Supreme Court clarifies pension benefits for contractual employees: Doordarshan vs. Magi H Desai (2023)

Date of the Judgment: 24 March 2023
Citation: Civil Appeal No. 1787 of 2023
Judges: M.R. Shah, J. and C.T. Ravikumar, J.
Can prior contractual service be counted towards pension benefits for a government employee? The Supreme Court of India recently addressed this question, clarifying the distinction between contractual and temporary service in the context of pension eligibility. This judgment clarifies the interpretation of Rule 13 of the Central Civil Services (Pension) Rules, 1972, and its implications for employees who have transitioned from contractual to regular employment. The bench comprised Justices M.R. Shah and C.T. Ravikumar, with the judgment authored by Justice M.R. Shah.

Case Background

The respondent, Smt. Magi H Desai, was initially engaged as a General Assistant on a contract/casual basis in 1985. Her services were extended periodically, with short breaks in between. She then filed an Original Application (OA No. 32/1987) before the Central Administrative Tribunal, Ahmedabad, which was partly allowed on 30 August 1990. The Tribunal directed the department to pay her the same salary and allowances as regular General Assistants/Clerks from October 1990.

Subsequently, following a decision by the Principal Bench of the Central Administrative Tribunal, New Delhi, to regularize casual employees, the respondent’s services were regularized as a Lower Division Clerk with effect from 31 March 1995. This regularization was done under the Scheme of Regularisation of Casual Staff Artists of Doordarshan, 1992/94. She was given the regular pay scale of a Lower Division Clerk from the date of her regularization.

The respondent then approached the Tribunal again, seeking consideration of her past service for pensionary benefits. This OA was dismissed, leading to a writ petition before the High Court. The High Court allowed her to submit a representation to the department. Her representation, dated 11 April 2014, was rejected on 18 September 2014. The department refused to grant her the benefit of her casual/contractual services from 1985 to 31 March 1995 for calculating pensionary benefits.

The respondent filed another OA (No. 446/2014) before the Tribunal, which was dismissed on 8 September 2021. The Tribunal held that her contractual/casual services could not be treated as temporary service and thus could not be counted for retirement benefits. This dismissal was challenged in a writ petition before the High Court, which was allowed. The High Court directed that her contractual/casual services should be counted as temporary service for pension calculation. This High Court order is the subject of the present appeal.

Timeline:

Course of Proceedings

The respondent initially approached the Central Administrative Tribunal (CAT), Ahmedabad, which partly allowed her application by directing equal pay to regular employees. Subsequently, after her regularization, the Tribunal dismissed her plea to count her past service for pension benefits. This dismissal was challenged before the High Court of Gujarat at Ahmedabad. The High Court allowed her writ petition, directing the department to count her contractual service as temporary service for pension benefits. The department then appealed this order to the Supreme Court.

Legal Framework

The case revolves around the interpretation of the Central Civil Services (Pension) Rules, 1972, specifically Rules 13 and 14. Rule 13 of the Central Civil Services (Pension) Rules, 1972, states:

“13. Commencement of qualifying service – Subject to the provisions of these rules, qualifying service of a Government servant shall commence from the date he takes charge of the post to which he is first appointed either substantively or in an officiating or temporary capacity :
Provided that officiating or temporary service is followed without interruption by substantive appointment in the same or another service or post :
Provided further that –
(a)in the case of a Government servant in a Group `D’…….
(b)in the case of a Government servant not covered by clause (a),…”

This rule defines when qualifying service begins for pension benefits. It specifies that service can be counted from the date of substantive, officiating, or temporary appointment, provided that temporary service is followed by substantive appointment without interruption. Rule 14 of the Central Civil Services (Pension) Rules, 1972, further defines the conditions under which service qualifies:

“14. Conditions subject to which service qualifies:
(1) The service of a Government servant shall not qualify, unless his duties and pay are regulated by the Government, or under conditions determined by the Government.
(2) For the purposes of sub-rule (1), the expression “Service” means service under the Government and paid by that Government from the Consolidated Fund of India or a Local Fund administered by that Government but does not include service in a non-pensionable establishment unless such service is treated as qualifying service by that Government.
(3) In the case of a Government servant belonging to a State Government, who is permanently transferred to a service or post to which these rules apply, the continuous service rendered under the State Government in an officiating or temporary capacity, if any, followed without interruption by substantive appointment, or the continuous service rendered under that Government in an officiating or temporary capacity, as the case may be, shall qualify :
Provided that nothing contained in this sub-rule shall apply to any such Government servant who is appointed otherwise than by deputation to a service or post to which these rules apply.”

This rule clarifies that service must be under the government and paid from the Consolidated Fund of India to qualify, and it excludes non-pensionable service unless explicitly treated as qualifying service.

