Central Administrative Tribunal - Delhi
The Csir Pensioners Welfare ... vs Science And Technology on 28 August, 2025
1
Item No. 24 (C-5) O.A. No.717/2025
CENTRAL ADMINISTRATIVE TRIBUNAL
PRINCIPAL BENCH: NEW DELHI
O.A. No. 717/2025
Reserved on: 12.08.2025
Pronounced on: 28.08.2025
Hon'ble Mr. Manish Garg, Member (J)
Hon'ble Mr. Rajinder Kashyap, Member (A)
1. The CSIR Pensioners' Welfare Association office at B-7/1,
LDA Flats, Niral Nagar, Lucknow, Uttar Pradesh
Pradesh-226022.
2. Dr. Jayandra Kumar Johri S/o Late Mr. Chokey Lal
Satyapal R/o L-IV/96,
L IV/96, Sector M, Aliganj, Kursi Road,
Lucknow, Uttar Pradesh-226022.
Pradesh
...Applicants
(By Advocates: Mr. Siddharth
Siddharth and Mr. Prateek Goyal)
Versus
1. Union of India, the Ministry of Science and Technology,
through its Secretary, Technology Bhawan, New Mehrauli
Road, Block C, Qutub Institutional Area, Delhi 110016.
2. Council of Scientific & Industrial Research through its
Director General, Office at Anusandhan Bhawan, 2 Rafi
Ahmed Kidwai Marg, New Delhi-
Delhi 110001.
3. Ministry of Personnel, Public Grievances and Pension
Through its Secretary, Department of Pension and
Pensioners' Welfare, North Block, Central Secr
Secretariat, New
Delhi - 110001
and also at
2
Item No. 24 (C-5) O.A. No.717/2025
Department of Pension & Pensioners' Welfare, A Wing, 3rd
Floor, Loknayak Bhawan, Khan Market, New Delhi -
110001Ministry of Finance through its Secretary,
Department of Expenditure, Jeevan Deep Building, Sansad
Marg,, New Delhi - 110001.
4. Ministry of Finance through its Secretary, Department of
Expenditure, Room No. 74 -B, B, North Block, Central
Secretariat, New Delhi - 110001.
5. Ministry of Finance through its Secretary, Department of
Financial Services, Jeevan Deep
Deep Building, Sansad Marg,
New Delhi - 110001.
...Respondents
(By Advocates: Mr. Rajpal Singh and Mr. Pradeep Kumar
Sharma)
3
Item No. 24 (C-5) O.A. No.717/2025
ORDER
Hon'ble Mr. Manish Garg, Member (J) :
"Everyone wants best of both worlds"
In the present case, the applicants seek the following reliefs:
"a. Set aside rule 6, 8, 10A and 29 of the Commutation Rules as unconstitutional and as violative of the Pension Rules and section 23 of the Contract Act insofar as they mandate deduction from the monthly pension beyond the complete recovery recovery of lumpsum in 11 years. b. Set aside the impugned order dated 06.08.2024. c. Direct the respondents to stop deductions made in the monthly pension for recovery of the lumpsum and restore the pension after 11 years from the date of commutation. d. Direct the respondents to refund with interest the deductions made beyond 11 years from the date of commutation.
e. Pass such other orders as may be deemed appropriate"
2. The brief facts of the case as narrated by the learned counsel for the applicants are as under:
2.1. The applicants, comprising Applicant No. 2 and members of Applicant No. 1 Association, are retired employees of various laboratories under the Council of Scientific and Industrial Research (CSIR), having superannuated at the age of 60 years years from 2010 onwards.
They are governed by the CCS (Pension) Rules, 1972 and 4 Item No. 24 (C-5) O.A. No.717/2025 2021 and had commuted 40% of their pension under the CCS (Commutation of Pension) Rules, 1981 ('Commutation Rules').
2.2. Upon retirement, the applicants received a lump sum commuted muted value of pension. The commuted amount was refunded through equal monthly deductions over approximately 8 years, and the interest component thereon in a further 3 years. Thus, the refund was complete in 11 years.
2.3. For instance, Applicant No. 2, ha having retired at 60 years with a monthly pension of ₹32,270, 32,270, commuted 40% thereof (₹12,908 12,908 per month) and received a lump sum of 12,69,218, calculated as under:
₹12,69,218, "Lump sum = (40/100 × ₹32,270 32,270 × 12 × 8.194) = ₹12,69,218"
2.4. Thus, Rs. 12,908 were deducted from his monthly pension to refund the lumpsum of Rs. 12,69,218 in 99 months. Interest at 8% p.a. prescribed in Table E was refunded in further 3 years thus: "TABLE E 5 Item No. 24 (C-5) O.A. No.717/2025 Months Lumpsum Monthly Monthly Accrued progressively deduction interest on interest decreasing B at 8% with p.a. monthly repayments.
