WPSS/450/2020 of JAGDISH PRASAD Vs STATE OF UTTARAKHAND

Order Reserved on: 07.03.2022 Order Delivered on: 15.06.2022

IN HIGH COURT OF UTTARAKHAND AT NAINITAL

Writ Petition No.450 of 2020 (S/S)

Sri Jagdish Prasad

..…Petitioner

State of Uttarakhand & others

…Respondents

Advocate: Mr. S. Bhupendra Singh, Advocate for the petitioner. Mr. T.S. Phartiyal, Addl. C.S.C. for the State of Uttarakhand. Mr. D.S. Patni, Senior Advocate assisted by Mr. Bhagwat Mehra, Advocate for respondent nos.2 & 3.

Hon’ble Sharad Kumar Sharma, J.

The petitioner in the present writ petition happens to be retired employee, who has attained his age of superannuation on 31.05.2015, having retired from the post of Junior Engineer from the Electricity Distribution Division, Uttarakhand Power Corporation, Sitarganj, District Udham Singh Nagar.

2. The grievance raised by the petitioner in the present writ petition, is to the effect that despite of having being superannuated on 31.05.2015, the petitioner has not been paid his pensionery benefits, as well as the other retiral benefits, due to which he and his family is financially suffering lot and the reason for withholdment of the pensionery benefits had not been disclosed by respondent no.3, and hence, he contended that in fact the reasons which are attributable was on account of the malafide act of respondent no.3, itself who for no reasons has curtailed the reitral benefits. The petitioner was served with copy of an order of 06.01.2020, by virtue of which the respondent no.3 has assigned the reasons for non remittance of the retiral benefits, which was sought to be put to challenge by the petitioner by filing an amendment application praying for quashing of the FIR and for the purposes of remittance of the retiral benefits alongwith the interest of 12%, to be made payable on it.

3. It has been the case of the petitioner, that after his initial inducement with the respondents, he has rendered an unblemished service and

during his period of service as Junior Engineer with the respondents, there has been not even single iota of any misconduct, which was ever made attributable to the petitioner, but despite of it when after having retired on 31.05.2015, when the amount was not remitted, he has contended, that he has consistently requested the respondents by approaching them by filing various representations praying for the remittance of the reitral benefits. The petitioner submitted that when despite of his repeated request, when the pensionery benefits was not released and the request made by him on 31.05.2019, 25.06.2019, 11.09.2019 and 22.10.2019 was not acceded to and when no reasons were given by the respondents, which may have attributed to be the reasons for non release of the pension to the petitioner, has submitted that in all probability it spells out some ulterior motive on the part of some of the officials of the respondents-corporation. Petitioner submitted that right of an employee to get the retiral benefits and the consequential regular pension in fact is fundamental right and this is not bounty which is extended by the State or an employer, rather it has been made obligatory on part of the employer State or for that matter on any other statutory agency to release the pension of retired employee in order to reckoned the services rendered by him and to enable an employee and his family to sustain themselves in the old age, when the body and mind becomes fickle and is not in position to sustain his day today activities and needs. Hence, payment of pension is only reckoning of financial assistance for sustainability to an employee, who has retired from services and who has left with no other source of earning and it is benefit of subsistence provided to an employee, and to his family members.4. The petitioner submitted that at very belated stage when despite of the earlier request as referred to when it was not remitted the respondents had issued the impugned order on 06.01.2020, where they have assigned the reasons for the non remittance of the retiral benefits which has been put to challenge by the petitioner, by filing an amendment, which stood allowed by the Coordinate Bench of this Court by an order of 05.01.2020. If the reasons, which has been assigned therein in the impugned order of 06.01.2020, is taken into consideration, as it has been summarized therein it has mentioned that during the tenure of service, when the petitioner was serving with the respondents prior to his attainment of age of superannuation on 31.05.2015, the petitioner was said to

