Girishkumar Venishankar Pandya vs State Of Gujarat & 4 on 8 October, 2015

[Cites 31, Cited by 0]

Gujarat High Court

Girishkumar Venishankar Pandya vs State Of Gujarat & 4 on 8 October, 2015

Bench: J.B.Pardiwala

               C/SCA/16761/2014                                            CAV JUDGMENT



                   IN THE HIGH COURT OF GUJARAT AT AHMEDABAD


                      SPECIAL CIVIL APPLICATION NO. 16761 of 2014




         FOR APPROVAL AND SIGNATURE:



         HONOURABLE MR.JUSTICE J.B.PARDIWALA
         ==========================================================

         1    Whether Reporters of Local Papers may be allowed                           No
              to see the judgment ?

         2    To be referred to the Reporter or not ?                                    No

         3    Whether their Lordships wish to see the fair copy of                       No
              the judgment ?

         4    Whether this case involves a substantial question of                       No
              law as to the interpretation of the Constitution of
              India or any order made thereunder ?

         ==========================================================
                  GIRISHKUMAR VENISHANKAR PANDYA....Petitioner(s)
                                     Versus
                       STATE OF GUJARAT & 4....Respondent(s)
         ==========================================================
         Appearance:
         PARTY-IN-PERSON, ADVOCATE for the Petitioner(s) No. 1
         GOVERNMENT PLEADER for the Respondent(s) No. 1 - 5
         ==========================================================

                  CORAM: HONOURABLE MR.JUSTICE J.B.PARDIWALA



                                     Date :08/10/2015


                                    CAV JUDGMENT

1. By this writapplication under Article 226 of Page 1 of 40 HC-NIC Page 1 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT the Constitution of India, the petitioner, a retired lecturer of a grantinaid college, has prayed for the following reliefs: "(A) To admit this Special Civil Application.

(B) To quash and set aside the G.R. dated 19th July, 2014 and respondents' impugned action, not considering the case of the petitioner and granting enhanced gratuity as per the G.R. dated 13th April, 2009 and to be pleased declare that the petitioner is entitled for the enhanced gratuity and to be pleased direct the respondents to pay the difference of gratuity as per the G.R. dated 13th April, 2009 from 112006 along with interest at the rate of 18% p.a. or to order to pay enhanced gratuity with interest at the rate notified by the government for payment as envisaged under sub section 3(A) of Section 7 of the payment of gratuity Act, 1972 from the date of entitlement to the date of actual payment.

2. The case of the petitioner appearingin person is as under:

3. The petitioner was serving as a lecturer in the C.P. Patel and F.H. Shah Commerce College, Anand. The said college is a grantinaid Page 2 of 40 HC-NIC Page 2 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT affiliated with the Sardar Patel University and run and managed by the Sardar Patel Education Trust, Anand. The petitioner had joined the services with the college from 2nd September, 1974 and after putting in 34 years of service attained superannuation on 14th June, 2008.

4. It is his case that he is a senior citizen and he is not being paid the amount of gratuity according to the G.R. No. PGR10095Pay Cell (M) dated 13th April, 2009.

5. It is his case that he was a member of the Contributory Provident Fund. According to him the Contributory Provident Fund is a scheme parallel to the pension scheme. All the employees irrespective of the holders of any scheme are entitled for the benefits of the gratuity amended from time to time by the State Government.

6. It is his case that after attaining the superannuation in June, 2008, the college had Page 3 of 40 HC-NIC Page 3 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT sent a proposal for the disbursement of the gratuity amount of the petitioner according to the G.R. dated 23rd March, 2006. All the employees including the applicant were paid Rs.3.50 Lacs as gratuity being a maximum limit of the same.

7. Thereafter the Government enhanced the limit of gratuity from Rs.3.50 to Rs. 10 Lac vide its decision dated 13th April, 2009 according to the recommendations of the 6th Pay Commission and made it effective from 1st January, 2006.

8. It is the case of the petitioner that the State Government implemented the said G.R. only in favour of six members who were in the pension scheme and paid the difference of gratuity to those who retired on or after 1st January, 2006 according to the enhanced limit of gratuity of Rs.10 Lac.

9. It is his grievance that the Government did not implement the said G.R. in case of the Page 4 of 40 HC-NIC Page 4 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT teachers who were the members of the Contributory Provident Fund and also failed to pay the difference of the enhanced gratuity to the members who had retired on or after 1st January, 2006.

10. According to the petitioner such discrimination is violative of Article 14 of the Constitution of India.

11. The petitioner appearinginperson has placed reliance on a decision of this Court rendered in the case of Madhukar T. Bapat V. State of Gujarat, Special Civil Application No.9769 of 1993, decided on 27th August, 2001. A learned Single Judge of this Court observed as under: "(v) For the purpose of payment of death cum retirement/gratuity the retire employees form one class itself. Whether they are pension holder or members of the Contributory Provident Fund and by no intelligible differentia any distinction can be made for the purpose of death cum retirement gratuity on the ground that one set of employees are pension holders and the other set of employees are members of the Contributory Provident Page 5 of 40 HC-NIC Page 5 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT Fund. Therefore, when the decision was taken to raise the upper limit of the death cum retirement gratuity in September 1991 to raise it from Rs.36,000/ to Rs.75,000/ and again in January 1993 to raise it from 75,000/ to Rs 1,00,000/ care ought to have been taken that the maximum limit of Rs.1,00,000/should have been made applicable from 1.1.86 as was done in the case of the pension holders vide Government Resolution dated 31.07.87.

(vi) Further it has to be noted that on 31.07.87 when the upper limit of the gratuity of Rs.1,00,000/ was retrospectively applied from 1.1.86, the petitioner was very much in service and he had retired subsequently i.e. on 1.7.91 and, therefore, the benefit of the upper limit of the gratuity should have been extended to the petitioner on the same terms as was done in the case of the pension holders and the petitioner could not be deprived of this benefit of the revision of the upper limit of the gratuity from 1.1.86. If such a different treatment is given for the purpose of death cum retirement gratuity to the employees belonging to the same class, merely on the ground that one set of employees are pension holders and the other set of persons are members of the Contributory Provident Fund, it is bound to result in creating a class within a class and it is transparently clear that the members of the Contributory Provident Fund stand discriminated in violation of Article 14 and 16 of the Constitution of India viz a viz the pension holders. In the opinion of this court whether an employee is a pension holder or a member of Contributory Provident Fund, he stands on the same footing and as similarly situated so far as the benefit of the death cum retirement gratuity is concerned and they cannot be treated differentially. Accordingly the Court finds that the petitioner is notified to the benefit of the upper limit of gratuity of Rs.1,00,000/ from 1.1.86 and to the extent the Government Resolution dated ..............found to be dissatisfactory in the ...........of the earlier Government Resolution dated 31.07.87, which was taken with regard to the pension holders making the upper limit of Page 6 of 40 HC-NIC Page 6 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT gratuity of Rs.1,00,000/applicable to the pension holders with effect from 1.1.86.

