- (1.) THIS special appeal has been registered on remand from the Supreme Court. The appellant had filed SLP (Civil) no. 1410/2003 giving rise to Civil Appeal No. 8553/2003 challenging the judgment and order of a learned Single Judge of this Court dated 6.9.2002 in S.B. Civil Writ Petition No. 4808/1994. Leave was granted on 31.10.2003 but when the matter came up for hearing on 4.10.2005 the Supreme Court passed the following order: "It is brought to our notice by learned counsel for the respondents that a Letters Patent Appeal before the Division Bench is available and a specific stand in that regard has been taken by respondent No. 1. Since factual adjudication, more particularly of the question as to whether respondent No. 1 actually worked after 31.7.1985 or had availed leave preparatory to retirement would require detailed examination, we think it would be appropriate if the appeal filed in this Court which has been registered after grant of leave as a civil appeal be transmitted to the High Court to be treated as Letters Patent Appeal (Special Appeal). Since the matter is pending since long, we request the High Court to dispose of the Letters Patent Appeal in accordance with law within a period of three months from the date of receipt of our order." Accordingly, on receipt of the order and the records from the Supreme Court this appeal was registered on 16.1.2006.
(2.) RESPONDENT No. 1 Ram Narain Upadhayaya (hereinafter referred to as `the respondent') had filed the writ petition seeking direction on the appellant to allow him the benefit of pension under the National Bank for Agriculture and Rural Development Pension Regulations, 1993 from 1.1.1986 after adjusting the provident fund amount paid to him. He also sought a declaration that the exclusion clause - to wit, "excluding those on leave preparatory to retirement" - occurring in regulation 3(3) of the Regulations as unconstitutional in case it is found that the benefit of pension can not be allowed in view of the exclusion clause. The learned Single Judge under the judgment impugned held that the clause excluding employees who had on leave preparatory retirement as on 1.1.1986 from the benefit of Pension Regulations was ultra vires Article 14 of the Constitution of India. Holding further, that the respondent was in service upto 31.1.1986, the learned Judge directed the appellant to extend the benefit of pension scheme to him after adjusting the amount of provident fund paid to him with interest at 12 per cent per annum from 1.1.1986 when the pension became due to him. Before referring to the relevant provisions and the point in dispute it may be mentioned that the respondent was originally in the service of the Reserve Bank of India. After establishment of the National Bank for Agriculture and Rural Development (NABARD) under the National Bank for Agriculture and Rural Development Act, 1981 (in short, "the Act'), he joined the service of NABARD and became its employee on exercising option in terms of proviso to sub- section (6) of Section 50 of the Act with effect from 12.7.1982. On 16.12.1982, the NABARD i.e. appellant herein framed staff rules called the National Bank for Agriculture and Rural Development (Staff) Rules, 1982 (hereinafter referred to as "the Staff Rules'). These Staff Rules are applicable to all the employees of the NABARD appointed on or after 12.7.1982 or deemed to have been appointed under different sub-sections of Section 50 of the Act. Rule 19 of the Staff Rules provides for superannuation and retirement of employees in Groups `A', `B' or `C' at the age of 58 years (now 60 years). In terms of sub-rule (4) of rule 19, notwithstanding the provisions regarding superannuation/retirement, where an employee has earned ordinary leave, but not availed of the same, as on the date of retirement, he may avail such leave subject to maximum of six months (now ten months). In that case, he will be deemed to have finally retired from service on the expiry of leave. In the alternative, he has the option to be paid lump sum amount equivalent to pay as on the date of retirement plus other allowances for the unavailed ordinary leave period subject to maximum of six months (now ten months). The respondent who was a Group `A' employee completed 58 years of age on 16.7.1985 and in view of proviso to rule 19(1) he was treated as retired on the last day of the month i.e. 31.7.1985. However, he was permitted to avail six months' ordinary leave standing to his credit as on the date of his retirement in terms of clause (a) of rule 19(4) of the Staff Rules. On retirement his accounts were thus settled and he was paid his retiral dues including CPF dues as per the Contributory Provident Fund Scheme which was then in vogue in respect of the employees of the appellant Bank. In 1993 the appellant with the approval of the Central Government introduced a pension scheme in place of the existing CPF scheme called National Bank for Agriculture and Rural Development Pension Regulations, 1993 (referred to as `the Pension Regulations') with effect from 1.11.1993. These regulations were framed on the pattern of the Reserve Bank of India Pension Regulations, 1990. Like the RBI Pension Regulations, choice was given to employees of the appellant Bank in service on 1.1.1986 under regulation 3(3) to opt for pension within the period specified on refunding the Bank's contribution to the Provident Fund with interest. The choice or option however was not available to those who were `on leave preparatory to retirement". The actual date of retirement of the respondent being 31.7.1985 he was treated to be not in service as on 1.1.1986 and therefore not allowed the option to switch over to the pension scheme in terms of regulation 3(3) of the Pension Regulations. In the Constitutions he approached this Court seeking directions to extend him the benefit of Pension and in case it is held that he can not claim pension in view of the clause "excluding those on leave preparatory to retirement", the same may be struck down as mentioned at the outset. The main question for consideration in this appeal is whether exclusion of those on leave preparatory to retirement on 1.1.1986 is arbitrary and discriminatory. The allied question is whether those on leave preparatory to retirement on 1.1.1986 are to be treated in service so as to become entitled to the benefit of pension in terms of regulation 3(3) of the Pension Regulations. We have referred to above the relevant feature of the pension scheme but in order to correctly appreciate the point and answer the questions it is necessary to notice the relevant provisions. But before referring to the provisions of the Pension Regulations, rule 19 of the Staff Rules so far relevant for the purpose of this case may be noticed. Rule 19 deals with `superannuation and retirement' of the employees of the appellant Bank. It lays down- Superannuation and Retirement (1) An employee in Group `A' or Group `B' or Group `C' shall retire at 58 years of age; Provided that an employee who attains the age of superannuation on a day other than the first during a calendar month shall retire on the last day of that month; Provided further............. ..................... (4) Notwithstanding anything contained in this Rule, where an employee has ordinary leave earned but not availed of as on the date of retirement, he may, at his option (a) be permitted to avail of leave subject to maximum of six months in respect of ordinary leave earned under these Rules and in that case the employee will be deemed to have finally retired from the service on the expiry of the leave; or (b) be paid a lumpsum amount which shall be equivalent to pay as defined in Rule 3(j) of these Rules as on the date of his retirement for the unavailed ordinary leave earned subject to maximum of six months plus all allowances normally admissible to the employee concerned during ordinary leave. Explanation : "Date of retirement" means the date on which the employee attains the age of superannuation in accordance with the provisions of this Rule or the date on which he is retired from the National Bank under sub-rule (1) of this Rule, or the date on which the employee voluntarily retires in terms of sub-rule (3) or sub-rule (3A) of this Rule, as the case may be."