0 12,69,218 0 8,461.45 8,461.45
1. 12,56,310 12,908 8,375.40 16,836.85
2. 12,43,402 12,908 8,289.35 25,126.20
3. 12,30,494 12,908 8,203.29 33,329.49
4. 12,17,586 12,908 8,117.24 41,446.73
5. 12,04,678 12,908 8,031.19 49,477.91
6. 11,91,770 12,908 7,945.13 57,423.05
7. 11,78,862 12,908 7,859.08 65,282.12
8. 11,65,954 12,908 7,773.03 73,055.15
9. 11,53,046 12,908 7,686.97 80,742.12
10. 11,40,138 12,908 7,600.92 88,343.04
11. 11,27,230 12,908 7,514.87 95,857.91
12. 11,14,322 12,908 7,428.81 1,03,286.72
13. 11,01,414 12,908 7,342.76 1,10,629.48
14. 10,88,506 12,908 7,256.71 1,17,886.18
15. 10,75,598 12,908 7,170.65 1,25,056.83
16. 10,62,690 12,908 7,084.60 1,32,141.43
17. 10,49,782 12,908 6,998.55 1,39,139.98
18. 10,36,874 12,908 6,912.49 1,46,052.47
19. 10,23,966 12,908 6,826.44 1,52,878.91 6 Item No. 24 (C-5) O.A. No.717/2025
20. 10,11,058 12,908 6,740.39 1,59,619.30
21. 9,98,150 12,908 6,654.33 1,66,273.63
22. 9,85,242 12,908 6,568.28 1,72,841.91
23. 9,72,334 12,908 6,482.23 1,79,324.13
24. 9,59,426 12,908 6,396.17 1,85,720.30
25. 9,46,518 12,908 6,310.12 1,92,030.42
26. 9,33,610 12,908 6,224.07 1,98,254.49
27. 9,20,702 12,908 6,138.01 2,04,392.50
28. 9,07,794 12,908 6,051.96 2,10,444.46
29. 8,94,886 12,908 5,965.91 2,16,410.36
30. 8,81,978 12,908 5,879.85 2,22,290.22
31. 8,69,070 12,908 5,793.80 2,28,084.02
32. 8,56,162 12,908 5,707.75 2,33,791.76
33. 8,43,254 12,908 5,621.69 2,39,413.45
34. 8,30,346 12,908 5,535.64 2,44,949.09
35. 8,17,438 12,908 5,449.59 2,50,398.68
36. 8,04,530 12,908 5,363.53 2,55,762.21
37. 7,91,622 12,908 5,277.48 2,61,039.69
38. 7,78,714 12,908 5,191.43 2,66,231.11
39. 7,65,806 12,908 5,105.37 2,71,336.49
40. 7,52,898 12,908 5,019.32 2,76,355.81
41. 7,39,990 12,908 4,933.27 2,81,289.07
42. 7,27,082 12,908 4,847.21 2,86,136.28
43. 7,14,174 12,908 4,761.16 2,90,897.44
44. 7,01,266 12,908 4,675.11 2,95,572.55
45. 6,88,358 12,908 4,589.05 3,00,161.60 7 Item No. 24 (C-5) O.A. No.717/2025
46. 6,75,450 12,908 4,503.00 3,04,664.60
47. 6,62,542 12,908 4,416.95 3,09,081.54
48. 6,49,634 12,908 4,330.89 3,13,412.44
49. 6,36,726 12,908 4,244.84 3,17,657.27
50. 6,23,818 12,908 4,158.79 3,21,816.06
51. 6,10,910 12,908 4,072.73 3,25,888.79
52. 5,98,002 12,908 3,986.68 3,29,875.47
53. 5,85,094 12,908 3,900.63 3,33,776.10
54. 5,72,186 12,908 3,814.57 3,37,590.67
55. 5,59,278 12,908 3,728.52 3,41,319.19
56. 5,46,370 12,908 3,642.47 3,44,961.65
57. 5,33,462 12,908 3,556.41 3,48,518.07
58. 5,20,554 12,908 3,470.36 3,51,988.42
59. 5,07,646 12,908 3,384.31 3,55,372.73
60. 4,94,738 12,908 3,298.25 3,58,670.98
61. 4,81,830 12,908 3,212.20 3,61,883.18
62. 4,68,922 12,908 3,126.15 3,65,009.33
63. 4,56,014 12,908 3,040.09 3,68,049.42
64. 4,43,106 12,908 2,954.04 3,71,003.46
65. 4,30,198 12,908 2,867.99 3,73,871.44
66. 4,17,290 12,908 2,781.93 3,76,653.37
67. 4,04,382 12,908 2,695.88 3,79,349.25
68. 3,91,474 12,908 2,609.83 3,81,959.08
69. 3,78,566 12,908 2,523.77 3,84,482.85
70. 3,65,658 12,908 2,437.72 3,86,920.57
71. 3,52,750 12,908 2,351.67 3,89,272.24 8 Item No. 24 (C-5) O.A. No.717/2025
72. 3,39,842 12,908 2,265.61 3,91,537.85
73. 3,26,934 12,908 2,179.56 3,93,717.41
74. 3,14,026 12,908 2,093.51 3,95,810.91
75. 3,01,118 12,908 2,007.45 3,97,818.36
76. 2,88,210 12,908 1,921.40 3,99,739.76
77. 2,75,302 12,908 1,835.35 4,01,575.11
78. 2,62,394 12,908 1,749.29 4,03,324.40
79. 2,49,486 12,908 1,663.24 4,04,987.64
80. 2,36,578 12,908 1,577.19 4,06,564.82
81. 2,23,670 12,908 1,491.13 4,08,055.96
82. 2,10,762 12,908 1,405.08 4,09,461.04
83. 1,97,854 12,908 1,319.03 4,10,780.06
84. 1,84,946 12,908 1,232.97 4,12,013.03
85. 1,72,038 12,908 1,146.92 4,13,159.95
86. 1,59,130 12,908 1,060.87 4,14,220.82
87. 1,46,222 12,908 974.81 4,15,195.63
88. 1,33,314 12,908 888.76 4,16,084.39
89. 1,20,406 12,908 802.71 4,16,887.09
90. 1,07,498 12,908 716.65 4,17,603.75
91. 94,590 12,908 630.60 4,18,234.35
92. 81,682 12,908 544.55 4,18,778.89
93. 68,774 12,908 458.49 4,19,237.38
94. 55,866 12,908 372.44 4,19,609.82
95. 42,958 12,908 286.39 4,19,896.21
96. 30,050 12,908 200.33 4,20,096.54
97. 17,142 12,908 114.28 4,20,210.82 9 Item No. 24 (C-5) O.A. No.717/2025
98. 4,234 12,908 28.23 4,20,239.04
99. 12,908 4,11,564.87
100. 12,908 3,98,656.87
101. 12,908 3,85,748.87
102. 12,908 3,72,840.87
103. 12,908 3,59,932.87
104. 12,908 3,47,024.87
105. 12,908 3,34,116.87
106. 12,908 3,21,208.87
107. 12,908 3,08,300.87
108. 12,908 2,95,392.87
109. 12,908 2,82,484.87
110. 12,908 2,69,576.87
111. 12,908 2,56,668.87
