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2012 DIGILAW 265 (HP)

Himachal Pradesh Agro Industries Corporation Limited v. R. K. Sharma

2012-05-08

DHARAM CHAND CHAUDHARY, KURIAN JOSEPH

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JUDGMENT : Kurian Joseph, J. Whether an employee opting for Voluntary Retirement Scheme would be entitled to pension under an independent Pension Scheme, is the question arising for consideration in this case ? 2. The appellant is the respondent public sector undertaking. In terms of the Voluntary Retirement Scheme introduced by the public sector undertakings in the year 2001, the writ petitioner sought voluntary retirement. The scheme introduced, is the same as of the Government of India, notified as per office memorandum dated 5th October, 1988, Annexure P-7. Clause-I of the scheme provides for the benefits available to the employees opting for this scheme. In terms of the Government clarification, the stand taken by the appellant is that apart from the benefits under the voluntary retirement scheme, an employee will not be entitled to the benefits of the Corporate Pension Scheme. The learned Single Judge, though for different reasons held in favour of the writ petitioner, holding that the voluntary retirement under the scheme is not resignation and hence the writ petitioner would be entitled to the benefits of the pension scheme. Thus, aggrieved, the appeal. 3. It is not in dispute that at the time of retirement of the petitioner, there was also a corporate pension scheme operating under the appellant and other public sector undertakings known as Himachal Pradesh Corporate Sector Employees (Pension, Family Pension, Commutation of Pension and Gratuity) Scheme, 1999. It was a contributory scheme. According to the writ petitioner, being covered under the pension scheme, to which both employer and the employee being the contributories and the benefits of pension having not been excluded in the voluntary retirement scheme, the pension under the scheme cannot be denied. On the other hand, learned counsel for the appellant placing reliance on the clarification from the Government dated 19th June, 2000, submits that the employee having opted for voluntary retirement under the scheme will not be entitled to pension. We may extract the clarification of the Government : "This department has received several proposals from various pubic sector undertakings regarding entitlement of pension along with voluntary retirement scheme. In this context, I am directed to inform you that the pension would not be available to the employees seeking retirement under voluntary retirement scheme. We may extract the clarification of the Government : "This department has received several proposals from various pubic sector undertakings regarding entitlement of pension along with voluntary retirement scheme. In this context, I am directed to inform you that the pension would not be available to the employees seeking retirement under voluntary retirement scheme. It is also further clarified that the benefit of 5 years service under Himachal Pradesh Civil Services (Premature Retirement) Rules, 1976 would not be admissible to employees seeking retirement under voluntary retirement scheme." 4. It appears that the Government had in its mind the premature retirement available under the Pension Rules, which provides for an additional benefit of five years of service. As a matter of fact, what was required to be clarified was whether an employee who has opted for voluntary retirement under the scheme, would be entitled to the benefits of the Corporate Pension Scheme. There cannot be even a remote doubt that pension Rules and VRS operate in different fields. The benefit of five years is only under the Pension Rules. 5. As already noted above, it is not in dispute that in terms of Annexure P-2, pension scheme, the petitioner also had been contributing and that scheme was in force at the time of retirement of the petitioner in April, 2001, though it was implemented only subsequent to the judgment of this Court in R.K. Soni v. State of Himachal Pradesh, rendered in the year, 2009. Be that as it may, admittedly, during the period from 1999 to 2004, the pension scheme was in operation. 6. It is the contention of the learned counsel for the appellant appearing for the employer that having received ex-gratia in terms of the voluntary retirement scheme, an employee cannot claim pension as well. In this context, the facts may be of some relevance and we may refer to the same as well. At the time of retirement of the petitioner, he had completed 29 years of service and he had only around two years left to retire from service. As per the voluntary retirement scheme, he was entitled to have an ex-gratia payment of future salary calculated at the rate of last drawn salary; the same being less than 1 months emoluments for each completed year of service. As per the voluntary retirement scheme, he was entitled to have an ex-gratia payment of future salary calculated at the rate of last drawn salary; the same being less than 1 months emoluments for each completed year of service. However, it is seen from Annexure P-1, that in the case of the writ petitioner, there is a wrong calculation of pension under the voluntary retirement scheme. The entitlement is for whichever is less and hence the excess payment made to the petitioner has to be refunded/recovered/adjusted. 