C.P.Krishnaswamy v. Union of India & Ors.

option of the appellant and grant the pension under the abovereferred to regulations. The appellant made a representation on20.04.1998. There was a reply by the bank on 28.04.1998. Theappellant once again sent a detailed representation on 16.12.1998.By its reply dated 26.04.1999, the respondent bank by referring toregulation 33(1) of the Pension Regulations rejected the claim of theappellant for pension. 6. Challenging the same, the appellant preferred the presentwrit petition in W.P.No.9572 of 1999. The learned single Judge havingdismissed the writ petition on 14.05.2002, the appellant has comeforward with this appeal.7. Mr.N.G.R.Prasad, learned counsel appearing for the appellant,contended that when the appellant exercised his option on 08.07.1994,for grant of pension, the same was also recommended by the Manager ofthe Chennai office of the Bank on 02.03.1996 and that the appellantwas also ready and willing to pay back the bank's share of P.F.contribution, that going by the provisions contained in theregulations, under clause 2(y), 3(1)(a), 29, 32 and 33, the appellantwas entitled for the grant of pension and therefore the rejection ofthe same by the impugned letter of the respondent bank dated26.04.1999, was not justified. The learned counsel contended thatthe cut-off date of 01.11.1993, stipulated under regulation 33(1) ofthe regulations cannot deprive the appellant of the payment ofpension. The learned counsel by relying upon the Division Benchjudgment of this Court dated 31.08.2006, passed in W.A.No.1076 of2006, which related to a case of voluntary retirement which isgoverned by regulation 29 of the regulations, contended that whateverstated with reference to a case of voluntary retirement will equallyapply to the case of compulsory retirement and therefore applying theratio of the said Division Bench judgment, the appellant should begranted pension by setting aside the impugned order of the respondentbank. 8. The learned counsel placed before this Court the judgmentdated 31.08.2006, of the Division Bench passed in W.A.No.1076 of2006, the decision reported in 2000 (1) LLJ 1617 (Bank of India Vs.Indu Rajagopalan), (1981) 4 SCC 335 (Air India Vs. Nergesh Meerza),2007 (2) LLN 169 (C.Damodarasamy Vs. Government of India) in supportof his submissions.9. As against the above submissions Mr.S.Jayaraman, learnedcounsel for the respondent bank by taking us through the variousprovisions viz., 2(r), 2(y), 29, 32 and 33 of the regulationscontended that the cut-off date viz., 01.11.1993, fixed in regulation33(1) has got a definite purpose and intent and which date was fixedbased on the settlement reached with the employees union of therespondent bank and therefore the said cut-off date cannot bealtered. https://hcservices.ecourts.gov.in/hcservices/

10. According to the learned counsel, the employees who werecompulsorily retired on and after 01.11.1993, alone were entitled forpension under the regulations and that the learned Judge wastherefore justified in declining to interfere with the order of thebank dated 26.04.1999. According to the learned counsel the fixingof the cut-off date did not make any artificial discrimination; thatsince the payment of pension came to be introduced in banking servicefor the first time under the above regulations and the same being anew scheme providing for pension, the prescription of a cut-off datecannot be found fault with. The learned counsel relied upon thedecisions reported in 2005 AIR SCW 5664 (State of Punjab Vs. AmarNath Goyal), 2007 (3) SLR 697 (Bank of India Retired OfficersAssociation Vs. Bank of India), (1997) 2 SCC 342 (State of RajasthanVs. Amrit Lal Gandhi), AIR 1986 SC 1907 (State GovernmentPensioners' Association Vs. State of Andhra Pradesh), an unreporteddecision of a learned Single Judge of the Delhi High Court dated30.08.1999, passed in C.W.No.3830 of 1998 and 2009 IV LLJ 57 (SC)(Manjula Bhashini Vs. Managing Director, A.P.Women's Co-operativeFinance Corporation Ltd.).11. Having heard the learned counsel for the appellant and therespondents and after perusal of the various provisions contained inthe 1995 regulations, we find that the crucial question to be decidedin this appeal is as to whether the cut-off date fixed in regulation33(1) viz., 01.11.1993, for an employee who was compulsorily retiredprior to the said date, though he was in service after 01.01.1986, bedisentailed for grant of pension can be approved ?12. To answer the said question, the various other provisionscontained in the regulations viz., regulations 2(k) definition of'date of retirement', 2(r) definition of 'notified date', 2(u)definition of 'pensioner', 2(y) definition of 'retirement' andregulation 3(1)(a) to (c), the relevant parts of regulation 29(1)with its 3rd proviso as well as regulations 32, 33(1) and 34 arerelevant and are extracted below:"2(k) "date of retirement" means the last dateof the month in which an employee attains the age ofsuperannuation or the date on which he is retired bythe Bank or the date on which the employeevoluntarily retires; or the date on which theofficer is deemed to have retired;2(r) "notified date" means the date on whichthese regulations are published in the officialGazette;2(u) "pensioner" means an employee eligible forpension under these regulations; https://hcservices.ecourts.gov.in/hcservices/ 2(y) "retirement" means cessation from Bank'sservice:-a) on attaining the age of superannuationspecified in Service Regulations or Settlements;b) on voluntary retirement in accordance withprovisions contained in regulation 29 of theseregulations;c) on premature retirement by the Bank beforeattaining the age of superannuation specified inService Regulations or Settlement;3. ApplicationThese regulations shall apply to employeeswho,-1) a) were in the service of the Bank on orafter the 1st day of January, 1986 but had retiredbefore the 1st day of November, 1993; andb) exercise an option in writing within onehundred and twenty days from the notified date tobecome member of the Fund; andc) refund within sixty days after the expiry ofthe said period of one hundred and twenty daysspecified in clause (b) the entire amount of theBank's contribution to the Provident Fund includinginterest accrued thereon together with a furthersimple interest at the rate of six per cent perannum on the said amount from the date of settlementof the Provident Fund account till the date ofrefund of the aforesaid amount to the Bank or tillthe 1st day of April, 1995 whichever is earlier. 