4. The respondents are, therefore, directed to pay the due amount of gratuity to the petitioner, who retired on 1.7.91 as was made available to the pension holders and any amount due shall be paid accordingly, preferably within a period of three months from the date the certified copy of this order is produced before the concerned authority and for this purpose the respondents shall issue appropriate orders. This Special Civil Application is allowed and the rule is made absolute. In the facts and circumstances of this case, no order as to costs."

12. He pointed out that the aforenoted decision of this Court was later on relied upon by the another learned Single Judge in the case of Dineshchandra Manilal Raval v. State of Gujarat, Special Civil Application No.4595 of 2005 and allied matters, decided on 19th October, 2005.

13. He submitted that the teachers who are the members of the Contributory Provident Fund and who are serving in the different departments of the university have also been given the benefit of the G.R. The teachers of the Sardar Patel University have also been paid the difference towards the enhanced gratuity amount of Rs.10 Lac Page 7 of 40 HC-NIC Page 7 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT with effect from 1st January, 2006. On the other hand the petitioner who was serving in the college affiliated with the same university has been denied the benefit of the G.R. dated 13th April, 2009 and has also been denied the difference towards the enhanced amount of gratuity.

14. He submitted that an appropriate writ or order be issued to quash and set aside the G.R. dated 9th July, 2014 with a further direction to consider the case of the petitioner for grant of the enhanced gratuity according to the G.R. dated 13th April, 2009 and also pay the difference from 1st January, 2006 along with interest at the rate of 18% per annum.

15. On the other hand, this application has been vehemently opposed by Mr. Swapneshwar Gautam, the learned AGP appearing for the StateRespondent.

He has placed reliance on the following averments made in the affidavitinreply filed on behalf of Page 8 of 40 HC-NIC Page 8 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT the respondent No.3: "6. It is submitted that admittedly the petitioner was serving as a lecturer in respondent No.5 college, which is a grantin aid institution. It is submitted that the perusal of the clause no.1.1 of the resolution dated 31.04.2009, it clear that the same is applicable to the government servant only and the petitioner being the employee of the respondent no.5 college is not entitled to any benefits which flows from the aforesaid Government Resolution.

7. It is submitted that the Parliament has passed the Payment of Gratuity (amendment) bill, 2009 and by notification dated 24.05.2010 it has been made applicable. A copy of the above mentioned amendment and the Gazette of India dated 24.05.2010 are annexed herewith and marked as AnnexureRII(Colly) to this affidavit.

8. It is submitted that perusal of the above mentioned amendment it is clear that the amount of gratuity has been enhanced from Rs.3,50,000/ to Rs.10,00,000/. It is submitted that in consonance with the above referred Amendment, the State Government vide resolution dated 19.07.2014 has already increased the maximum amount of gratuity up to Rs.10,00,000/ lacks for the employees working under the grantinaid Colleges and Universities. It is submitted that as the Parliament has passed a bill on 17.05.2010, the State Government has given the effect of the above referred resolution from 24.05.2010. A copy of the above referred Government resolution dated 24.05.2010 is annexed herewith and marked as AnnexureRIII to this affidavit."

16. He has also placed reliance on the following Page 9 of 40 HC-NIC Page 9 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT averments made in the additional affidavitin reply filed on behalf of the respondent No.3: "4. Petitioner, respectfully, says that the limit of gratuity is enhanced from 3.50 lacks to 10.00 lacks on recommendation of 6th Pay Commission which is made applicable to all the Universities and Colleges of the Country and the State. Not only that it is equally applicable to all the members of Contributory Provident Fund and law is also settled by this honourable High Court twice in past in two different judgments. Both the judgments are annexed with the petition.

5. Petitioner, respectfully, drowse the attention of this honourable High Court towards the letter annexed to the reply, of Deputy Secretary, Education Department dated 6122014 (On page 68) in which a responsible officer commits different treatment and says that the benefit of enhanced gratuity given to the members of the pension scheme cannot be given to the members of the pension scheme cannot be given to the members of the Contributory Provident Fund. Petitioner says that it is nothing but the unlawful act ignoring the judgments given by this honourable High Court twice in past, annexed to the petition.

6. Petitioner says so far the "The payment of gratuity (Amendment) Act2010 is concerned, it is usual amendment after the recommendation of 6th Pay Commission, which is made effective from 112006. Gratuity is also raised from 3.50 lacks to 10.00 lacks to meet the appropriate parity of 16 and ½ salaries as minimum gratuity and made it effective from 1 12006 as part of the recommendation of 6th Pay Commission. Earlier in 5th Pay Commission also revision was made effective from 111996 and amendment in the same gratuity act was amended from 24th September, 1997 and upper limit of the gratuity was enhanced from 1.00 lack to 3.50lacks. Similarly at the time of Page 10 of 40 HC-NIC Page 10 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT 4th Pay Commission, recommendation was made effective from 111986, gratuity was also increased from Rs.36000 to 1.00 lack by amendiang the act and was made effective from 1186. This time also Amendment in Gratuity Act is made in 2010 and gratuity is enhanced earlier from 112006. Moreover this amendment is not meant only for the members of Contributory Provident Fund. It is made for enhancing the upper limit of gratuity which is applicable equally to the members of the pension Scheme as well as to the members of Contributory Fund.

7. Petitioner says that the circular dated 20 082014 is issued only for the members of Contributory Provident Fund with different treatment. All members of pension scheme is kept outside from G.R. dated 19072014. Not only that but two different criteria are adopted for the same benefit of enhanced gratuity. One criteria is of 6th Pay Commission which is adopted for the pension holders and it is made effective from 112006 while second criteria is of amendment of gratuity Act1972(amendment) 2010 is adopted for the members of the Contributory Fund and it is made effective from 24052010. This is again different treatments adopted between two similar schemes, effective on two different dates, and is in violation of article 14 and

16. The circular dated 20082014 is required to sat aside at once.

8. Petitioner, respectfully, submit that the action of respondent No.3 of not considering the petitioner for the benefit of enhanced gratuity from 3.50 to 10.00 lacks as per the Government resolution dated 13th April, 2009 only on the ground that the petitioner is the member of the Contributory Provident Fund is illegitimate, illogical and against the law settled by this Hon'ble High Court and also in violation of article 14 and 16 of the Constitution.

