Rajasthan High Court - Jaipur
Prakash Chandra Sharma And Ors. vs State Of Rajasthan And Ors. on 20 May, 2002
Equivalent citations: (2003)IIILLJ997RAJ, RLW2003(3)RAJ1643, 2002(4)WLC367, 2003(2)WLN281
JUDGMENT Balia, J.
1. These three special appeals arise out of a common judgment and raise identical questions and hence, they are being disposed of by a Common Judgment.
2. For the purpose of deciding these appeals, it would be apposite to narrate the facts of D.B. Civil Special Appeal No. 852 of 2001.
3. Petitioner Prakash Chandra Sharma was appointed on 1.8.69 on the post of Upper Division Clerk in Urban Improvement Trust, Jodhpur. He was superannuated on 31.7.99 from the post of Stores Officer. After his superannuation, though he has been granted pension and other retiral benefits but he has not been paid the Gratuity. According to the petitioner, the State of Rajasthan vide its'order (Annex.3) dated 25.7.72 made Raj.Municipalities (Contributory Provident Fund and Gratuity) Rules, 1963 applicable to the employees of Urban Improvement Trust of the State. Rule 11 of the Rules provides payment of Gratuity and it specifically provides that gratuity shall be granted to those employees who have completed 5 years of service. The rates at which Gratuity is payable has also been mentioned in the Rules. However, the petitioners have not been paid Gratuity after their retirement inspite of demands having been made.
4. According to the respondents, when the petitioners entered into the service, the was no scheme of pension on retirement and the employees were only entitled to receive the benefits of Contributory Provident Fund ('CPF') as well as Gratuity Fund. However, after the promulgation of the Rajasthan Urban Improvement Trust Employees Pension Service Rules, 1996 with effect from 1.9.1992, the employees of Urban Improvement Trust became entitled to pension also. However, no provision has been made for payment of Gratuity and therefore, no Gratuity is payable to the petitioners as they have availed the benefit of pension.
5. There is no dispute between the parties about the fact that in response to an attention motion brought in the State Legislature Assembly, it was made clear by the State 'Govt. that the employees of Urban Improvement Trust are subjected to 5% deduction as their contribution towards Gratuity Fund and the Gratuity is being paid even after the promulgation of the Rules of 1996. It is also not in dispute that the petitioners have been subjected to 5% deduction as their contribution towards Gratuity Fund.
6. Mr. Kailash Nath Joshi, the learned counsel appearing for the respondents have contended that keeping in view the aforesaid contended that keeping in view the aforesaid controversy, the respondent Urban Improvement Trust, Jodhpur has sought guidelines from the State Govt. He has also submitted that Gratuity Rules governing the employees of the Urban Improvement Trusts are in contemplation.
7. Having given our thoughtful consideration to the contentions made by the learned counsel for the parties before us and upon perusal of the scheme of the Rules of 1963 and the Rules of 1996, we are of the opinion that these appeals merit acceptance.
8. The learned Single Judge has dismissed the writ petitions on the ground of alternative remedy. The writ petitions having been entertained, replies having been filed and the matter concerns interpretation of the Rules, it would not be appropriate to send the petitioners back to seek alternative remedy for seeking redereesal of their grievances regarding grant of retiral benefits. Moreover, after lapse of such a long time, we are not inclined to send the [petitioner to avail the alternative remedy, which could have been pursued by him at the time when he filed the writ petitions. Only question of interpretation of Rules is involved in the instant matter and the controversy concerns the retiral benefits of the appellant-petitioner who had. superannuated long ago and, therefore, it would be appropriate to decide such question finally in these appeals. Such question is likely to occur again and again.
9. As stated above, it is not in dispute that when the petitioners entered into the service, there was no scheme of pension of retirement and the employees were only entitled to receive the benefits of Contributory Provident Fund as well as Gratuity Fund. However, after the promulgation of the Rajasthan Urban Improvement Trust Employees Pension Service Rules, 1996 with effect from 1.9.92, the employees of Urban Improvement Trust became entitled to pension also, however, no provision has been made for payment of Gratuity in the Rules of 1996, it is also not in dispute that the petitioners have been subjected to 5% deduction as their contribution towards Gratuity Fund.