112. 12,908 2,43,760.87
113. 12,908 2,30,852.87
114. 12,908 2,17,944.87
115. 12,908 2,05,036.87
116. 12,908 1,92,128.87
117. 12,908 1,79,220.87
118. 12,908 1,66,312.87
119. 12,908 1,53,404.87
120. 12,908 1,40,496.87
121. 12,908 1,27,588.87
122. 12,908 1,14,680.87
123. 12,908 1,01,772.87 10 Item No. 24 (C-5) O.A. No.717/2025
124. 12,908 88,864.87
125. 12,908 75,956.87
126. 12,908 63,048.87
127. 12,908 50,140.87
128. 12,908 37,232.87
129. 12,908 24,324.87
130. 12,908 11,416.87
131. 12,908 1,491.13"
2.5. However, the learned counsel for the applicants submitted that the CSIR has continued with excessive deductions beyond 11 years under rule 10A of the Commutation Rules. This excess deduction is illustrated below"
"Name (PPO Lab / Lump Monthly Refund Refund (₹) no.) city sum deduction (₹) till in 15 (₹) (₹) 01.01.25 years Jayandra NBRI 12,69, 12,908 18,58,75 23,23,440 Kumar Johri Luckno 218 2 (767/NBRI/20 w
12) Dr. Devinder NBRI 12,95, 13,514 20,13,58 24,32,520 Vijay Luckno 425 6 (NBRI/759/20 w
12) Deepak Wahal NBRI 12,53, 12,752 15,55,74 22,95,360 (817/NBRI/20 Luckno 879 4
14) w Swadesh NBRI 12,78, 13,004 16,90,52 23,40,720 Malhotra Luckno 657 0 796/NBRI/20 11 Item No. 24 (C-5) O.A. No.717/2025 13 w K. Sarveswara IMMT 11,87, 12,080 21,38,16 21,74,700 Rao (SP-191- Bhuba 803 0 2009- neshwa 10/ACCTS) r B.V. IMMT 12,28, 12,492 22,48,56 22,48,560 Ramanamurth Bhuba 314 0 y (SP-202 202- neshwa 2011- r 12/ACCTS) Lala Behari IMMT 13,14, 13,722 21,40,63 24,69,960 Sukla (SP-(SP Bhuba 349 2
203-2011 2011- neshwa 12/ACCTS) r K.S. CFTRI 11,67, 11,212 19,84,52 20,18,160 Jagannatha Mysore 573 4 Rao (1072/CFTRI/ 2009- 2010/26 2010/26-03- 2010) H. J. Kantha CFTRI 11,69, 11,896 19,74,73 21,41,280 (1106/CFTRI/ Mysore 710 6 2010- 2011/21 2011/21-02- 2011) H.Y. CFTRI 11,92, 12,128 20,86,01 21,83,040 Mahakuteshw Mysore 522 6 ar (1088/CFTRI/ 2010- 2011/18 2011/18-08-
2010)
Shivaswamy CFTRI 1,77,7 1,808 2,60,352 3,25,440
(1178/CFTRI/ Mysore 78
2012-
2013/28
2013/28-12-
2012)
S. Yella Reddy CFTRI 11,69, 11,898 17,84,70 21,41,640
(1155/CFTRI/ Mysore 907 0
2012-
2013/27
2013/27-06-
12
Item No. 24 (C-5) O.A. No.717/2025
2012)
Sreedhara N CFTRI 11,03, 11,888 19,85,29 21,39,840
(1102/CFTRI/ Mysore 634 6
2010-
2011/24
2011/24-01-
2011)
Mohini Saxena AMPRI 9,46,4 9,625 16,45,87 17,32,500
(AMPRI(RRL)/ Bhopal 07 5
BHO/PEN
BHO/PEN-
35/2010)
Kuldeep AMPRI 12,22, 12430 21,50,29 22,37,400
Kumar Kaul Bhopal 218 0
(AMPRI(RRL)/
BHO/PEN
BHO/PEN-
34/2010)"
2.6 The applicants' representations dated 27.05.2024 and 19.07.2024 seeking discontinuance of such deductions and restoration of full pension after 11 years were rejected by the impugned non-speaking non speaking order dated 06.08.2024. 2.7. The grievance of the applicants is that such continued deductions are are arbitrary, disproportionate, and violative of Articles 14 and 21 of the Constitution of India, the provisions of the Pension Rules, and settled principles of proportionality. Hence, this O.A. 2.8. Learned counsel for the applicants submitted that the deductions ductions made under the Commutation Rules are vitiated by the following legal infirmities: 13
Item No. 24 (C-5) O.A. No.717/2025
(i) Firstly, it is submitted that the recovery of the commuted pension amount beyond 11 years is arbitrary and disproportionate, thereby violating Article 14 of the Constitution. The deductions, in many instances, exceed the lump sum actually received by the pensioners, resulting in manifest unfairness. Reliance is placed on the judgment of the Hon'ble Supreme Court in Mafatlal Group Staff Association v. Regional Comm Commissioner, Provident Fund [(1994) 4 SCC 58], wherein it was held that there must be a broad correspondence between employee contributions and the benefits received, and that periodic valuations must be undertaken to ensure fairness. It is submitted that the present mechanism of recovery fails to meet this test of proportionality and non non-arbitrariness.
(ii) Secondly, it is contended that the Commutation Rules give rise to invidious discrimination, also offending Article
14. Pensioners who opt for commutation are subjected to a lower effective pension over time compared to those who do not, despite having made equal contributions. The mandatory 15-year 15 year recovery period imposes an undue financial burden on those exercising the commutation 14 Item No. 24 (C-5) O.A. No.717/2025 option, effectively penalising them for availing a lawful entitlement.
