Gujarat High Court
Bhikhabhai Malabhai Babaria vs State Of Gujarat on 30 April, 2026
NEUTRAL CITATION
C/SCA/1648/2020 JUDGMENT DATED: 30/04/2026
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 1648 of 2020
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CIVIL APPLICATION (FOR JOINING PARTY) NO. 1 of 2024
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CIVIL APPLICATION (FOR BREACH OF ORDER) NO. 1 of 2025
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R/SPECIAL CIVIL APPLICATION NO. 5355 of 2019
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R/SPECIAL CIVIL APPLICATION NO. 13102 of 2020
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NEUTRAL CITATION
C/SCA/1648/2020 JUDGMENT DATED: 30/04/2026
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NEUTRAL CITATION
C/SCA/1648/2020 JUDGMENT DATED: 30/04/2026
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FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE MAULIK J.SHELAT
=============================================
Approved for Reporting Yes No
√
============================================= BHIKHABHAI MALABHAI BABARIA Versus STATE OF GUJARAT & ORS.
============================================= Appearance:
MRS KRISHNA G RAWAL(1315) for the Petitioner(s) No. 1 MS FORUM SUKHADWALA, AGP for the Respondent(s) No. 1 MR TUSHAR L SHETH(3920) for the Respondent(s) No. 2 RULE SERVED for the Respondent(s) No. 1,3 ============================================= Page 3 of 30 Uploaded by GAURAV J THAKER(HC00951) on Wed May 06 2026 Downloaded on : Wed May 06 20:44:37 IST 2026 NEUTRAL CITATION C/SCA/1648/2020 JUDGMENT DATED: 30/04/2026 undefined CORAM:HONOURABLE MR. JUSTICE MAULIK J.SHELAT Date : 30/04/2026 COMMON JUDGMENT
1. Since this batch of petitions claims similar reliefs and raises a common question of law, at the request of the learned advocates for the respective parties, they were heard together and are being decided by way of this common judgment.
SHORT FACTS:
2. Since the facts are identical in all these petitions, to appreciate the contentions raised by the respective learned advocates, the facts of the lead case, being Special Civil Application No. 1648 of 2020, are considered as follows.
2.1 The petitioner was serving as a Labourer in Una Gram Panchayat which was converted into Una Nagarpalika in the year 1986, the respondent No. 2 herein (herein after referred as "the Municipality"). The entire staff of the Panchayat was continued with the Municipality after its conversion without any break of service.
2.2 The petitioners herein along with others raised a reference before the Industrial Tribunal seeking the relief of permanency in the establishment of the Municipality. After hearing the parties, the Industrial Tribunal vide its award dated 20-02-1997, allowed the reference and made the workmen of the Municipality permanent with effect from 01- 01-1989. The aforesaid award was confirmed by the learned Single Judge and the Division Bench of this Court.
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2.3 The Respondent No.1-State of Gujarat vide its resolution dated 28-11-1994 issued by the Urban Development and Urban Housing Department has accepted its liability to pay pension to the employees of the Panchayat recruited after 01- 04-1963 but prior to its conversion into a Municipality by extending the benefit of its resolution dated 29-09-1992 issued by the Panchayat Department. As per Clause-16 of the said Resolution, any employee recruited subsequent to the conversion of the Panchayat into a Municipality, the benefit of pension will not be extended to them. Clause 17 of the said resolution would also indicate that such a converted Municipality is required to deposit pension contribution (in lieu of CPF) of such employees with the State Government so long as they serve the Municipality.
2.4 The petitioners, having served the Municipality for about 39 years and or completed qualifying service, as the case may be, to receive pension, were not paid any pension and other retirement benefits at the time of their retirement; thus, they have approached this Court by way of these petitions.
3. It has been pointed out to this Court that in the case of other similarly situated employees like the petitioners herein, the learned Single Judge and the Division Bench of this Court Page 5 of 30 Uploaded by GAURAV J THAKER(HC00951) on Wed May 06 2026 Downloaded on : Wed May 06 20:44:37 IST 2026 NEUTRAL CITATION C/SCA/1648/2020 JUDGMENT DATED: 30/04/2026 undefined vide their different judgments at regular intervals allowed their claims by directing the respondents-authorities to pay pension and other benefits and such decisions were also confirmed by the Hon'ble Supreme Court of India.
SUBMISSIONS OF THE PETITIONERS :
4. Mrs.Krishna Raval, learned advocate for the petitioners, has made the following submissions:
4.1 The petitioners were permanent employees of the converted Municipality, thereby entitled to receive pension from the State.
4.2 It is not in dispute that the cases of the petitioners herein are similar to other employees who had been denied the pension by the respondent and upon approaching this Court, the learned Single Judge and the Division Bench of this Court have accepted their prayers by directing the respondent to pay pension and other benefits.
4.3 The Hon'ble Apex Court in the case of Una Nagar Palika vs. Kaliben Balubhai Makwana - (2019) 12 SCC 340, after appreciating all the contentions of the respondents, confirmed the judgment passed by the learned Single Judge and the Division Bench of this Court. The similar benefit is required to be granted in favour of the petitioners.
4.4 The petitioners were made permanent by the award passed by the Industrial Tribunal which was confirmed by this Page 6 of 30 Uploaded by GAURAV J THAKER(HC00951) on Wed May 06 2026 Downloaded on : Wed May 06 20:44:37 IST 2026 NEUTRAL CITATION C/SCA/1648/2020 JUDGMENT DATED: 30/04/2026 undefined Court and accordingly the Municipality passed an office order, whereby they were made permanent. The Government Resolution dated 28-11-1994, read with 03-11-1986, entitles the petitioners to claim pension benefit.