29. Pension on voluntary Retirement:(1) On or after the 1st day of November, 1993,at any time after an employee has completed twentyyears of qualifying service he may, by giving noticeof not less than three months in writing to theappointing authority retire from service;Provided that this sub-regulation shall notapply to an employee who is on deputation or onstudy leave abroad unless after having been https://hcservices.ecourts.gov.in/hcservices/ transferred or having returned to India he hasresumed charge of the post in India and has servedfor a period of not less than one year;provided further that this sub-regulation shallnot apply to an employee who seeks retirement fromservice for being absorbed permanently in anautonomous body or a public sector undertaking orcompany or institution or body, whether incorporatedor not to which he is on deputation at the time ofseeking voluntary retirement;Provided that this sub-regulation shall notapply to an employee who is deemed to have retiredin accordance with clause (1) of regulation 2.32. Premature Retirement Pension:Premature Retirement Pension may be granted toan employee who,-(a) has rendered minimum ten years of service;and(b) retires from service on account of ordersof the Bank to retire prematurely in the Publicinterest or for any other reason specified inservice regulations or settlement, if otherwise hewas entitled to such pension on superannuation onthat date.33. Compulsory Retirement Pension:(1) An employee compulsorily retired fromservice as a penalty on or after 1st day ofNovember, 1993 in terms of Punjab National BankOfficer Employees' (Discipline and Appeal)Regulations, 1977 or awards/settlement may begranted by the authority higher than the authoritycompetent to impose such penalty, pension at a ratenot less than two-thirds and not more than fullpension admissible to him on the date of hiscompulsory retirement if otherwise he was entitledto such pension on superannuation on that date.34. Payment of pension or family pension inrespect of employees who, retired or died between1.1.1986 to 31.10.1993: https://hcservices.ecourts.gov.in/hcservices/ (1) Employees who have retired from the serviceof the Bank between the 1st day of January, 1986 andthe 31st day of October, 1993 shall be eligible forpension with effect from the 1st day of November,1993.(2) The family of a deceased employee governedby the provisions contained in sub-regulation (7)of regulation 3 shall be eligible for pension orfamily pension as the case may be, with effect fromthe 1st day of November, 1993."13. In the case of the appellant, we find that he was proceededagainst by way of disciplinary action for certain acts of misconduct.A perusal of the order of punishment dated 25.01.1990, discloses thatwhile he was working as Assistant Manager of Pombur branch, he wasalleged to have committed the following irregularities viz.,(i) he utilised the services of middlemen insanctioning and disbursing advances in contraventionof Head Office guidelines;(ii) he did not conduct pre-sanction ofappraisal in loan accounts;(iii) he failed to observe post-sanctionsafeguards which resulted in expiry of limitationand missing of securities in many loan accounts.According to the respondent bank, the said irregularities committedby the appellant jeopardised bank's interest to a great extent.While deciding the imposition of penalty of compulsory retirement, itwas observed that the appellant should have conducted regularinspection of securities and ensured obtaining of balanceconfirmation letters periodically and the appellant's plea that hewas not conversant with Bank's procedure relating to sticky accountswas not acceptable. The appellant was therefore compulsorily retiredwith immediate effect by an order dated 25.01.1990.14. After the passing of the said order, the appellant's PFaccount namely his contribution and other terminal benefits wassettled. In the normal course but for the order of punishment dated25.01.1990, the appellant would have retired on 28.02.1990. Sincethe bank's contribution was not paid, the appellant moved this Courtby filing W.P.No.9574 of 1991. Subsequent to the filing of the writpetition, the bank paid back its contribution of PF and the writpetition was stated to have been withdrawn by the appellant. https://hcservices.ecourts.gov.in/hcservices/

15. Subsequently after the pension regulations was brought intoeffect, the appellant applied for sanction of pension by exercisinghis option to refund the bank's contribution of PF with accruedinterest at the rate of 6% per annum from the date of receipt tillthe date of refund. The said application was submitted by him on08.07.1994, which was rejected by the respondent bank by its orderdated 26.04.1999, stating that in terms of clause 33(1) such of thoseemployees who were compulsorily retired from service as a penalty onor after 01.11.1993, alone can be granted pension and since theappellant was compulsorily retired prior to 01.11.1993, his requestcannot be acceded to.16. When we examine the definition “date of retirement” underregulation 2(k) we find that while stating that the said definitionwould mean the last day of the month in which the employee attainsthe age of superannuation, it is also stated that such date ofretirement would be the date on which the employee is retired by thebank. It also refers to the date on which the said employeevoluntarily retires or the date on which the officer is deemed tohave retired. Therefore amongst the retirees, there is one categorynamely an employee who is retired by the bank. When it comes to thequestion of application of the regulations, regulation 3(1)(a) makesit clear that the regulations would not apply to employees who werein the services of the bank on or after 01.01.1986, but who hadretired before the first date of November, 1993. Therefore readingregulations 2(k), 2(x), 2(y) and 3(1)(a) together, it can be safelyheld that all types of retirement namely retirement on reaching theage of superannuation, deemed retirement, voluntary retirement or anyother premature retirement would fall within the expressionretirement as well as the other provisions of applicability namelyregulation 3(1)(a). 17. A perusal of regulation 33(1) discloses that even anemployee who is compulsorily retired from service as a penalty underthe respondent's bank Discipline and Appeal Regulations orawards/settlement may be granted by an authority higher than theauthority competent to impose such penalty, pension at a rate notless than two-thirds and not more than full pension admissible to theemployee on the date of his compulsory retirement if he is otherwiseentitled to such pension on superannuation on that date. The cut-offdate prescribed under the said regulation 33(1) viz., 01.11.1993,only makes a distinction between the employee who was compulsorilyretired prior to 1.11.1993 and after 01.11.1993, in order to beeligible for invoking the said regulation.18. At this juncture, when we refer to the Division Benchdecision relied upon by the learned counsel for the appellant viz.,the one rendered in W.A.No.1076 of 2006, dated 31.08.2006, that was acase of an employee of Indian Overseas Bank, whose request forvoluntary retirement came to be accepted and who was allowed to