Supreme Court Upholds Patna High Court’s Jurisdiction in Pension Dispute: Shanti Devi vs. Union of India (2020)

Date of the Judgment: 05 November 2020

Citation: 2020 INSC 806

Judges: Ashok Bhushan, J., R. Subhash Reddy, J., M.R. Shah, J.

Can a High Court refuse to hear a case about pension when the person who should receive the pension lives within its area? The Supreme Court of India recently addressed this important question in a case involving a retired employee whose pension was stopped. This case clarifies when a High Court can hear a case about pension disputes, even if the employer is located in a different state. The Supreme Court bench comprised Justices Ashok Bhushan, R. Subhash Reddy, and M.R. Shah, with the judgment authored by Justice Ashok Bhushan.

Case Background

Shri Bashishtha Narayan Mishra, the husband of the appellant, was an employee of Coal India Limited, working at Moira Colliery in West Bengal. He retired on 30 April 2005. Initially, he did not opt for the Coal Mines Family Pension Scheme of 1971. However, in 2002, an amendment allowed employees to opt for the 1998 pension scheme, which he did. After his retirement, his pension was being paid in his account at State Bank of India, Darbhanga, Bihar. In 2013, the Regional Provident Fund Commissioner, Asansol, issued letters stating that his pension was erroneously settled and directed him to refund the pension amount received, also stopping his monthly pension. This led to a series of legal challenges.

Timeline:

Course of Proceedings

Initially, Shri B.N. Mishra filed Writ Petition No. 13955 of 2006 in the Patna High Court, seeking a refund of an amount that was allegedly illegally deducted. This petition was dismissed on 8 February 2013, due to lack of territorial jurisdiction, as the court held that the cause of action arose in West Bengal or Jharkhand. Subsequently, he filed Writ Petition No. 4930 of 2013 in the Jharkhand High Court, seeking the same relief. While this petition was pending, the Regional Provident Fund Commissioner, Asansol, issued letters in 2013, stopping his pension and directing him to refund the amount received. This led to the filing of Writ Petition No. 5999 of 2014 in the Patna High Court, which was also dismissed on 4 August 2017, for lack of territorial jurisdiction. The Division Bench of the Patna High Court upheld this decision, leading to the appeal before the Supreme Court.

Legal Framework

The case primarily revolves around the interpretation of Article 226 of the Constitution of India, which deals with the power of High Courts to issue certain writs. Specifically, Article 226(2) states that a High Court can exercise its power if the cause of action, wholly or in part, arises within its territorial jurisdiction. The Coal Mines Provident Fund and Miscellaneous Provisions Act, 1948, and the Coal Mines Pension Scheme, 1998, are also relevant.

The Supreme Court also referred to Section 20 of the Code of Civil Procedure, which deals with the jurisdiction of courts to entertain suits, and uses similar language as Article 226(2) regarding where the cause of action arises.

Arguments

Appellant’s Arguments:

• The appellant argued that the Patna High Court had territorial jurisdiction because a part of the cause of action arose within its jurisdiction. Specifically, the stoppage of pension and the demand for a refund occurred while Shri B.N. Mishra was residing in Darbhanga, Bihar, and receiving his pension there.
• The appellant contended that the earlier Writ Petition No. 13955 of 2006 was based on a different cause of action (refund of illegally deducted amount), whereas Writ Petition No. 5999 of 2014 was based on the stoppage of pension, which directly affected him in Darbhanga.

Respondents’ Arguments:

• The respondents argued that the Patna High Court lacked territorial jurisdiction because Shri B.N. Mishra had served in West Bengal and his retirement benefits were being processed there. They also argued that since Shri B.N. Mishra had already filed a writ petition in the Jharkhand High Court, he should have continued there.
• The respondents contended that the cause of action arose in West Bengal, where the pension was processed, and not in Bihar, where the pension was received. They also invoked the principle of forum conveniens, arguing that the Jharkhand High Court was the more appropriate forum.
• The respondents submitted that Shri B.N. Mishra had not opted for the Coal Mines Pension Scheme in 1998, and his subsequent option in 2002 was not valid, leading to the deductions made by the Regional Provident Fund Commissioner.