4.5 The petitioners were not recruited by the Municipality but upon conversion of the Panchayat into the Municipality, they were made permanent by the award of the Tribunal.
Clause 16 of the resolution dated 28-11-1994 has already been interpreted by the learned Single Judge of this Court vide its common oral judgment dated 28-10-2010 passed in the case of Bhikhabhai M. Bambhania vs. Chief Officer and others, being Special Civil Application No.589 of 2010 and allied matters, whereby it has rejected the contention of the respondent that since the petitioners were confirmed or regularized in their service subsequent to the conversion of the Panchayat to the Municipality, they were not entitled to receive pensionary benefits.
4.6 The Division Bench of this Court vide its oral order dated 06-10-2015 passed in the case of Una Nagar Palika vs. Chandrikaben W/o. Bhurabhai S. Bhamat and others, being Letters Patent Appeal No.1067 of 2015 and allied matters, also rejected the contention of the State that in the absence of any rules providing pension to the employees of the Municipality and merely because the contribution is deposited in the GPF, the employees concerned would not be entitled to pension unless covered by specific rules. The said judgment has been confirmed by the Hon'ble Apex Court in Kaiben Balubhai Makwana (supra).
Page 7 of 30 Uploaded by GAURAV J THAKER(HC00951) on Wed May 06 2026 Downloaded on : Wed May 06 20:44:37 IST 2026NEUTRAL CITATION C/SCA/1648/2020 JUDGMENT DATED: 30/04/2026 undefined 4.7 The respondent is trying to disown its liability to pay the pension to the petitioners by submitting that the account number which is mentioned for the GPF scheme is not in fact related to the payment of pension but it is related to other purposes. Such contention may not be entertained by this Court in light of the decision of the Division Bench of this Court dated 29-04-2024 passed in the case of The Chief Officer vs. The State of Gujarat and others, being Letters Patent Appeal Nos.1102 of 2021 and allied matters. The said decision was confirmed by the Hon'ble Apex Court by dismissing the Special Leave Petition (C) Nos.28184 of 2024 and allied matters filed by the respondent vide order dated 09-12-2025.
4.8 As per the Circular dated 22-08-2014 issued by the State, in the case of a previous decision by the Court and if it applies to the other similarly situated cases, after verifying the decision and if applicable to the other similarly situated cases, the same should be applied.
4.9 To buttress her argument, she has relied upon the following decisions:
(i) Una Nagar Palika vs. Kaliben Balubhai Makwana - (2019) 12 SCC 340.
(ii) Order of the Division Bench of this Court dated 06-10-2015 passed in the case of Una Nagar Palika vs. Chandrikaben W/o.
Bhurabhai S. Bhamat and others, being Letters Patent Appeal No.1067 of 2015 and allied matters.
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(iii) Judgment of Division Bench of this Court dated 31.01.2013 passed in the case of State of Gujarat and another vs. Jayaben Wd/o.
Bharatbhai Chauhan and another, being Letters Patent Appeal No.96 of 2013 and allied matters.
(iv) Chorwad Gram Panchayat vs. Ramniklal Dharshi Shah - (20100 1 GCD 675.
(v) Arjanbhai Panchabhai Bambhania vs. Una Nagar Palika - 2011 JX (Guj.) 1334.
(vi) Chief Officer vs. Mohmad Irshad Husenbhai Baloch - 2011 (1) GCD 569.
(vii) Bhikhabhai M. Bambhania vs. Chief Officer and others, being Special Civil Application No.589 of 2010 and allied matters.
(viii) Order of the Division Bench of this Court dated 29-04-2024 passed in the case of The Chief Officer vs. The State of Gujarat and others, being Letters Patent Appeal Nos.1102 of 2021 and allied matters.
4.10 By making the above submissions, Mrs.Raval, learned advocate for the petitioners would urge this Court to allow the present petitions.
SUBMISSIONS OF THE RESPONDENTS :
5. Per contra, Mr.Tushar L. Sheth, learned advocate and Ms.Forum Sukhadwala, learned AGP, appearing for the respective respondents, have opposed these petitions. Nonetheless, they are unable to dispute during the course of their arguments that the status of the present petitioners is not similar to the petitioners of different petitions and appeals Page 9 of 30 Uploaded by GAURAV J THAKER(HC00951) on Wed May 06 2026 Downloaded on : Wed May 06 20:44:37 IST 2026 NEUTRAL CITATION C/SCA/1648/2020 JUDGMENT DATED: 30/04/2026 undefined which were allowed and the respondent was directed to pay them pension. In short, none of the respondents is in a position to dispute the fact that the case of the petitioners herein is not covered by the cited decisions by Mrs.Raval, learned advocate for the petitioners. Yet, they made the following submissions.
6. Mr.Sheth, learned advocate for the Municipality has made following submissions:
6.1 The petitioners were not covered in the GPF scheme and as such would not be governed by the Government Resolution dated 28-11-1994. The petitioners were covered under the Contributory Pension Scheme (CPF). The employer's contribution, i.e. the Municipality's, was deposited with the authority and at the time of retirement, all the petitioners have received such benefit as well as the employer's contribution with interest.