https://hcservices.ecourts.gov.in/hcservices/ retire voluntarily. The Division Bench was concerned with aprovision contained in the very same regulations with which we arenow concerned and in particular regulation 29 which relates to grantof pension for employees gone on voluntary retirement as well asregulation 32 which deals with premature retirement pension. Sincein that case the voluntary retirement of the concerned employeeoccurred on 20.09.1988, i.e. before 01.11.1993, though after01.01.1986, the Bank management in the said case declined to paypension on the ground that regulation 29 does not provide for paymentof such pension to the employees who had gone on voluntary retirementbefore 01.11.1993. The Division Bench dealt with the said issue asunder in paragraphs 7 and 8 as well as followed a reported decisionof the Bombay High Court in 1997 (1) LLJ 1094 (Madhav K. KirthikarVs. Bank of India) in paragraph 10, the Division Bench has referredto the said decision which is also relevant which are as under:“7.There is no dispute that in the present case therespondent has been given premature retirement videletter dated 9.5.1989. The definition of'retirement' provided in clause 2(y) covers all theretirements and also the voluntary prematureretirement by the bank before superannuation. It isalso not disputed that the Indian Overseas Bank(Employees') Pension Regulations, 1995 areapplicable to all the employees who were in theservice of the bank on or after first January, 1986but had retired before the first day of November,1993. Regulation 32 states that the prematureretirement pension may be granted to an employee whohas rendered minimum 10 years of service, retiresfrom service on account of orders of the bank toretire prematurely in the public interest or for anyother reasons specified in the service regulationsor settlement, if otherwise, he was entitled to suchpension or superannuation on that date. A combinedreading of clause (c) of Regulation 2(y) withRegulation 32 and Regulation 34, clearly shows thatthe scheme is applicable in respect of employees whohad retired or died between 1.1.1986 and 31.10.1993.The appellant bank has however contended that therespondent by his own accord voluntarily retired onmedical grounds on 9.5.1989 as per non statutorycircular bearing permanent EST 104/86 of 27.8.1986which is based on Central Government's guidelinesdated 25.5.1982 permitting the public sector banksto modify their scheme or appointment oncompassionate grounds so as to extend the benefit tothe dependants of the employees who retired onmedical grounds. The submission is that therespondent retired on his own accord and therefore, https://hcservices.ecourts.gov.in/hcservices/ his case could not fall under clause (c) ofRegulation 2(y) of the Pension Regulations. We areunable to accept the argument of the bank. In thefirst place there is nothing in the Regulations toindicate that the Scheme does not cover the employeewho has prematurely retired as per the statutorycircular. On the other hand the definition of'retirement' in Regulation 2(y) is wide and coverall cases of premature retirement where the employeehas retired before attaining the age ofsuperannuation specified in Service Regulations orSettlement. Now the Bank has chosen to apply thescheme to the employees who have retired after1.1.1986. The benefit of the scheme, therefore,must be given to all the employees who have retiredafter 1.1.1986. It will be totally impermissible tomake artificially a further classification amongstthe employees retired after 1st January, 1986 as itwill be totally irrational, arbitrary and violativeof Article 14 of the Constitution. This is more sobecause under the scheme the employees who haveretired prematurely after 1st November, 1993 areexpressly covered by the scheme. 8. In A.P.Srivastava Vs. Union of India &Others, (1995) 6 SCC 227, the question before theSupreme Court was whether an employee who was atemporary Government servant loses his right toreceive pension when the employer exercises itsoption and retires the employee after he attains theage of 55 years in accordance with Rule 56(j)(ii) ofthe Fundamental Rules, even though the employeemight have completed more than 20 years service?The Supreme Court held that if a temporaryGovernment servant who has rendered 20 years ofservice, is entitled to pension there is nojustification for denying the right to him when heis required to retire by the employer in the publicinterest as an order of compulsory retirement is nota punishment and pension is a right of the employeefor service rendered. Therefore, a temporaryGovernment servant would be entitled to pensionafter he has completed more than 20 years of serviceeven if he is required to retire by the employer inexercise of power under Rule 56(j) of theFundamental Rules. https://hcservices.ecourts.gov.in/hcservices/

10. We may also refer to a reported judgment ofthe Bombay High Court in Madhav K. Kirtikar v. Bankof India, 1997 (I) L.L.J. 1094 to which one of us(A.P.Shah, CJ) was a party. In that case the writpetitioner was denied pension by his employer-bankfor the reason that he had sought and obtainedvoluntary retirement prior to November 1, 1993.Allowing the petition it was held as follows:"With the assistance of the learnedcounsel for the parties, I have carefullygone through the pension scheme of 1995. Ido not see any distinction in the schemeamongst retired employees. If a properconstruction is given to the regulations,in my view, the Bank cannot make adistinction among employees who retireunder the voluntary retirement scheme andemployees who retire otherwise because theterm "retirement" which occurs in theregulations enclose voluntary retirement.There is no reason to confine voluntaryretirement only to regulation 29 of theregulations. If such a construction isgiven to regulation 29 it clearly violatesArticle 14. In Shri Govindlalji v. Stateof Rajasthan, AIR 1963 SC 1638 it wasobserved that if the impugned provisions ofa statute are reasonably capable of aconstruction which does not involve theinfringement of any fundamental rights,that construction must be preferred thoughit may reasonably be possible to adoptanother construction which leads to theinfringement of the said fundamentalrights. This rule of interpretation wasreiterated by the Supreme Court inM.K.B.Menon v. A.C.Estate Duty, AIR 1971 SC2392. The Supreme Court held the Courtought not to interpret statutoryprovisions, unless compelled by theirlanguage, in such a manner as would involveits constitutionality because thelegislature is presumed to enact a lawwhich does not contravene or violate theconstitutional provisions. We have alreadynoted that by Rule 3(1)(a) the scheme ismade applicable to the employees retiredafter January 1, 1986. Rule 34 then https://hcservices.ecourts.gov.in/hcservices/ provides that employees who have retiredfrom service of the