Supreme Court rules in favor of pension benefits for former CLR worker: V. Sukumaran vs. State of Kerala (26 August 2020)

Date of the Judgment: 26 August 2020
Citation: V. Sukumaran v. State of Kerala & Anr., Civil Appeal No. 3984 of 2010, 2020 INSC 637
Judges: Sanjay Kishan Kaul, J., Ajay Rastogi, J., Aniruddha Bose, J.

Can a government employee be denied pension benefits for their prior service as a casual laborer, even if they later secured a permanent position through a competitive exam? The Supreme Court of India addressed this crucial question in the case of V. Sukumaran vs. State of Kerala, ruling in favor of the employee. This case highlights the importance of considering prior service in pension calculations and the need for a liberal interpretation of pension rules.

Case Background

The appellant, V. Sukumaran, worked for approximately 32 years in various capacities within the Kerala State Government. He initially joined the Department of Fisheries as a Casual Labour Roll (CLR) worker on July 7, 1976, serving in a pilot project on Pearl Culture. He worked in this capacity until November 29, 1983, a total of 7 years, 4 months, and 23 days. Subsequently, he was advised by the Kerala Public Service Commission (KPSC) to join the Revenue Department as a Lower Division Clerk (LDC), which he did on November 30, 1983.

Later, Sukumaran sought an inter-departmental transfer back to the Fisheries Department, which was approved. He rejoined the Fisheries Department on September 18, 1987, and his service was regularized on September 18, 1989. He was promoted to Upper Division Clerk (UDC) and retired from this post on December 31, 2008. His total service was about 25 years, excluding his service as a CLR worker.

Timeline

Course of Proceedings

The appellant initially filed a writ petition (WP(C) No. 22931/2007) in the High Court of Kerala, seeking to have his CLR service counted towards his pension benefits. The High Court dismissed the petition on January 16, 2009, stating that since Sukumaran was appointed through the KPSC and not absorbed from CLR service, he could not claim the benefits available to regularized CLR workers.

The appellant then filed an appeal (W.A. No. 892/2009), which was also dismissed by the High Court on June 3, 2009. The High Court reiterated that CLR service was not considered qualifying service for pension for those who, like Sukumaran, were appointed through the KPSC. The High Court also noted that there was no declaration under Rule 11 of the Kerala Service Rules to allow such service to be counted for pension.

Legal Framework

The case revolves around the interpretation of various Government Orders (G.O.s) and the Kerala Service Rules, specifically:

• G.O. dated 20.8.1993: This G.O. created 29 Seasonal Labour Roll (SLR) posts in the Fisheries Department for the absorption of existing CLR workers.
• G.O. dated 31.3.2001: This G.O. stipulated that the 29 SLR posts were for CLR workers who had completed 500 days of work before 1.4.1987. It also ordered the permanent absorption of 27 employees who had worked for 20 years and had completed 8 years as SLR workers, granting them pensionary and provident fund benefits.
• G.O. dated 13.7.2006: This G.O. brought the service and wage conditions of SLR workers in the Fisheries Department at par with those in the Agriculture and Animal Husbandry Department, effective from 31.3.2001.
• G.O. dated 21.8.2006: This G.O. framed the Pension (Gratuity) Rules for SLR Workers/Permanent Labourers of the Fisheries Department, granting them pension benefits with retrospective effect from 31.3.2001.
• Rule 4(f)(iii) of the Pension Rules: This rule defined that 200 days or more work in a calendar year as a casual laborer in departmental farms prior to permanency would be treated as one year of qualifying service for pension.
• G.O. dated 19.1.2007: This G.O. clarified that the casual service period of farm laborers would be counted for calculating qualifying service for pension, with prospective effect.
• Rule 13, Part III of the Kerala Service Rules: This rule states that “work establishment employees absorbed in regular establishment will be allowed to count 50 per cent of the work establishment service for purposes of pension.”
• Rule 11 of the Service Rules: This rule allows the government to declare that any specified kind of service shall qualify for pension or, in individual cases, allow service rendered by an employee to count for pension.