6.2 The employee has attached Provident Fund Varshik Patraks which is PF ship and contended that he was governed by GPF scheme and deduction qua GPF was done by the Municipality till the date of superannuation. The sole reliance is placed for falling under GPF scheme is standard format available as such it is labeled as PF varshik patraks, but there is a mention in the form at the top and bottom Sr. no. UNP /AC/GPF/ (ledger A/c. Number) and at the bottom General Provident Fund ledger of Panchayat Seva, which is due to using old standard format of Gram-panchayat. It is submitted that it maintains PF Fund Ledger A/c of individual employee, Page 10 of 30 Uploaded by GAURAV J THAKER(HC00951) on Wed May 06 2026 Downloaded on : Wed May 06 20:44:37 IST 2026 NEUTRAL CITATION C/SCA/1648/2020 JUDGMENT DATED: 30/04/2026 undefined wherein particular Account number is mentioned and the same is PF Fund Ledger Account and not GPF account.
6.3 As per the Provident Fund Ledger, there are two kinds of figure related to amount are mentioned in column no.2 and 3, in column no.2 the amount which is mentioned is towards PF and in column no.3 the amount which is mentioned is towards CPF (Contribution by the respondent). In the first the row of first column, the amount which is mentioned is towards the figures fetched for the calculation of earlier years and subsequent rows are towards the monthly figures of particular year. Thereafter, the ultimate amount calculated on the basis of closing balance of earlier years, deposit of particular year I.e. retirement year and interest up to the date of retirement.
Therefore, as per the PF ledger the total amount towards PF and CPF is calculated and the same is already paid to the petitioner. The said provident Fund Ledger Account is part of Provident Fund Varshik Patrak.
6.4 In connection with other case, the Nagarpalika had called for the details of P.F. account provided by the State having head number '8336-00-800-04′ for the purpose of deposit of P.F. deduction amount of the employees of Una Nagarpalika from the Senior Auditor, AG office, Rajkot. In turn the Nagarpalika was informed vide a communication dt. 04-04-2019 that nomenclature of the head '8336-00-800-04 (14)' is P.F. Deposits of Nagarpalika. It is submitted that in the salary-slip also deduction of PF is mentioned. The respondent Nagarpalika has also written a letter dated 19-10- 2018 to Sub-Treasury Officer, Una asking that under which Page 11 of 30 Uploaded by GAURAV J THAKER(HC00951) on Wed May 06 2026 Downloaded on : Wed May 06 20:44:37 IST 2026 NEUTRAL CITATION C/SCA/1648/2020 JUDGMENT DATED: 30/04/2026 undefined head PF is being deposited and whether the employees are entitled to pension, in turn the reply dated 19-10-2018 is received by the Nagarpalika that PF Account transaction is being done in the accounting head of 8336-00-800.04 Nagarpalika P. F. Deposit and the PF account holders are entitled to the benefits of combined insurance and fixed interest benefits on the deposited amount.
6.5 That it is clear that PF was deducted from the salary and not GPF; and PF scheme and benefit of CPF is provided. Therefore, the judgments rendered in case of Mohmad Irshad Husenbhai Baloch (supra) and Kaliben Balubhai Makwana (supra) and other decisions of this Hon'ble Court, relied are not applicable to the present case as those cases have been decided on the premise that it is undisputed position that all the concerned employees were treated in the GPF Scheme and it is also undisputed position that all such employees were not treated in CPF scheme.
6.6 That in the Constitution Bench judgment of Krishena Kumar vs. Union of India (1990) 4 SCC 207, wherein the decision of D.S.Nakara vs. Union of India - (1983) 1 SCC 305 was explained and it was held that the pension retirees and provident fund retirees do not form one homogeneous class. On the other hand, the Rules governing the provident fund and its contribution are entirely different from the Rules governing pension and therefore, it would not be reasonable to argue what is applicable to the pension retirees must also equally be applicable to Provident Fund retirees. It was further held in the aforesaid case that the rights of each Page 12 of 30 Uploaded by GAURAV J THAKER(HC00951) on Wed May 06 2026 Downloaded on : Wed May 06 20:44:37 IST 2026 NEUTRAL CITATION C/SCA/1648/2020 JUDGMENT DATED: 30/04/2026 undefined individual retiree finally crystallised on his retirement where after no continuing obligation remained in case of those who are governed by Provident Fund Rules whereas in case of Pension retirees the obligation continues till the death of the employee.
6.7 Therefore, it is very much clear that deduction of PF is no ground to extend pensionary benefits to the Petitioner. The respondent-Nagarpalika is also an autonomous body and not having pension Rules and Regulations or pension scheme. The respondent-Nagarpalika is facing great financial crunch and there will be huge financial liability and it will be difficult for Nagarpalika to sustain as it is continuing obligation.
6.8 That as per the resolution of the State Government, Panchayat and Rural Housing Department dated 28.11.1994, which is with regard to benefits of pension to the regular employees of converted Nagarpalika, who have been appointed after 1963 but before conversion of Nagarpalika, i.e. 1986. It also provides that the post has to be created with the approval of the competent officer and services of the employee has to be in the sanctioned setup and on full time basis. It also provides that for availing benefits of pension, the employees have to deposit the requisite amount of respective heads as per condition Nos. 5, 6, 7 and 9. Condition No.16 provides that pension scheme is not applicable to the employees, who have been appointed after the conversion of the Nagarpalika.