(iii) Thirdly, learned counsel submitted that ther there is no tangible risk of non-recovery non recovery of the commuted amount. Since pensions are paid directly by the employer and constitute unencumbered assets, recovery is inherently secure. Furthermore, commutation is allowed only after medical examination, and increased increased life expectancy has rendered the 15 year 15-year recovery period outdated and unjustified. The continued deductions thus operate as economic duress on retired employees.
(iv) Fourthly, it is submitted that the commutation agreement is in the nature of an adhes adhesion contract, lacking any real element of consent, and is void under Section 23 of the Indian Contract Act. Lower Lower-tier employees, in particular, are compelled by economic necessity to accept these terms without any bargaining power. This results in diminished hed pension entitlements and adversely affects their right to livelihood. Reliance is placed on the judgments in LIC v. Consumer Education & Research Centre [(1995) 5 15 Item No. 24 (C-5) O.A. No.717/2025 SCC 482]and Central Inland Water Transport Corp. Ltd. v. Brojo Nath Ganguly [(1986) 3 SCC 156], wherein the Hon'ble Supreme Court held that unconscionable contracts, especially those involving social security, are unenforceable as they violate Articles 14 and 21.
(v) Lastly, learned counsel submitted that the present recovery mechanism is in direct direct contravention of the CCS (Pension) Rules and the public policy reflected in Section 23 of the Contract Act. Pension has been judicially recognized as deferred wages in D.S. Nakara v. Union of India [(1983) 1 SCC 305], and any deduction therefrom is permissible ermissible only in cases of misconduct under the Rules. Recovery exceeding the lump sum received thus amounts to an illegal reduction of pension. Rule 33 of the Commutation Rules prohibits inequitable implementation, which the current practice blatantly ig ignores. It is, therefore, respectfully submitted that the prevailing recovery regime violates public policy and the foundational principles of the pension system.
16Item No. 24 (C-5) O.A. No.717/2025 2.9. Learned counsel for the applicants further submitted that the issue of excess recovery un under Rule 10A of the Commutation Rules is already under active judicial consideration before various forums across the country. In OA No. 834/2024, Rajneesh Anand v. Council for Scientific and Industrial Research, Research the Jammu Bench of this Tribunal was pleased pleased to stay the recovery beyond 10 years from the date of commencement. Similarly, interim reliefs against monthly deductions have been granted by other judicial bodies in matters involving the same grievance. These include WP(C) No. 2199/2024, Ravindra Dhar v. Union of India before the Hon'ble High Court of Jammu & Kashmir and Ladakh; OA No. 860/2024, Hari N. Saste v. Union of India before the Mumbai Bench of this Tribunal; and WP No. 32535/2024, Bejjipurapu Viswanadham v. Union of India before the Hon'ble H High Court of Telangana, each of which granted interim protection from continued deductions. Furthermore, the Hon'ble Supreme Court has, by its order dated 19.12.2024 in SLP (C) No. 30084/2024, State Bank of India v. Bejjipurapu Viswanadham, Viswanadham, been pleased to dismiss the 17 Item No. 24 (C-5) O.A. No.717/2025 special leave petition filed against the interim order of the Hon'ble Telangana High Court, thereby allowing the protection granted to the petitioners therein to remain in force. It is also submitted that despite repeated representations esentations and ongoing litigation, the respondents have not disclosed any rational basis for enforcing a uniform 15-year 15 year deduction period under Rule 10A. Their silence on this issue, both in their pleadings before the courts and in response to the affecte affected pensioners' representations, further underscores the arbitrariness of the existing recovery regime.
3. Opposing the grant of relief, learned counsel for the respondents, while opposing the Original Application, submitted that the challenge to Rule 10A of the Commutation Rules is devoid of merit and liable to be dismissed on multiple grounds, including delay, waiver, and the binding effect of judicial precedents. 3.1. Learned counsel submitted that the applicants, including members of the applicant associa association, voluntarily opted for the commutation of pension at the time of their 18 Item No. 24 (C-5) O.A. No.717/2025 retirement. They were fully aware, from the very beginning, that under Rule 10A of the Commutation Rules, the commuted portion of the pension is to be restored only after the completion completion of 15 years. This stipulation was accepted by them unconditionally, and they received the lump sum commuted value without raising any objections for more than a decade. Their present grievance, raised nearly ten years after retirement, is clearly an afterthought and amounts to an attempt to reopen a concluded matter, which is barred both by the law of limitation and the principle of waiver.
3.2. Learned counsel further submitted that the Council of Scientific and Industrial Research (CSIR), though an autonomous body under the Department of Scientific and Industrial Research, Ministry of Science and Technology, follows the Central Civil Services (Pension) Rules, 1972 and the Commutation of Pension Rules mutatis mutandis, as per its own internal circulars circulars and longstanding administrative practice. Accordingly, CSIR has no independent authority to alter or amend the 15 15-year 19 Item No. 24 (C-5) O.A. No.717/2025 recovery rule, which continues to be binding until modified by the Government of India.
3.3. Learned counsel further emphasizes that th the issue raised in the present OA is no longer res integra. The Hon'ble High Court of Delhi, in Forum of Retired IPS Officers v. Union of India & Ors., Ors. 2019 SCC Online Del 6610,, has specifically upheld the validity of the 15 15-year recovery period under Rule 10A. The Court held that commutation provides several advantages, including the receipt of a tax free tax-free lump sum and investment opportunities that could yield returns. The Court also noted that the 15-year 15 year period is based on an actuarially sound and equitable equitable approach that balances public interest and the need for administrative consistency. The Hon'ble Supreme Court, while dismissing SLP (C) No. 8852/2019 against this judgment, affirmed its reasoning. Learned counsel for the respondents also cited similar de decisions from the Hon'ble High Courts of Allahabad ((Dan Bahadur Yadav v. Bank of Baroda, Baroda, 2025 SCC Online All 600), (Shila Devi v. State of Punjab Punjab & Haryana (Shila Punjab, CWP No. 9426/2023), and Himachal Pradesh ((Rajinder Kumar 20 Item No. 24 (C-5) O.A. No.717/2025 Bhardwaj v. State of HP, HP, CWP No. 118 11858/2024), all of which have declined to interfere with the established 15 15- year commutation rule.
