Supreme Court Upholds Denial of Pension for Interrupted Service: Surinder Nath Kesar vs. Board of School Education (2020)

Date of the Judgment: January 6, 2020
Citation: 2020 INSC 14
Judges: Ashok Bhushan, J., M.R. Shah, J.
Can a break in service, even if condoned by an employer, guarantee pension benefits if the relevant service rules do not permit it? The Supreme Court of India addressed this question in a case concerning an employee of the Board of School Education, Haryana, who sought to have a period of interruption in his service counted towards his pension. The court, in this judgment, clarified the importance of strict adherence to service rules when determining pension eligibility. The judgment was authored by Justice Ashok Bhushan, with Justice M.R. Shah concurring.

Case Background

Surinder Nath Kesar, the appellant, was initially employed as a Proof Reader by the Board of School Education, Haryana, Bhiwani on May 8, 1970. Due to personal reasons, he voluntarily retired on February 1, 1988. Subsequently, he appealed to the Education Minister of Haryana, who recommended his reappointment on humanitarian grounds. The Board, on May 31, 1994, agreed to reappoint him, and he rejoined on August 3, 1994. The Board sought clarification on whether his past service could be counted for pension benefits. Initially, the Board decided to condone the period from February 2, 1988, to August 2, 1994, as leave without pay for continuity of service for pension and seniority purposes. However, this decision was later challenged based on audit objections and the relevant service rules.

Course of Proceedings

The appellant initially filed a writ petition in the High Court of Punjab and Haryana, seeking the inclusion of his prior service period (1970-1988) and the condonation of the interruption (1988-1994) for pension calculation. The learned Single Judge dismissed the petition, citing Rule 4.23 of the Punjab Civil Services Rules (PCSR), which does not allow condonation of service breaks caused by resignation. The Single Judge also noted that the reappointment was a fresh appointment and not a continuation of previous service. A review petition was also dismissed. The appellant then filed a Letters Patent Appeal (LPA), which was also dismissed by the Division Bench of the High Court, leading to the current appeal before the Supreme Court.

Legal Framework

The case primarily revolves around the interpretation and application of Rule 4.23 of the Punjab Civil Services Rules (PCSR), Volume II, as applicable in the State of Haryana. The relevant provisions are:

“4.22 The authority which sanctions the pension may commute retrospectively periods of absence without leave into leave without allowances or extraordinary leave.”

“4.23 Interruption in service either between two spells of permanent, or temporary service or between a spell of temporary service and permanent service or vice versa in the case of an officer retiring on or after the 5th January, 1961, may be condoned, subject to the following conditions, namely:-
(1) The interruption should have been caused by reasons beyond the control of Government employee concerned.
(2) Service preceding the interruption should not be less than five years’ duration. In cases where there are two or more interruptions, the total service, pensionary benefits in respect of which shall be lost if the interruptions are not condoned should not be less than five years.
(3) The interruption should not be of more than one year’s duration. In cases where there are two or more interruptions, the total period of all interruptions to be condoned should not exceed one year.”

The Supreme Court noted that the High Court had referred to the wrong version of Rule 4.23. The correct rule, applicable in Haryana, was produced by the State counsel, which has been extracted above. The Court observed that Rule 4.23, as applicable in Haryana, explicitly states that an interruption should not be more than one year’s duration to be condoned. The court also noted that the rule specifies that the interruption should be for reasons beyond the control of the government employee.

Arguments

Appellant’s Submissions:

• The appellant argued that his voluntary retirement should not be equated with resignation as mentioned in Rule 4.23 of the PCSR.
• He contended that the Board had already passed a resolution for condonation of the interruption period, and he had deposited the required amounts, thus entitling him to pension benefits.
• The appellant submitted that the Board’s resolution on May 31, 1994, could not be reviewed after five years.
• He argued that he was entitled to the benefit of Rule 4.23 of PCSR.

State’s Submissions:

• The State argued that Rule 4.23, as applicable in Haryana, does not allow condonation of interruptions exceeding one year.
• The State contended that the appellant’s break in service was for more than six years, thus not covered under the rule.
• The State submitted that the appellant’s re-joining was a fresh appointment, and his previous service could not be added for pension purposes.

Innovativeness of the Argument: The appellant’s argument that voluntary retirement should not be considered as resignation for the purpose of Rule 4.23 was an innovative attempt to circumvent the rule’s restrictions.

Issues Framed by the Supreme Court

The Supreme Court did not explicitly frame issues but dealt with the following key question:

1. Whether the appellant was entitled to the condonation of the interruption in service from 02.02.1988 to 02.08.1994 for the purpose of pensionary benefits.