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Though the aforesaid Letters Patent Appeals were dismissed, the observations of the Hon'ble Division Bench in para 5 of the final order, are in favour of the respondent - Nagarpalika, which reads as under :
"It may also be noted that in the affidavit of compliance filed on behalf of the Commissioner of Municipalities before this Court, the distinction is sought to be made between the two sets of Provident Fund deposits. It is stated that the accounts of the appellant Nagar Palika are being maintained by the District Treasury Officer, District Gir Somnath and the said fact itself proves that the employees of the Nagar Palika are not enrolled under GPF, which is essentially being maintained by the office of the Auditor General, Rajkot. The assertion in the said affidavit is that the respondents have never been issued any GPF Account number by the office of the Auditor General and, therefore, the respondent employees are not entitled to any pensionary benefits. This statement is also not found to be incorrect from the reading of the communication dated 4.4.2019 issued by the Accounts Officer/Deposits from the office of the Principal Accountant General, Gujarat, Page 14 of 30 Uploaded by GAURAV J THAKER(HC00951) on Wed May 06 2026 Downloaded on : Wed May 06 20:44:37 IST 2026 NEUTRAL CITATION C/SCA/1648/2020 JUDGMENT DATED: 30/04/2026 undefined Ahmedabad, which has been issued in reply to the communication dated 25.3.2019 sent by the Chief Officer, Una Nagar Palika, seeking clarification about the nature/ nomenclature of the Provident Fund Accounts. It is clarified therein by the Accounts Officer that the nomenclature of the head 8336-00-800-04(14) is the PF Deposits of Nagar Palikas."
6.10 In those Letters Patent Appeals, the officer of Commissioner of Municipalities, filed Affidavit in Compliance of the interim order dated 25-04-2022, stating inter alia that the respondents have never been issued any GPF account number by the office of Auditor General and therefore, the respondent employees are not entitled to any pensionary benefits and a bare perusal of the Treasury Register of Personal Deposits maintained by Sub-Treasury Office, Una as well as the District Treasury Office, District Gir Somnath that P.F. deposits of the respondent No.1-Una Nagarpalika was opened on 29-04-1989 under the nomenclature of major head 8336-00-80004 (14) and relevant abstract of the treasury register is also produced; and also clearly stated that the employees of respondent No.1-Nagarpalika were never enrolled under GPF scheme and consequently, the employees are not entitled to any pensionary benefits as claimed by them.
6.11 The earlier decisions granting pensionary benefits, rendered in the cases of Una Nagarpalika cannot be relied as precedent, as those cases are decided on the premises that admittedly there was GPF deduction and no such specific affidavit was filed by the officer of Commissioner of Municipalities pointing out that it was PF deposits of Page 15 of 30 Uploaded by GAURAV J THAKER(HC00951) on Wed May 06 2026 Downloaded on : Wed May 06 20:44:37 IST 2026 NEUTRAL CITATION C/SCA/1648/2020 JUDGMENT DATED: 30/04/2026 undefined Nagarpalika, therefore, the said point was not argued and considered by the Hon'ble Court, therefore, the earlier decisions are not authority on the said point and those decisions pass sub-silentio. In support of the same, the Nagarpalika relies upon the decision of this Hon'ble Court rendered in a case of Deb Narayan Shyam & Ors v. State of W.B. - 2005 (2) SCC 286.
6.12 In support of his submission, Mr.Sheth, learned advocate for the Municipality has placed reliance upon the following judgments :
(i) Chief Officer vs. Mohmad Irshad Husenbhai Baloch - 2011 (1) GCD 569.
(ii) State of Maharashtra and Anr. vs. Bhagwan and others - 2022 (4) SCC 193.
(iii) Deb Narayan Shyam & Ors vs. State of W.B. -
2005 (2) SCC 286.
(iv) UP Roadways Retired Officials and officers Association vs. State of U.P. and another - 2024 SCC Online SC 1818.
(v) Judgment rendered by learned Single Judge of High Court of Allahabad dated 27.02.2026 in the case of Rekha Singh vs. Union of India and others, being Writ A. No.4877 of 2021.
7. Ms.Sukhadwala, learned AGP appearing for the respondent State has made the following submissions:
7.1 None of the petitioners had been appointed to a sanctioned post and while granting them the benefit of Page 16 of 30 Uploaded by GAURAV J THAKER(HC00951) on Wed May 06 2026 Downloaded on : Wed May 06 20:44:37 IST 2026 NEUTRAL CITATION C/SCA/1648/2020 JUDGMENT DATED: 30/04/2026 undefined permanency by the Municipality, no prior approval/sanction was obtained from the competent authority of the State;
thereby, they are not entitled to receive any pensionary benefits from the State.
7.2 All the petitioners were made permanent after the conversion of the Municipality and as per Clause 16 of the aforesaid Resolution dated 28-11-1994, the State is not liable to pay any pension. The State has not received any GPF contribution either from the petitioners or the Municipality; thus, it is not liable to pay any pensionary benefits to the petitioners.
7.3 The account which is referred by the petitioners claiming the benefit of pension is not pertaining to the pensionary benefits of the Municipality's employees but it is in relation to other than pension. There is no scheme of the State which can provide any pensionary benefit to the employees of the Municipality and as such, considering the facts and circumstances of the present case, none of the petitioners are entitled to receive the benefit of pension from the State and in a case where this Court may reach to the conclusion that the petitioners are entitled to receive pension, such liability may be fastened upon the Municipality.
7.4 By making the above submissions, learned advocates for the respective respondents request this Court to dismiss the petitions.
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8. No other or further submissions have been made by the learned advocates for the respective parties.
ANALYSIS AND DISCUSSION:
9. Having heard the learned advocates for the respective parties and upon perusal of the pleadings and documents and after going through the cited decisions, it would emerge that the cases of the present petitioners are similar to the cases of other employees of the Municipality who were engaged by the Panchayat prior to its conversion into a Municipality. As per the various decisions cited by Mrs.Raval, learned advocate for the petitioners, it is held that all such employees of the converted Municipality are entitled to receive pension from the respondents-authorities.