(3.) THE relevant provisions of the Pension Regulations may now be noticed at one place as under- 2 Definitions: In these Regulations, unless the context otherwise requires: ........... ............. ............. (6) `Date of Retirement' means the date on which an employee attains the age of superannuation or he is retired by the National Bank or the date on which the employee voluntarily retires. ..... .............. ................. (10) Subject to other conditions contained in these Regulations, `qualifying service' means service rendered while on duty or otherwise which shall be taken into account for the purpose of pension under these Regulations. (11) `Retirement' means retirement in terms of Staff Rule 19 and other instructions issued by the National Bank under Settlements/Awards. 3 Application THEse Regulations shall apply to:- (1) Employees who join the National Bank's service on or after 1 November, 1993. (2) Employees who are in the service of the National Bank as on 31 October 1993, except those employees who, within the period prescribed by the National Bank exercise an option in writing not to be governed by these Regulations. (3) Employees who were in service as on 1 January 1986 (excluding those on leave preparatory to retirement) and had retired before 1 November 1993, provided they exercise option to be governed by these Regulations and refund, within such period as may be specified, the National Bank's contribution to Provident Fund including interest received by them from the National Bank together with simple interest at six per cent per annum from the date of withdrawal till the date of repayment. Pension shall be payable to them in accordance with Regulation 31. 22. Leave Preparatory to retirement. Leave preparatory to retirement shall not count as qualifying service and pension shall not be payable during leave preparatory to retirement. Employees will have the choice as under: (a) either to encash the entire period of accumulated leave preparatory to retirement and draw pension from the first of the month following the date of superannuation itself (as leave preparatory to retirement commences from the beginning of that month); or (b) to avail of leave preparatory to retirement for completed months and encash the broken period of leave preparatory to retirement of less than a month so as to draw pension from the first of the succeeding month. .......... ......... ............... 24. Superannuation pension Superannuation pension shall be granted to an employee who has retired on his attaining the age of superannuation. Provided that pension shall not be payable during leave preparatory to retirement. 25. Premature retirement pension (1)........... ........... .............. (2)........... ........... .............. (4)........... ........... .............. (4) No pension shall be payable during leave preparatory to retirement. ........... ........... .............. 31. Payment of pension to employees who retired on or after 1 January 1986 but before 1 November 1993. Employees who have retired from the National Bank's service on or after 1 November 1992 shall be eligible for pension from 1 November 1993, or after expiry of leave preparatory to retirement subject to Regulation 22. THE payment of pension shall be subject to their refunding National Bank's contribution to Provident Fund including interest received by them from the National Bank, together with simple interest at the rate of six per cent per annum from the date of withdrawal till the date of repayment. Such employees will be permitted to commute their pension with effect from 1 November 1993, after due medical examination....." It was submitted on behalf of the respondent that though the date of superannuation of an employee in the Bank's service at the relevant time was the date when he attained the age of 58 years, under sub-rule (4) of rule 19 of the employee is deemed to have retired from service on expiry of the period of leave if he opts to avail of the leave in terms of clause (a) of sub-rule (4), and as the respondent had exercised the option to avail of six months' leave which was due to him on the date of his retirement, he cannot be said to have retired from service on 31.7.1985. It was submitted that the respondent remained in service for six additional months i.e. upto 31.1.1986 for all intents and purposes; he continued to be governed by Disciplinary Rules etc. during such period, and therefore, he cannot be said to have retired on 31.7.1985. It was submitted that the pension scheme was framed to replace the erstwhile CPF scheme so as to provide better retiral benefit to the employees of the appellant Bank and there cannot be any classification inter se between the CPF retires who retired prior to 1.1.1986 and afterwards. The first and foremost aspect of the case is that the age of retirement of employees in Groups `A', `B' or `C' at the relevant time was 58 years and thus the due date of retirement of the respondent was 31.7.1985 by virtue of proviso to sub-rule (1) of rule 19. Sub-rule (4) starting with a non obstante clause no doubt envisages a "deemed" retirement effective from the date of expiry of leave in cases where the employee has unutilized earned ordinary leave to his credit as on the date of retirement and he opts to avail of the leave (subject to maximum of six months). In other words, in view of rule 19(4)(a), by a legal fiction - "deemed to have finally retired" - the employee is treated to be in service till expiry of the leave. It is well known that legal fiction is created to provide for something which is not real. In such cases the Court is required to assume something as real which in fact does not exist. But though the Court is required to give full effect to the fiction irrespective of the consequences, at the same time the Court is required to ascertain the purpose for which the fiction is created. The consequences of legal fiction cannot be extended beyond such purpose. ;