Supreme Court rules resignation entails forfeiture of past service in pension case: State of Punjab vs. Gurbaran Singh (2019)

Date of the Judgment: March 01, 2019
Citation: 2019 INSC 182
Judges: Uday Umesh Lalit, J., Indu Malhotra, J.
Can an employee who resigns from service claim pensionary benefits for their past service? The Supreme Court of India recently addressed this question, clarifying the implications of resignation under the Punjab Civil Services Rules. This case revolves around a pharmacist who resigned from his position and subsequently claimed pension benefits, leading to a dispute over the interpretation of service rules concerning resignation and forfeiture of past service. The judgment was delivered by a two-judge bench comprising Justice Uday Umesh Lalit and Justice Indu Malhotra, with the opinion authored by Justice Uday Umesh Lalit.

Case Background

The respondent, Gurbaran Singh, was appointed as a pharmacist by the Director Health Services, Punjab on September 5, 1975. He served in various districts and, while posted at Ferozepur, he resigned on June 27, 1986. His resignation was accepted by the Civil Surgeon, Civil Hospital, Muktsar, Punjab. Subsequently, Mr. Singh made several representations claiming that he was entitled to pension and service benefits, but was only granted gratuity and General Provident Fund. Aggrieved by the denial of pension, he filed a civil suit.

Timeline:

Course of Proceedings

The respondent, Mr. Singh, filed Civil Suit No. 74 of 2009 in the Civil Court, seeking pensionary benefits. The appellants, the State of Punjab, failed to file a written statement, and their defense was struck off. The Civil Judge, Senior Division, Bathinda, decreed the suit on November 16, 2012, directing the appellants to pay pensionary benefits with 9% interest per annum from the date of the decree. The State of Punjab appealed this decision before the Additional District Judge, Bathinda, which was dismissed on December 23, 2014. The State then filed a Second Appeal No. 1576 of 2015 in the High Court of Punjab and Haryana at Chandigarh, arguing that Rule 7.5(1) of the Punjab Civil Services Rules, Volume-I, Part-I, barred pensionary benefits for employees who resigned. The High Court rejected this argument and dismissed the Second Appeal on August 31, 2017.

Legal Framework

The case primarily revolves around the interpretation of Rule 7.5 of the Punjab Civil Services Rules, Volume-I, Part-I. Specifically, sub-rules (1) and (2) are relevant:

“7.5 (1) Resignation from a service or a post, unless it is allowed to be withdrawn in public interest by the appointing authority, entails forfeiture of past service.
(2) A resignation shall not entail forfeiture of past service if it has been submitted to take up, with proper permission, another appointment, whether temporary or permanent, under the Government where service qualifies for pension.”

Rule 7.5(1) of the Punjab Civil Services Rules states that resignation from a service or post leads to the forfeiture of past service unless the resignation is withdrawn in public interest by the appointing authority. Rule 7.5(2) provides an exception: if the resignation is to take up another government job with proper permission, the past service is not forfeited.

Arguments

Arguments by the State of Punjab (Appellants):

• The State argued that Rule 7.5(1) of the Punjab Civil Services Rules clearly states that resignation entails forfeiture of past service, thus disqualifying the respondent from receiving pensionary benefits.
• They relied on the Supreme Court’s decision in Union of India and others vs. Braj Nandan Singh [ (2005) 8 SCC 325], which interpreted a similar provision (Rule 26 of the Central Civil Service (Pension) Rules) to mean that resignation leads to forfeiture of past service, unless it falls under an exception.
• The State contended that the High Court erred in not applying Rule 7.5(1) correctly.

Arguments by Gurbaran Singh (Respondent):

• The respondent did not seriously contest the scope and interpretation of Rule 7.5(1) of the Rules.
• The respondent’s counsel requested that the monetary benefits already received by the respondent should not be recovered.

Submissions Table

Issues Framed by the Supreme Court

The Supreme Court did not explicitly frame specific issues in a separate section. However, the core issue before the Court was:

✓ Whether the High Court was correct in its interpretation of Rule 7.5(1) of the Punjab Civil Services Rules, and whether the respondent was entitled to pensionary benefits despite having resigned from service.

Treatment of the Issue by the Court

The following table demonstrates how the Court decided the issue:

Authorities

The Supreme Court considered the following authorities:

Cases:

• Union of India and others vs. Braj Nandan Singh [(2005) 8 SCC 325] – Supreme Court of India. This case was relied upon by the court to interpret Rule 7.5(1) of the Punjab Civil Services Rules, as the court had interpreted a similar provision in the Central Civil Service (Pension) Rules. The court held that resignation from service entails forfeiture of past service unless it falls under the exception mentioned in the rule.