10. The Rules of 1963 deals with Contributory Provident Fund and also Gratuity. Both parts of retiral benefits are payable on cessation of service. It also cannot be doubted and disputed that retiral benefits, where pension is payable, also include entitlement of payment of gratuity independent of and in addition to pension, Pension and Gratuity are not' mutually exclusive arid incompatible concept of retiral benefits. Rather in most cases, both exist simultaneously. In fact even under Rajasthan Service Rules also employees, of the State are entitled to both pension and gratuity on superannuation or cessation of service on account of death or voluntarily or compulsory retirement.
11. The same thing cannot be said to Contributory Provident Fund. Ordinarily CPF and Pension do not exist concurrently. Wherever there is scheme of Contributory Provident Fund to which employer also contributes to become part of retiral benefits of his employee on superannuation do not continue after pension scheme is introduced. On introduction of pension scheme, the employer is usually not required to pay both his part of contribution to CPF and pension.
12. In short while continuance of CPF may be incongruous and incompatible with pension with pension scheme and existing scheme of CPF may be superseded with introduction of pension scheme, if the new scheme so provides, same thing cannot be said about Gratuity. An existing Gratuity Scheme cannot be deemed to be superseded merely because Rules of Pension have been framed.
13. Rule 3 of the Rules of 1963 provides that every Board shall establish a fund for all persons holding posts which are non pensionable in accordance with those rules and the provisions of the Provident Fund Act, 1925 shall apply to each such fund. Each fund shall vest in and be administered by the Board concerned. Another function which was envisaged under the provisions of the Rule was that there was Rule 10 under which the Board shall alongwith the monthly subscription to the fund make a contribution each month to the account of each subscriber. The contribution shall be equal to the subscription paid into the fund by a subscriber each month.
14. In addition to this, Rule 11 envisages that every Board in addition to its share of contribution as provided under Rule 10 shall also grant to a scriber who has completed 5 years service, the amount of gratuity at the rate of one fourth of the emoluments of a subscriber for each competed 6 monthly period of service, subject to a maximum of 16 1/2 times of emoluments. In the event of death of a subscriber while in service the gratuity will be subject to a minimum of 12 times the emoluments of the subscriber at the time of death, The minimum limit of gratuity payable under the Rules was Rs. 50,000/-.
15. For giving effect to the provision of paying Gratuity under Rule. 11(1) of the Rules, it was envisaged under Rule 11 (5) that every Board for the purpose of Sub-rule (1) shall open a separate Personal Deposit Account other than as provided under Sub-Rule 6 on the similar conditions for the purpose of this rule. Any amount credited by the Board in the Fund or in the Accounts of the subscribers or account of gratuity before coming into force of this notification shall be deposited to the said account alongwith the interest accrued thereon, Clause (ii) of Sub-rule (5) of Rule 11 further envisages that every Board shall deposit in the said Personal Deposit Account such monthly amount which maybe equal to 5% of the total employments of all the subscribers. The amount shall be drawn in the salary bills and shall be deposited in the said account forthwith. Clause (iii) of Sub-rule (5) of Rule 11 further envisages that the amount so deposited in the Personal Deposit Account shall not be withdrawn in any case except to make payment of gratuity to the subscriber in accordance with rule or under Sub-rule 6. The minimum/maximum limit fixed for payment of gratuity has been amended from time to time keeping in view the revision of pay scales. Sub-rule (3) of Rule 11 further goes to show that the gratuity at the rates indicating in Sub-rule (1) shall be payable to a subscriber who retires on attaining the age of superannuation on or after 1.6.1978 provided that it is certified by the competent authority that the services rendered by the employee has been good, efficient and satisfactory.