Bank between January 1,1986 and October 31, 1993 shall be eligiblefor pension with effect from November 1,1993. The combined reading of Rules 3 and34 shows that the petitioner is entitled toget pensionary benefits which are extendedby the Bank, even though it is for thefirst time. The regulations framed by theBank is for giving pensionary benefits toall the employees of the Bank eitherretired on attaining the age ofsuperannuation or retired under the schemeof voluntary retirement. It is thereforenot permissible for the bank to fixartificially a further cut-off date asNovember 1, 1993 to give benefit of thepension scheme to the employees who haveretired voluntarily only after November 1,1993. When the Bank decides to extend thebenefit of pension to its employees itcannot make any distinction between theemployees who have retired and employeeswho sought voluntary retirement andretired. I am also supported by anunreported judgment, single Judge of theKarnataka High Court dated September 30,1996 in Writ Petition Nos.3919 to 3994 of1996. The Karnataka High Court has heldthat the employees of the respondent Bankwho had voluntarily retired between January1, 1986 and October 31, 1993 are eligiblefor pension."" (Emphasis added)19. A comparative consideration of the above referred todecision to the facts of this case it emerges that in the case ofvoluntary retirement though the regulations specifically provided thecut-off date viz., 01.11.1993 and only such of those employees whovoluntarily retired after that date alone were eligible for pension,the Division Bench took the view that even such voluntary retirementis nothing but a premature retirement and therefore applying theprovisions contained under regulation 32 relating to prematureretirement pension, the employee who had gone on voluntary retirementbefore the cut-off date should also be held to be eligible forpayment of pension. The Division Bench went on to hold that thefixation of such cut-off date would amount to creating an artificialfurther classification amongst the employees who retired voluntarilyafter 01.01.1986 but before 01.11.1993, which was wholly irrational,irrelevant and violative of Article 14 of the Constitution. https://hcservices.ecourts.gov.in/hcservices/

20. A further reasoning which weighed with the Division Benchwas that when under the regulations the very same category ofemployees namely those who had gone on voluntary retirement schemeafter 01.11.1993, were made eligible, who were also in service after01.01.1986, a distinction cannot be made in respect of thoseemployees who had gone on voluntary retirement prior to 01.11.1993.The extracted portion of the Bombay High Court Decision goes one stepfurther and states that such position cannot change even if it isgranted for the first time.21. Keeping the above principles set out in the Division Benchdecision in mind, when we analyse the other provisions contained inthe regulations, we find that in regulation 2(k) it is specificallyprovided that the significance of date of retirement means the dateon which the employee was retired by the bank. When we examine thedefinition of retirement as defined under Section 2(y), we find thatretirement has been defined to mean cessation from bank serviceeither on attaining the age of superannuation or on voluntaryretirement in accordance with regulation 29 or premature retirementby the bank before attaining the age of superannuation specified inservice regulation or settlement.22. In the service regulations provision for superannuation isprovided under regulation 19(1) which states that the age ofretirement of an officer/employee shall be as determined by the Bankin accordance with the guidelines issued by the bank from time totime. The first proviso to the said regulation reads as under:“Provided that the bank may, at its discretion,on review by a special committee/special committeesas provided hereinafter in sub-regulation (2), if itis of the opinion that in public interest anofficer/employee on or at any time after thecompletion of 55 years of age or on or at any timeafter the completion of 30 years of total service asofficer/employee or otherwise which ever isearlier.”The second proviso only provides time of three months notice inwriting or three months salary/pay and allowance in lieu of suchnotice.23. Apart from such a provision in the service regulations whichhas been specifically mentioned in the definition of retirement inregulation 2(y), regulation 32 of the pension regulations also makes https://hcservices.ecourts.gov.in/hcservices/ a mention about premature retirement pension. However underregulation 32(b) while making a provision for grant of prematurepension, it is stated that the same may be granted in respect of anemployee who has either retired from service on account of orders ofthe bank to retire prematurely in the public interest or for anyother reason specified in service regulations/settlement if otherwisehe was entitled to such pension on superannuation on that date. Whilewe deal with regulation 32, it is relevant to note that underregulation 20 of the service regulations the provision fortermination of service is prescribed. Under regulation 20(1)(a) suchprovision has been made and under regulation 20(1)(f) it isstipulated that the officer/employee whose services are terminatedunder sub-regulation (a) should be paid gratuity, PF includingemployer's contribution and all other dues that may be admissible tohim as per rules notwithstanding the years of service rendered. Underregulation 20(1)(g) it is again stipulated that nothing contained inthe other sub-regulation of 20(1) would affect the bank’s right toretire an officer/employee under regulation 19(1). One otherprovision which is kept in mind is Regulation 4(h) of the PunjabNational Bank Officer Employees' (Discipline & Appeal) Regulations,1977. Regulation 4 prescribes the penalties which may be imposed onan officer/employee for acts of misconduct or for any other good andsufficient reason. Regulation 4(h) is one of the major penaltiesthat can be imposed by the bank management on an officer/employeewhich is compulsory retirement by way of punishment. Therefore, ifat all the respondent bank is empowered to compulsorily retire anofficer/employee it could be either under regulation 19(1) in publicinterest or by invoking regulation 20(1) of the service regulations1979 or Regulation 4(h) of Punjab National Bank Officer Employees'(Discipline & Appeal) Regulations 1977.24. When the above provisions confers the power on therespondent bank to compulsorily retire an officer/employee who was inservice as on 01.01.1986 and who came to be retired compulsorily byway of punishment or in public interest in our considered opinion,such cessation of employment namely by way of compulsory retirementby way of punishment would also fall well within the four corners ofpremature retirement.25. When