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2011 DIGILAW 1114 (KER)

Kerala State Electricity Board v. Raghunathan

2011-11-11

C.N.RAMACHANDRAN NAIR, P.S.GOPINATHAN

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JUDGMENT : 1. The Judgment of the Court was delivered by P. S. Gopinathan, J.--Since the issue involved in these connected Writ Appeals is one and the same, these appeals are disposed of by this common Judgment. The appellants are common in all the appeals. The respondents were employees of the Kerala State Electricity Board. The appellants represent the Board. The respondents retired from the service of the Board on various dates subsequent to 1-7-2003. After their retirement, pay revision was implemented. Consequent to the pay revision, orders were issued revising pension and other related benefits. Ext.P-1 produced in W.P.(C) No.37707/2009, against the Judgment of which W.A.No. 1702/2010 is filed, is the Pay Revision Order dated 11-11-2008. As per Clause 6.1 of Ext.P-1, the maximum amount of DCRG was raised from Rs. 2,80,000/- to Rs. 3,30,000/- to those who retired on or after 1-8-2006. For those who retired before 1-8-2006 the limit of DCRG was retained at Rs. 2,80,000/-. As per Clause 7.1 the existing rate of 1/3rd of the basic pension for commutation was enhanced to 40% based on the revised pay in the case of those who retired on or after 1-9-2007. For those who retired from 1-7-2003 to 31-8-2007, only 1/3rd of the pension admissible on the pre-revised pay was allowed to be commuted. In other way, the respondents were declared not entitled to commute the pension admissible on the revised pay. Aggrieved by Ext.P-1, the respondents moved the Writ Petitions. They would allege that the cut-off date mentioned earlier is arbitrary, discriminatory and illegal and sought for quashing the same. They further sought for a writ of mandamus commanding the appellants to revise the commuted value of pension and to grant DCRG in par with those who retired subsequent to the dates mentioned earlier. 2. The learned Single Judge, though found that it may be possible for the Board to justify a cut-off date and denial of revised benefits to those who retired subsequent to the cut-off dates, in the light of the decision in D.S. Nakara and Others Vs. Union of India (UOI), found that the cut-off dates mentioned earlier are unsustainable. 2. The learned Single Judge, though found that it may be possible for the Board to justify a cut-off date and denial of revised benefits to those who retired subsequent to the cut-off dates, in the light of the decision in D.S. Nakara and Others Vs. Union of India (UOI), found that the cut-off dates mentioned earlier are unsustainable. Consequently, Clauses 6.1, 7.1 and 7.2 in Ext.P-1 were quashed to the extent it discriminated the employees on the basis of their dates of retirement and directed the appellants to extend the benefit of revised DCRG and commutation of pension uniformly to the respondents without discrimination on the basis of their date of retirement. Assailing the above judgment, these Writ Appeals were filed. 3. We have heard senior Advocate N.N. Sugunapalan, the standing counsel appearing for the appellants in six appeals as well as Sri Pulikool Abubacker, Senior Standing Counsel appearing in W.A.No. 1052/2011 and Advocate Sri P. M. Pareeth appearing for the respondents. We had also perused the argument notes submitted by Adv. Sri P. M. Pareeth. 4. The learned counsel appearing for the appellant, as against Nakara's case (supra) canvassed our attention to the decisions reported in, Union of India Vs. P.N. Menon and others, Tamil Nadu Electricity Board Vs. R. Veeraswamy and Ors, State of Punjab and Others Vs. Amar Nath Goyal and Others, Union of India (UOI) Vs. S.R. Dhingra and Others, and Government of Andhra Pradesh and others v. N. Subbarayudu and others (2008) 14 S.C.C. 702 . In P. N. Menon's case (supra), at para 8 it is held as follows: As such any revised scheme in respect of post-retirement benefits, if implemented with a cut-off date, which can be held to be reasonable and rational in the light of Article 14 of the Constitution, need not be held to be invalid. It shall not amount to 'picking out a date from the hat', as was said by this Court in the case of D. R. Nim v. Union of India in connection with fixation of seniority. Whenever a revision takes place, a cut-off date becomes imperative because the benefit has to be allowed within the financial resources available with the Government. In T. N. Electricity Board's case (supra), at para 16 it is held as follows: 16. Whenever a revision takes place, a cut-off date becomes imperative because the benefit has to be allowed within the financial resources available with the Government. In T. N. Electricity Board's case (supra), at para 16 it is held as follows: 16. In the light of the foregoing discussion and applying the rulings of this Court above noted, we answer the issue set out at the outset by holding that the appellant--Board has not acted illegally or contrary to law in introducing the pension scheme prospectively from 1-7-1986 and that the employees (respondents) retired before 1-7-1986 cannot compel the appellant--Board