have been responsible for not depositing the revenue, which was allegedly collected on behalf of the department, which was to be deposited into the coffers of the department and the default amount, which was observed due to be paid by the petitioner by the assessment by the respondents themselves to be of Rs.3,52,212/- and it was because of this reason, that the amount which was held to be payable by the petitioner towards the department for the amount recovered by him, the pensionery benefits and other retiral benefits were not paid. Apart from it there was another reasons which was given therein as per Clause 3 of the impugned order, it was referred therein, that for the amount, which is due to be paid by an employee who has superannuated which is above Rs.5,00,000/-. Hence, the same could be curtailed only after conducting an inquiry and after being settled by the appointing authority of the department of having committed any financial irregularity, for an amount more than Rs.5,00,000/-, the retiral benefits could be curtailed. Hence, it was observed that vide Letter No.4314 of the Directorate dated 24.05.2016 since there were two annual increments, which was curtailed and was imposed by way of punishments with direction to make the deduction from the salary and the retiral benefits, which was payable to the petitioner amounting to Rs.14,160/- and the said amount was not paid, the retiral benefits was not remitted to the petitioner.

5. Even much prior to the passing of the impugned order dated 06.01.2020, the case of the petitioner as it was pleaded after the incorporation of amendment it was to the effect that after his retirement on 31.05.2015, the petitioner was called upon by the office of Executive Engineer, in order to enable him to prepare the documents for the purposes of forwarding his papers for determination of pension. The petitioner contends that in response to the said correspondence of 2016, he did appeared before the office of Executive Engineer but no documentation as such was made by them for which he was called and orally he was informed, that the process of documentation could not be completed, owing to the fact that after his retirement on 31.05.2015 all his service records has been sent to Dehradun and hence for the purposes of processing his retiral benefits documents, he is required to visit the office of the Headquarters of the respondents at Dehradun.

6. The petitioner submits that in response to the aforesaid oral information the petitioner and his wife went to Dehradun in order to facilitate and activate the processing the documents for settlement of the retiral benefits but no action was taken despite of the fact, that the petitioner has supplied all the documents.

7. Being dissatisfied with the reaction/response, which was extended by the respondents despite of the petitioner’s visiting their office at Dehradun, the petitioner was informed by the office of the Executive Engineer, Sitarganj i.e. respondent no.3 herein and that too in October 2018, that the total amount which was collected by him and which was otherwise supposed to be deposited since it was not complete deposit made and there was shortage in depositing the collected revenue, his pension has been witheld. At this stage, this date of the communication made from the office of the Executive Engineer, becomes relevant to be referred to, because it was an Communication made in October 2018, in response to which the petitioner submitted representation on 16.10.2018, and when no heed was paid to it, the petitioner submitted reminder on 30.11.2018 and in these two communications the petitioner expressed his willingness, that the set of allegations, which was orally informed by the office of respondent no.3, in October 2018, with regards to shortage of deposit of the collected charges. The petitioner expressed his willingness to deposit the shortage amount, as alleged subject to the condition that the office of respondent no.3 gives him the details of amount due to be paid by him. This process which was adopted by the petitioner and even by the respondents was even prior to the passing of the impugned order.

8. As consequence of the petitioner’s representation of 16.10.2018 and reminder of 30.11.2018, the petitioner’s case, in the writ petition is that by the correspondence of respondent no.3 dated 21.11.2018, the office of the respondents, informed that the details of the shortage amount, which was assessed to be sum of Rs.3,53,215/- which was due to be paid by the petitioner. The petitioner vide his correspondence of 12.02.2019, sought permission from the office of respondent no.3, making request to permit him to deposit the alleged defaulted amount of Rs.3,53,212/- so that the obstacle,

which has been caused in remitting the retiral benefits and pension may be eradicated.

