The High Court
Case Details
IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 4TH DAY OF MARCH, 2025 BEFORE THE HON’BLE MR.JUSTICE S.G.PANDIT WRIT PETITION No.35266/2024 (S-R) ...PETITIONER BETWEEN: MURUGAN O K STAFF NO.20806 AGED ABOUT 70 YEARS S/O LATE KRISHNAN DIVYAM AMBALAPARAMBIL HOUSE INDIRAJI NAGAR, PULLAZHI P, O., THRISSUR-688012, KERALA STATE. (BY SRI. K.R. GANESH RAO, ADV.) AND: 1. THE DIVISIONAL MANAGER CANARA BANK PENSION AND GRATUITY SECTION H.R. WING, HEAD OFFICE ANNEX NAVEEN COMPLEX BENGALURU-560001. 2. THE CHIEF MANAGER CANARA BANK I FLOOR, SRIKRISHNA BUILDING WEST PALACE ROAD THRISSUR-680022 KERALA STATE. 2 3. THE CHIEF MANAGER CANARA BANK MAIN BRANCH TRISSUR-680001. ….RESPONDENTS
Legal Reasoning
petitioner is before this Court in this writ petition. 3. Heard learned counsel Sri.K.R.Ganesh Rao for petitioner and learned counsel Sri.T.P.Muthanna for respondents. Perused the entire writ petition papers. 4. Learned counsel for the petitioner would submit that the action of the respondents in recovering the entire pension and adjusting the same towards loan accounts of the petitioner is wholly illegal, arbitrary and unreasonable. He submits that action of the respondent would violate Article 21 of the Constitution of India. He submits that the petitioner has served the respondent- Bank and for the service rendered by him, the pension is being paid. He submits that the purpose of pension is 5 for survival of the employee during his evening of life. But, if the entire pension is recovered, the very purpose of sanctioning pension would be defeated. Learned counsel referring to Canara Bank (Employees’) Pension Regulations, 1995 (for short “1995 Regulations”) would submit that there is no provision in 1995 Regulations to recover the entire pension from a pensioner. 5. Per contra, learned counsel Sri.T.P.Muthanna referring to statement of objections filed on behalf of the respondent-Bank submits that as the petitioner has failed to adhere to the installments towards educational loan as well as housing loan, the respondent-Bank having no other option, resorted to recover the same from the pension of the petitioner. Learned counsel would submit that the petitioner is due to the respondent-Bank in a total sum of Rs.8,41,515/-. Further, learned counsel would submit that the respondent-Bank is entitled to recover the dues from the 6 petitioner in respect of the loans taken by him. In that regard, learned counsel refers to regulation 49 of 1995 Regulations and submits that the Bank is entitled to recover dues from the commutation value of the pension or pension or family pension. Further, Sri.Muthanna would submit that the petitioner has stood has co- obligant for educational loan availed by his daughter and he submits that the petitioner as well as his daughter are jointly and severally liable to repay the educational loan, which is admittedly not repaid by the petitioner. Further, learned counsel would submit that the petitioner has availed two housing loans. Learned counsel referring to Regulation 49 of 1995 Regulations submits that the respondent-Bank would be entitled to recover dues to the Bank on account of housing loans, advances, license fees and other recoveries from the commutation value of pension or pension or family 7 pension. Thus, learned counsel justifies recovery by the respondent-Bank from the pension of the petitioner. 6. Having heard the learned counsel for the parties
Arguments
(BY SRI.T.P. MUTHANNA, ADV. FOR R1 TO R3) THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO DIRECT THE R1 TO 3 TO STOP RECOVERY OF FULL AMOUNT OF PENSION RECEIVED BY THE PETITIONER TOWARDS HIS LOAN ACCOUNTS AND TO STOP CHARGING OF PENAL INTEREST ON EDUCATIONAL LOAN IMMEDIATELY AND ALSO TO RECAST THE EDUCATION LOAN ACCOUNT SINCE 10.10.2003 TILL DATE WITHOUT CHARGING PENAL INTEREST IN THE SAID EDUCATIONAL LOAN AND ETC. THIS WRIT PETITION HAVING BEEN HEARD AND RESERVED ON FOR PRONOUNCEMENT THIS DAY, THE COURT MADE THE FOLLOWING: COMING ON 24/02/2025 CORAM: HON'BLE MR JUSTICE S.G.PANDIT CAV ORDER The petitioner, a retired employee of the respondent-Canara Bank is before this Court under Article 226 of the Constitution of India, praying for a writ of mandamus to direct respondent Nos.1 to 3 to stop recovery of full amount of pension towards his loan accounts and to stop charging of penal interest on 3 educational loan immediately; to direct the respondent Nos.1 to 3 to recover bank dues as per the installments fixed by the respondent-Bank in all the accounts and also to consider the representations of the petitioner dated 16.07.2024 and 05.09.2024 vide Annexures-J and K respectively and to pass orders. 2. The brief facts of the case are that: The petitioner was an employee of the respondent- Canara Bank. It is stated that the petitioner retired from service of the respondent-Bank on attaining the age of superannuation on 30.11.2014. Petitioner during the service had obtained educational and housing loans from the respondent-Bank. It is further stated that the respondent-Bank permitted the petitioner to pay the balance amount towards educational loan as well as housing loan in installments. It is the grievance of the petitioner that during July 2024, the respondent-Bank started recovering entire pension of the petitioner to 4 adjust the balance amount towards his loan accounts. The representations made by the petitioner to the respondent-Bank to recover balance loan amounts in installments have not yielded any result. Therefore, the