to extend the benefit of the newly-introduced pension scheme with retrospective effect. In the case of State of Punjab (supra), at para 28 it is held as follows: It is trite that, the final recommendations of the Pay Commission were not ipso facto binding on the Government, as the Government had to accept and implement the recommendations of the Pay Commission consistent with its financial position. This is precisely what the Government did. Such an action on the part of the Government can neither be characterised as irrational, nor as arbitrary so as to infringe Article 14 of the Constitution. In S. R. Dhingra's case (supra), at para 25 it is held as follows: 25. It is well-settled that when two sets of employees of the same rank retire at different points of time, one set cannot claim the benefit extended to the other set on the ground that they are similarly situated. Though they retired with the same rank, they are not of the same class or homogeneous group. Hence Article 14 has no application. The employer can validly fix a cut-off date for introducing any new pension/retirement scheme or for discontinuance of any existing scheme. What is discriminatory is introduction of a benefit retrospectively (or prospectively) fixing a cut-off date arbitrarily thereby dividing a single homogeneous class of pensioners into two groups and subjecting them to different treatment. In the case of Government of Andhra Pradesh and others (supra), at paragraphs 5 and 6 it is held as follows: 5. In a catena of decisions of this Court it has been held that the cut-off date is fixed by the executive authority keeping in view the economic conditions, financial constraints and many other administrative and other attending circumstances. In the case of Government of Andhra Pradesh and others (supra), at paragraphs 5 and 6 it is held as follows: 5. In a catena of decisions of this Court it has been held that the cut-off date is fixed by the executive authority keeping in view the economic conditions, financial constraints and many other administrative and other attending circumstances. This Court is also of the view that fixing cut-off dates is within the domain of the executive authority and the court should not normally interfere with the fixation of cut-off date by the executive authority unless such order appears to be on the face of it blatantly discriminatory and arbitrary. 6. No doubt in D. S. Nakara v. Union of India this Court had struck down the cut-off date in connection with the demand of pension. However, in subsequent decisions this Court has considerably watered down the rigid view taken in Nakara's case as observed in para 29 of the decision of this Court in State of Punjab v. Amar Nath Goyal. 5. In the light of the above rulings of the Apex Court, we find that the Apex Court had watered down the rigid view taken in Nakara's case and Nakara's case is no more a good law. In the light of the above rulings, we find that the cut-off date fixed by the appellants in Ext. P-1 keeping in view of the economic conditions, financial constraints and other administrative and attending circumstances is neither arbitrary nor discriminatory nor illegal. The appellants are justified in fixing a cut-off date to limit the benefit of revision and the learned Single Judge went wrong in interfering with the order impugned. The learned counsel for the respondents submitted that in this case the appellants had not shown any good reasons, namely, the financial conditions and financial constraints for fixing a cut-off date. It is true that before us there is no material produced. But, we find that it is not at all necessary for the appellants to produce such materials to come to a conclusion that there are financial restraints or that the economical conditions is not satisfactory to extend the benefit to all, irrespective of the date of retirement, especially, when the respondents had not brought forward any material to show that such cut-off dates were determined with any mala fides. In the above circumstance, we find no merit in the contention advanced by the respondents. The judgment impugned is not sustainable and liable to be interfered. 6. At the time of argument, the learned counsel for the respondents produced an order BO(FB) No. 1313/11 (PSI/Gratuity/TVPM/2006) dated 24-5-2011 whereby the appellants had sanctioned the enhanced limit of DCRG to all the pensioners, irrespective of the date of retirement. The submission is recorded. The learned counsel for the respondents also submitted that they are not challenging the percentage of commutation but are confining the challenge to the commutation benefit limiting to the pre-revised pay with an argument that as per the existing executive orders on pension, the respondents are automatically entitled to further commutation on revised pension. In the light of our conclusion in the pre-paragraph, we find that it is needless to go deep into that aspect. Subsequent executive orders would prevail over earlier orders. Ext. P-1 order requires no interference. In the result, all the Writ Appeals are allowed. While setting aside the judgments impugned, all the Writ Petitions would stand dismissed. No order as to costs.