Issues Framed by the Supreme Court

The Supreme Court framed the following issues:

1. Whether the writ petition filed by late Shri B.N. Mishra being Writ Petition No. 5999 of 2014 is similar to Writ Petition No. 13955 of 2006 and the Patna High Court had territorial jurisdiction to entertain the writ petition?
2. Whether part of cause of action for filing the Writ Petition No. 5999 of 2014 arose within the territorial jurisdiction of Patna High Court?

Treatment of the Issue by the Court

The following table demonstrates as to how the Court decided the issues

Authorities

The Supreme Court considered the following authorities:

Judgment

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

How each authority was viewed by the Court?

The Supreme Court relied on several precedents to define “cause of action” and determine territorial jurisdiction. The Court used Oil and Natural Gas Commission Vs. Utpal Kumar Basu and Ors. [(1994) 4 SCC 711] to define “cause of action” as the bundle of facts that a petitioner must prove to obtain a judgment. It cited Navinchandra N. Majithia Vs. State of Maharashtra and Ors. [(2000) 7 SCC 640] to emphasize that a High Court can exercise jurisdiction if the cause of action, wholly or in part, arises within its territory. The court also referred to Read Vs. Brown [(1888) 22 QBD 128] for the definition of “cause of action” as every fact necessary for the plaintiff to prove. The Court also relied on Nawal Kishore Sharma Vs. Union of India and Ors. [(2014) 9 SCC 329] to support the view that the Patna High Court had jurisdiction when the petitioner received a letter of refusal at his home address in Bihar. The court also took into consideration the judgment of Patna High Court in Saryu Singh Vs. The Union of India and Ors. [2015(2) PLJR 256]

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily influenced by the fact that the cause of action, specifically the stoppage of pension, directly impacted the petitioner at his residence in Darbhanga, Bihar. The court emphasized that the petitioner was receiving pension in Darbhanga for eight years, and the abrupt stoppage of pension directly affected him there. The court also considered the principle of convenience for a retired employee, noting that they should not be forced to litigate in a different state when the cause of action arose at their place of residence. The court distinguished the present case from the previous writ petition, highlighting that the cause of action was entirely different. The court also noted that the High Court did not consider the material facts and pleadings in the writ petition.

Logical Reasoning:

The court rejected the argument that the case should be heard in Jharkhand, stating, “For a retired employee convenience is to prosecute his case at the place where he belonged to and was getting pension.” The court also noted that the earlier writ petition was on a different cause of action, stating, “The cause of action for filing Writ Petition No.5999 of 2014 was entirely different.” The court further emphasized, “The stoppage of pension of late B.N. Mishra affected him at his native place, he being deprived of the benefit of pension which he was receiving from his employer.”

Key Takeaways

• A High Court has jurisdiction to hear a case if part of the cause of action arises within its territorial limits, even if the employer is located elsewhere.
• The place where a retired employee receives their pension is a significant factor in determining the jurisdiction of a court in pension disputes.
• The principle of forum conveniens should be applied to ensure convenience for the retired employee.
• A new cause of action arises when a pension is stopped, even if previous legal challenges were made on other grounds.

Directions

The Supreme Court directed the respondents to ensure that provisional pension is paid to the appellant from December 2020, subject to the final decision in the writ petition.

Development of Law

The ratio decidendi of this case is that a High Court has territorial jurisdiction to entertain a writ petition regarding the stoppage of pension when the petitioner resides and receives pension within its jurisdiction, even if the employer is located elsewhere. This case clarifies that the location where the pension is received and the impact of its stoppage are crucial factors in determining the cause of action, reinforcing the principle that the convenience of a retired employee should be prioritized. This decision reinforces the interpretation of Article 226(2) of the Constitution of India and provides guidance for similar cases involving pension disputes.

Conclusion

The Supreme Court allowed the appeal, setting aside the Patna High Court’s judgment. The court held that the Patna High Court had the territorial jurisdiction to entertain the writ petition, as part of the cause of action arose in Darbhanga, Bihar, where the petitioner was residing and receiving his pension. The court emphasized that the stoppage of pension directly affected the petitioner at his place of residence and that the convenience of the retired employee should be prioritized. The court also directed the payment of provisional pension to the appellant pending the final decision in the writ petition.