Arguments

Appellant’s Arguments:

• The appellant argued that he should be treated at par with other CLR workers who were regularized as SLR workers, as he had worked for 1678 days as a CLR worker.
• He contended that the G.O. dated 21.8.2006, which equated 200 days of CLR work to one year of qualifying service for pension, should apply to him.
• He highlighted that he was the second senior-most CLR worker and would have been absorbed into one of the 29 SLR posts had he remained in the Fisheries Department.
• The appellant argued that the rejection of the Fisheries Department’s recommendation to grant him pension benefits was wrongful.
• He asserted that he would be entitled to his maximum pensionable service only if his CLR service was counted as qualifying service, similar to his co-workers.
• The appellant relied on Rule 13 of the Kerala Service Rules, which allows for 50% of work establishment service to be counted for pension upon absorption into a regular establishment.
• The appellant emphasized that pension is a right vested in a government servant and not a bounty, citing D.S. Nakara and Ors. v. Union of India [1983] 1 SCC 305, U.P. Raghavendra Acharya & Ors. v. State of Karnataka & Ors. [2006] 9 SCC 630, and Deokinandan Prasad v. The State of Bihar & Ors. [1971] 2 SCC 330.

Respondent’s Arguments:

• The respondents argued that the benefits of the G.O. dated 21.8.2006 were only for CLR workers who were regularized as SLR workers and did not apply to Sukumaran, who was appointed through the KPSC.
• They contended that the rule equating 200 days of CLR work to one year of qualifying service was not applicable to Sukumaran, as he had not been absorbed from CLR service into the Fisheries Department.
• The respondents stated that Sukumaran was a direct recruit to a higher post since 1983, which was not available to his original co-workers until their regularization in 2001.
• They argued that had Sukumaran not transferred back to the Fisheries Department, he would not have been able to claim these benefits.

Submissions Table

Issues Framed by the Supreme Court

The Supreme Court did not explicitly frame issues in a separate section, but the core issue was:

1. Whether the appellant, who had worked as a CLR worker and later joined through KPSC, is entitled to have his CLR service counted for pensionary benefits, similar to those CLR workers who were absorbed as SLR workers.

Treatment of the Issue by the Court

Authorities

Cases:

• D.S. Nakara and Ors. v. Union of India [1983] 1 SCC 305 – The Supreme Court of India. Cited to emphasize that pension is a right vested in a government servant and not a bounty.
• U.P. Raghavendra Acharya & Ors. v. State of Karnataka & Ors. [2006] 9 SCC 630 – The Supreme Court of India. Cited to support the view that pension is a social welfare measure and a post-retirement entitlement.
• Deokinandan Prasad v. The State of Bihar & Ors. [1971] 2 SCC 330 – The Supreme Court of India. Cited to reinforce the idea that pension is a post-retirement entitlement.

Legal Provisions:

• Rule 4(f)(iii) of the Pension Rules: Defined that 200 days or more work in a calendar year as a casual laborer would be treated as one year of qualifying service for pension.
• Rule 13, Part III of the Kerala Service Rules: Allowed for 50% of work establishment service to be counted for pension upon absorption into a regular establishment.
• Rule 11 of the Service Rules: Allowed the government to declare any specified kind of service as qualifying for pension or allow service rendered by an employee to count for pension in individual cases.

Authorities Table

Judgment

The Supreme Court allowed the appeal, setting aside the orders of the High Court. The Court held that the appellant was entitled to have his CLR service counted for pensionary benefits, at par with other CLR workers.

Treatment of Submissions

Treatment of Authorities

• D.S. Nakara and Ors. v. Union of India [1983] 1 SCC 305: The Court cited this case to emphasize that pension is a right vested in a government servant and not a bounty payable at the will and pleasure of the Government.
• U.P. Raghavendra Acharya & Ors. v. State of Karnataka & Ors. [2006] 9 SCC 630: This case was cited to support the view that pension is a social welfare measure and a post-retirement entitlement aimed at maintaining the dignity of the employee.
• Deokinandan Prasad v. The State of Bihar & Ors. [1971] 2 SCC 330: The Court used this case to reinforce the idea that pension is a post-retirement entitlement that should not be unreasonably denied.

What Weighed in the Mind of the Court?

The Supreme Court’s decision was primarily influenced by the following considerations:

• Social Welfare Measure: The Court emphasized that pension is a social welfare measure intended to provide financial security and maintain the dignity of retired employees. This principle guided the Court’s interpretation of the relevant rules and G.O.s.
• Liberal Interpretation: The Court stressed that pensionary provisions must be given a liberal construction to ensure that benefits are not unreasonably denied to employees on technicalities.
• Parity: The Court noted that the appellant was similarly situated to other CLR workers who had been regularized and granted pension benefits. Denying the appellant the same benefits would be unfair and discriminatory.
• Prior Service: The Court recognized the appellant’s long service as a CLR worker and held that this service should be recognized for pension purposes, especially since he was senior among the CLR workers.
• Unreasonable Denial: The Court found that denying the appellant pension benefits based on the fact that he was appointed through the KPSC was unreasonable, especially since the other CLR workers were regularized without going through such a process.
• Rule 13 of the Service Rules: The Court noted that Rule 13 supported the rationale of counting prior service for pension, further justifying their decision.