10. As recorded hereinabove, the learned advocates appearing for the respective respondents are unable to dispute the fact that the petitioners are not similarly situated to those who received the benefits pursuant to various orders passed by this Court, which have been confirmed by the Hon'ble Supreme Court. They are also unable to dispute the fact that the petitioners are not covered under the GPF scheme, unlike those who were covered by this Court's order. Although somewhat similar submissions were again made by the learned advocates appearing for the respondents, which had already been rejected by this Court on previous occasions.
11. I would have appreciated the submissions of the respondents but considering the fact that in the case of other Page 18 of 30 Uploaded by GAURAV J THAKER(HC00951) on Wed May 06 2026 Downloaded on : Wed May 06 20:44:37 IST 2026 NEUTRAL CITATION C/SCA/1648/2020 JUDGMENT DATED: 30/04/2026 undefined similarly situated employees of the Municipality, not only this Court but also the Hon'ble Supreme Court has decisively held that such employees of the converted Municipality from the Panchayat are entitled to receive pensionary benefits, in that view of the matter, there is no reason for me to re-appreciate such contentions; rather the respondents, being the State and its instrumentalities, are required to give quietus to such type of litigation by accepting their liability to pay the pension.
12. At this juncture, I would like to refer to the previous decisions of the Coordinate Bench and the Division Bench of this Court which clearly held that employees like the petitioners retired from the respondent-Municipality are entitled to receive pensionary benefits.
13. In the case of Arjanbhai Panchabhai Bambhania (supra), the Coordinate Bench of this Court having heard the similar arguments as canvassed before me, after referring to the previous decision of the Division Bench, observed and held thus:
"6. Having heard the learned counsels appearing for the parties and upon perusal of the record of the case and the judgment and order dated 3.2.2011 passed by a Division Bench of this Court in Letters Patent Appeal No.214 of 2011 and allied matters, indisputably, the directions issued by the learned Single Judge in the writ petitions came to be confirmed in appeal by the Division Bench since the Letters Patent Appeals filed by the aggrieved Municipality came to be dismissed by the Division Bench, and the petitioners herein were the employees of the respondent-Municipality, who were also parties to the common award referred to hereinabove, which attained finality upto the High Court, and the common award passed by the Industrial Court in various References was never disturbed, modified or changed and, for all purposes, the petitioners-employees Page 19 of 30 Uploaded by GAURAV J THAKER(HC00951) on Wed May 06 2026 Downloaded on : Wed May 06 20:44:37 IST 2026 NEUTRAL CITATION C/SCA/1648/2020 JUDGMENT DATED: 30/04/2026 undefined had not only acquired rights but their rights also came to be crystallized in their favour. Besides, the similarly situated employees from the very respondent-Municipality were ordered to be paid retiral dues and benefits by the learned Single Judge, which came to be confirmed by the Division Bench of this Court and all the contentions which were raised there are on par with the contentions raised herein by the learned counsels for the respondent- Municipality and the State Government and answering those contentions, the Division Bench in paragraph 6 onwards held as under:
"6. It is undisputed position that all the concerned employees were treated in the GPF scheme, therefore, respective GPF accounts were opened and the deduction was also made from their salary from the date on which they were made permanent and until they retired from service or their service ended on account of their death. It is also undisputed position that all such employees were not treated in CPF scheme, which is applicable to other municipal employees and no deduction for the purpose of CPF has been made by the municipality from the salary of concerned employees. If the employee, when he is absorbed in service, is treated for all purposes in the GPF scheme for pensional benefits and not treated in the CPF scheme for lumpsum amount, and the said position continued until the person concerned reached to the age of superannuation or otherwise, would it be open to the employer or the concerned authorities to deny the pensionary benefits after retirement on the ground that the employees concerned was not eligible for pension as per the GPF scheme. In our view, if such is permitted to be entertained and accepted, it would not only be highly improper on the part of the authority, but can also be termed as atrocious action, which would be absurd on the face of it.
7. The learned counsel for the appellant, however contended that the employees concerned, who were in the then panchayat service and subsequently continued in the municipality, were not recruited by the regular selection process and it was submitted that it is only w.e.f. 1.1.1989 they have been granted permanency benefit. When on 1.1.1989 permanency benefits were granted, they were taken as municipal employees and not as employees of the panchayat. Under the circumstances, they would be entitled for all benefits, which may be available to other municipal employees. It was submitted that as per Page 20 of 30 Uploaded by GAURAV J THAKER(HC00951) on Wed May 06 2026 Downloaded on : Wed May 06 20:44:37 IST 2026 NEUTRAL CITATION C/SCA/1648/2020 JUDGMENT DATED: 30/04/2026 undefined the decision of this Court in case of Chorwad Gram Panchayat Vs. Ramniklal Dharshi Shah reported at (2010)1 GCD 675, such employees who were not recruited by the regular selection process of the then Gram Panchayat, could not be termed as in panchayat service and, therefore, would not be eligible for the pensional benefits as available to other employees of the panchayat or Government service. Learned counsel, therefore, contended that if the employees were of the municipality, there is no scheme of the Government for pensional benefits, but the scheme applicable would be CPF to the employees of the municipality. It was submitted that the learned single Judge was guided by the resolution of the Government, which in the submission of the municipality is not applicable and, therefore, the order passed by the learned single Judge is erroneous.