9. Petitioner, respectfully, submits that in view of the above and contents put in the petition, the prayer made in the petition may please be allowed and granted in favor of Page 11 of 40 HC-NIC Page 11 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT justice."

17. Having heard the petitionerinperson and the learned AGP appearing for the State the only question that falls for my consideration is whether the petitioner is entitled to any of the reliefs prayed for in this petition.

18. The Central Government passed a bill to amend the payment of gratuity Act, 1972. It reads thus: "THE PAYMENT OF GRATUITY (AMENDMENT) BILL, 2010 A. BILL further to amend the payment of Gratuity Act, 1972.

B. it enacted by Parliament in the Sixty first Year of the Republic of India as follows:

1.(1) This Act may be called the Payment of Gratuity (Amendment) Act, 2010 (2) It shall come into force on such date as the Central Government may by notification in the Official Gazette, appoint.

2. In section 4 of the Payment of Gratuity Act, 1972, in suchsection (3) for the words "three lakhs and fifty thousand rupees", the words "ten lakh rupees" shall be substituted.

STATEMENTS OF OBJECTS AND REASONS Page 12 of 40 HC-NIC Page 12 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT The Payment of Gratuity Act, 1972 provides for payment of gratuity to the employees engaged in factories, mines, oilfields, plantations, ports, railway companies, shops or other establishments and for matters connected therewith or incidental thereto.

2. Subsection 3 of Section 4 of the Act provides that the amount of gratuity payable to an employee shall not exceed three lakh and fifty thousand rupees. This amount was fixed with effect from the 24th September, 1997 by amendment to the Payment of Gratuity Act, 1972. There have been representations from trade unions and individuals to remove or enhance the ceiling on the maximum amount of gratuity payable under the Act.

3. Based on the representations and wide consultation with all stakeholders it is now proposed to enhance the ceiling of three lakhs and fifty thousand rupees on the maximum amount of gratuity payable under sub section(3) of section 4 of the Act to ten lakh rupees.

4. The Bill seeks to achieve the above objectives."

19. The Central Government in its Ministry of Labour and Employment therefore issued a Notification dated 24th May, 2010, which reads thus: "MINISTRY OF LABOUR AND EMPLOYMENT NOTIFICATION New Delhi, the 24th May, 2010 S.O.1217(E). In exercise of the powers conferred by subsection(2) of section 1 of The Payment of Gratuity (Amendment)Act, 2010 (15 of 2010), the Central Government hereby appoints Page 13 of 40 HC-NIC Page 13 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT the 24th day of May, 2010, as the date on which the said Act shall come into force."

20. It appears on perusal of the impugned resolution dated 19th July, 2014 that the State Government decided to give effect to the payment of gratuity (Amendment) Act, 2010 to the retired employees of all non government grantinaid colleges and employees of the university in the CPF with effect from 24th May, 2010 rather then with effect from 1st January, 2006. The grievance ventilated by the petitioner appears to be that the State Government issued a resolution dated 13th April, 2009 in respect to the 6th Central Pay Commission and revision of provisions regulating pension/gratuity/commutation of pension etc. of post 1st January, 2006 pensioners/family pensioners and decided to extend the benefit with effect from 1st January, 2006 in terms of the recommendations of the 6th Pay Commission. Whereas employees like the petitioner who were members of the Contributory Provident Fund and retired between 1st January, 2006 and 24th May, 2010 were Page 14 of 40 HC-NIC Page 14 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT given the benefit with effect from 24th May, 2010.

21. Thus, the State Government by way of policy decision provided a cut off date.

22. The stance of the State Government is that it has already enhanced the amount of gratuity up to Rs.10 Lac in terms of the amendment and vide G.R. dated 19th July, 2010 though fit to give the benefit with effect from 24th May, 2010 since the parliament passed the bill on 17th May, 2010. The second reason assigned by the State Government is that the petitioner was serving with of non government grantinaid college affiliated with the Sardar Patel University and therefore, he could not be termed as a government servant. The Resolution dated 31st April, 2009 would be applicable only to those lecturers having retired from the government colleges.

23. Therefore, the short point for my consideration is whether the Government is Page 15 of 40 HC-NIC Page 15 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT justified in providing the cut off date.

24. An almost identical issue was considered by a Division Bench of this Court to which I was a party in the case of S.L. Oza and others v. State of Gujarat, Special Civil Application No.6883 of 2012, decided on 4th October, 2013. In the case before the Division Bench the petitioners had challenged the constitutional validty of the circular dated 5th June, 2010 issued by the Gujarat Urja Vikas Nigam Limited, an instrumentality of the State within the meaning of Article 12 of the Constitution of India on the ground that the same was illegal and was contrary to the provisions of the payment of Gratuity Act, 1972. The petitioners also challenged the Government Resolution dated 30th April, 2009 issued by the Finance Department in connection with the 6th Central Pay CommissionRevision of provisions regulating pension/gratuity/commutation of pension etc. of post 1st January, 2006 pensioners/family Page 16 of 40 HC-NIC Page 16 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT pensioners.

25. Pursuant to the recommendations of the Sixth Pay Commission declared by the Central Pay Commission, the State Government accorded sanction to implement such recommendations vide Government Resolution dated 13th April 2009.

According to the petitioners, such benefits were extended to the employees of the Corporations and the Panchayats. The petitioners were also extended the benefit of the Sixth Pay Commission with effect from 1st January 2006 including the arrears of pension towards the enhanced salary and allowances.

26. On 18th May 2010, the Payment of Gratuity (Amendment) Act, 2010 came into force by which Section 4 of Act 39 of 1972 came to be amended.

In Section 4 of the Payment of Gratuity Act, 1972, in subsection (3) for the words 'three lakhs and fifty thousand rupees', the words 'ten Page 17 of 40 HC-NIC Page 17 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT lakh rupees' were substituted.

27. Pursuant to such amendment in the Payment of Gratuity Act, the respondent no.2 issued a Circular dated 5th June 2010 enhancing the ceiling of gratuity from Rs.3,50,000=00 to Rs.10,00,000=00 with effect from 24th May 2010 but with a clarification that all those employees who had resigned or retired before 24th May 2010 would not qualify to seek benefit of such enhanced ceiling.