Legal Provisions:

• Rule 7.5 of the Punjab Civil Services Rules, Volume-I, Part-I – This rule was the primary focus of the case. Sub-rule (1) states that resignation entails forfeiture of past service, while sub-rule (2) provides an exception.

Authority Table

Judgment

How each submission made by the Parties was treated by the Court?

How each authority was viewed by the Court?

• The Supreme Court in Union of India and others vs. Braj Nandan Singh [(2005) 8 SCC 325]* was followed as the court had interpreted a similar provision in the Central Civil Service (Pension) Rules. The court held that resignation from service entails forfeiture of past service unless it falls under the exception mentioned in the rule.
• Rule 7.5(1) of the Punjab Civil Services Rules was interpreted by the court to mean that resignation entails forfeiture of past service.

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily driven by the clear and unambiguous language of Rule 7.5(1) of the Punjab Civil Services Rules and the precedent set by the Supreme Court in Union of India and others vs. Braj Nandan Singh [(2005) 8 SCC 325]. The Court emphasized that resignation leads to forfeiture of past service unless it falls under the exception mentioned in the rules. The Court’s reasoning was focused on the interpretation of the rule and the application of the law to the facts of the case.

Logical Reasoning:

The court considered the submissions and the relevant legal provisions and precedents. The court rejected the High Court’s view and held that the respondent was not entitled to pensionary benefits as his resignation entailed forfeiture of past service. The court also considered the plea of the respondent that the monetary benefits already received should not be recovered, and partially accepted the same.

The Court’s reasoning was based on the clear language of Rule 7.5(1) of the Punjab Civil Services Rules, which states that resignation entails forfeiture of past service. The Court also relied on the decision in Union of India and others vs. Braj Nandan Singh [(2005) 8 SCC 325], which interpreted a similar provision in the Central Civil Service (Pension) Rules. The Court noted that the language of Rule 7.5(1) is mandatory and leaves no room for interpretation other than that resignation leads to forfeiture of past service. The Court also considered the exception in Rule 7.5(2), but found that it did not apply to the facts of the case.

The Supreme Court quoted the following from Union of India and others vs. Braj Nandan Singh [(2005) 8 SCC 325]:

“In clear terms it provides that resignation from a service or a post, unless it is allowed to be withdrawn in the public interest by the appointing authority, entails forfeiture of past service. The language is couched in mandatory terms.”

“After the past service is forfeited the same has to be excluded from the period of qualifying service. The language of Rule 26 sub-rules (1) and (2) is very clear and unambiguous.”

“It is trite law that all the provisions of a statute have to be read together and no particular provision should be treated as superfluous.”

There were no dissenting opinions in this case.

Key Takeaways

• Resignation from a government job typically leads to the forfeiture of past service, unless there is a specific exception.
• Employees who resign may not be entitled to pensionary benefits for their past service.
• The interpretation of service rules is crucial in determining pension entitlements.
• The Supreme Court’s decision in Union of India and others vs. Braj Nandan Singh [(2005) 8 SCC 325] was upheld in this case.

Directions

The Supreme Court directed that:

✓ The appeal filed by the State of Punjab was allowed, setting aside the judgment of the High Court.

✓ The civil suit filed by the respondent was dismissed.

✓ The amount of Rs.3,94,474.89 already paid to the respondent was not to be recovered, but no further payments were to be made.

Development of Law

The ratio decidendi of this case is that resignation from a government job entails forfeiture of past service, unless it falls under the exception mentioned in the service rules. This position of law is consistent with the earlier position of law as laid down in Union of India and others vs. Braj Nandan Singh [(2005) 8 SCC 325].

Conclusion

The Supreme Court’s decision in State of Punjab vs. Gurbaran Singh clarifies that resignation from service, as per Rule 7.5(1) of the Punjab Civil Services Rules, leads to the forfeiture of past service, thereby disqualifying the employee from receiving pensionary benefits. The Court upheld the interpretation of the rule and relied on the precedent set in Union of India and others vs. Braj Nandan Singh [(2005) 8 SCC 325]. While the Court allowed the appeal, it directed that the amount already paid to the respondent should not be recovered, but no further payments should be released.