we examine the dictionary meaning of the expression"premature", in P.Ramanatha Aiyar ‘Law Lexicon’ 2nd Edition, the word"premature" has been explained to mean “happening, or being performedbefore prior or usual or appointed time”. Even going by the abovecommon definition of the expression "premature" it is quiteconvincing that the said meaning when read along with the happeningof an event namely retirement, one can only conclude that it wouldtake within its fold in the absence of any other specificprescription the retirement of an employee prior to normal date on https://hcservices.ecourts.gov.in/hcservices/ which he would have otherwise retired on superannuation. It will haveto be borne in mind that either regulation 2(k) or 2(x) or 2(y) doesnot specifically exclude or make a distinction of compulsoryretirement by way of punishment as one not falling under prematureretirement.26. On the other hand, a reading of regulation 2(y)(c) of thepension regulations along with regulation 19(1) first proviso and 20(1) of the 1979 Service Regulations or Regulation 4(h) of PunjabNational Bank Officer Employees' (Discipline and Appeal) Regulations,1977 persuade us to hold that it would be in order to state thatcompulsory retirement even by way of punishment having regard to theconnotations applicable to it would only fall under the broadclassification of premature retirement. Apparently for these reasons,we are able to discern that under the pension regulations, regulation33 came to be incorporated providing for payment of pension subjecthowever to the grant of such pension by the authority higher than theauthority competent to impose such compulsory retirement as a penaltyand the rate at which it should be granted as provided therein.27. In our considered opinion any other view would run counterto the very object of the bank management in having come forward togrant pension to various categories of employees including those whowere retired prematurely in public interest which is otherwise knownas compulsory retirement in public interest and also an employeeretired compulsorily by way of punishment under regulations 32 and 33respectively.28. We are also convinced that regulation 32(b) havingspecifically provided for covering those employees who areprematurely retired in public interest namely those who would fall inthe category of compulsorily retired employees in public interest andalso employees who were retired for any other reason specified in theservice regulations or settlement which would cover other cases ofpremature retirement which would include compulsory retirement by wayof punishment and there could be no other category that would fallwithin the above said expression premature retirement and thoseretired by the bank within the expression “for any other reasonspecified in service regulations or settlement”.29. We therefore hold that an officer/employee who iscompulsorily retired by way of punishment would also fall within thecategory of premature retirement and consequently it cannot be saidthat he would fall outside the pension regulations in order toexclude him from being eligible to claim pension under the pensionregulations in particular regulation 33(1). https://hcservices.ecourts.gov.in/hcservices/

30. With the above conclusion of ours on the various provisionscontained in the regulations when we apply the decisions cited beforeus, in the first place, we are inclined to follow the ratio laid downin the unreported decision of the Division Bench dated 31.08.2006 inW.A.No.1076 of 2006. The said case though relates to a case ofvoluntary retirement, similarity in the said case as well as the caseon hand are that the officer/employee in that case as well as in thecase on hand were in service even after 01.01.1986 and in both thecases, the retirement occurred prior to 01.11.1993. In the case ofvoluntary retirement also under regulation 29, it is stipulated thatthe benefit of pension is payable only in respect of an employee whohad retired voluntarily on or after 01.11.1993, like the case of acompulsory retirement from service as a penalty, where also it isprovided that such compulsory retirement should have taken place onor after 01.11.1993. In the said decision, the Division Bench hasheld that such voluntary retirement is nothing but prematureretirement by interpreting regulation 2(y) as well as regulation 3(1)of the regulations. In that case also the specific contention wasthat the case of voluntary retirement cannot be brought under clause(c) of regulation 2(y) which contention was straightaway rejected bythe Division Bench by holding that there is nothing in theregulations to indicate that the scheme does not cover an employeewho is prematurely retired as per the statutory circular and while onthe other hand the definition of retirement in regulation 2(y) iswide and would cover all cases of premature retirement where anemployee is retired before attaining the age of superannuationspecified in the service regulations/settlements.31. The Division Bench went on to hold that it will be totallyimpermissible to make artificially a further classification amongstthe employees retired after 01.01.1986, as it would be totallyirrational, arbitrary and violative of Article 14 of theConstitution, more so, when the regulations provides for coverage ofsuch premature retirement after 01.11.1993. In fact the Bombay HighCourt decision which was followed by the Division Bench dealt with anidentical situation. We are in full agreement with the principles andratio set down in the above referred to decision and applying thesame also we hold that such principles mutatis mutandis apply to thecase of compulsory retirement by way of punishment subject however tothe prescription contained in regulation 33(1). 32. We are also fortified by the decision of the Hon’ble SupremeCourt reported in (1995) 6 SCC 227 (A.P.Srivastava Vs. Union ofIndia). The said decision related to a temporary Government servantwho had served for more than 20 years and who was retired after heattained the age of 55 years by invoking Rule 56(j)(ii) of theFundamental Rules. In other words, that was also a case of https://hcservices.ecourts.gov.in/hcservices/ compulsory retirement by way of punishment. The facts have been setout clearly by the Hon'ble Supreme Court in paragraph 3 which readsas under:"3. The appellant joined the service of theGovernment of India as temporary Lower DivisionClerk in the Central Tractor Organisation on06.10.1995. He was promoted to the post of UpperDivision Clerk on probation on 28.12.1962 and havingcontinued for 8 years, he was referred to the postof temporary Lower Division Clerk on 01.12.1970.Pending initiation of departmental proceeding he wassuspended on 01.12.1980. The departmentalproceeding was initiated on 10.04.1981. Thedisciplinary authority finally passed an order ofpunishment on 01.06.1985...........While theaforesaid