8. There cannot be any different view in respect of the employees taken by this Court in Chorwad Gramp Panchayat (supra). However, the point which arise for consideration in the present group of matters did not arise in the said case inasmuch as if for all purposes the employees concerned were treated as in panchayat service with the scheme of the Government for pension by deduction of GPF, would it be open to the Government or the municipality to deny the pensional benefits, if the employees concerned have retired from service. It is true that if one was not appointed by regular recruitment process, he may not fall in the panchayat service. In our view, the factum of giving treatment by the municipality and Government to all the concerned employees in the present case as member of the panchayat service and the consequent action of regular deduction of contribution of GPF account that too from the inception of the service as the permanent employees until reaching to the age of superannuation or until the services came to an end, would be sufficient to decline the entertainment of such plea taken by municipality and/or the Government as the case may be, that the employees concerned in view of the aforesaid decision of this Court in case of Chorwad Gram Panchayat (supra), would not be entitled for the pensional benefits. Be it noted that it is not the case of the appellant or any of the State authority that it is on account of any fraud or misrepresentation or any mischief played by the concerned employees at the relevant point of time or even thereafter they were treated as member of GPF Page 21 of 30 Uploaded by GAURAV J THAKER(HC00951) on Wed May 06 2026 Downloaded on : Wed May 06 20:44:37 IST 2026 NEUTRAL CITATION C/SCA/1648/2020 JUDGMENT DATED: 30/04/2026 undefined scheme. Therefore, the question is to be examined in light of the bonafide action on the part of employee as well as the concerned officer of the employer or the Government, as the case may be. It is true that in normal circumstance, such estoppel may not operate against any statute, but it is not a mere case of considering the question of estoppel. In our view, a case of conduct of the party concerned coupled with the alteration of the position of the party concerned throughout. At any point of time, neither the municipality or the Government has refunded the amount of contribution nor they have intimated to the employees concerned for their mistake or otherwise. After completion of the service, if such a plea is entertained or is accepted, in our view, it would result into allowing the atrocious treatment to be played by the municipality or the Government or its officers, which would violate Article 14 of the Constitution.
9. The aforesaid is coupled with the circumstance that it is not that in every case whenever a person is daily wager or a temporary employee of the Government, he would not be eligible or entitled for pension. On the contrary as per the policy of the Government, even if a person is an adhoc/temporary employee, after completion of requisite length of service, he is to be treated as eligible for the scheme of pension and once he is treated as eligible for the scheme of pension, and his contribution are being deducted from his salary, he would be eligible for the pension upon completion of the requisite length of service. Therefore, there is no absolute bar operating upon the entitlement of the pension by the employees of the then Gram Panchayat, who are treated as for all purposes covered by the scheme of pension for the contribution from their salary and same position continued until they reached to the age of superannuation or until the end of their service.
6.1. Thus, the subject matter and issues involved in present group of writ petitions are almost similar and identical to the subject matter and issues of the above Letters Patent Appeals, where directions came to be issued to pay pensionery benefits and other benefits within eight weeks from the date of receipt of the order. In view of the above, the contentions raised by the learned counsels for the respondent-Municipality and the State Government that the appointments of the petitioners were not approved or even the setup of the establishment was not sanctioned by the Competent Authority are irrelevant, when the Page 22 of 30 Uploaded by GAURAV J THAKER(HC00951) on Wed May 06 2026 Downloaded on : Wed May 06 20:44:37 IST 2026 NEUTRAL CITATION C/SCA/1648/2020 JUDGMENT DATED: 30/04/2026 undefined common award passed by the Industrial court in various References ordering reinstatement, full back wages and granting permanency to the workmen attained finality. No administrative instructions or resolution can over-ride the effect of the award passed by the competent court of law and, having received the benefits of the common award passed by the Industrial Court, and the petitioners attained the age of superannuation after conferment of benefits of permanency, they cannot be deprived of the retiral dues including pension/family pension on account of CPF scheme, for which the option was not exercised. Besides, the record produced by the petitioners would reveal that for all purposes, the respondent- Municipality had accepted contribution of GPF and the accounts were opened accordingly and the amounts were also deposited in the accounts. Having done so, the respondent-Municipality cannot retrieve the situation. Plea of financial burden cannot come in the away of this Court ordering the respondents to release and disburse the pension due and payable to the petitioners."
(Emphasis supplied) 13.1 The aforesaid decision of the Coordinate Bench was confirmed by the Division Bench vide its judgment dated 31- 03-2013 passed in Letters Patent Appeal No.96 of 2013 and allied matters and such decision, though challenged by the State before the Hon'ble Supreme Court, the same was not disturbed by the Hon'ble Supreme Court, having dismissed the petition filed by the State by its order dated 16-09-2013.
14. Likewise, another Division Bench of this Court vide its order dated 06-10-2015 passed in the case of Chandrikaben W/o. Bhurabhai S. Bhamat and others (supra), while rejecting the contention of the Municipality observed thus:
"11. However, Mr. Hasurkar, learned counsel appearing for the appellant made twofold submissions and he further contended that the said aspects were not brought to the notice of the Court at the time when earlier Letters Patent Appeals were HC-NIC Page 11 of 15 Created On Sat Oct 10 00:48:49 IST 2015 decided and therefore, this Court may Page 23 of 30 Uploaded by GAURAV J THAKER(HC00951) on Wed May 06 2026 Downloaded on : Wed May 06 20:44:37 IST 2026 NEUTRAL CITATION C/SCA/1648/2020 JUDGMENT DATED: 30/04/2026 undefined hold the earlier decision as per incuriam and a different view may be taken than was taken in the above referred Letters Patent Appeals. The first submission was that in the earlier decision of this Court, the employees concerned were appointed by the then Gram Panchayat which is subsequently converted into appellant municipality and therefore, the present employees in respect of whom the petitions were filed before the learned Single Judge cannot be said to be on the same footing since all the original petitioners herein were appointed by the municipality itself and not by the then Gram Panchayat. In furtherance to his submission, the learned counsel submitted that in panchayat service pension would be available to the employees of the panchayat whereas such would be unavailable to the employees of the municipality. The second contention raised was that merely because GPF contribution is made and the amount is deposited in GPF, it cannot be said that the employees concerned would be entitled to pension unless it is expressly shown that the employees concerned are covered by a particular rule or resolution of the Government which makes the employees concerned as entitled for pension. In his submission, in absence thereof, the pension would not be available nor the municipality could be directed to pay pension either directly or through the Government.