Decision
and on perusal of the writ petition papers, the only point which falls for consideration is as to whether the respondent-Bank could recover the entire pension to adjust the same towards petitioner’s loan accounts? 7. Answer to the above point would be in the negative and the respondent-Bank cannot recover the entire pension. 8. It is settled position of law that the pension is not a bounty and it is deferred payment for the services rendered by an employee. The pension is paid by the State or its instrumentalities to eke out pensioners livelihood in the evening of their life. The pension gives economic security to the petitioners. The pension could be called as reward for giving his best in heyday of life 8 of an employee. The Hon'ble Apex Court in the case of D.S.NAKARA AND OTHERS v/s UNION OF INDIA reported in (1983) 1 SCC 305 while considering the entitlement of pension has observed as follows: “In fact we look upon pension not merely as a statutory right but as the fulfillment of a constitutional promise inasmuch as it partakes the character of public assistance in cases of unemployment, old age, disablement or similar other cases of underserved want. Relevant rules merely make effective the constitutional mandate.” 9. The Hon'ble Apex Court in the above decision has also observed that pension is a right but not bounty or gratuitous payment. 10. No doubt, as contended by learned counsel for the respondent-Bank Sri.Muthanna, the Bank has every right to recover the pecuniary loss caused to the Bank by its employees in accordance with the relevant 9 Regulations. Regulation 43 of 1995 Regulations empowers the competent authority to withhold or withdraw the entire pension, if the pensioner is convicted of a serious crime or criminal breach of trust or forgery or acting fraudulently or is found guilty of grave misconduct, which means power to withhold or withdraw pension would be available to the respondent- Bank only on happening of certain events and finding a Bank employee guilty of grave misconduct in an enquiry. Regulation 46 of 1995 Regulations permits recovery of amount determined in an enquiry from the gratuity or pension. Regulation 48 of 1995 Regulations empowers the Bank to recover pecuniary loss caused to the Bank by its employees and order recovery from the pension, if in any departmental or judicial proceedings, the pensioner is found guilty of grave misconduct or negligence. Regulation 49 of 1995 Regulations empowers the Bank to recover bank dues such as 10 housing loans, advances, license fees, other recoveries and recoveries due to staff co-operative credit society from the commutation value of the pension or the pension or the family pension. But none of the regulations would permit the respondent-Bank to recover the entire pension amount without conducting enquiry. If recovery of entire pension is permitted towards recovery of loan balance, it would defeat the very object of payment of pension. 11. It is not that Bank would be remediless for recovery. For recovery of loan dues, the Bank could enforce security obtained. The pension is paid to an employee to sustain himself after retirement. Normally, recovery should not exceed 50% of the take home salary, if an employee is in service. The same principle should apply in the instant case also. If the entire pension is permitted to be recovered towards loan dues, it would be violative of Article 21 of the Constitution of 11 India. A pensioner would not be in a position to get re- employment and if the pensioner is depending only on the pension, then life of his family would be in financial distress. 12. For the reasons recorded above, and in the peculiar facts of the present case, the writ petition deserves to be allowed in part. 13. Hence, the following order: (i)The writ petition is allowed in part. (ii)A writ of mandamus is issued to the respondents not to recover in excess of 50% from the petitioner’s pension towards his loan accounts. (iii) It is open for the respondents to resort to any other mode available in law to recover the loan balance along with interest. Sd/- (S.G.PANDIT) JUDGE mpk/-* CT:bms