28. The petitioners were aggrieved by such policy decision taken by the respondent no.2 to give benefit of the enhanced ceiling of the gratuity amount only to those employees who had retired or resigned from service after 24th May 2010.

29. The stance of the board was that the cut off date which had been fixed for the application of Page 18 of 40 HC-NIC Page 18 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT the circular was not violative of Article 14 of the Constitution of India.

30. Although the Government of Gujarat through its Finance Department might have raised the maximum limit of gratuity to Rs.10 lac with effect from 1st January 2006 vide Resolution dated 3rd April 2009 in lieu of the acceptance of the recommendations of the Sixth Pay Commission, yet the same was not binding on the respondent no.2 as it had decided not to implement the recommendations of the Sixth Pay Commission in lieu of the settlement arrived at with the recognized unions and associations of the employees. In furtherance to the same, the GSO1 dated 1st July 2009 was issued. Under the GSO1 at Point No.28, it had been clearly stated that the amount of the gratuity payable would be according to the Payment of Gratuity Act, 1972 as amended from time to time.

30. Since the Payment of Gratuity Act, 1972 has Page 19 of 40 HC-NIC Page 19 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT been adopted with effect from 6th April 1972, there was no requirement to follow the resolution of the Government of Gujarat dated 13th April 2009 to give effect to the enhanced ceiling of gratuity from Rs.3,50,000=00 to Rs.10,00,000=00 with effect from 1st January 2006.

31. The principal argument on behalf of the petitioners was the alleged violation of Article 14 of the Constitution of India. They contended that the decision of the respondent no.2 to make available the increased quantum of gratuity only to those employees who had retired, resigned or died after 24th May 2010 was discriminatory and arbitrary. They also contended that all retirees formed a homogeneous class and any discrimination or distinction between retirees prior to 24th May 2010 and those retired/ resigned on or after 24th May 2010 had no rationale basis, nor was intended to serve any purpose.

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HC-NIC Page 20 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT

32. The Division Bench in the above referred factual background held as under: "In State Government Pensioners' Association v. State of A.P., AIR 1986 SC 1907, the order in question provided that retirement gratuity may be onethird of the pay drawn at the time of retirement for every sixmonthly service, subject to maximum of 20 months' pay limited to Rs.30,000. This order was made effective from 1.4.1978. The petitioners, who were government employees and had retired before 1.4.1978, contended that the gratuity, being a part and parcel of the pensionary benefits, they were also entitled to the same retrospectively. On behalf of the State, it was pointed out that the gratuity which had accrued to the petitioners prior to 1.4.1978, was calculated on the then existing rules and pay, and such petitioners formed a distinct class, for the purpose of payment of gratuity, from others who retired after 1.4.1978, the date from which the revised pension rules were made applicable by the Government. The Supreme Court held that the upward revision of gratuity which took effect from a specified date i.e. 1.4.1978 with prospective effect, was legal and not violative of Article 14 of the Constitution.

In Ramrao v. All India Backward Class Bank Employees Welfare Assn., AIR 2004 SC 1459, the Supreme Court has held that, even for the purpose of effecting promotion, fixing of a cutoff date was neither arbitrary, unreasonable nor did it offend Article 14 of the Constitution. The Supreme Court further observed as under :

"32. If a cutoff date can be fixed, indisputably those who fall within the purview thereof would form a separate class. Such a classification has a reasonable nexus with the object which the decision of the Page 21 of 40 HC-NIC Page 21 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT Bank to promote its employees seeks to achieve. Such classifications would neither fall within the category of creating a class within a class or an artificial classification so as to offend Article 14 of the Constitution of India.

33. Whenever such a cutoff date is fixed, a question may arise as to why a person would suffer only because he comes within the wrong side of the cutoff date, but, the fact that some persons or a Section of society would face hardship, by itself cannot be a ground for holding that the cutoff date so fixed is ultra vires Article 14 of the Constitution."

In State of Bihar v. Bihar Pensioners Samaj, AIR 2006 SC 2100, the Supreme Court held as under :

"17. We think that the contention is well founded. The only ground on which Article 14 has been put forward by the learned counsel for the respondent is that the fixation of the cutoff date for payment of the revised benefits under the two notifications concerned was arbitrary and it resulted in denying arrears of payments to certain sections of the employees. This argument is no longer res integra. It has been held in a catena of judgments that fixing of a cutoff date for granting of benefits is well within the powers of the Government as long as the reasons therefor are not arbitrary and are based on some rational consideration."

In State of Punjab and others v. Amar Nath Goyal and others, reported in (2005)6 SCC 754, the Supreme Court explained the principle of classification and fixation of cutoff date. In the said case, the Central Government issued an O.M. dated 14th July 1995, whereby the dearness allowance linked to the All India Average Consumer Price Index 1201.66 (as on 1st July 1993), was treated as reckonable part of dearness allowance for the purpose of calculating the deathcum retirement gratuity under the Central Civil Page 22 of 40 HC-NIC Page 22 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT Services (Pension) Rules, 1972. The said benefit was actually made available to the employees who retired or died on or after 1st April 1995 i.e. the cutoff date suggested by the Fifth Central Pay Commission in its Interim Report. Following the aforesaid O.M. issued by the Central Government, the Government of Punjab also issued an order dated 13th December 1996 granting the same benefit fixing the said cutoff date.

A large number of employees, both of the Central Government as well as the State Governments of Punjab and Himachal Pradesh, who had retired prior to 1st April 1995, applied for getting the additional benefits of increased quantum of deathcumretirement gratuity up to the increased limit of Rs.2.5 lac. Their claims were rejected in some cases and in other cases, the CAT and the High Court took the view that such of the employees who had retired between 1st July 1993 and 31st March 1995 were also eligible for the aforesaid benefits. The employees whose cases were wholly rejected or partly rejected and partly granted, as well as the Union of India and the State Governments preferred appeal before the Supreme Court. The employees argued that there was violation of Article 14 of the Constitution. They contended that the decision of the Central Government/State Governments to make available the increased quantum of gratuity (with revised ceiling) only to employees, who retired or died on or after 1st April 1995, was discriminatory and arbitrary. They also contended that all retirees/dead persons formed a homogeneous class and any discrimination or distinction between retirees/dead persons prior to 1st April 1995 and those who retired/died on or after 1st April 1995 had no rational basis, nor was intended to serve any purpose.