3.4. With respect to the applicants' claim of economic duress, it is submitted that commutation of pension is entirely optional and is exercised at the sole di discretion of the pensioner. The applicants cannot now, after having availed the benefits for a decade, challenge the very terms under which they accepted those benefits. This belated attempt to re characterize re-characterize a voluntary contractual arrangement as coercive or unconstitutional is neither tenable in law nor supported by facts. 3.5. Concluding the arguments, learned counsel for the respondents submitted that the administrative rejection of the applicants' representations on 06.08.2024 was in strict adherence to to the prevailing rules and in compliance with judicial guidance. The said order clearly explains that unless and until the Government of India amends the rule, CSIR is bound to follow the existing statutory framework. 21 Item No. 24 (C-5) O.A. No.717/2025
4. In the written submission filed on behalf of the applicants by Mr. Siddharth, learned counsel, it is submitted as under:
(i) The impugned Rules 6, 8, 10A, and 29 of the CCS (Commutation of Pension) Rules, 1981 require deductions for 15 years despite full recovery of principal and interest within ithin 11 years. This imposes a disproportionate burden violating the applicant's fundamental rights. Waiver or estoppel cannot bar a challenge to such a violation ((Ref.
Olga Tellis vs. Bombay Municipal Corp. (1985) 3 SCC 545 and Basheshar Nath vs. CIT (1959 Supp 1 SCR 528)
528)).
(ii) Pensioners form a homogeneous class ((D.S. Nakara vs. UOI,, 1983 1 SCC 305),
305), yet those who opt for commutation are unfairly penalised through continued deductions. This discriminates against the more vulnerable and violates the intended protective purpose of the commutation scheme. No actuarial justification has been provided for this continued deduction.
(iii) The commutation option constitutes an unfair contract due to unequal bargaining power. The pensioners, under 22 Item No. 24 (C-5) O.A. No.717/2025 economic duress, duress, had no real choice. This violates public (Central Inland Water policy and fundamental rights (Central Transport Corpn. Ltd. Vs. Brojo Nath Ganguly (1986 3 SCC 156) and LIC of India and anr. vs. CERC & Ors. 1995 5 SCC 482).
482
(iv) The respondents reliance on Forum of Retired IPS Officers vs. UOI 2019 DHC : 353 -DB DB is misplaced as the said judgment did not address proportionality or socio socio-
economic vulnerability. It dealt with alternate actuarial calculations, not with continued disproportionate deductions post-recovery.
post
5. Having heard learned counsel for the respective parties and perused the pleadings available on record, as well as the submissions made by them, we would draw the following analysis:
6. ANALYSIS :
6.1 The Central Civil Services (Commutation of Pension) Rules, 1981 are relevant for the present purpose:
"RULE RULE 8. Calculation of commuted value of pension - 23 Item No. 24 (C-5) O.A. No.717/2025 The lump sum payable to an applicant shall be calculated in accordance with the Table of the values prescribed from time to time and applicable to the applicant on the date on which the commutation becomes absolute. Section 11 to 28 deal with -Commutation Commutation of Pension Section 29 provides for the modification in the value specified in the commutation as per the table thereto.
thereto."
6.2 The formula is as under :-
"Commuted Commuted Value = 40% of Pension Ordered x Commutation Factor x 12"12
The he 'Commutation Factor' is a predefined number based on the age of the pensioner at the time of retirement. The commutation of pension calculation can be considered by the following example:
Pension Ordered: Rs. 50,000 per month Age at retirement: 60 years Commutation factor for age 60: 8.194 Using the formula:
Commuted Value = 40% of Pension Ordered x Commutation Factor x 12 = 40% of 50,000 x 8.194 x 12 = 19,66,560 24 Item No. 24 (C-5) O.A. No.717/2025 Thus, the pensioner will receive Rs. 19,66,560 as a lump sum amount for the commuted portion of their pension.
6.3 Vide Office Memorandum No. 34/2/86 34/2/86-P&PW(G) dated 22.08.1990, the Government of India revised its earlier instructions by clarifying that the period of 15 years for restoration of the commuted portion of pension shall be reckoned from the date of commutation of pension pension, rather than from the date da of retirement.
6.4 In R.Gandhi vs U.O.I. 1999 (8) SCC 106), the Hon'ble Supreme Court held as under:-
"In In Welfare Association of Absorbed Central Government Employees in Public Enterprises & Ors. vs. Union of India & Anr.[AIR [AIR 1996 SC 1201], the relief sought by the pensioners in their petition under Article 32 of the Constitution was :
restoration of 1/3rd portion of the fully commuted pension as p per the decision of this Court in Common Cause (supra). A three- Judge Bench, of which one of us (Venkataswami,J.) was a member, reiterated the principles applied in the aforementioned cases. Indeed, the date from which 15 years pension was to be reckoned was not in issue there. This Court strikes at arbitrary action of the State and accordingly it did in Common Cause (supra), by interdicting the arbitrary action of the Government in paying the reduced pension as a result of commutation of 1/3rd pension for the rest of the life of the pensioners and issued an equitable direction to restore the full pension after 15 years "from the period of the retirement" to the pensioners who had commuted 1/3rd of the pension. The period of 15 years has been arrived at after taking into consideration various factors mentioned above. It is well well-settled principle that the words in the judgment of the Court cannot be interpre interpreted as 25 Item No. 24 (C-5) O.A. No.717/2025 the words in a statute. By the said direction this Court never intended to confer any unfair or undue advantage on the pensioners. It only ensured fairness in the treatment of pensioners at the hands of the Government in respect of deduction of pension pension consequent upon the commutation of the portion of the pension. The decision in Common Cause (supra) has been understood in all subsequent judgments of this Court as 15 years from the date of commutati commutation and we are in respectful agreement with the same. This neither prejudices the rights of any of the parties nor confers any undue or unfair advantage upon any party. From the above discussion, it follows that the impugned Memorandum does not incorporate any condition contrary to the judgment of this Court in Common Cause (supra). The High Court was, therefore, right in dismissing the writ petition. We find no illegality in the order of the High Court. The The appeal fails and it is accordingly dismissed."