proceeding was pending before theTribunal, the Under Secretary in the Ministry ofHome Affairs issued an order prematurely retiringthe appellant under Rule 56(j)(ii) of theFundamental Rules on 26.02.1988, making it effectivefrom 01.03.1988.........The Vice-Chairman gave hisopinion that the order of compulsory retirement of atemporary Government servant under Rule 56(j) of theFundamental Rules is not an order of punishment. Healso found that the employee will not be entitled toany pensionary benefit since neither he has retiredon reaching the age of superannuation nor he hasbeen declared permanently incapacitated for furthergovernment service nor he has sought voluntaryretirement after completion of 20 years of service."While answering the issue raised in the said decision, the Hon'bleSupreme Court has held as under in paragraph 5:"5......It has been held by this Court time andagain that the pension is not a charity or bountynor is it a conditional payment solely dependent onthe sweet will of the employer. It is earned forrendering a long service and is often described asdeferred portion of payment for past services. Itis in fact in the nature of social security planprovided for a superannuated governmentservant........"Again in paragraph 6 the Hon'ble Supreme Court held as under:"6. In view of the legal position that an order https://hcservices.ecourts.gov.in/hcservices/ of compulsory retirement is not a punishment andpension is a right of the employee for servicesrendered, we see no justification for denying suchright to a temporary government servant merely onthe ground that he was required to retire by theemployer in exercise of power under Rule 56(j) ofthe Fundamental Rules.........." (Emphasis added)33. From the above decision of the Hon'ble Supreme Court, theposition clearly emerges to the effect that a compulsory retirementis not a punishment but a premature retirement. Though that was thecase of compulsory retirement under FR 56(j)(ii) namely in publicinterest, the Hon'ble Supreme Court took note of the fact that therewas an earlier order of punishment dated 01.06.1985 and while certainproceedings initiated by the employer was pending before the CentralAdministrative Tribunal, the order of compulsory retirement came tobe effected on 26.02.1988. In that context, the Hon'ble SupremeCourt made it clear that pension is not a charity or bounty nor wasit dependent on any condition to be solely imposed by the employer.The Hon'ble Supreme Court also held that payment of pension is asocial security scheme for superannuated employees. The aboveprinciples laid down by the Hon'ble Supreme Court supports our viewthat amongst the employees who were compulsorily retired by way ofpenalty, there cannot be a further classification of those whoretired prior to 01.11.1993 and those who retired after 01.11.1993.The contention of the learned counsel for the respondent bank thatsuch a cut-off date is permissible whenever a new scheme isintroduced, with great respect to the learned counsel, we hold thatit will not apply to the case on hand. 34. In the decision of the Hon'ble Supreme Court reported in1981 (4) SCC 335 (Air India Vs. Nergesh Meerza), the Hon'ble SupremeCourt held as under in paragraph 78:"78. In view of the authorities indicatedabove assuming that the two awards are binding onthe petitioners, the serious question forconsideration is whether the agreement, which maybe binding on the parties, would estop them fromchallenging the Regulations on the ground that thesame are void as being violative of Article 14 or16 of the Constitution. It is well settled thatthere can be no estoppel against a statute muchless against constitutional provisions. If,therefore, we hold in agreement with the argumentof the petitioners that the provisions for https://hcservices.ecourts.gov.in/hcservices/ termination and retirement are violative ofArticle 14 as being unreasonable and arbitrary,the Awards or the Agreements confirmed by theAwards would be of no assistance to theCorporations."35. The learned counsel for the respondent bank to support hiscontentions as to the fixing of cut-off date viz., 01.11.1993, inregulations 33(1) contended that the same came to be incorporatedbased on the settlement dated 29.10.1993, between the management of58 banks including the respondent bank with their workmen representedby All India Bank Employees Association. The learned counseltherefore contended that the fixing of cut-off date as 01.11.1993,had the seal of approval of the employees Union apart from the factthat being a new scheme and fixing of such cut-off date with anagreement entered into with the Union would form a reasonable basisfor fixing the said date. 36. Having regard to the law laid down by the Hon'ble SupremeCourt in the above referred to decision de hors the agreement signedby the respondent bank with the employees Union, there would be noimpediment for this Court to examine the validity of fixing of cut-off date in regulation 33(1). In the event of this Court finding thefixing of the said cut-off date as violative of Article 14 of theConstitution, this Court can always set right the anomaly in order torender justice to the homogeneous group of employees who would beotherwise entitled for pension but for fixing of the cut-off dateviz., 01.11.1993. 37. Having regard to our conclusion on regulation 33(1) where wehave found based on the prescription contained in other regulationsthe fixing of cut-off date viz., 01.11.1993, was unjustified,arbitrary, unreasonable and discriminatory, we hold that irrespectiveof the agreement dated 29.10.1993, with the employees Union, the saidfixation of cut-off date viz., 01.11.1993, cannot operate against theinterest of the officers/employees who were in service after01.01.1986 and who happen to compulsorily retire by way of punishmenteven before 01.11.1993, for whom also regulation 33(1) is applicable.Therefore, they are entitled to invoke regulations 33(1) and theauthority competent is bound to decide their claim in accordance withlaw.38. The learned counsel for the respondent bank placed relianceupon the decision of the Hon'ble Supreme Court reported in 2005 AIRSCW 5664 (State of Punjab Vs. Amar Nath Goyal). In paragraph 24, theHon'ble Supreme Court held as under: https://hcservices.ecourts.gov.in/hcservices/ "24. It is difficult to accede to the argument onbehalf of the employees that a decision of the CentralGovernment/State Governments to limit the benefits onlyto employees, who retire or die on or after 01.04.1995,after calculating the financial implications thereon,was either irrational or arbitrary. Financial andeconomic implications are very relevant and germane forany policy decision touching the administration of theGovernment, at the Centre or at the State level."39. The question posed for consideration in that case was as towhether the decision of the Central and State