Rejecting the said contentions, the Supreme Court held:

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HC-NIC Page 23 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT It is difficult to accede to the argument that a decision of the Central Government/State Governments to limit the benefits only to employees, who retire or die on or after 1.4.1995, after calculating the financial implications thereon, was either irrational or arbitrary. Financial and economic implications are very relevant and germane for any policy decision touching the administration of the Government, at the Centre or at the State level..... In the present case, the cutoff date has been fixed as 1.4.1995 on a very valid ground, namely, that of financial constraints. Consequently, the contention that fixing of the cutoff date was arbitrary, irrational or had no rational basis or that it offends Article 14, is liable to be rejected.

Although in the case before the Supreme Court the classification and the fixation of the cutoff date was sought to be justified on financial and economic implications, which has not been pleaded before us so far as the case in hand is concerned, but the principle explained could definitely be made applicable even to the facts of the present case. Applying such principle as explained by the Supreme Court in the case of State of Punjab (supra), it could not be said that the cut off date fixed by the respondent no.2 is arbitrary, irrational or that it offends Article 14 of the Constitution of India.

In Union of India v. P.N.Menon, reported in (1994)4 SCC 68, while implementing the recommendations of the Third Pay Commission with regard to dearness pay linked to Average Index Level 272, which was to be counted as emoluments for pension and gratuity under the Central Civil Services (Pension) Rules, 1972, the Central Government had fixed a certain cutoff date and directed that only officers retiring on or after the specified date were entitled to the benefits of the dearness pay being counted for the purpose of retirement benefits. This was challenged as arbitrary and violative of Article 14 of the Constitution. This Court turned down the challenge and observed:

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HC-NIC Page 24 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT "Not only in matters of revising the pensionary benefits, but even in respect of revision of scales of pay, a cutoff date on some rational or reasonable basis, has to be fixed for extending the benefits. This can be illustrated. The Government decides to revise the pay scale of its employees and fixes the 1st day of January of the next year for implementing the same or the 1st day of January of the last year. In either case, a big section of its employees are bound to miss the said revision of the scale of pay, having superannuated before that date. An employee, who has retired on 31st December of the year in question, will miss that pay scale only by a day, which may affect his pensionary benefits throughout his life. No scheme can be held to be foolproof, so as to cover and keep in view all persons who were at one time in active service. As such the concern of the court should only be, while examining any such grievance, to see, as to whether a particular date for extending a particular benefit or scheme, has been fixed, on objective and rational considerations." (2006 part 1 GLR 146)

33. A Division Bench of this Court in the case of State of Gujarat and others V. Narsinhdas Krishnadas Agravat, 2006 (1) GLR 146 after an exhaustive discussion of case law observed as under:

8. We have given our most anxious consideration to the entire matter. The question whether the cutoff date specified in a legislative instrument or the administrative policy decision taken by the Page 25 of 40 HC-NIC Page 25 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT State and/or its instrumentality is violative of the doctrine of equality has become subjectmatter of large number of cases and it will be profitable to notice some of the judgments of the Supreme Court.

8.1 In D. R. Nim v. Union of India, AIR 1967 SC 1201, the Constitution Bench of the Supreme Court considered whether the cutoff date i.e. 1951951 fixed by the Government of India for determination of the year of allotment under the Indian Police Service (Regulation of Seniority) Rules, 1954 was arbitrary and violative of Art. 14. The appellant who joined Uttar Pradesh Police Service in 1938 was promoted as Officiating Superintendent of Police with effect from June 25, 1947. He was regularly promoted to the Indian Police Service Cadre of Uttar Pradesh with effect from 22101955. He was allotted 1956 for the purpose of fixation of seniority under the 1954 Rules. This was done on the basis of order dated 2581955 issued by the Government of India which had fixed 1951951 as the cutoff date for determination of the year of allotment. After making a a reference to the affidavit filed on behalf of the Government of India, the Supreme Court held that the cutoff date was artificial and arbitrary, inasmuch as it had nothing to do with the application of the first and the second proviso to Rule 3(3) of the Rules. The Supreme Court observed that the Central Government cannot pick out a date from the hat for the purpose of fixing the seniority of the promotee officers and directed that the entire service of the appellant including the officiating service should be reckoned for the purpose of fixing the year of allotment.

8.2 In Union of India v. M/s. Parameswaran Match Works, AIR 1974 SC 2349, the Supreme Court negatived the challenge to Clause (b) of Notification dated 461967 issued by the Government under Rule 8(1) of the Central Excise Rules, 1944 by which only those manufacturers of match boxes were held entitle to the benefit of concessional rate of duty who filed declaration before 49 Page 26 of 40 HC-NIC Page 26 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT 1967. The respondent successfully challenged the choice of the date before the Madras High Court. While reversing the judgment o f the High Court, Their Lordships of the Supreme Court observed as under :

"That a classification can be founded on a particular date and yet be reasonable, has been held by this Court in several decisions (See M/s. Hathisingh Mfg. Co. Ltd. v. Union of India, 1960 (3) SCR 528 at 543 : AIR 1960 SC 923 at 931, Dr. Mohmmad Saheb Mahbood Medico v. Deputy Custodian General, 1962 (2) SCR 371 at 379 : AIR 1961 SC 1657 at 1661, M/s. Bhikusa Yamasa Kshatriya (P) Ltd. v. Union of India, 1964 (1) SCR 860 at 880 : AIR 1963 SC 1591 at 1599) and Daruka & Co. v. Union of India, AIR 1973 SC 2711. The choice of a date as a basis for classification cannot always be dubbed as arbitrary even if no particular reason is forthcoming for the choice unless it is shown to be capricious or whimsical in the circumstances. When it is seen that a line or a point there must be and there is no mathematical or logical way of fixing it precisely, the decision of the legislature or its delegate must be accepted unless we can say that it is very wide of any reasonable mark. See Louisville Gas & E. Co. v. Coleman, (1927) 277 US 32 per Justice Holmes."