6.5 In CWP No. 9426 of 2023 (O&M) dated 27.11.2024, the Punjab and Haryana High Court also declined to restore commuted pensions after 12 years, impacting 808 writ petitions, petitions, and ordered the recovery of pensions already released under interim orders. Paras 25 to 31 of the said decision are reproduced as follows:
"25. Learned counsel for petitioners were at pains to indicate that the 6 Central Pay Commission had recommended periodical revision and review of commutation tables keeping in view the interest rates and mortality rate. While referring to Sample Registration System (SRS) Based Abridged Lifetables 2013 2013-2017 issued by Registrar General and Census Commissioner, Ministry of Home Affairs, it was contended that palpable Ministry change is indicated in mortality rate which calls for a relook by the authorities on the issue in question. In respect to this argument, we take note of the response of State of Punjab by way of additional affidavit dated 04.11.2024 of Saroj, Under Secretary to Government of Punjab, Department of Finance, in CWP No. 9426 of 2023 stating therein that as per data supplied by Department of Health State of Punjab, based on the Sample Registration System (SRS) statistical statistical data issued by Registrar General 26 Item No. 24 (C-5) O.A. No.717/2025 and Census Commissioner, Ministry of Home Affairs, Government of India, death rate in the State of Punjab is higher since the year 2019 than that of the Country as a whole.
26. It is pertinent to note at this stag stage that the 7th Central Pay Commission did not recommend any change in respect to commutation of pension including the period of restoration. The 6th Punjab Pay Commission on considering the report of the 7th Central Pay Commission as well as the representations representations of the Employees Association did not find any reason to differ and did not recommend any change. The observations and recommendations as reproduced in affidavit dated 04.11.2024 read as under:-
under:
"Observations and recommendations 8.11.3Employee Associa Associations have represented that the commuted pension needs to be restored after 12 years and the commutation be allowed @ 40% of the pension as was previously the case.
Moreover, the existing rate of commutation is 40% for Central Government pensioners.
8.11.4The The 7th CPC has not recommended any change either in maximum percentage of commutation or in the period of restoration. It has in this context referred to the Supreme Court judgment of 09.12.1986 wherein the hon'ble court specifically observed that though the amount is recovered in 12 years yet since there is a risk factor and some of the States are restoring pension after 15 years, the existing period of restoration should be retained. 8.11.5The Commission has no reason to differ and recommends that the rrate of commutation be raised to 40% with no change in the period of restoration of the commuted amount."
27. It is a matter of record that all the petitioners before us are27. It is a matter of record that all the petitioners before us are retired employees employees who have admittedly availed of 27 Item No. 24 (C-5) O.A. No.717/2025 the benefit of commutation of pension. Admittedly, pension of some of the employees also stands restored. All the petitioners were in service at the time of issuance of notification dated 21.07.1998. They never raised any objection bjection to the stipulated period of 15 years for restoration of pension. Having availed of a benefit which is clearly voluntary in nature, it is not open to the petitioners to raise the grievances as noted above, at this stage, to seek a variation in the terms and conditions accepted by them with open eyes. They are not entitled to seek recovery of the amount so deposited by them in accordance with the accepted terms and conditions.
28. In this factual matrix, the argument that it is a continuing cause of action as it pertains to pension, is clearly unacceptable. There is no question of any direction to the State to restore pension on expiry of 11.5 years or 12 years as prayed for or to refund the amount so recovered. It is necessarily for the State to take a considered decision thereon after delving into the complex questions and underlying parameters which would be involved for assessment of the issues. Admittedly, matters related to commutation of pension are complex affairs involving vexed issues traversing traversing diverse field which calls for application of specialized expertise. It is a settled position that in such matters the Court would venture only in case of manifest and apparent arbitrariness. Learned counsel for petitioners were unable to point out any material on record to indicate that the formula adopted is per se and ex facie irrational or arbitrary which calls for interference by this Court.
29 At this stage, we take note of the specific stand of the State as projected before us that it would be rea ready to examine the scheme period of commutation while taking into consideration changes, if any, in underlying parameters and that an Expert Committee would be constituted in this respect which would be assisted by Recognized Expert Agency or Institution(s) which possess requisite knowledge and competence in assessing such matters. In this process the Committee would also invite and consider submission and representations in the matter from Associations of pensioners in the State.
30.Keeping in view the fair stand on the part of the State, we do not find any ground for issuance of any particular direction in this regard except to observe that in terms of the stand as projected before us, it is expected that necessary steps in this regard would be taken expedi expeditiously by the State.
28Item No. 24 (C-5) O.A. No.717/2025
31.Keeping in view facts and circumstances as narrated and discussed in foregoing paras, all the 808 writ petitions are dismissed with order as to cost. It is clarified that the State is entitled to effect recoveries which were stayed by way of interim orders in the writ petitions. Such recovery however be made in a staggered manner to obviate any hardship to the pensioners." 6.6 .6 A Special Leave Petition, being SLP(C) No. 8845 of 2025 titled Des Raj vs. State of Punjab Punjab, arising out of the judgment dated 04.12.2024 passed in CWP No. 22606 of 2024, which itself was based on the decision rendered in CWP No. 9426 of 2023 (O&M) decided on 27.11.2024 (batch cases) by the Hon'ble Punjab and Haryana High Court, was taken up for hearing along wi with other connected matters before the Hon'ble Supreme Court. The Hon'ble Apex Court, after considering the submissions, was pleased to dismiss the said SLP on 07.04.2025, thereby upholding the view taken by the High Court. The observations in this regard are re as under: -
"1. Heard learned counsels appearing for the petitioners.
