Case Note & Summary
These special leave petitions arose from the judgment of the Division Bench of the Punjab and Haryana High Court dated May 10, 1996 in CWP No.14764/94 and batch, which dismissed writ petitions filed by non-provincialised employees working in notified municipal committees. The employees challenged the denial of pensionary benefits on the ground that the State Government had arbitrarily fixed April 1, 1990 as the cut-off date for the introduction and extension of a pension scheme, thereby excluding those who retired before that date, in violation of Article 14 of the Constitution. The State of Punjab had issued notification No.JA-I-DCFA-DLG-91/3958 dated January 25, 1991, introducing a pension scheme applicable to All India Gazetted officers and Punjab Civil Services officers working in municipalities with effect from April 1, 1990. Subsequently, by notification dated July 28, 1994, the benefit of the pension scheme was extended to employees who were members of the non-provincialised service of municipal committees. Employees who retired before April 1, 1990 were admittedly governed by the contributory provident fund scheme and had withdrawn their benefits under that scheme. They contended before the High Court that the cut-off date was arbitrary and discriminatory. The High Court, in Sham Das Sharma v. State of Punjab, dismissed the writ petitions, leading to the special leave petitions before the Supreme Court. Before the Supreme Court, learned counsel for the petitioners argued that the cut-off date was arbitrary and that pensionary benefits should be extended to retirees before the cut-off date; reliance was placed on Union of India v. Shri Deoki Nandan Agarwal, Shri R.L. Marwah v. Union of India, and Shri M.C. Dhingra v. Union of India. The Supreme Court rejected this contention. The Court acknowledged that pension is not a bounty but a right earned by persons while in service. However, it observed that the pension scheme was not in vogue prior to the retirement of the petitioners. The pension scheme came to be introduced for the first time with effect from April 1, 1990, and the extension to non-provincialised employees was made on July 28, 1994. The Court held that all employees were treated as a class and no invidious discrimination had been meted out to them. The date of April 1, 1990 bore rationality because the scheme was introduced for the first time on that date. Employees who retired before that date were treated as a class and the scheme was extended to it; thus there was no illegality in introducing the cut-off date, nor did it violate Article 14. The Supreme Court further held that the ratio of the judgments relied upon by the petitioners had no application to the facts of the case. Accordingly, the special leave petitions were dismissed.
Headnote
A) Constitutional Law - Equality Before Law - Validity of Cut-off Date for Pension Scheme - Constitution of India, 1950, Article 14 - The petitioners, non-provincialised municipal employees who retired before April 1, 1990, challenged the cut-off date as arbitrary and violative of Article 14; the Court held that pension is a right earned in service but the scheme was introduced for the first time with effect from April 1, 1990, and employees who retired before that date formed a distinct class, so there was no invidious discrimination; the date bore rationality and the cut-off date did not violate Article 14 - Held that the cut-off date was valid and the special leave petitions were dismissed (Paras Not mentioned).
Issue of Consideration
Whether the prescription of April 1, 1990 as cut-off date for extending pension scheme to non-provincialised municipal employees is arbitrary and violative of Article 14 of the Constitution.
Final Decision
The Supreme Court dismissed the special leave petitions, holding that the cut-off date of April 1, 1990 for extension of pension scheme to non-provincialised municipal employees is rational and does not violate Article 14 of the Constitution.
Law Points
- Pension is not a bounty but a right earned during service
- A cut-off date for introduction of pension scheme is valid if it coincides with first introduction
- Employees retiring before cut-off date form a distinct class
- No invidious discrimination if all within class treated equally
- Article 14 does not require retrospective extension of pension scheme