9. The petitioner has come up in the writ petition, that on the information supplied with regards to the defaulted amount, the petitioner vide his correspondence of 12.02.2019 and 14.04.2019; in fact had deposited the amount of Rs.3,53,212/- in the office of respondent no.3, and the acknowledgment of the receipt of the said amount was also issued by the respondents on 19.08.2019. Meaning thereby the embargo of non remittance of the retiral and pensionery benefits as observed in the impugned order dated 06.01.2020, on their own admitted action of the respondents of informing the defaulted amount, accepting the deposit made by the petitioner, acknowledgment of the receipt dated 19.08.2019, would itself show, that the reasons, which were given in the order of 06.01.2020, was thereafter not sustainable for the reason, being that as on 06.01.2020, whatsoever the said allegation pertaining to the non payment of collection charges were levelled against the petitioner that stood eradicated, because of the fact of deposit made by the petitioner prior in time i.e. 04.04.2019 and according to their own acknowledgment of receipt dated 19.08.2019, but still despite of having acknowledged, that no dues were payable, the respondents have taken no action.10. In order to justify their inaction in settlement of the retiral benefits, the respondents once again had observed, that as against the amount which was not deposited by the petitioner and which the petitioner was thereafter even called upon by the respondents to deposit, which the petitioner has admittedly deposited on 04.04.2019, it was contended by the respondents by fishing out new ground altogether that the pensionery benefits and the retiral benefits, could not be processed for the reason being that on the said amount, which has been deposited by the petitioner on 04.04.2019, he would be rather liable to pay an interest also on the said amount, which was assessed to be Rs.2,31,733/-. But however this amount determined was at much belated stage, even much after the deposit of 04.04.2019 and which was communicated by the letter of 31.08.2019.

11. The petitioner contends that once on his representation of 16.10.2018, the respondent once have determined the liability, which was even admittedly paid by the petitioner, then the subsequent communication of 31.08.2019, taking it as ground, to not to remit the pensionery benefits, due to non remittance of the interest amount as determined, in fact was an afterthought story developed by the respondents, because if any interest was accruable on the alleged amount, which was said to be not deposited by the petitioner, he ought to have been informed at an appropriate time at least in October 2018, itself when the petitioner was called upon by the respondents to deposit the defaulted amount of Rs.3,53,215/-. This subsequent generation of an amount allegedly due towards interest was malicious without any logic and was later developed subsequently with clever device, to not to remit the pensionery benefits. But later on, the respondents despite of having received the amount on 19.08.2019, has passed the impugned order on 06.01.2020 on the ground of the alleged default of non payment of Rs.3,53,215/- but what is more important, is that in the communication of 06.01.2020, the petitioner by virtue of an amendment has submitted, that later on respondent no.3 had called upon the petitioner to get the documents prepared for the purposes of the settlement of the pensionery benefits and gratuity vide his communication dated 16.03.2020. But despite of having satisfied the condition of letter of 16.03.2020, which obviously was after the passing of the impugned order of 06.01.2020, this Court is of the view, that the reasons for non remittance of the pensionery benefits, as depicted in the impugned order of 06.01.2020, itself stood eradicated and overruled by the communication of the Executive Engineer/respondent no.3 himself i.e. dated 16.03.2020, when the petitioner was called to process the documents for the purposes of remittance of pension and gratuity amount, respondent no.3 by an order of 16.03.2020, when has called upon the petitioner to fulfil all the other codal formalities, that in itself dilutes the reasons which has been given in the impugned order of 06.01.2020, which was later taken as to be creating an impediment in depositing the amount.

12. Hence, the petitioner has submitted in the writ petition that in view of the reckoned principles governing the field of law for the payment of pensionery benefits to the retired employees, the petitioner’s case would fall to be well within the ambit of the principles laid down by the Hon’ble Apex Court

in judgment reported in 2001 AIR SCW 2819Gorakhpur University and others vs. Dr. Shitla Prasad Nagendra and others. In the said judgment, the Hon’ble Apex Court in para 5 & 6 had observed, that too on the basis of the earlier ratio laid down in the matters of State of Kerala vs M. Padmanathan Naiyyer reported in (1985) 1 Supreme Court Cases 429, that pension and gratuity apart from the fact that they are not the matters or bounty, which is distributed by the Government to the retired employees but rather valuable acquired right and it forms to be property falling within Article 300-A of the Constitution of India, and it cannot be delayed merely because of the fact that certain amount is yet to be outstanding due to be paid by an employee. Para 5 & 6 of the said judgment are extracted hereunder:-