8.3 In Dr. (Mrs.) Sushma Sharma v. State of Rajasthan, AIR 1985 SC 1367, the Supreme Court held that the choice of date fixed for determination of the eligibility of the temporary lecturers for absorption under Rajasthan Universities Teachers and Officers (Special Conditions of Service) Act, 1974 was not arbitrary. It was argued on behalf of the appellant that 25th June, 1975, i.e. the date on which emergency was declared in the country had nothing to do with the object of the legislation, viz., to regularize the services of the temporary lecturers and that the choice of the date was wholly arbitrary, irrational and violative of Art. 14 of the Constitution. Their Lordships of the Supreme Court referred to the earlier precedents In Re : The Special Courts Bill, 1978, AIR 1979 Page 27 of 40 HC-NIC Page 27 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT SC 478, Prag Ice and Oil Mills v. Union of India, AIR 1978 SC 1296, D. S. Nakara v. Union of India, AIR 1983 SC 130, Union of India v. M/s. Parameswaran Match Works (supra) and held as under :

"The, choice of 25th June, 1975 as the date prior to which temporary teachers must have been in employment to be eligible for screening cannot be said to be an arbitrary choice. The choice of the said date was not with an intention to differentiate between pre and post emergency appointees."

"The primary object of the Ordinance as well as of the Act was to provide for the absorption and regularization of temporary lecturers of long standing in the universities in Rajasthan. What was intended was that the temporary teachers of long standing should be screened and 25th June, 1975 was taken because it was as convenient a date as any other. While interpreting the provisions of any Act, what is necessary is the intention of the legislature and that has to be found out from the language used, it is not the view of the ViceChancellor or of an officer or authority who might or might not have put a note to the Bill."

"The intention was that those who had continued from a date prior to 1975 upto June, 1978 should get the benefit. Such benefit had to be fixed giving a particular period and from the mere fact that 25th June, 1975 was fixed which also happens to be the date on which emergency was clamped on the country, it cannot be said that emergency was the nexus. A certain tenure of service for the purpose of absorption was the object to be achieved and this has a rational nexus with the object. The prescription of the date from which the period should begin and the date on which it should end were mere incidental to the purpose. Any date perhaps could have served the purpose which took into consideration long tenure. What was intended by the use of the expression "appointed on or before 2561975 and must have continued until 1261978 being the date of coming into Page 28 of 40 HC-NIC Page 28 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT force of the Ordinance indicated that there should have been near about three years experience for being eligible for absorption. The date was a handy date. Handy in the sense, it came quickly in the minds of some people. At least there is no evidence that there was an attempt to separate or penalize preemergency appointees and no decision was taken by any appropriate authority and no such evidence is there to make a distinction between preemergency and postemergency appointees."

8.4 In D. S. Nakaras case (supra), the Supreme Court struck down the classification made between pensioners for the purpose of grant of benefit of liberalization only on the basis of the particular date i.e. 3rd March, 1979.

The judgment in Nakaras case (D. S. Nakara v. Union of India, AIR 1983 SC 130) was considered by another Constitution Bench in Krishena Kumar v. Union of India, 1990 (4) SCC 207. The facts of that case were that the petitioners, who were retired Railway employees challenged the cutoff date i.e. 1 41957 specified in the Pension Scheme introduced in place of Provident Fund Scheme. While repelling the challenge, the Supreme Court distinguished the ratio of Nakaras case (supra) by making following observations :

"In Nakara, the Court treated the pension retirees only as a homogeneous class. It was never held that both the pension retirees and the PF retirees formed a homogeneous class and that any further classification among them would be violative of Art. 14. On the other hand the court clearly observed that it was not dealing with the problem of a "fund".

The Railway Contributory Provident Fund is by definition a fund. Besides, on the retirement of an employee Governments legal obligation under the Provident Fund account ends while under the Pension Scheme it begins. The rules governing the Provident Fund and its contribution are entirely different from the rules governing pension. It would not, therefore, be reasonable to argue that what Page 29 of 40 HC-NIC Page 29 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT is applicable to the pension retirees must also equally be applicable to P.F. retirees. This being the legal position the rights of each individual P.F. retiree finally crystallized on his retirement whereafter no continuing obligation remained, while on the other hand, as regard Pension retirees, the obligation continued till their death. The continuing obligation of the State in respect of pension retirees is adversely affected by fall in rupee value and rising prices which, considering the corpus already received by the P.F. retirees they would not be so adversely affected ipso facto. It cannot, therefore, be said that it was the ratio decidendi in Nakara that the States obligation must be the same as that towards the pension retirees. An imaginary definition of obligation to include all the Government retirees in a class, was not decided and could not form the basis for any classification for the purpose of this case. Nakara cannot, therefore, be an authority for this case."

8.5 In State of West Bengal & Ors. v. Ratan "Behari Dey & Ors., 1993 (4) SCC 62, the Supreme Court referred to the, judgments in Shushma Sharmas case (supra), D. S. Nakaras case (supra) and Krishena Kumars case (supra) and upheld the cutoff date i.e. 141977 specified in the Corporation of Calcutta Employees (Deathcumretirement) Benefit Regulations, 1982. Some of the observations made in that judgment are extracted below :

"The State Government had acted reasonably in specifying the cutoff date April 1, 1977. That might have been the year in which the Left Front came into power in that State, but that does not detract from the validity of the reasons for fixing the date. It cannot be said that the reasons assigned by the State Government are neither relevant nor acceptable. Nakara was a case where an artificial date was specified classifying. the retirees, governed by the same Rules, and similarly situated, into two different classes, depriving one such class of the benefit of liberalized Pension Rules. Whereas Page 30 of 40 HC-NIC Page 30 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT in this case, the employees retiring prior to April 1, 1997 and those retiring thereafter were governed by different sets of rules."

"It is open to the State or to the Corporation; as the case may be, to change the conditions of service unilaterally. Terminal benefits as well as pensionary benefits constitute conditions of service. The employer has the undoubted power to revise the salaries and/or the pay scales as also terminal benefits/pensionary benefits. The power to specify a date from which the revision or payscales or terminal benefits/pensionary benefits, as the case may be, shall take effect is a concomitant of the said power. The State can specify a date with effect from which the Regulations framed, or amended, as the case may be, shall come into force. It was within the power of the Corporation to enforce the Regulations either prospectively or with retrospective effect from such date as they might specify. Only condition is that in such cases the State cannot pick a date out of its hat. It has to prescribe the date in a reasonable manner, having regard to all the relevant facts and circumstances. So long as such date is specified in a reasonable manner, i.e., without bringing about a discrimination between similarly situated persons, no interference is called for by the Court in that behalf on ground of discrimination."