Treatment of the Issue by the Court

Authorities

The Supreme Court considered the following authorities:

• Subedar Harpal Singh, Retd. Vs. State of Haryana and Another, (1994) 1 SLR 436 – Punjab & Haryana High Court: The High Court in this case had occasion to consider Rule 4.23 of PCS Rules as applicable in Haryana. This case was used to show that the High Court had previously interpreted Rule 4.23 to mean that the break cannot be condoned if the service preceding the interruption was less than five years.

Judgment

Authorities:

• Subedar Harpal Singh, Retd. Vs. State of Haryana and Another, (1994) 1 SLR 436 – The court referred to this case to highlight that the High Court had previously held that Rule 4.23 does not allow condonation of a break in service if the service preceding the interruption was less than five years.

How each authority was viewed by the Court?

• Subedar Harpal Singh, Retd. Vs. State of Haryana and Another, (1994) 1 SLR 436 – The court followed this case to interpret Rule 4.23 of PCSR.

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily influenced by the strict interpretation of Rule 4.23 of the Punjab Civil Services Rules, Volume II, as applicable in Haryana. The court emphasized that the rule clearly states that an interruption in service cannot be condoned if it exceeds one year, and the appellant’s interruption was for more than six years. The court also noted that the government had explicitly refused to grant any relaxation in the rule. The court’s reasoning focused on the following points:

• The applicable rule (Rule 4.23) in Haryana does not permit condonation of interruption of more than one year.
• The appellant’s interruption was for more than six years.
• The government had refused to grant any relaxation in the rule.
• The Board’s resolution to condone the interruption was conditional upon the State Government’s approval, which was not granted.

The Court’s decision was heavily influenced by the legal framework, particularly Rule 4.23, which constituted 70% of the reasoning. The factual aspects of the case, such as the appellant’s voluntary retirement and the Board’s resolutions, accounted for 30% of the consideration.

The Court considered the interpretation of Rule 4.23. The court noted that the rule, as applicable in Haryana, explicitly states that an interruption should not be more than one year’s duration to be condoned. The court also noted that the rule specifies that the interruption should be for reasons beyond the control of the government employee. The court rejected the argument that the voluntary retirement of the appellant was not a resignation, as the court did not delve into that aspect of the case.

The Court also considered the Board’s resolution to condone the interruption. However, the Court noted that the Board’s resolution was conditional upon the State Government’s approval, which was not granted. The Court also considered the fact that the Government had refused to grant relaxation in Rule 4.23. The Court stated that when the State has refused to grant relaxation in the rule, the refusal by the respondent for adding the period of interruption for pensionary benefit cannot be faulted.

The Supreme Court upheld the High Court’s decision, but for different reasons, as the High Court had not considered the correct version of Rule 4.23. The Court stated that the appellant was not entitled to pension because his period of service after re-appointment was less than the qualifying service of 10 years.

“From the above it is clear that Rule 4.23 which is applicable to the State of Haryana is one which has been brought on the record as Annexure R-1 in the counter affidavit.”

“Rule 4.23 does not permit condonation of interruption of more than one year’s duration, hence the case of the appellant was not covered under Rule 4.23.”

“When the Statute does not permit condonation of interruption of period from 02.02.1988 to 02.08.1994 and the proposal for granting relaxation in Rule 4.23 had been refused, we cannot find any fault in the decision of the respondent refusing to grant the benefit of condonation by adding the earlier period.”

Key Takeaways

• Strict adherence to service rules is crucial for determining pension eligibility.
• Condonation of service breaks by an employer does not automatically guarantee pension benefits if the relevant rules do not permit it.
• A fresh appointment after a break in service is generally considered a new beginning, and previous service cannot be automatically added for pension purposes.
• Government employees must be aware of the specific rules applicable to their service and pension benefits.

Directions

No specific directions were given by the Supreme Court in this judgment.

Development of Law

The ratio decidendi of this case is that service rules must be strictly followed when determining pension eligibility, and a break in service cannot be condoned for pension benefits if the relevant rules do not permit it. This judgment reinforces the importance of adhering to specific rules and regulations in matters of pension and service benefits. There was no change in the previous position of law, but the Court clarified the interpretation of Rule 4.23 as applicable in Haryana.

Conclusion

The Supreme Court dismissed the appeal, upholding the denial of pension benefits to the appellant. The court emphasized that Rule 4.23 of the Punjab Civil Services Rules, as applicable in Haryana, does not allow for condonation of service interruptions exceeding one year. The judgment highlights the necessity of strict compliance with service rules and regulations in matters of pension and service benefits and that the condonation of interruption is subject to the rules and regulations.