“5. We have carefully considered the submissions on behalf of the respective parties before us. The earlier decision pertaining to this very university reported in 1996 (2) ESC 211 (All.) (supra) is that of Division Bench rendered after considering the principles laid down and also placing reliance upon the decisions of this Court reported in 1994 (6) SCC 589 (supra) which, in turn, relied upon earlier decisions inState of Kerala vs M. Padmanabhan Nair(1985) 1 SCC 429: (AIR 1985 SC 356: 1985 Lab IC 664) and AIR 1981 SC 212 (supra). This court has been repeatedly emphasizing the position that pension and gratuity are no longer matters of any bounty to be distributed by Government but are valuable rights acquired and property in their hands and any delay in settlement and disbursement whereof should be viewed seriously and dealt with severely by imposing penalty in the form of payment of interest. Withholding of quarters allotted, while in service, even after retirement without vacating the same has been viewed to be not valid ground to withhold the disbursement of the terminal benefits. Such is the position with reference to amounts due towards Provident Fund, which is rendered immune from attachment and deduction or adjustment as against any other dues from the employee. In the context of this, mere reliance on behalf of the appellant upon yet another decision of different Division Bench of the very High Court rendered without taking note of any of the earlier decisions of this court but merely proceeding to decide the issue upon equitable considerations of balancing conflicting claims of respective parties before it does not improve the case of the appellant any further. Reliance placed for the appellant university on the decision reported in JT 2000 Suppl. (1) SC 515 (Supra) does not also sound well on the facts and circumstances of this case. It is not clear from the facts relating to the said decision as to whether the person concerned was allowed to remain in occupation on receipt of the normal rent as in the present case. As noticed earlier, the case of the contesting respondent in this case is that the university authorities regularly accepted the rent at normal rates every month from the petitioner till the quarters wasvacated and that in spite of request made for the allotment of the said quarters in favour of the son of the respondent, who is in the service of the university, no decision seems to have been taken and communicated though it is now claimed in the Court proceedings that he is not entitled to this type of accommodation. Further, the facts disclosed such as the resolutions of the university resolving to waive penal rent from all Teachers as well as that of the Executive Council dated 18.7.1994 and the actual such waiver made in the case of several others cannot be easily ignored. The lethargy shown by the authorities in not taking any action according to law to enforce their right to recover possession of the quarters from the respondent or fix liability or determine the so-called penal rent after giving prior show-cause notice or any opportunity to him before ever even proceeding to recover the same from the respondent renders the claim for penal rent not only seriously disputed or contested claim but the university cannot be allowed to recover summarily the alleged dues according to its whims in vindictive manner by adopting different and discriminatory standards. The facts disclosed also show that it is almost one year after the vacation of the quarter and that too on the basis of certain subsequent orders increasing the rates of penal rent, the applicability of which to the respondent itself was again seriously disputed and to some extent justifiably too, the appellant cannot be held to be entitled to recover by way of adjustment such disputed sums or claims against the pension, gratuity and provident fund amounts indisputably due and unquestionably payable to the respondent before us. The claims of the university cannot be said to be in respect of an admitted or conceded claim or sum due. Therefore, we are of the view that no infirmity or illegality could be said to be vitiated the order, under challenge in this appeal, to call for our interference, apart from the further reason that the disbursements have already been said to have been made in this case as per the decision of the High Court.

6. The appeal fails and, therefore, shall stand dismissed. No costs. We make it clear that this shall not have the effect of foreclosing the rights of the university, if any, if the appellant chose to workout the same, as is permissible in law.”