2. After considering various aspects of the matters, we are not inclined to interfere with the impugned judgments and orders passed by the High Court. The special leave petitions are, are, accordingly, dismissed.
3. Pending application(s), if any, shall stand closed.
closed."29
Item No. 24 (C-5) O.A. No.717/2025 6.7. In M. S. P. Shantha Kumari vs. The State of Andhra Pradesh, Pradesh, decided on 28 April 2025 in Writ Petition No. 24822 of 2024 and batch matters, the Hon'ble High Court of Andhra Pradesh at Amaravati held as under:
"34. Considering the fact that the Government has framed "34.
a Rule which has as its substratum the policy based upon the recommendations of the Pay Revision Commissions and when we test the impugned Rule on the touc touchstone of the aforementioned principles, it can be seen that the Government has prescribed a period of 15 years, considering various factors including the risk factors which accompany the payment of a lump sum amount to a pensioner and other economic consi considerations accompanying it. It would be worthwhile to reproduce the recommendations made by the 11th Pay Revision Commission which shows the advantage which the pensioners secure upon receipt of lump sum payment:
"Recommendation 17.34. This issue was put forth before the earlier PRCs as well. The PRC 1999 did not agree for reducing the period of restoration on the ground that the age of retirement in the State Government was 58 years but not 60 years as was being followed in other other states like Kerala, Orissa, Punjab and Madhya Pradesh. This position is no longer relevant though since the age of retirement has been revised to 60 years in 2014. The PRC 2005 suggested to adopt the principles which are followed by the Government of India.
India. The 2010 and 2015 PRCs reiterated the recommendation of the 2005 PRC. 17.35. We would like to highlight four different aspects which have a bearing on this issue:
i) Firstly, commutation of pension is a voluntary act and the employee can even exercise exercise this option at any time after his retirement. He/she can also decide the portion of pension which he/she wants to commute, subject of course to the prescribed limit. The employee is therefore free to judge the benefits and drawbacks of the scheme and then then decide whether to opt for it or not. 30
Item No. 24 (C-5) O.A. No.717/2025
ii) Secondly, the rules provide for restoration of the commuted portion of pension in the unfortunate event of demise of the original pensioner i.e. in such cases no further recovery is made from the Family Pensione Pensioner. This introduces an element of mortality risk which has been factored in for the purpose of calculating the restoration period. The Supreme Court, vide their judgment dated 09.12.1986, allowed restoration of pension after 15 years because of the presence of this risk factor. We are aware that this conclusion has been contested in some quarters by arguing that the Supreme Court decision was delivered long time back and since then the expectancy of life at birth has increased (from 56.60 to 69.04 years). Nevertheless, considering the fact that the normal age of Nevertheless, retirement is 60 years and the restoration of pension takes place at the age of 75 (or more) there is still a mortality risk involved in the scheme although it has reduced quite a bit.
iii) Thirdly, one of the most attractive benefits of the scheme is that it makes available to the pensioner a lump sum amount by capitalising the pension over several months. The pensioner can use it either to meet some urgent family needs such as acquiring a suitable shelter, meeting marriage/educational/health care expenses etc. or simply invest it for financial return. In the earlier case the true value of this amount cannot be expressed only in monetary terms.
iv) Fourthly, as mentioned above, the pensioner may choose to invest the amount for financial benefit. Although choose there are many alternative avenues of investment, we would make an attempt to compare the financial returns that the pensioner would get if he/she deploys the lump sum commuted amount in a Bank fixed deposit, which is the safest mode of investment, with the amount that one would have made by investing the amount recovered every month towards commutation i.e. had he not opted for commutation. The contention of the pensioners is that the Government recovers recovers more than it pays in lump sum on commutation. While making this comparison one has to keep in mind the fact that the Commutation Value of pension, received in lump sum, is not taxable but the monthly pension as well as the interest accrued on Bank de deposits are taxable."
6.8 In a recent decision arising out of CIVIL APPEAL NO.
The Reserve Bank Of India Versus M.T. 13962 OF 2024 -The 31 Item No. 24 (C-5) O.A. No.717/2025 Mani And Another, Another decided on 23.05.2025, the Apex Court observed as follows:
" 37.Moreover, based on the facts of the case, the Respondent cannot be permitted to blow hot and cold in the same breath, as stated above. Each Circular had its own specific terms and conditions, entitling the retirees or in service employees to the benef in-service benefits as were laid down therein and that too subject to certain conditions.
38. The said scheme itself was a well well-considered and thoroughly worked-out worked out detailed financial liability aspect. The said Scheme therefore to be operational and effective and above all, a viable one was to operate as a whole. The present Scheme of the year 2020, was a conglomerate of various factors, with each factor working in tandem with the others making it an effective and workable Scheme which when tested on the principles laid down by this Court as referred to above would not fall foul of it.
39. The financial aspect, in itself, is a valid consideration, as stated above, and would be applicable in the present case. The Respondent, therefore, cannot be permitted to choose a particular aspect aspect of the Scheme that makes it unworkable, and that too for his own financial benefit. Approbation and reprobation would not be permissible in such schemes. Respondent having once opted for the Scheme cannot be permitted to not accept a part thereof while intending to take the benefit of the Scheme as a while whole.
******
41.There being no violation of the Constitutional, Statutory or Common Law principles, interference by the Division Bench vide the impugned judgment while setting aside the judgement of the Single Judge cannot sustain.