12. The first contention raised for making distinction to the original appointment of the employees concerned in our view would be inconsequential for the simple reason that had the original petitioners treated as employees of municipality for the purpose of CPF Scheme, the matter might stand on different footing and different consideration, but once the employees concerned were treated as member of GPF and the contribution for GPF was deducted from time to time, whether they were appointed by the then Gram Panchayat or municipality would not make any difference for their status as the member of the GPF. It is not the case of the appellant municipality that by mistake they were admitted as member of GPF nor it is the case of the municipality that by misrepresentation or fraud the respective employees had become the member of GPF. Under these circumstances, we find that the distinction as sought to be canvassed would be inconsequential for entitlement of the pension in capacity as the member of GPF by the employee concerned.
13. The second contention raised that unless expressly demonstrated before the Court for entitlement of the pension as per rules or as per Government Resolution, such amount of pension would be unavailable since the Page 24 of 30 Uploaded by GAURAV J THAKER(HC00951) on Wed May 06 2026 Downloaded on : Wed May 06 20:44:37 IST 2026 NEUTRAL CITATION C/SCA/1648/2020 JUDGMENT DATED: 30/04/2026 undefined municipality in any case had to deposit the amount with the HC-NIC Page 13 of 15 Created On Sat Oct 10 00:48:49 IST 2015 Government treasury as per section 57A of the Gujarat Municipalities Act, in our view also cannot be countenanced for two reasons, one is that it is not a matter of depositing the amount in the Government treasury as sought to be canvassed, but is a matter of depositing the amount in GPF fund which is a separate fund and being governed by separate mechanism, viz., Bombay General Provident Fund Rules. Secondly, once the municipality has treated the employees concerned as member of GPF and has deposited his GPF contribution with the GPF, it would not lie in the mouth of the municipality to contend that since the municipality had to deposit the amount of contribution in Government treasury, it should not be treated as contribution of GPF entitling the employee concerned for pension."
(Emphasis supplied) 14.1 The said decision of the Division Bench was challenged before the Hon'ble Supreme Court, but the same was not disturbed. [See : Kaliben Balubhai Makwana (supra)].
15. The argument of the State is that the benefit of permanency was given to the petitioners by the Municipality subsequent to its conversion; thus, the petitioners are not entitled to get the benefit of pension from the State in view of Clause 16 of the Government Resolution dated 28-11-1994. Such contention is already negated by the Coordinate Bench of this Court in the case of Bhikhabhai M. Bambhania (supra), wherein it has been held that 'Clause 16 only provides that, employees who were recruited by the Municipality after its conversion from the Panchayat, this pension scheme will not be applicable to them'. It has been observed that the word used is 'recruited' and not 'confirmed' or 'regularized'. Since in the case at hand, none of the petitioners were recruited by the Municipality after its Page 25 of 30 Uploaded by GAURAV J THAKER(HC00951) on Wed May 06 2026 Downloaded on : Wed May 06 20:44:37 IST 2026 NEUTRAL CITATION C/SCA/1648/2020 JUDGMENT DATED: 30/04/2026 undefined conversion from Panchayat, merely because an order of permanency was passed subsequent to its conversion, that would not ipso facto absolve the State from its liability to pay pension. In fact, it is specifically observed by the Coordinate Bench in the case of Arjanbhai Panchabhai Bambhania (supra), that once there is an award passed by the Industrial Court, no administrative instructions or resolution can override the effect of the award passed by the competent Court of law. It is not in dispute that due to the award passed by the Industrial Tribunal, the benefit of permanency was ordered by the Municipality.
16. So far as the contention of the respondent about the nomenclature of the account and its number is concerned, such argument is no longer available to the respondent, inasmuch as this argument, though presented differently before the Division Bench, was not accepted by the Division Bench, as it declined to entertain the appeal filed by the Municipality. As such the further appeal before the Hon'ble Supreme Court was also not entertained. The pertinent observation of the Division Bench made in the case of The Chief Officer (supra), requires to be referred, which reads thus:
"4. As the issue has been set at rest with the aforesaid decision of the Apex Court, we do not find any justification to re- open the same on the premise of an affidavit filed by the State Government in this appeal stating that none of the employees of the Nagar Palika were enrolled under GPF Scheme and the nomenclature of the head 8336-00-800- 04(14) is the PF deposit of the Nagar Palika. The submission of the learned senior advocate appearing for the appellant Nagar Palika that the services of employees Page 26 of 30 Uploaded by GAURAV J THAKER(HC00951) on Wed May 06 2026 Downloaded on : Wed May 06 20:44:37 IST 2026 NEUTRAL CITATION C/SCA/1648/2020 JUDGMENT DATED: 30/04/2026 undefined of the Nagar Palika are non-pensionable services, cannot be looked into in view of the aforesaid.
