High Court

1. Heard learned counsel for the petitioners, learned Standing Counsel and Shri Rishabh Kapoor, learned counsels for the respondents.

2. The retired pensioners of the U. P. Jal Nigam (Urban) are before this Court praying for a writ of mandamus commanding the respondents to make payment of arrears of pension which are due from April 2024 to August 2024 and further to make payment of arrears of dearness allowance to the petitioners.

3. At the very outset, learned counsel for the petitioners states that the arrears of pension from April 2024 to August 2024 have been paid but now the petitioners have not paid pension since September 2024 till date.

4. Responding to that, Shri Rishabh Kapoor, learned counsel for the respondent Corporation has placed reliance on the averments made in paragraph 3, 6 and 7 of the counter affidavit to contend that on account of financial crunch which the Jal Nigam is facing there is backlog of four months of payment of salary and pension of officers, employees and retired personnel of the corporation.

5. He further states that the aforesaid paragraphs be reproduced in the order of this Court. As such, on his request paragraph 3, 6 and 7 of the counter affidavit are reproduced below: "3. That it is humbly submitted that orders have been issued for the payment of salaries and pension to the employees / officers of the Uttar Pradesh Jal Nigam (Urban) until August 2024. It is further submitted that the financial conditions of the Uttar Pradesh Jal Nigam (Urban) is such that there is backlog of four months in the payment of salaries and pensions to the officers/employees and retired personnel of the organization.

6. That during the current fiscal year, under the AMRUT-1 and AMRUT-2 schemes, the Uttar Pradesh Jal Nigam (Urban) has undertaken works valued at Rs 2416.83 crore, with Rs 83.07 crore allocated for state sector works and Rs 101 crore deposited for other works, totalling Rs 2600.9 crore. Out of this, Rs 240 crore has been released as a Central grant for ongoing works. The payment for these works and the revenue generated from them are being utilized for salaries, pensions and other obligations of the employees and retirees of the Uttar Pradesh Jal Nigam (Urban).

7. That as per the Finance Department's Government Order dated 17.05.2023, the provision for service charge collection has also been implemented. This has improved the financial management of the Nigam to some extent, but the funds generated are insufficient to fully meet the salary and pension obligations and efforts are ongoing to ensure timely payments of salaries an pensions based on available resources. A true copy of Government order dated 17.05.2023 is being annexed herewith as Annexure NO. C.A. - 02 to this affidavit."

6. From the arguments as raised by learned counsel for the parties and perusal of record it emerges that admittedly the petitioners are retired employees of the respondent corporation who are not paid pension regularly rather the same is paid belatedly.

7. Pensioners have no source of income apart from pension which they receive every month. In case the corporation is sitting over the matter and pays pension in blocks of four months or belatedly on account of financial crunch which it may be facing, then the corporation has to itself make efforts to get over the financial crunch or / and to make a request to the state government for making funds available regularly if permissible or to generate funds from its own resources but lack of funds cannot be a ground for non payment of dues which are admittedly due to the petitioners more particularly when they are retired employees.

8. This aspect of the matter has been considered by this Court in the case of Rabindra Nath Pandey vs State of U.P. and others, 2023 (41) LCD 2932 wherein this Court has held as under: "15. Whether lack of finances can be considered to be a reasonable ground for non payment of retiral dues to the employees is no longer res integra. This Court in the case of Gajraj Singh vs State of U.P and others passed in Writ Petition No. 8015 (SS) 2021 decided on 18.08.2021 has held as under: "It is admitted on behalf of respondents that the date of retirement of the petitioner is on 31.01.2019 and admittedly the dues of gratuity and leave encashment have still not been paid to the petitioner till date. The ground of financial difficulty being indicated by the corporation cannot be considered to be a valid ground to deny the lawful dues to which the petitioner, retired employee of the Corporation, is entitled as a matter of right. This aspect of the matter has been considered by this Court in the case of Samal Chand Tiwari vs State of U.P. & others reported in 2005 SCC OnLine All 1276 : (2006) 62 ALR 698 (All) : (2006) 109 FLR (Sum 12) 6 : (2006) 2 All LJ 45 : (2006) 4 LLJ (Supp) (NOC 114) 870 wherein this Court has held as under: "4. After considering the rival submissions of the learned Counsel for the parties, I find that the defence of financial crisis on the part of the respondents is neither just nor a valid reason to deny the lawful dues to which a employee is entitled a matter of right.