Sentiment Analysis Table

Ratio Table

Logical Reasoning

The court considered the following points in its reasoning:

• The appellant’s long service as a CLR worker (7 years, 4 months, and 23 days) was a significant factor.
• The court noted that the appellant was second in seniority among the CLR workers and would have been absorbed had he continued in that role.
• The court emphasized that the various G.O.s were intended to benefit CLR workers, and the appellant should not be excluded from these benefits.
• The court observed that denying the appellant the benefit of his CLR service would be unreasonable, especially since other CLR workers were granted these benefits.
• The court also noted that the appellant was being deprived of the maximum pensionable service, which should not be denied to him.

The court quoted the following from the judgment:

“Pension is succour for post-retirement period. It is not a bounty payable at will, but a social welfare measure as a post-retirement entitlement to maintain the dignity of the employee.”

“The pensionary provisions must be given a liberal construction as a social welfare measure.”

“To say that the appellant would be denied the benefit of the period spent as CLR worker for his pensionary benefit would be to treat his case as inferior one to the case of other CLR workers.”

Key Takeaways

• Prior service as a casual laborer can be counted for pension benefits, even if the employee later secures a permanent position through a competitive exam.
• Pensionary provisions should be interpreted liberally to ensure that benefits are not unreasonably denied to employees.
• Government employees should be treated equally, and those who have worked in similar capacities should receive similar benefits.
• The judgment emphasizes the importance of considering the social welfare aspect of pension benefits.
• This case sets a precedent for similar cases where employees have worked in different capacities within the government.

Directions

The Supreme Court directed that:

• The benefit of the service rendered as a CLR worker would be counted for determining the pensionary benefits of the appellant at par with other CLR workers.
• The pension should be calculated accordingly.
• The arrears of pension should be remitted to the appellant within a maximum period of eight weeks from the date of the judgment, with admissible interest as applicable to outstanding pension amounts.

Development of Law

The ratio decidendi of the case is that prior service as a casual laborer should be considered for pension benefits, even if the employee later secures a permanent position through a competitive exam. This decision emphasizes the need for a liberal interpretation of pension rules and ensures that employees are not unfairly denied benefits due to technicalities. This case clarifies that the intent of welfare measures should be upheld.

Conclusion

In the case of V. Sukumaran vs. State of Kerala, the Supreme Court ruled in favor of the appellant, holding that his prior service as a Casual Labour Roll (CLR) worker should be counted for pensionary benefits, despite his later appointment through the KPSC. The Court emphasized the social welfare nature of pension and the need for a liberal interpretation of pension rules. This judgment ensures that employees are not unfairly denied benefits and sets a precedent for similar cases.

Category

Parent Category: Pension Law

• Child Category: Calculation of Pension
• Child Category: Casual Labourers
• Child Category: Kerala Service Rules

Parent Category: Kerala Service Rules

• Child Category: Rule 13, Kerala Service Rules

FAQ

Q: Can my previous work as a casual laborer be counted towards my pension?

A: Yes, according to the Supreme Court’s ruling in V. Sukumaran vs. State of Kerala, your prior service as a casual laborer can be counted towards your pension benefits, even if you later secured a permanent position through a competitive exam.

Q: What if Iwas appointed through a competitive exam after working as a casual laborer?

A: The Supreme Court has clarified that even if you were appointed through a competitive exam after working as a casual laborer, your prior service should still be considered for pension benefits.

Q: What does the term ‘liberal interpretation of pension rules’ mean?

A: A liberal interpretation of pension rules means that the rules should be interpreted in a way that favors the employee, ensuring that they receive the benefits they are entitled to. The Court emphasized that pension is a social welfare measure and should not be denied on technicalities.

Q: How does this judgment affect other government employees?

A: This judgment sets a precedent for similar cases where employees have worked in different capacities within the government. It emphasizes the importance of considering prior service and ensuring equal treatment for all employees.

Q: What should I do if my pension benefits have been denied based on prior casual labor service?

A: If your pension benefits have been denied based on your prior casual labor service, you should consult with a legal professional who specializes in pension law. The judgment in V. Sukumaran vs. State of Kerala may provide a basis for your claim.