Arguments

Arguments of the Appellants (Doordarshan Prasar Bharti Corporation of India):

• The appellants argued that the respondent’s services from 1985 to 31 March 1995 were as a casual/contractual employee, not as a temporary employee.
• They contended that Rule 13 of the Central Civil Services (Pension) Rules, 1972, does not apply to casual/contractual employees.
• The appellants submitted that the High Court misinterpreted Rule 13 by including casual and contractual services within the definition of temporary service.

Arguments of the Respondent (Smt. Magi H Desai):

• The respondent claimed that 50% of her casual/contractual service should be counted as temporary service for pension benefits, similar to schemes in other departments.
• However, the respondent could not provide any statutory provision for this claim.

Issues Framed by the Supreme Court

The main issue before the Supreme Court was:

1. Whether the services rendered by the respondent as a casual/contractual employee from 1985 to 31 March 1995 can be counted as temporary service for the purpose of calculating qualifying service for pensionary benefits under the Central Civil Services (Pension) Rules, 1972.

Treatment of the Issue by the Court

Authorities

The Court considered the following legal provisions:

• Rule 13 of the Central Civil Services (Pension) Rules, 1972: This rule defines the commencement of qualifying service for pension benefits.
• Rule 14 of the Central Civil Services (Pension) Rules, 1972: This rule specifies the conditions under which service qualifies for pension benefits.

The Court did not cite any case laws in its judgment.

Judgment

The Supreme Court held that the High Court erred in interpreting Rule 13 of the Central Civil Services (Pension) Rules, 1972. The Court clarified that contractual service cannot be automatically considered temporary service for pension benefits. The Court emphasized that the rule requires temporary service to be followed by substantive appointment without interruption, which was not the case with the respondent’s casual/contractual service.

The Supreme Court referred to Rule 13 of the Central Civil Services (Pension) Rules, 1972 and stated that, “qualifying service of a Government servant shall commence from the date he takes charge of the post to which he is first appointed either substantively or in an officiating or temporary capacity”. The Supreme Court further stated that, “Even the services rendered as temporary service can be considered as qualifying service provided that the officiating or temporary service is followed without interruption by substantive appointment in the same or another service or post. Service rendered as casual/contractual cannot be said to be service rendered on a substantive appointment.”

The Court also noted that the respondent was not entitled to the benefits claimed, as there was no scheme in the appellant’s department that allowed for counting casual/contractual service as temporary service. The Supreme Court stated that, “merely because some other departments might have such schemes, the respondent shall not be entitled to the same benefit in absence of any scheme in the appellants’ department/department in which the respondent rendered her services.”

The Supreme Court set aside the High Court’s judgment and restored the Tribunal’s order, dismissing the respondent’s claim. The Court stated that, “the impugned judgment and order passed by the High Court is unsustainable and the same deserves to be quashed and set aside and is accordingly quashed and set aside. The judgment and order passed by the Tribunal dismissing the Original Application is hereby restored.”

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily driven by a strict interpretation of the Central Civil Services (Pension) Rules, 1972, particularly Rule 13. The Court emphasized the distinction between different types of employment, highlighting that casual or contractual service does not automatically qualify as temporary service. The absence of any specific scheme or rule in the appellant’s department allowing for the counting of casual/contractual service towards pension benefits was a significant factor. The Court’s reasoning focused on the legal definitions and conditions outlined in the pension rules, rather than equitable considerations or practices in other departments.

Key Takeaways

• Contractual or casual employment is distinct from temporary employment and does not automatically qualify for pension benefits under the Central Civil Services (Pension) Rules, 1972.
• Temporary service must be followed by a substantive appointment without interruption to be considered for pension benefits.
• Employees cannot claim pension benefits based on schemes in other departments if their own department lacks such provisions.

Directions

The Supreme Court did not give any specific directions in this case.

Development of Law

The ratio decidendi of this case is that casual or contractual service cannot be equated with temporary service for the purpose of pension benefits under the Central Civil Services (Pension) Rules, 1972, unless specifically provided for in the rules or a departmental scheme. This judgment clarifies the interpretation of Rule 13 and reinforces the importance of adhering to the specific conditions laid down in the pension rules. There is no change in the previous position of law, but the judgment clarifies the distinction between contractual and temporary service.

Conclusion

The Supreme Court’s judgment in Director General, Doordarshan Prasar Bharti Corporation of India & Anr. vs. Smt. Magi H Desai clarifies that contractual or casual service does not automatically qualify as temporary service for pension benefits under the Central Civil Services (Pension) Rules, 1972. The Court emphasized the need for a clear legal basis for claiming such benefits and rejected the respondent’s claim, thereby upholding the strict interpretation of the pension rules. This decision underscores the importance of specific rules and schemes in determining pension eligibility for government employees.