facts of the case on hand. The facts in this case
and the facts in D.S. Nakara [D.S. Nakara v.
Union of India, (1983) 1 SCC 305 : 1983 SCC
(L&S) 145] are clearly distinguishable.
Although she has not challenged the cut-off date as arbitrary, reliance
in this connection is placed by her on the decision in the case of D.S.
Nakara v. Union of India1. This decision has been subsequently explained and
distinguished in a number of cases.
In view of the above and for the reasons
stated above, we are of the opinion that the
controversy/issue in the present appeal is
squarely covered by the decision of this
Court in D.S. Nakara [D.S. Nakara v. Union
of India, (1983) 1 SCC 305. The decision of
this Court in D.S. Nakara shall be applicable
with full force to the facts of the case on
hand. The Division Bench of the High Court
has clearly erred in not following the
decision of this Court in D.S. Nakara and
has clearly erred in reversing the judgment
and order of the learned Single Judge. The
impugned judgment and order passed by the
Division Bench is not sustainable and the
same deserves to be quashed and set aside
and is accordingly quashed and set aside.
The judgment and order passed by the
learned Single Judge is hereby restored and
it is held that all the pensioners, irrespective
of their date of retirement viz. pre-1996
retirees shall be entitled to revision in
pension on a par with those pensioners who
retired post-1996. The arrears be paid to the
respective pensioners within a period of
three months from today."
As ruled by the Apex Court in a Constitution Bench decision of D.S. Nakara & others v. Union of India, 1983 SCC (L&S) 145 that in upholding the constitutional mandate of Article 14 of the Constitution, financial constraints are not to be an impediment.
That is the combined effect of staff Circular No. 18 dated 8.4.1974 read with the Pension Fund Rules referred to supra. The reasons for prescribing the maximum age limit of 35 or 38, as the case may be, for the purpose of induction into Pension Fund appears to be that the employee would be able to render minimum service of 20 years as contemplated by Rule 22 of the Pension Fund Rules. However, there does not appear to be any rational or discernible basis for fixing the cut-of date as 1.1.1965, notwithstanding their earlier confirmation in bank service. True, a new benefit has been conferred on the ex servicemen and therefore, a cut-off date could be fixed for extending this new benefit, without offending the ratio of the decision in D.S. Nakara v. Union of India but there could be no arbitrariness or irrationality in fixing such date. Minimum qualifying service being the essential consideration, even according to the Bank, there is no reason why the ex-servicemen like the respondents, who from the date of their confirmation had put in more than twenty years of service, even taking the retirement age as 58, should be excluded. No reason is forthcoming in the counter-affidavit filed by the Bank for choosing the said date. When it is decided to extend the pensionary benefit to ex-servicemen drawing pension, the denial of the benefit to some of the serving employees should be based on rational and intelligible criterion. In substance, that is the view taken by the High Court and we see no reason to differ with that view.
That is the combined effect of Staff Circular No. 18 dated 8-4-1974
read with the Pension Fund Rules referred to supra. The reason for
prescribing the maximum age-limit of 35 or 38, as the case may be, for the
purpose of induction into Pension Fund appears to be that the employee
would be able to render minimum service of 20 years as contemplated by
Rule 22 of the Pension Fund Rules. However, there does not appear to be
any rationale or discernible basis for fixing the cut-off date as 1-1-1965,
notwithstanding their earlier confirmation in bank service. True, a new
benefit has been conferred on the ex-servicemen and therefore, a cut-off
Signature Not VerifiedDigitally SignedBy:KAMAL KUMAR W.P.(C) 4406/2017 and connected matter Page 51 of 59Signing Date:07.04.202523:51:06
date could be fixed for extending this new benefit, without offending the
ratio of the decision in D.S. Nakara v. Union of India [(1983) 1 SCC 305 :
That is the combined effect of Staff Circular No. 18 dated 8-4-1974
read with the Pension Fund Rules referred to supra. The reason for
prescribing the maximum age-limit of 35 or 38, as the case may be, for the
purpose of induction into Pension Fund appears to be that the employee
would be able to render minimum service of 20 years as contemplated by
Rule 22 of the Pension Fund Rules. However, there does not appear to be
any rationale or discernible basis for fixing the cut-off date as 1-1-1965,
notwithstanding their earlier confirmation in bank service. True, a new
benefit has been conferred on the ex-servicemen and therefore, a cut-off
Signature Not VerifiedDigitally SignedBy:KAMAL KUMAR W.P.(C) 4406/2017 and connected matter Page 51 of 59Signing Date:07.04.202523:51:06
date could be fixed for extending this new benefit, without offending the
ratio of the decision in D.S. Nakara v. Union of India [(1983) 1 SCC 305 :
That is the combined effect of the staff circular No. 18 dated 8.4.1974 read with the Pension Fund Rules referred to supra. The reason for prescribing the maximum age limit of 35 or 38, as the case may be, for the purpose of induction into pension fund appears to be that the employee would be able to render minimum service of 20 years as contemplated by Rule 22 of the Pension Fund Rules. However, there does not appear to be any rationale or discernible basis for fixing the cutoff date as 1.1.1965, notwithstanding their earlier confirmation in Bank service. True, a new benefit has been conferred on the ex-servicemen and therefore a cutoff date could be fixed for extending this new benefit, without offending the ratio of the decision in D.S. Nakara and others Vs. Union of India [AIR 1983 SC 130]; but, there could be no arbitrariness or irrationality in fixing such date. Minimum qualifying service being the essential consideration, even according to the Bank, there is no reason why the ex-servicemen like the respondents, who from the date of their confirmation had put in more than twenty years of service, even taking the retirement age as 58, should be excluded. No reason is forthcoming in the counter-affidavit filed by the Bank for choosing the said date. When it is decided to extend the pensionary benefits to ex-servicemen drawing pension, the denial of the benefit to some of the serving employees should be based on rational and intelligible criterion. In substance, that is the view taken by the High Court and we see no reason to differ with that view.
Nakara [D.S. Nakara v. Union of India, (1983) 1
SCC 305 : 1983 SCC (L&S) 145] cannot, therefore, be an
authority for this case.‖
Having observed that the Pension Scheme and the
Provident Fund Scheme were structurally different, it was
then concluded that the retirees in both categories did not
belong to the same class and that there was no
discrimination. The challenge was, therefore, rejected.
15. As noticed earlier, the learned Judges even after
noticing that the ratio in the judgment of this Court in
Nakara case cannot be pressed into service,
erroneously granted relief on the alleged delay on the
part of the appellant-Electricity Board in introducing
the pension scheme which certainly cannot be a ground
for the Court to give retrospective effect to the pension
scheme. Moreover, the appellant-Board had given
well-founded reasons for introducing the pension
scheme from 1-7-1986 including financial constraints,
a valid ground. We are of the view that the retired
employees (respondents), who had retired from service
CWP No. 5770 of 1999 -15-
before 1-7-1986 and those who were in employment on
the said date, cannot be treated alike as they do not
belong to one class. The workmen, who had retired
after receiving all the benefits available under the
Contributory Provident Fund Scheme, cease to be
employees of the appellant-Board w.e.f. the date of
their retirement. They form a separate class.