be covered under the “right to property” under Article 31(1) of the Constitution by a Constitution bench of this Court in Deokinandan Prasad v. State of Bihar.

Therefore it was held that the Respondent-State was unjustified in withholding 10% pension of the Appellant under administrative Circulars dated 22.08.1974 and 31.10.1974, and Government Resolution No. 3104 dated 31.07.1980 after the Appellant had superannuated on 31.03.2008. It was directed that 10% of the pension amount which had been withheld after superannuation on 31.03.2008 till 19.07.2012 is liable to be paid to the Appellant within a period of 12 weeks from the date of this Judgment.

The State is directed to release 90% of the gratuity payable to the Appellant within a period of 12 weeks from the date of this judgment. The balance 10% will be released subject to the outcome of the criminal proceedings pending against him in R.C. Case No. 48A/1996. Thus, the Appeals were allowed.

View/Download the Judgment: DR.HIRA LAL VS. STATE OF BIHAR AND ORS.

– Saral M

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