5. In the case of D.S. Nakara v. Union of India, it has been held as follows: "pension is a right and the payment of it does not depend upon the discretion of the Government but is governed by the rules and a Government servant coming within those rules is entitled to claim pension. It was further held that the grant of pension does not depend upon any one's discretion. (Para 20). In the course of transformation of society from feudal to welfare and as socialistic thinking acquired respectability, State obligation to provide security in old age, as escape from undeserved want was recognized and as a first steps pension was treated not only as a reward for past service but with a view to helping the employee to avoid destitution in old age. The guid pro quo was that when the employee was physically and mentally alert, he rendered not master the best, expecting him to look after him in the fall of life. A retirement system therefore exists solely for the purpose of providing benefits. In most of the plans of retirement benefits, everyone who qualifies for normal retirement receives the same amount. (Para 22). Pensions to civil employees of the Government and the defence personnel as administered in India appear to be a compensation for service rendered in the past. (Para 28). Summing up it can be said with confidence that pension is not only compensation for loyal service rendered in the past, but pension also has a broader significance, in that it is a measure of socio-economic justice which inheres economic security in the fall of life when physical and mental prowess is ebbing corresponding to aging process and therefore, one is required to fall back on savings. One such saving in kind is when you give your best in the hey-day of life to your employer, in days of invalidity, economic security by way of periodical payment is assured. The term has been judicially defined as a stated allowance or stipend made in consideration of past service or a surrender of rights or emoluments to one retired from service. Thus the pension payable to a Government employee is earned by rendering long and efficient service and therefore can be said to be a deferred portion of the compensation or for service rendered. (Para 29)"

6. Thus, retiral benefits are not bounty but a right earned by the employee and thus it is deferred wages payable to a Government servant in lieu of considerable length of service rendered by an employee to the employer.

10. Similarly financial crunch or shortage of funds would not be a valid defence for the State where it is bound to discharge its duties which are statutory or constitutional is also the view taken by the Apex Court in the case of Secretary, Ministry of Chemicals and Fertilizers, Government of India v. Cipla Ltd. and the State of Gujarat v. Shri Ambica Mills Ltd., Ahmedabad In the present case, the petitioner has a fundamental right to earn livelihood under Article 21 of the Constitution of India which includes that after the retirement he is also entitled to receive his deferred wages in accordance with rules. Non- payment of retiral benefits, therefore, of the petitioner is violation of the petitioner's fundamental right under Article 21 of the Constitution of India." Considering the aforesaid judgement in the case of Samal Chand Tiwari (Supra) it is apparent that the ground being taken by the respondents for withholding of the retiral dues of the petitioner i.e. financial difficulties cannot be considered to be a valid ground on which the respondents can withhold the retiral dues of the petitioner. (emphasis by the Court)

16. Likewise a division bench of this Court in the case of Shiv Shankar Mishra (supra) has held as under: "The present case is an unfortunate instance where an employee has been left in the lurch after having rendered long years of service. Both the arrears on account of salary as well as pensionary dues have not been paid on time. When the appellant had moved a writ petition before the Court, an order was passed on 11 September 2013 directing the payment of the admitted arrears within four months and for immediate steps to determine the pensionary dues. This order was not complied with following which, he was constrained to file contempt proceedings. It is only thereafter that on 18 March 2014 the payment of arrears of salary from August 2010 until February 2013 was made. It was only then that the appellant was also paid arrears on account of gratuity, pension and other retiral dues. There was no reason or justification to withhold the payment of salary during the period when the appellant had worked when salary fell due for payment or for the non payment of pensionary and retiral dues, the latter within a reasonable period of retirement. There was no lapse on the part of the appellant. The paucity of funds cannot surely be held up as an excuse not to pay the salary of an employee who had worked for the period for which his salary is due. Similarly, pensionary dues constitute a rightful entitlement of an employee. The State cannot be heard to say that it would fail to pay the pension on time and yet excuse itself from the liability to pay interest. In the case of State of Kerala Vs M Padmanabhan Nair and Som Prakash1, the Supreme Court held as follows: "Pension and gratuity are no longer any bounty to be distributed by the Government to its employees on their retirement but have become, under the decisions of this Court, valuable rights and property in their hands and any culpable delay in settlement and disbursement thereof must be visited with the penalty of payment of interest at the current market rate till actual payment." (emphasis by the Court)