7. Ex-gratia payment is defined in the Blacks Law Dictionary, 6th Edition, as follows : Ex gratia payment. Payment made by one who recognises no legal obligation to pay but who makes payment to avoid greater expense as in the case of a settlement by an insurance company to avoid costs of suit. A payment without legal consideration. 8. The Oxford Dictionary defines ex-gratia as follows: ex gratia: (especially with reference to the paying of money) done from a sense of moral obligation rather than because of any legal requirement. 9. The ex gratia payment under the voluntary retirement scheme offered is a payment, in view of the forfeiture of the future service of the employee. It is not in lieu of or in substitution of any other benefits by way of pension otherwise available to an employee under the scheme, particularly since in the VRS, it is not notified that other than the benefits available under the scheme, the pension available to an employee in another scheme will not be available. As we have already noticed above, the corporate sector pension in the State of Himachal Pradesh is contributory in nature, both the employer and the employee have to contribute and from that fund the only the pension is paid. It is difficult to digest that an employee having only around two years service left to retire from service would forfeit the life time pension, for only the lump-sum salary for the future service. 10. On facts, it is seen that the petitioner had received the contribution at the time of retirement in the year 2004, after three years of retirement, apparently, since the entitlement of pension was not scrutinised at the relevant time. Pursuant only to judgment in R.K. Sonis case (supra) rendered in the year 2009, the scheme was implemented in the State of Himachal Pradesh. Pursuant only to judgment in R.K. Sonis case (supra) rendered in the year 2009, the scheme was implemented in the State of Himachal Pradesh. It was at that juncture, the writ petitioner offered to pay back the share and avail the pension. 11. Thus, it is fairly clear that the voluntary retirement scheme has not excluded the valuable right of pension available to the employee under the Himachal Pradesh Corporate Sector Employees (Pension, Family Pension, Commutation of Pension and Gratuity) Scheme, 1999. The benefits flowing out of the scheme in terms of the contribution made by the employee as well as the employer cannot be taken away. In other words, the pension under the pension scheme is in addition to ex-gratia payment offered under the voluntary retirement scheme. It is not a case of double benefits; it is a case of benefits under the voluntary retirement scheme as well as the pension scheme. As we have noted above also on the facts, we do not find that there is any unjust enrichment for the employee having opted the voluntary retirement scheme, since what is paid by way of ex-gratia is only the future pay in lump-sum for the future service left at the rate of last pay drawn. In other words, had the petitioner continued in service, he would have been entitled to his increments, he would have continued to draw the monthly salary with increments and any other subsequent revision and his gratuity calculations would have been on the basis of last pay drawn at the time of superannuation. In the above circumstances, though for different reasons, the appeal is only to be dismissed, but with the certain modifications regarding the calculations in order to avoid any confusion. The excess payment given to the petitioner while calculating the ex-gratia at the rate of 1 months salary for the services already rendered, has to be adjusted. His entitlement would only be for the salary for the future service left calculated at the last pay drawn in service. The writ petitioner shall refund the share, he has received from the appellant under the Himachal Pradesh Corporate Sector Employees (Pension, Family Pension, Commutation of Pension and Gratuity) Scheme, 1999. Needless to say, both these can be appropriately adjusted. His entitlement would only be for the salary for the future service left calculated at the last pay drawn in service. The writ petitioner shall refund the share, he has received from the appellant under the Himachal Pradesh Corporate Sector Employees (Pension, Family Pension, Commutation of Pension and Gratuity) Scheme, 1999. Needless to say, both these can be appropriately adjusted. The pension under the scheme shall be worked out and paid to the petitioner, after all the adjustments as above, within a period of four months from the date of production of a copy of this judgment. 12. The appeal stands disposed of accordingly, so also, the pending application(s), if any.