8.6 In All India Reserve Bank Retired Officers Association v. Union of India, AIR 1992 SC 767, the Supreme Court distinguished Nakaras case (supra) and applied the ratio of Krishena Kumars case (supra) for rejecting the petitioners plea that denial of the benefit of Pension "Scheme framed by the Reserve Bank in lieu of Contributory Provident Fund Scheme to those who had retired prior to 111996 was violative of Art. 14. Their Lordships drew distinction between cases in which existing Pension Scheme is liberalized and in which new Pension Scheme is introduced and held :

"When the State decides to revise and Page 31 of 40 HC-NIC Page 31 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT liberalize an existing pension scheme with a view to augmenting the social security cover granted to pensioners, it cannot ordinarily granted the benefit to a section of the pensioners and deny the same to others by drawing an artificial cutoff line which cannot be justified on rational grounds and is wholly unconnected with the object intended to be achieved. But when an employer introduces an entirely new scheme which has no connection with the existing scheme, different considerations enter the decision making process. One such consideration may be the extent of capacity of the employer to bear the burden. Keeping in view its capacity to absorb the financial burden that the scheme would throw, the employer would have to decide upon the extent of applicability of the scheme."

"It appears on a conjoint reading of Regulation 3(3) and Regulation 31 that Bank employees who retied from service between 1st January, 1986 and 1st November, 1990 could opt for the benefit of the pension scheme with effect from 1st November, 1990 provided they refunded the Banks contribution to the provident fund together with interest received calculated at 6 percent per annum from the date of withdrawal till the date of repayment. Bank employees who retired from service before 1st January, 1986 were not eligible to opt for the newly introduced Pension Scheme."

"The cutoff date i.e. 111986 is not arbitrary fixed by the Bank authorities or the Central Government while giving its approval and it is not devoid of rational consideration not is wholly whimsical. In fixing the cutoff date the authorities had not acted mala fide with a view to deprive those who had retired on or before 31st December, 1985 of the benefit of the pension scheme but it was not practicable to extend the benefit to such retirees. The rationale for fixing the cutoff date as 1st January, 1986 was the same as the case of Central Government employees based on the recommendation of the Fourth Central Pay Page 32 of 40 HC-NIC Page 32 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT Commission. The fact that service records of persons retired prior to cutoff date were not available also justified the reason for not extending the benefit to those who had retired before five years or more."

8.7 In Union of India v. P. N. Menon, 1994 (4) SCC 68, the Supreme Court reversed the judgment of the Madras High Court and upheld the cutoff date specified in the Memorandum dated 2551979 for grant of higher pensionary benefits to the employees who had retired between 30th September, 1977 and 30th April, 1979. The Supreme Court referred to the judgments in Nakaras case, Krishena Kumars case, All India Reserve Bank Officers Associations case and observed :

"Whenever the Government or an authority, which can be held to be a State within the meaning of Art. 12 of the Constitution, frames a scheme for persons who have superannuated from service, due to many constraints, it is not always possible to extend the same benefits to one and all, irrespective of the dates of superannuation. As such any revised scheme in respect of postretirement benefits, if implemented with a cutoff date, which can be held to be reasonable and rational in the light of Art. 14 of the Constitution, need not be held to be invalid. Whenever a revision takes place, a cutoff date becomes imperative because the benefit has to be allowed within the financial resources available with the Government."

"No scheme can be held to be foolproof, so as to cover and keep in view all persons who were at one time in active service. As such the concern of the Court should only be, while examining any such grievance, to see, as to whether a particular date for extending a particular benefit or scheme, has been fixed, on objective and rational considerations."

"The decision to merge a part of the dearness allowance with pay, when the price index level was at 271, appears to have been taken Page 33 of 40 HC-NIC Page 33 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT on basis of the recommendation of the Third Pay Commission. In this background, it cannot be said that the date, 3091977, was picked out in an arbitrary or irrational manner, without proper application of mind. The option given to employees, who retired on or after 3091977, but not later than 304 1979, to exercise an option to get their pension and deathcumretirement gratuity calculated by excluding the element of dearness pay as indicated in the aforesaid office memorandum or to get it included in their pension and deathcumretirement gratuity, was not an exercise to create a class within a class. The decision having in nexus with the price index level at 272, which it reached on 3091977, was just and valid. It has been rightly pointed out that respondents had never been in receipt of dearness pay and as such the office memorandum in question could not have been applied to them. Similarly, the encashment of leave was a new scheme introduced which could not have been extended retrospectively to respondents, who had retired before the introduction of the said scheme. Same can be said even in respect of family pension scheme which was earlier contributory, but with effect from 2291977 the scheme was made noncontributor. The respondents not being in service on the said date, were not eligible for the same benefit and no question of refunding the amount, which had already been contributed by them, did arise."

8.8 In Union of India v. Lieut (Mrs.) E. Iacats, 1997 (7) SCC 334, the Supreme Court reiterated the principle that where liberal Pension Scheme was introduced after considering report of Study Group and the scheme was made applicable to those who retired after 1101983, those who retired earlier cannot plead discrimination and complain of the violation of Art. 14.

8.9 In State of Punjab v. Justice S. S. Dewan (supra), the cutoff date specified in the Punjab Superior Judicial Service Rules, 1963 for grant of benefit of 10 years practice at the Bar as a part of qualifying service was Page 34 of 40 HC-NIC Page 34 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT upheld in the following words :

"Conceptually, pension is a reward for past service. It is determined on the basis of length of service and last pay drawn. Length of service is determinative of eligibility and the quantum of pension. The formula adopted for determining last average emoluments drawn has an impact on the quantum of pension. D. S. Nakara case involved the change of formula for determining average emoluments and it was treated as liberalization or upward revision of the existing pension scheme. On parity or reasoning it can be said that any modification with respect to the other determinative factor, namely, qualifying service made with a view to make it more beneficial in terms of quantum of pension scheme. If, however, the change is not confined to the period of service but extends or relates to a period anterior to the joining of service, then it would assume a different character. Then, it is not liberalization of the existing scheme but introduction of a new retiral benefit. Here; what has been done by amending Rule 16 is to make the period of practice at the Bar, which was otherwise irrelevant for determining the qualifying service, also relevant for that purpose. The purpose seems to make the service more attractive for those who are already in service so that they may not leave it and for new entrants so that they may be tempted to join it. Though, Rule 16 does not specifically state that the amended rule will apply only to those who retired after 222 1990, the intention behind it clearly appears to be to extend the new benefit only to those who retired after that date. For these reasons, the principle laid down in D. S. Nakara case that if pensioners from a class, computation of their pension cannot be by different formula affording unequal treatment merely on the ground that some retired earlier and some retired later, will have no application to a case of this type. Benefit of the amendment would be available to only those direct recruits who retired after it came into force."