17. Upon perusal of the aforesaid judgements including the judgement of Hon'ble Supreme Court in the case of D S Nakara (supra) it clearly emerges that where the dues are payable to an employee then the state or the corporation which is duty bound to discharge its duties which are statutory or constitutional cannot take a plea of lack of finances for payment of dues which are admittedly due.

18. Accordingly considering the aforesaid judgements the Court does not find that the reasons given by the respondents of the bank facing financial crunch is a valid ground for non payment or lesser payment of retiral dues to petitioner in accordance with law."

9. From perusal of judgement of this Court in the case of Rabindra Nath Pandey (supra) it clearly emerges that this Court after placing reliance on earlier judgements of Hon'ble Supreme Court has held that financial crunch cannot be a valid ground for non payment or lesser payment of retiral dues to the petitioners.

10. Considering the aforesaid, the writ petition is allowed. A writ of mandamus is issued commanding the respondent corporation to pay regular pension to the petitioners every month. The arrears which are due to the petitioners with regard to the pension would also be paid to them within a period of four weeks from the date of receipt of certified copy of this order. The dearness allowance as due to the petitioners in accordance with law shall also be paid within the aforesaid period. Order Date :- 27.2.2025 J. K. Dinkar

1. Heard learned counsel for the petitioners, learned Standing Counsel and Shri Rishabh Kapoor, learned counsels for the respondents.

2. The retired pensioners of the U. P. Jal Nigam (Urban) are before this Court praying for a writ of mandamus commanding the respondents to make payment of arrears of pension which are due from April 2024 to August 2024 and further to make payment of arrears of dearness allowance to the petitioners.

3. At the very outset, learned counsel for the petitioners states that the arrears of pension from April 2024 to August 2024 have been paid but now the petitioners have not paid pension since September 2024 till date.

4. Responding to that, Shri Rishabh Kapoor, learned counsel for the respondent Corporation has placed reliance on the averments made in paragraph 3, 6 and 7 of the counter affidavit to contend that on account of financial crunch which the Jal Nigam is facing there is backlog of four months of payment of salary and pension of officers, employees and retired personnel of the corporation.

5. He further states that the aforesaid paragraphs be reproduced in the order of this Court. As such, on his request paragraph 3, 6 and 7 of the counter affidavit are reproduced below: "3. That it is humbly submitted that orders have been issued for the payment of salaries and pension to the employees / officers of the Uttar Pradesh Jal Nigam (Urban) until August 2024. It is further submitted that the financial conditions of the Uttar Pradesh Jal Nigam (Urban) is such that there is backlog of four months in the payment of salaries and pensions to the officers/employees and retired personnel of the organization.

6. That during the current fiscal year, under the AMRUT-1 and AMRUT-2 schemes, the Uttar Pradesh Jal Nigam (Urban) has undertaken works valued at Rs 2416.83 crore, with Rs 83.07 crore allocated for state sector works and Rs 101 crore deposited for other works, totalling Rs 2600.9 crore. Out of this, Rs 240 crore has been released as a Central grant for ongoing works. The payment for these works and the revenue generated from them are being utilized for salaries, pensions and other obligations of the employees and retirees of the Uttar Pradesh Jal Nigam (Urban).

