Case Note & Summary
The case concerned a retired government employee's claim for pension and gratuity. The respondent retired on 31 January 1994 from service under the State of Haryana. When his pension was not paid, he filed a writ petition before the Punjab and Haryana High Court, seeking payment of pension and gratuity. The High Court, by order dated 25 July 1994 in C.W.P. No.8687 of 1994, directed the State to pay gratuity with 12% interest within one month and to determine pension on the basis of last drawn emoluments, subject to final decision on the actual scale of pay to which the respondent was eligible, with arrears adjustable accordingly. The High Court also directed payment of pension with 12% interest per annum. The State of Haryana appealed to the Supreme Court by special leave. The Supreme Court granted leave and heard counsel on both sides. The respondent's counsel argued that the entitlement should be computed on the last drawn scale of pay as found by the High Court, that the fixation of pay had been correctly done, and that similarly situated persons were being paid pension while the respondent was denied. The State contended that the scale of pay was provisionally fixed and the matter was under consideration, so it was unable to determine the pension until that issue was decided, and there was no slackness on its part. The Supreme Court held that since the scale of pay to which the respondent was entitled had not been determined, the State Government could not fix the pension, and therefore the High Court's direction to pay interest was incorrect. The Court reversed the High Court order and directed the State to compute the pension on the undisputed scale of pay and pay the same within two months from the date of decision, subject to decisions in pending cases. It further directed the State to decide the pending matter within six weeks from receipt of the order and to release the gratuity payable to the respondent within four weeks from the date of the order. The appeal was allowed with no order as to costs.
Headnote
A) Service Law - Pension - Interest on Delayed Pension - Not mentioned - The respondent retired and pension was not paid; High Court directed payment of gratuity with 12% interest and pension based on last drawn emoluments; Supreme Court held that since scale of pay was provisionally fixed and under consideration, State could not determine pension and no slackness attributable, so High Court erred in awarding interest; appeal allowed, State directed to compute pension on undisputed scale within two months, decide pending cases within six weeks, and release gratuity within four weeks (Paras 1-2).
Issue of Consideration
Whether the High Court was justified in directing payment of pension with interest when the scale of pay was under dispute; whether the State could be held liable for interest for delay in pension fixation due to pending determination of pay scale.
Final Decision
Appeal allowed; High Court order reversed; State directed to compute pension on undisputed scale of pay and pay within two months from date of decision; State to decide pending cases within six weeks from receipt of order; release gratuity within four weeks from today; no costs.
Law Points
- Pension cannot be fixed until final scale of pay is determined
- no interest payable for delay due to pending scale of pay determination
- gratuity must be released separately
- pension to be computed on undisputed scale of pay