Governments to restricttheir revision of the quantum of gratuity as well as the increasedceiling of gratuity consequent upon merger of a portion of dearnessallowance into dearness pay reckonable for the purpose of calculatinggratuity by prescribing a cut-off date , was irrational or arbitrary.In that context, the Hon'ble Supreme Court held as stated inparagraph 24 of the Judgment. We do not find any scope to apply thesaid ratio to the facts of this case. In the first place, financialconstraint was not the reason to treat a set of employees fallingunder the same category differently. Consequently, that was not thecase where the applicability of the higher benefits was restricted toone set of employees while denying the same benefit to another set ofemployees who were also similarly placed. The claim in that case wasmade by various group of employees who were all retirees long priorto the cut-off date and none in that group were made eligible forconferment of the benefits.40. In contra distinction to the case on hand were amongstemployees who were in service after 01.01.1986. One set of employeeswho were compulsorily retired by way of punishment after 01.11.1993,were conferred with the benefit while those who retired prior to01.11.1993, were denied the said benefit. We therefore do not findany scope to apply the said decision.41. The learned counsel for the respondent bank then relied uponthe decision of the Hon'ble Supreme Court reported in (1997) 2 SCC342 (State of Rajasthan Vs. Amrit Lal Gandhi). In the said decision,the Hon'ble Supreme Court was concerned with the fixation of cut-offdate as 01.01.1990, in respect of introduction of a pension scheme inthe Universities in the State of Rajasthan, came to be challenged onthe ground that the same was arbitrary. Such of those teachers whoretied prior to 01.01.1986 and some of them retired between01.01.1986 and 01.01.1990, challenged the fixation of the said cut-off date by the University of Jodhpur. Dealing with such asituation, the Hon'ble Supreme Court held that justification of thecut-off date of 01.01.1990, was wholly economic and that the paying https://hcservices.ecourts.gov.in/hcservices/ capacity cannot be held to be an irrelevant factor or validconsideration while fixing the cut-off date. The Hon'ble SupremeCourt therefore held that it cannot be said that that cut-off datewas fixed arbitrary or without any reason.42. Like in the other decision of the Hon'ble Supreme Courtreported in 2005 AIR SCW 5664 (State of Punjab Vs. Amar Nath Goyal),here again, the Hon'ble Supreme Court was pleased to accept theextraordinary financial burden that was taken into account whilefixing the cut-off date and have accepted such fixation and have heldthat the same was reasonable and not arbitrary. We therefore do notfind any scope to apply the ratio of the said decision to the factsof this case. 43. The learned counsel for the respondent bank has referred toone another decision of the Hon'ble Supreme Court reported in (1993)4 SCC 62 (State of West Bengal Vs. Ratan Behari Dey) wherein theHon'ble Supreme Court has held as under:"Now, it is open to the Sate or to theCorporation, as the case may be, to change theconditions of service unilaterally. Terminal benefitsas well as pensionary benefits constitute conditions ofservice. The employer has the undoubted power torevise the salaries and/or the pay scales as alsoterminal benefits/pensionary benefits. The power tospecify a date from which the revision of pay scales orterminal benefits/pensionary benefits, as the case maybe, shall take effect is a concomitant of the saidpower. So long as such date is specified in areasonable manner, i.e., without bringing about adiscrimination between similarly situated persons, nointerference is called for by the court in thatbehalf." (Emphasis added)As held by the Hon'ble Supreme Court whenever such cut-off date isspecified, the authorities are bound to show that it has got soundreasoning and there cannot be a distinction between similarlysituated persons. As found by us in the case on hand, theofficer/employee who were compulsorily retired by way of punishmentand amongst the officer/employee who were in service after01.01.1986, a discriminatory treatment is meted out to those who wereimposed with such punishment prior to 01.11.1993 and those who haveretired after 01.11.1993, which is wholly arbitrary and therefore thesame cannot be permitted to remain. https://hcservices.ecourts.gov.in/hcservices/

44. Reliance was placed upon a single Judge decision of theGujarat High Court reported in 2007 (3) SLR 679 (Bank of IndiaRetired Officers Association Vs. Bank of India). In the said case,the challenge was to the grant of pension to the employees who are inemployment between 01.01.1986 to 01.11.1993 for whom the benefit ofpension was extended only from 01.11.1993, and not from the date oftheir actual retirement. The challenge was on the ground that thefixation of such future date for grant of pension was discriminatory.The learned Judge rightly held that when a new scheme was introduced,it was open for the bank to exclude altogether the employees retiredprior to 01.11.1993, having come forward to grant pension as from01.11.1993, cannot be held to be arbitrary or discriminatory. We donot find the issue raised and decided in that case to be incomparison to the case on hand.45. The learned counsel then relied upon an unreported decisionof the Delhi High Court rendered in Civil Writ No.3830 of 1998 dated30.08.1999. In the said judgment the issue involved is identical tothe case on hand. The learned single Judge by applying the decisionof All India Reserve Bank Retired Officers Association and others Vs.Union of India (1992 Supp (1) SCC 644) took the view that fixing ofthe cut-off date of 01.11.1993, being a reasonable classification wasjustified. Since there is intelligible difference between two setsof classification and the classification has a nexus to the fixationof the cut-off date. We are not in a position to approve thereasoning of the learned Judge for more than one reason. In thefirst place we do not find any detailed consideration of the variousregulations of the pension regulations, 1995. In the earlier part ofour Judgment we have considered the regulations where the definitionof 'date of retirement', 'retirement' and regulation Nos.3, 29 and32, consideration of which, persuade us to hold that there was adiscriminatory treatment meted out to a set of employees falling in ahomogeneous group and by fixing the cut-off date, arbitrarydiscrimination is shown. Secondly, we had an opportunity to considerthe case of voluntary retirement for whom also a similar cut-off datehas been prescribed under regulation 29 which has been held to bearbitrary, discriminatory and violative of Articles 14 and 16 of theConstitution. The Division Bench decision of this Court has followedanother decision in an identical case rendered by the Bombay HighCourt. The various reasoning rendered in those decisions were allfully convincing and were in tune with the Constitutional mandate andtherefore by applying those reasoning we have held that the cut-offdate fixed in regulation 33(1) is liable to be interfered with. We donot find any such detailed discussion in the order of the learnedsingle Judge, though the learned Judge has dealt with the very sameregulation namely regulation 33(1) with which we are also concerned.With great respect to the learned Judge, we are not thereforeinclined to follow his conclusions. https://hcservices.ecourts.gov.in/hcservices/