7. That as per the Finance Department's Government Order dated 17.05.2023, the provision for service charge collection has also been implemented. This has improved the financial management of the Nigam to some extent, but the funds generated are insufficient to fully meet the salary and pension obligations and efforts are ongoing to ensure timely payments of salaries an pensions based on available resources. A true copy of Government order dated 17.05.2023 is being annexed herewith as Annexure NO. C.A. - 02 to this affidavit."

6. From the arguments as raised by learned counsel for the parties and perusal of record it emerges that admittedly the petitioners are retired employees of the respondent corporation who are not paid pension regularly rather the same is paid belatedly.

7. Pensioners have no source of income apart from pension which they receive every month. In case the corporation is sitting over the matter and pays pension in blocks of four months or belatedly on account of financial crunch which it may be facing, then the corporation has to itself make efforts to get over the financial crunch or / and to make a request to the state government for making funds available regularly if permissible or to generate funds from its own resources but lack of funds cannot be a ground for non payment of dues which are admittedly due to the petitioners more particularly when they are retired employees.

8. This aspect of the matter has been considered by this Court in the case of Rabindra Nath Pandey vs State of U.P. and others, 2023 (41) LCD 2932 wherein this Court has held as under: "15. Whether lack of finances can be considered to be a reasonable ground for non payment of retiral dues to the employees is no longer res integra. This Court in the case of Gajraj Singh vs State of U.P and others passed in Writ Petition No. 8015 (SS) 2021 decided on 18.08.2021 has held as under: "It is admitted on behalf of respondents that the date of retirement of the petitioner is on 31.01.2019 and admittedly the dues of gratuity and leave encashment have still not been paid to the petitioner till date. The ground of financial difficulty being indicated by the corporation cannot be considered to be a valid ground to deny the lawful dues to which the petitioner, retired employee of the Corporation, is entitled as a matter of right. This aspect of the matter has been considered by this Court in the case of Samal Chand Tiwari vs State of U.P. & others reported in 2005 SCC OnLine All 1276 : (2006) 62 ALR 698 (All) : (2006) 109 FLR (Sum 12) 6 : (2006) 2 All LJ 45 : (2006) 4 LLJ (Supp) (NOC 114) 870 wherein this Court has held as under: "4. After considering the rival submissions of the learned Counsel for the parties, I find that the defence of financial crisis on the part of the respondents is neither just nor a valid reason to deny the lawful dues to which a employee is entitled a matter of right.

5. In the case of D.S. Nakara v. Union of India, it has been held as follows: "pension is a right and the payment of it does not depend upon the discretion of the Government but is governed by the rules and a Government servant coming within those rules is entitled to claim pension. It was further held that the grant of pension does not depend upon any one's discretion. (Para 20). In the course of transformation of society from feudal to welfare and as socialistic thinking acquired respectability, State obligation to provide security in old age, as escape from undeserved want was recognized and as a first steps pension was treated not only as a reward for past service but with a view to helping the employee to avoid destitution in old age. The guid pro quo was that when the employee was physically and mentally alert, he rendered not master the best, expecting him to look after him in the fall of life. A retirement system therefore exists solely for the purpose of providing benefits. In most of the plans of retirement benefits, everyone who qualifies for normal retirement receives the same amount. (Para 22). Pensions to civil employees of the Government and the defence personnel as administered in India appear to be a compensation for service rendered in the past. (Para 28). Summing up it can be said with confidence that pension is not only compensation for loyal service rendered in the past, but pension also has a broader significance, in that it is a measure of socio-economic justice which inheres economic security in the fall of life when physical and mental prowess is ebbing corresponding to aging process and therefore, one is required to fall back on savings. One such saving in kind is when you give your best in the hey-day of life to your employer, in days of invalidity, economic security by way of periodical payment is assured. The term has been judicially defined as a stated allowance or stipend made in consideration of past service or a surrender of rights or emoluments to one retired from service. Thus the pension payable to a Government employee is earned by rendering long and efficient service and therefore can be said to be a deferred portion of the compensation or for service rendered. (Para 29)"

6. Thus, retiral benefits are not bounty but a right earned by the employee and thus it is deferred wages payable to a Government servant in lieu of considerable length of service rendered by an employee to the employer.