13. An identical view was taken by the Hon’ble Apex Court in yet another judgment as reported in AIR 1981 Supreme Court 212 Som Prakash Rekhi vs. Union of India and others, wherein in para 62, 64 and 65 it has been held that the payment of full pension to the retired employees, would fall to be vested right and the obligations, if any which was payable to, on the corporation of any continuation of pre-existing liability, would not be at all creating any restriction on the employer for the payment of the pensionery benefits. The said paragraphs are extracted hereunder:-

“62. The liability for the payment of full pension was that of Burmah Shell, but, by virtue of SS. 3 and 4 of the Act, all the assets and liabilities vested in the Central Government and thereafter, in the second respondent. Section 10 of the Act relates to provident fund, superannuation, welfare fund and the like. Section 10(3) is important:

10(3). The Government company in which the under taking of Burmah Shell in India are directed to be vested shall, as soon as may be after the date of vesting, constitute, in respect of the moneys and other assets which are transferred to, and vested in, it under this section, one or more trusts having objects as similar to the objects of the existing trusts as in the circumstances may be practicable, so, however, that the rights and interests of the beneficiaries of the trust referred to in sub-section (1) are not, in any way, prejudiced or diminished.(emphasis added)

Follow-up steps were accordingly taken and there is no quarrel over it. It is clear, therefore, that the second respondent has made provision for the rights and interests of the beneficiaries of the Trust established by Burmah Shell for the benefit of the persons employed by it. Section 10(1) puts this matter beyond doubt. This obligation of the second respondent is statutory one and having regard to the provisions of S.11, it cannot be affected by any instrument or decree or order. The statutory continuation of pre-existing liability to pay pension, provident fund or gratuity, cannot be avoided having regard to S.10.

64. Let us assume for moment that reg. 16 authorises deductions and that discretionary payments, although enjoyed by the employees, is liable to be stopped. The question is whether s. 12 of the PF Act forbids any such reduction or deduction out of the benefits in the nature of old age pension on the score of the payment of contribution to the provident fund. We may extract S.12 here for, according to Shri Parekh, the language speaks for itself.

12. No employer in relation to an establishment to which any scheme or the insurance scheme applies shall, by reason only of his liability for the payment of any contribution to the Fund or the Insurance Fund or any charges under this Act or the scheme, reduce whether directly or indirectly the wages of any employee to whom the scheme of the Insurance Scheme applies or the total quantum of benefit in the nature of old age pension gratuity provident fund or Life Insurance to which the employee is entitled under the terms of his employment, express or implied. (emphasis added)

We take the view that this benignant provision must receive benignant construction and, even if two interpretations are permissible, that which furthers the beneficial object should be preferred From that perspective, the inference is reasonable that the total quantum of benefits in the nature of

old age pension, gratuity or provident fund, shall not be reduced by reason only of the liability of the employer for payment of contribution to the fund. The Section prevails over the Trust Deed. The provident fund accrues by statutory force and S.12 overrides any agreement authorising deductions, argues Shri Parekh.

65. similar result holds good even under the Gratuity Act. Section 14 of that Act reads thus:

14. The provisions of this Act or any rule made there under shall have effect notwithstanding anything inconsistent therewith contained in any enactment other than this Act or in any instrument or contract having effect by virtue of any enactment other than this Act.

The expression "instrument" certainly covers Trust Deed and, notwithstanding the deduction that may be sanctioned by the Trust Deed, the overriding effect of S.14 preserves the pension and immunises it against any deduction attributable to the statutory payment of the provident fund. The deduction made by the second respondent is, in that event, illegal.

14. The Hon’ble Apex Court in yet another judgment reported in (1994) 6 Supreme Court Cases 589R. Kapoor vs. Director Inspection (Painting and Publication) Income Tax And Another has held that the retiral and pensionery benefits cannot be withheld merely because the claim ofdamages for unauthorized occupancy of an accommodation is pending, the pensionery benefits cannot be withheld, that is what has been observed in para 11 of the said judgment, wherein it has been held that continuance of an employee in an official accommodation even unauthorisedly after retirement then too, even if any amount is due to be paid, that cannot be at all reason to not to pay the pensionery benefits to an employee, which is the only source of his sustainability and the sustainability of his family members. Such the action has been held to be arbitrary and against the welfare concept of the Constitution of India. Para 11 of the judgment is extracted hereunder:-

“11. The Tribunal having comes to the conclusion that D.C.R.G. cannot be withheld merely because the claim for damages for unauthorised occupation is pending, should in our considered opinion have granted interest at the rate of 18% since right to gratuity is not dependent upon the appellant vacating the official accommodation. Having regard to these circumstances, we feel that it is fit case in which the award of 18% is warranted and it is so ordered. The D.C.R.G. due to the appellant will carry interest at the rate of 18% per annum from 1.6.1986 till the date of payment. Of

course this shall be without prejudice to the right of the respondent to recover damages under Fundamental Rule 48A. Thus, the civil appeal is allowed. However, there shall be no order as to costs.”