5. It may also be noted that in the affidavit of compliance filed on behalf of the Commissioner of Municipalities before this Court, the distinction is sought to be made between the two sets of Provident Fund deposits. It is stated that the accounts of the appellant Nagar Palika are being maintained by the District Treasury Officer, District Gir Somnath and the said fact itself proves that the employees of the Nagar Palika are not enrolled under GPF, which is essentially being maintained by the office of the Auditor General, Rajkot. The assertion in the said affidavit is that the respondents have never been issued any GPF Account number by the office of the Auditor General and, therefore, the respondent employees are not entitled to any pensionary benefits. This statement is also not found to be incorrect from the reading of the communication dated 4.4.2019 issued by the Accounts Officer/Deposits from the office of the Principal Accountant General, Gujarat, Ahmedabad, which has been issued in reply to the communication dated 25.3.2019 sent by the Chief Officer, Una Nagar Palika, seeking clarification about the nature/ nomenclature of the Provident FundAccounts. It is clarified therein by the Accounts Officer that the nomenclature of the head 8336-00-800-04(14) is the PF Deposits of Nagar Palikas.
6. Had it not been the deposits maintained by the office of the Account General, we do not see any reason why the Accounts Officer of the office of the Principal Accountant General would respond to the enquiry in such a manner."
(Emphasis supplied)
17. Mr.Sheth, learned advocate for the Municipality tried to convince this Court that appropriate materials/submissions were not pressed into service before the Division Bench in the earlier round of litigations and as per the principle of sub silentio, the Municipality can be allowed to raise them before this Court and the same shall be adjudicated here. To buttress his argument, he would strongly rely upon the decision of the Hon'ble Supreme Court in the case of Deb Narayan Shyam (supra).
Page 27 of 30 Uploaded by GAURAV J THAKER(HC00951) on Wed May 06 2026 Downloaded on : Wed May 06 20:44:37 IST 2026NEUTRAL CITATION C/SCA/1648/2020 JUDGMENT DATED: 30/04/2026 undefined 17.1 Such argument is not only misconceived but contrary to the record, inasmuch as in the previous round of litigation, it appears that not only the Municipality but the State had filed their reply and raised all possible contentions in support of their defense but none impressed this Court or the Hon'ble Supreme Court, as the case may be. In such circumstances, it cannot be argued by the Municipality that in the earlier round, neither proper facts nor submissions were made before the respective Benches.
17.2 In the case of Deb Narayan Shyam (supra), the facts were gross as can be seen from bare reading of para 17 of the judgment. In that case, at the relevant point of time, the respondent-State had neither filed any affidavit nor properly assisted the Court to reach to a correct conclusion and at a later point in time, upon noticing such gross error, the concerned Bench referred the matter to the Division Bench and ultimately, the contention was appreciated in light of the material placed before the Bench concerned, which is not the case at hand.
18. There should not be any cavil that in the absence of any statutory rules or a policy of the State to grant pension, as a matter of right, no employee can claim pensionary benefits from the State or its instrumentalities, as the case may be. At the cost of repetition, it is also decided in the previous round of litigation that other similarly situated persons like the petitioners herein are entitled to receive pensionary benefits in view of the fact that there is a policy dated 28-11-1994 of Page 28 of 30 Uploaded by GAURAV J THAKER(HC00951) on Wed May 06 2026 Downloaded on : Wed May 06 20:44:37 IST 2026 NEUTRAL CITATION C/SCA/1648/2020 JUDGMENT DATED: 30/04/2026 undefined the Government to grant the pension to the employees of the converted Municipality appointed prior to its conversion. So also, the fact that in the case of the petitioners, there was a deduction of GPF every year. In fact, as per Clause 17 of the said resolution, it was incumbent upon the concerned converted Municipality to deposit the pension contribution in lieu of CPF with the State in the case of the concerned employees of converted Municipality so long as they served concerned Municipality. Thus, in view of the aforesaid facts, the respondents cannot be allowed to argue that the petitioners are not entitled to receive pensionary benefits.
CONCLUSION AND DIRECTIONS:
19. In view of the foregoing discussion and reasons and in light of the binding decisions of this Court and the Apex Court as discussed above, I am of the considered view that the petitioners are also entitled to receive pensionary benefits from the respondent authorities.
19.1 The respondent shall work out the service details and prepare pension papers of all the petitioners/legal heirs of deceased employees, if any, on the basis of last pay drawn by the employee concerned in accordance with law. While preparing the pension papers of the petitioners and before releasing the arrears of the pension amount, if any document and signature of the petitioners or legal heirs of the deceased employees concerned is required, the same shall be obtained from them.
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20. Before parting with the matter, it is hereby observed that if any amount towards the contribution of the employer, i.e. the Municipality, was deposited with the Treasury Office of the State and if already received by the petitioners concerned, such amount shall be adjusted against the amount of arrears of pension. In such eventuality, the respondent authorities shall have to provide the calculation of such adjustment amount to the petitioners concerned while making the payment of arrears of pension.
21. In view of the foregoing conclusion and directions, all these petitions are partly allowed to the aforesaid extent. Rule is made absolute, accordingly. There shall be no order as to costs. Consequently, all pending Civil Applications also stand disposed of.
(MAULIK J. SHELAT, J) GAURAV J THAKER Page 30 of 30 Uploaded by GAURAV J THAKER(HC00951) on Wed May 06 2026 Downloaded on : Wed May 06 20:44:37 IST 2026