46. As against the above decisions we find some of the decisionsrelied upon by the learned counsel for the appellant fully supportsour conclusions. The Hon'ble Supreme Court in 2000 I LLJ 223 (Bankof India Vs. Indu Rajagopalan) dealt with a case of voluntarilyretired employees for whom in the pension regulations a cut-off dateviz., 01.11.1993, was fixed which was held to be violative of Article14 and 16 of the constitution by the Division Bench of our HighCourt, the Hon'ble Supreme Court while repelling the contention ofthe bank management has held as under in paragraph 3:"3. All that has happened is in such of thebanks where a Scheme for voluntary retirement wasavailable, certain employees retired under thatscheme. Now a comprehensive Pension Scheme hasbeen framed which came into force w.e.f. November1, 1993 and applicable uniformly to all Bankemployees which provides for voluntary retirementas well. The applicability of these Rules to thoseemployees who have voluntarily retired w.e.f.January 1, 1986 to October 31, 1993 is raised inthese matters. It is not possible for ShriV.R.Reddy, learned senior counsel who appears forthe appellants to point out that there is anysignificant financial or other burden or differenceso far as those who had voluntarily retired andthose who had ordinarily retired. In that eventwhere there is no distinction, the authoritieshaving sought to make a distinction and not appliedthe regulations framed subsequent to theirretirement, the High Court has given appropriatedirections. We also notice that the number ofemployees who have retired in this manner is alsovery small. Therefore we think no interference iscalled for in these appeals. The appeals are,therefore, dismissed with no order as to costs."Applying the said decision also to the case of compulsory retirementby way of penalty, the respondent bank has not placed before us anyvalid ground for discriminating between compulsorily retiredemployees as a measure of punishment prior to 01.11.1993 and after01.11.1993.47. Reliance was also placed upon the decision of the Hon'bleSupreme Court reported in AIR 1986 SC 1907 (State GovernmentPensioners' Association Vs. State of A.P.). The Hon'ble SupremeCourt dealt with the case of upward revision of gratuity, which wasgranted with prospective effect from a specified date. There again https://hcservices.ecourts.gov.in/hcservices/ the economic reason and the financial implications were the basis forgranting the benefit from the prospective date. Having regard to thefact that such grounds have been held to be justified for fixing thecut-off date and such reasons were not the reason while fixing thecut-off date in regulation 33(1) for the grant of pension, we do notfind any scope to apply the said decision to the facts of this case.48. The learned counsel for the respondent placed reliance uponthe recent decision of the Hon'ble Supreme Court reported in 2009 IVLLJ 57 (SC) (Manjula Bhashini Vs. Managing Director, A.P.Women's Co-operative Finance Corporation Ltd.). The Hon'ble Supreme Courtconsidered the case where the cut-off date was specified in thestatute for determination of the eligibility of daily wage employeesto be considered for regularisation and whether it was arbitrary,irregular and violative of Articles 14 and 16 of the Constitution.Prior to the Act which was known as Act 27 of 1998, by the Governmentof Andhra Pradesh, an ordinance came to be issued in 1993 and 1994Act was enforced w.e.f. 25.11.1993, i.e., the date on which theordinance was published in the official Gazette. The Hon'ble SupremeCourt therefore held that the cut-off date fixed in the Act haddirect bearing to the policy of regularisation which was issued bythe State Government in exercise of its powers under Article 162 ofthe Constitution. The Hon'ble Supreme Court also held that by virtueof the policy which was enforced by 1994 Act, the Legislature couldnot have fixed any date other than 25.11.1993, for determining theeligibility of daily wage employees to fulfil the required five yearscontinuous service. The Hon'ble Supreme Court went on to hold thatif any other date has been fixed for gaining five years service ofdaily wage employees for the purpose of proviso to Section 7, theobject sought to be achieved by enacting the 1994 Act would have beendefeated, in as much as the regular recruitment could not have beenmade for appointment against the sanctioned post and back doorentrant would have occupied the post. Having regard to such weightyreasons which weighed with the Hon'ble Supreme Court while acceptingthe cut-off date which reasons were specially applicable to the factsof that case. Therefore the said decision cannot have anyapplication to the case on hand.49. For all the above stated reasons, we hold that the cut-offdate viz., 01.11.1993, fixed in regulation 33(1) of the PunjabNational Bank Employees' Pension Regulations, 1995 as arbitrary,discriminatory and violative of Articles 14 and 16 of theConstitution. We therefore set aside the impugned order of therespondent bank dated 26.04.1999, in RM:PER:MR381:99 and consequentlydirect the respondent bank to entertain the option exercised by theappellant in the format of Annexure II dated 08.07.1994, applyingregulation 33(1) of the regulations and the competent authorityprescribed under Regulation 33(1) to pass appropriate orders in https://hcservices.ecourts.gov.in/hcservices/ accordance with law. Such exercise shall be carried out by therespondent bank within eight weeks from the date of receipt of a copyof this order. Since the appellant is now 79 years old, in theinterest of justice, it will be appropriate for the respondent bankto pass orders as expeditiously as possible within the stipulatedtime granted in this judgment. The appeal stands allowed. No costs. kk Sd/- Asst.Registrar/True Copy/ Sub.Asst.RegistrarTo 1. The Secretary to Government, Ministry of Finance, New Delhi.2. The Governor, Reserve Bank of India,Bombay – 400 001.3. The Chairman and Managing Director, Punjab National Bank, New Delhi.4. The Manager (Personnel), Punjab National Bank, Regional Office, Greams Road, Madras.+ 1 cc to Mr.A.Kalai Selvan, Advocate SR.67555+ 1 cc to Mr.S. Jayaraman, Advocate SR.67396 in W.A.No.2768 of 2002 AKR(CO)EU 18.12.2009.