15. It has been consistent principle and ratio which had been laid down by the various High Courts, as well as the Hon’ble Apex Court, that the pension and retiral benefits cannot be withheld or adjusted or appropriated or mis appropriated even for the purposes of satisfaction of any other dues, which are allegedly outstanding against the retired employee because if even any amount is due to be paid that has to be independently recovered by permissible procedure under law. The withholdment of pension or provident fund amount cannot be taken as to be tool and basis for non-remittance of retiral benefits.

16. The Hon’ble Apex Court in judgment rendered in Civil Appeal No.2463 of 2015 Assistant General Manager vs. Radhey Shyam Pandey, as decided on 02.03.2020, had laid down that the pension and pensionery benefits, cannot be dealt with arbitrarily and it cannot be denied in an unfair manner and the said observations made by the Hon’ble Apex Court, was on the ground of considering the socialistic structure of the Constitution of India and the Indian Society, which basically intends to eliminate any process of inequality and the basic frame work of socialism has been held in the said judgment, which intends to provide security in the fall of life of the working people and specially provide security from the cradles of the grave, when the employee has been rendered serviceless and is in the fag-end of his life. He cannot be left as destitute at an old stage. Hence, this Court is of the view that the stand taken in the order impugned dated 06.01.2020, is arbitrary in the light of the principles of the Hon’ble Apex Court as already dealt above.

17. There is another reason for not to accept the reason, given in the impugned order, is that and rather by way of writ petition too, that when the petitioner has paid the amount as demanded by the respondents on 04.04.2019 which was even acknowledged to have been received on 19.08.2019 by the respondents own official i.e. the S.D.O. on 05.04.2019, who had issued no due certificate, that in itself would show that as soon as no due certificate is issued by the competent officials, which was never recalled or set aside, at any point of time at later stage, the presumption would be that once the no due certificate

too has been issued prior to passing of the impugned order of 06.01.2020, the logic assigned in the impugned order would, run contrary to the acknowledgment of 19.08.2019 and the no due certificate of 05.04.2019.

18. Having considered the stand taken by the respondents in the counter affidavit in fact it happens to be akin to the reasons, which has been fished out by the respondents in their impugned order and for the alleged amount due to be paid by the petitioner, but in view of the reasons and the chronology of events which has chanced the averments made in the counter affidavit, will have to be read in this context to, the demand of the respondents! The petitioner’s undertaking to pay the same! The petitioner having deposited the amount! The respondents having accepted the amount, and consequently after issuance of the no dues certificate on 05.04.2019, that in itself had rendered the impugned order of denying the pensionery benefits of 06.01.2020, as to be bad in the eyes of law. Hence, for the reasons, that the denial of the pensionery benefits happens to be without any plausible reasons and coupled with the fact, that since the petitioner has retired in 2015 and he was legally entitled to receive the pension after the issuance of the no dues certificate when there was no other liability left to be honoured which was to be met with by the petitioner payable to the department. The action of the respondents in withholding the pensionery benefits and retiral dues would be arbitrary. Hence, the impugned order dated 06.01.2020 is hereby quashed. The writ petition is allowed.19. The writ of mandamus is issued to the respondents to determine the reitral benefits payable to the petitioner, with effect from the date of his retirement i.e. 30.05.2015 and are directed to pay the said amount of pensionery benefits alongwith the interest of 18% accruing upon it with effect from the date of withholdment till the date of actual payment in pursuance to today’s judgment and it is further directed that thereafter paying the arrears, the respondents would ensure to pay the retiral benefits by 10[th] of each month.

Subject to the aforesaid observations, the writ petition is allowed.

(Sharad Kumar Sharma, J.)

15.06.2022