Page 35 of 40

HC-NIC Page 35 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT 8.10 In V. Kasturi v. Managing Director, State Bank of India, 1998 (8) SCC 30, the Division Bench of the Supreme Court, after reviewing the caselaw on the subject reiterated the principle that the benefit of a new Pension Scheme can be confined by specifying a cutoff date and the principles governing the applicability of a liberalized pension scheme cannot be invoked for striking down such cutoff date.

8.11 In Hari Chand v. Faridabad Complex Administration, 2005 (4) SCC 593, the Supreme Court upheld the decision of the Punjab & Haryana High Court which had rejected the appellants challenge to the applicability of Pension Scheme introduced in 1992 only to those who retired after April, 1992.

9. The principles which can be deduced from the abovenoted judicial precedent are that if an existing Pension Scheme is revised or liberalized, then the benefit of revision/liberalization has to be given to the existing pensioners and they cannot be divided into two or more groups with reference to a particular date except when there are cogent and rational reasons for making classification or dividing the pensioners into two groups. However, if the employer introduces a new scheme for the first time, it is well within its domain to specify any particular date for implementation of scheme and those who may have retired prior to that date cannot complain of discrimination or invoke doctrine of equality enshrined under Arts. 14 and 16 for issuance of a direction to the employer to extend the benefit of Pension Scheme to the pre cutoff date retirees. Similarly, if an existing Provident Fund Scheme is replaced by Pension Scheme, the employer has the discretion to fix the cutoff date for enforcing the pension scheme and the Provident Fund holders who may have retired prior to that date cannot contend that the Pension Scheme is violative of their fundamental right to equality. The burden to prove that the date fixed for implementation Page 36 of 40 HC-NIC Page 36 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT of the new Pension Scheme is arbitrary is always on the petitioner and unless a very strong case is made out, the Court will not interfere with the employers choice of the date. Ordinarily, the Court will presume that the date fixed for implementation of the Pension Scheme is rational and does not suffer from the vice of discrimination. However, such presumption is rebuttable and the Court may nullify the discretion exercised by the employer if it is proved by the petitioner that the choice of the date is wholly arbitrary or irrational or is wide of the mark.

10. Reverting to the case in hand, we find that the respondents were governed by the Employees Provident Fund Scheme which was introduced in 1982 for educational establishments. Initially, the Supreme Court stayed the implementation of that scheme, but the writ petitions filed by the management of the schools were ultimately dismissed and they were directed to contribute their share with retrospective effect. The Pension Scheme was framed for the first time pursuant to the direction given by the Division Bench on 31 72001. The same was circulated vide letter dated 642002 and made applicable to the teachers who retired from service on or after 111997. This was done keeping in view the fact that the writ petition filed by Kusumben E. Borasada claiming pension was decided by the learned single Judge on 1811997. This was one of the factors enumerated in Paragraph No. 6 of the judgment of the Division Bench. Therefore, it is not possible to agree with the learned single Judge that the denial of pension to part 111997 retirees is arbitrary and violative of Arts. 14 and 16 of the Constitution.

11. In our opinion, the State could legitimately fixed 3172001 as the cutoff date for applicability of the Pension Scheme to the teachers of the primary schools of the private aided institutions because that is the date on which the Division Bench given direction for framing the Pension Scheme. However, keeping in view the factors Page 37 of 40 HC-NIC Page 37 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT enumerated in Paragraph No. 6 of the judgment of the Division Bench including the fact that the learned single Judge had decided the writ petition on 18th January, 1997, the State Government made the Pension Scheme applicable to those retiring on or after 111997. Thus, the choice of the cutoff date specified in the Pension Scheme cannot be termed as irrational or wide of the mark. Rather, it is based on a rational consideration, namely, that the High Court had recognized the entitlement of the teachers of private aided institutions to get pension only on 181 1997.

12. It is true that while directing the State Government to frame the Pension Scheme, the Division Bench had enumerated various other factors which were to be kept in view for determining the date of its implementation, but it cannot be said that the choice of 11 1997 made by the State Government is wholly arbitrary or violative of the right to equality guaranteed to the respondents under the Constitution.

13. The reasons assigned by the learned single Judge for directing the implementation of the Pension Scheme with effect from 13 1982 are not at all germane to the considerations which could weigh with the public employer in selecting a particular date for implementation of the scheme. It appears to us that attention of the learned single Judge was not drawn to the distinctions highlighted in the judgments of the Supreme Court between the Provident Fund Scheme and the Pension Scheme and between the cases in which the existing Pension Scheme is liberalized and the cases in which the Pension Scheme is for the first time introduced in place of the Provident Fund Scheme. No doubt, the Division Bench had specified the factum of introduction of the Employees Provident Fund Scheme as one of the factors which could he considered by the Government for the purpose of determining the date of implementation of the Pension Scheme, but there is nothing in the judgment dated 3172001 from which it can be inferred that Page 38 of 40 HC-NIC Page 38 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT the Court had ordained the State Government to introduce the Pension Scheme with effect from 131982 or any other particular date. Rather, the Court had unequivocally left to the discretion of the State to choose the date of the commencement of the scheme by taking into consideration various factors and the later had chosen 111997, keeping in view the fact that the High Court had recognized the entitlement of the teachers of the private schools to get pension only on 1811997. Thus, we do not find any constitutional infirmity in the decision of the State Government to make Pension Scheme applicable with effect from 111997 and the consequential exclusion of the teachers who had retired or before 31121996."

34. What is discernible from the aforenoted decisions of the Supreme Court and one of this Court is that the choice of a date as a basis for classification cannot always be dubbed as arbitrary even if no particular reason is forthcoming for the choice unless it is shown to be capricious or whimsical in the circumstances.

There is no mathematical or logical way of fixing a cutoff date precisely and the decision of the legislature or its delegate must be accepted unless it can be said to be absolutely unreasonable.

Page 39 of 40

HC-NIC Page 39 of 40 Created On Fri Oct 09 02:11:41 IST 2015 C/SCA/16761/2014 CAV JUDGMENT

35. For the forgoing reasons I do not find any merit in this writapplication and the same is accordingly rejected. However, in the facts and circumstances of the case, there shall no order as to costs.

(J.B.PARDIWALA, J.) Manoj Page 40 of 40 HC-NIC Page 40 of 40 Created On Fri Oct 09 02:11:41 IST 2015

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