16. It is apparent from the aforesaid Rules that Gratuity was being paid to the employees on retirement out of the fund deposited by the subscribers themselves, which was part of their emoluments which were payable to them: It is not in dispute that out of the salaries of the petitioners, monthly subscription towards gratuity was deducted till their retirement. The recommendations made by the respondent UIt also goes to show that gratuity has been paid to a number of other employees who have been retired after commencement of the Rules of 1997. The answers which have been submitted by the respondent UIT to the questions raised by the Deputy Secretary to the Govt. Local Self Govt. Department are relevant to be noticed.
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17. On the other hand, we find that vide notification dated 17.1.1997 published in Rajasthan Gazette Extra Ordinary dated 21.1.97 Rajasthan Urban Improvement Trust Employees Pension Rules, 1996 were promulgated by the State Govt. in exercise of its Rule making powers under Section 74 of the Rajasthan Urban Improvement Act, 1959. As the title of the Rules suggest, it only provides for grant of pension to the employees of various Urban Improvement Trust within the State. These rules extended the benefit of pension scheme to all the employee of UIT within the State who have retired on or after 1.9.1992. Those employees who had retired prior to 1.9.1992 were not extended any benefit of the Rules as per Rule 3(2) of the Rules.
18. Those who were in service on the date of commencement of Rules or retired prior to such commencement but on or after 1.9.1992 were required to give option for being governed by existing CPF Scheme or by the Rules within the specified period as per Rule. 4. Those employee who on retirement had already availed the benefit of CPF also could opt for pension by refunding 50% of benefit received from CPF with interest thereon at the rate at which interest accrued on CPF A/c. On such option being given or deemed to have been given for pension, the employees contribution to CPF was to be transferred to General Provident Fund alongwith interest accrued thereon and the contribution made by the UIT towards CPF was to be transferred to pension Fund in like manner as per Rule 6 of the said Rules. For earning right to pension, an employee was required to have 18 years qualifying service to his credit.
19. With this basic structure, the Rules also made provision for voluntary retirement with pension benefit, family pension, commutation of pension etc. However, the Rules do not deal with existing right to gratuity as such in any manner. It is apparent that the Rules of 1996 do not pertain the payment of gratuity at all. It is further apparent that monthly deductions towards gratuity fund are being made from the salaries of the employees. Therefore, the respondents cannot deny the payment of gratuity to the petitioners. The petitioners are entitled to receive the amount of gratuity as payable under the Rules of 1967.
20. Moreover, there is no ground to retain the money deducted out of employees emoluments after their retirement by the employer. It is relevant to notice that special provision has been made regarding payment of pension in the case of employees who have not completed 10 years of qualifying service also in Rule 13 of the Rules. Pertinently, it says that such provision shall be entitled to only service gratuity as per Rule 256(O) of the Rajasthan Service Rules. This further goes to how that Rules envisages provision for pension only and which is not in derogation of gratuity. In fact, no change or alteration has been made or envisaged under the Rules of 1996 in the matter of gratuity. Rule 13 tells us in unmistakable terms that right of a person who retires or ceases to be in service without completing 10 years of service is 'ONLY ENTITLED TO SERVICE GRATUITY' and NOT THE PENSION. That is to say that in the case governed by Rule 13, retiral benefit is confined to payment of Gratuity only and that too is restricted to claim under Rule 256D of the Rajasthan Service Rules but in other cases, pension does not affect right to claim gratuity which is otherwise payable under any existing scheme for payment of Gratuity.
21. To take any other view will result in very anomalous position. A person having lesser service will have benefit of both pension and gratuity but a person who has played full innings of his service satisfactorily will be entitled to pension only and not to gratuity, that too notwithstanding deduction on account of contribution towards Gratuity fund was being made from the employment of appellant-petitioner and person similarly situated till they superannuated. The Court shall be loathe to propagate such a view unless clear and unequivocal intention to the contrary appear from the Statute. That is not the case here.
22. Accordingly, these appeals are allowed. The impugned judgment dated 27.9.2001 passed by the Hon'ble single Judge is set aside. The respondents are directed to make payment of Gratuity to the petitioner as per the provisions of rules of 1963. There will be no order as to costs.