Case Note & Summary
The Reserve Bank of India (RBI) appealed against a Division Bench judgment of the Kerala High Court that had dismissed its appeal against a Single Judge's order. The Single Judge had dismissed the writ petition of Respondent No. 1, M.T. Mani, a retired RBI employee, who sought pension arrears from his retirement date of 30.11.2014. The facts were undisputed: Mani joined RBI on 14.09.1981 and was a member of the Contributory Provident Fund (CPF) scheme. He had four opportunities to switch to the RBI Pension Regulations, 1990, but chose not to. He retired on 30.11.2014 and received CPF and gratuity. In 2020, after the Government of India rejected a proposal for another option, Mani filed a writ petition seeking to exercise the pension option under the 1990 Regulations with effect from his retirement. During the pendency, RBI issued Administration Circular No. 1 on 14.09.2020, granting a final option to switch from CPF to pension for employees who were in service as on 01.11.1990 and continued as on 15.11.2000. The circular provided that pension would be payable from 01.07.2020, with no arrears for prior periods. Mani opted for the scheme and started receiving pension from 01.07.2020. He then amended his writ petition to challenge the denial of arrears from his retirement. The Single Judge dismissed the petition, and the Division Bench upheld that decision. The Supreme Court considered whether Mani was entitled to arrears from retirement. The Court noted that Mani had no vested right to pension as he had consistently opted for CPF. The 2020 circular was a fresh concession, and the employer had the discretion to fix the effective date. The Court held that the denial of arrears was valid and dismissed the appeal, affirming the High Court's judgment.
Headnote
A) Service Law - Pension - Option to Switch - Prospective Effect - RBI Pension Regulations, 1990 - Administration Circular dated 14.09.2020 - The issue was whether a retired employee who opted for pension under a later circular was entitled to arrears from the date of retirement. The Court held that the employee had no vested right to pension from retirement as he had earlier opted for CPF, and the circular validly provided for pension only from 01.07.2020. The denial of arrears was upheld as a valid exercise of employer's discretion. (Paras 1-12) B) Service Law - Pension - Arrears - Employer's Discretion - RBI Pension Regulations, 1990 - The Court held that the employer has the discretion to fix the date from which pension becomes payable when a new option is granted. The employee cannot claim arrears for the period before the circular's effective date, as the option was a fresh concession. (Paras 10-12)
Issue of Consideration
Whether a retired employee who opts for a pension scheme under a later circular is entitled to arrears of pension from the date of retirement, or only from the date specified in the circular.
Final Decision
The Supreme Court dismissed the appeal, upholding the High Court's judgment that the respondent was not entitled to arrears of pension from the date of retirement, and pension was rightly payable only from 01.07.2020 as per the circular.
Law Points
- Pension Scheme
- Option to Switch
- Prospective Effect
- Arrears
- Employer's Discretion
- No Vested Right