42. In view of the above, the impugned judgment dated 18.12.2023 passed by the Division Bench of High Court of Kerala, therefore, cannot sustain and is hereby set aside and the Judgment of the Learned Single Judge dated 04.04.2023 dismissing the writ petition preferred by the 04.04.2023 Respondent is restored. The appeal is allowed. "32
Item No. 24 (C-5) O.A. No.717/2025 .9 Much reliance has been placed on the judgment in LIC 6.9 v. Consumer Education & Research Centre [(1995) 5 SCC 482] by the learned counsel for the applicants. The reliance, however, is misplaced. In that case, the issue of unequal bargaining power arose in the context of a life insurance policy issued by the LIC. The Hon'ble Supreme Court interpreted the policy by incorporating certain elements of public purpose and declared a clause restricting the benefit of the policy only to those employed in the Government, quasi Government, quasi-Government, or reputable commercial firms as void under Article 14 of the Constitution.
on. We fail to appreciate how the said decision can be applied to the present case, where the applicants themselves continued to enjoy the fruits of commutation. The present case is not one of an unfair, untenable, or irrational contract but relates to a rule rule of 1981, framed in exercise of the powers conferred by the proviso to Article 309 and clause (5) of Article 148 of the Constitution, after consultation with the Comptroller and Auditor General, which has already been upheld in the Common Cause case pra). Even Central Inland Water Transport Corp. Ltd. (supra).
33Item No. 24 (C-5) O.A. No.717/2025 v. Brojo Nath Ganguly [(1986) 3 SCC 156] has no application to the facts of the present case. Similarly, in Mafatlal Group Staff Association and Others v. Regional Commissioner, Provident Fund and Others [(1994) 4 SCC 58], it was held by a coordinate Bench of the Apex Court as under: -
"11. Merely because the employees who were the members of the Employees Provident Fund Scheme before March 1, 1971 were given an option to become or not to become members of of the Family Pension Scheme, it does not follow that the employees who become members of the Provident Fund Scheme after March 1, 1971, and who are not given such option are discriminated against..."
The fixing of a cut-off cut off date was considered in Mafatlal Group Staff Association (supra) and held to be permissible. The Central Civil Services (Commutation of Pension) Rules, 1981 constitute a complete code in themselves. Commutation is dependent upon a government servant exercising an option under Rules 11 to 28, which confer greater flexibility in favour of the employee. These Rules do not take away any existing rights of the employees.
7. The recovery of a period beyond the prescribed years cannot be said to be disproportionate or detrimental to pensioners on the following counts: 34
Item No. 24 (C-5) O.A. No.717/2025
(i) The government servant consciously makes a decision for the commutation of pension under Rule Section 11 to 28 of 1981 Rules, which provides for financial Flexibility, Investment Opportunities, Freedom of Choice, Elimination of Longevity Risk, Estate Planning and tax benefits etc.
(ii) The COMMUTATION VALUES FOR A PENSION OF Re. 1 PER ANNUM effective from 1st January 2006[ see Rules 3(1)(m) 8,26(7), 28(5) and 29(1) and 29(2) as Per Table.
(iii) The factor determining this is the age at the time of retirement. The proviso (b) to Rule 6 as well as Rule
8 of the Commutation Rules and 'commutation value expressed as the number of years of purchase' has to be looked into.
(iv) The issue of proportionality urged before us thus hindered by the doctrine of approbate and reprobate. It is settled that law does not permit a person to both approbate and reprobate as no party can accept and reject the same instrument. A person cannot be 35 Item No. 24 (C-5) O.A. No.717/2025 permitted to say at one time that the transaction is valid and to obtain advantage under it and on the other hand to say that it is invalid or incorrect for the purposes of securing some other advantage. (CIVIL APPEAL NOS. 7467-7470 7467 7470 OF 2014 -SALEM MUSLIM BURIAL GROUNDPROTECTION COMMITTEE VERSUSSTATE OF TAMIL NADU AND ORS. decided on 18.05.2023) 7.1. In Union of India v. N. Murugesan(2022) 2 SCC 25 while holding that it will be inequitable and unfair if a party is allowed to challenge a position while enjoying its fruits, the Hon'ble Supreme Court observed as unde under:
"26. These phrases are borrowed from the Scots law. They would only mean that no party can be allowed to accept and reject the same thing, and thus one cannot blow hot and cold. The principle behind the doctrine of election is inbuilt in the concept of approbate and reprobate. Once again, it is a principle of equity coming under the contours of common law. Therefore, he who knows that if he objects to an instrument, he will not get the benefit he wants cannot be allowed to do so while enjoying the fruits.
fruits. One cannot take advantage of one part while rejecting the rest. A person cannot be allowed to have the benefit of an instrument while questioning the same. Such a party either has to affirm or disaffirm the transaction. This principle has to be applied with more vigour as a common law principle, if such a party actually enjoys the one part fully and on near completion of the said enjoyment, thereafter questions the other part. An element of fair play is inbuilt in this principle."36
Item No. 24 (C-5) O.A. No.717/2025 7.2.
.2. Having accepted the terms of commutation and derived the benefits thereunder, the applicants cannot now, after the expiry of the stipulated period, contend that the amount recovered after 11 years should be refunded or remitted back to them, or, in the alternative, that ffull pension ought to be restored. Such a plea is contrary to the scheme of the 1981 Rules under which the benefits were consciously availed. After the lapse of nearly 15 years, the applicants have approached this Court in the year 2025, seeking reliefs which which are clearly untenable. The challenge is also barred in light of the principles of waiver and acquiescence.
8. CONCLUSION :
8.1. In view of the above detailed analysis, we do not find any merit in the submissions urged urged on behalf of the applicants. T The applicants are re not entitled to the reliefs sought in the present original application. Th The Original Application is accordingly dismissed.37
Item No. 24 (C-5) O.A. No.717/2025 8.2. Pending M.A.s, if any, shall stand disposed of. No costs.
(Rajinder Kashyap) (Manish Garg) Member (A) Member (J) /as/