10. Similarly financial crunch or shortage of funds would not be a valid defence for the State where it is bound to discharge its duties which are statutory or constitutional is also the view taken by the Apex Court in the case of Secretary, Ministry of Chemicals and Fertilizers, Government of India v. Cipla Ltd. and the State of Gujarat v. Shri Ambica Mills Ltd., Ahmedabad In the present case, the petitioner has a fundamental right to earn livelihood under Article 21 of the Constitution of India which includes that after the retirement he is also entitled to receive his deferred wages in accordance with rules. Non- payment of retiral benefits, therefore, of the petitioner is violation of the petitioner's fundamental right under Article 21 of the Constitution of India." Considering the aforesaid judgement in the case of Samal Chand Tiwari (Supra) it is apparent that the ground being taken by the respondents for withholding of the retiral dues of the petitioner i.e. financial difficulties cannot be considered to be a valid ground on which the respondents can withhold the retiral dues of the petitioner. (emphasis by the Court)

16. Likewise a division bench of this Court in the case of Shiv Shankar Mishra (supra) has held as under: "The present case is an unfortunate instance where an employee has been left in the lurch after having rendered long years of service. Both the arrears on account of salary as well as pensionary dues have not been paid on time. When the appellant had moved a writ petition before the Court, an order was passed on 11 September 2013 directing the payment of the admitted arrears within four months and for immediate steps to determine the pensionary dues. This order was not complied with following which, he was constrained to file contempt proceedings. It is only thereafter that on 18 March 2014 the payment of arrears of salary from August 2010 until February 2013 was made. It was only then that the appellant was also paid arrears on account of gratuity, pension and other retiral dues. There was no reason or justification to withhold the payment of salary during the period when the appellant had worked when salary fell due for payment or for the non payment of pensionary and retiral dues, the latter within a reasonable period of retirement. There was no lapse on the part of the appellant. The paucity of funds cannot surely be held up as an excuse not to pay the salary of an employee who had worked for the period for which his salary is due. Similarly, pensionary dues constitute a rightful entitlement of an employee. The State cannot be heard to say that it would fail to pay the pension on time and yet excuse itself from the liability to pay interest. In the case of State of Kerala Vs M Padmanabhan Nair and Som Prakash1, the Supreme Court held as follows: "Pension and gratuity are no longer any bounty to be distributed by the Government to its employees on their retirement but have become, under the decisions of this Court, valuable rights and property in their hands and any culpable delay in settlement and disbursement thereof must be visited with the penalty of payment of interest at the current market rate till actual payment." (emphasis by the Court)

17. Upon perusal of the aforesaid judgements including the judgement of Hon'ble Supreme Court in the case of D S Nakara (supra) it clearly emerges that where the dues are payable to an employee then the state or the corporation which is duty bound to discharge its duties which are statutory or constitutional cannot take a plea of lack of finances for payment of dues which are admittedly due.

18. Accordingly considering the aforesaid judgements the Court does not find that the reasons given by the respondents of the bank facing financial crunch is a valid ground for non payment or lesser payment of retiral dues to petitioner in accordance with law."

9. From perusal of judgement of this Court in the case of Rabindra Nath Pandey (supra) it clearly emerges that this Court after placing reliance on earlier judgements of Hon'ble Supreme Court has held that financial crunch cannot be a valid ground for non payment or lesser payment of retiral dues to the petitioners.

10. Considering the aforesaid, the writ petition is allowed. A writ of mandamus is issued commanding the respondent corporation to pay regular pension to the petitioners every month. The arrears which are due to the petitioners with regard to the pension would also be paid to them within a period of four weeks from the date of receipt of certified copy of this order. The dearness allowance as due to the petitioners in accordance with law shall also be paid within the aforesaid period. Order Date :- 27.2.2025 J. K. Dinkar