IMPORTANT POINT
Rule 9(21)(a)(i) of the Fundamental Rules excludes the special pay or personal pay granted to a government servant in view of his personal qualifications or otherwise from the purview of the expression pay and, therefore, the incentive award would not form part of pay under Rule 9(21)(a)(i) and consequently would not form part of emoluments under Rule 31 of the Andhra Pradesh Revised Pension Rules of 1980.

Headnote:(i) Service Law-Andhra Pradesh Revised Pension Rules of 1980-Rule 31-Rule 9(21)(a)(i) of the Fundamental Rules-Pay-Interpretation of Rule 31 of Revised Pension Rules-Expression emoluments would mean Pay as defined in Rule 9(21)(a)(i) which a Government servant was receiving immediately before his retirement-Whether in calculating pension, amount which he was receiving as incentive award on date of his superannuation can be taken as a part of emoluments within meaning of Rule 31?-(No)-Rule 9(21)(a)(i) excludes special pay or personal pay granted in view of his personal qualifications or otherwise from purview of expression pay - Incentive award which respondent was drawing while continuing as Deputy Executive Engineer-Cannot be held to be part of emoluments .
       Held that for the purpose of Rule 31 of the Pension Rules emoluments of government servant would mean the pay which he is drawing as defined in Rule 9(21)(a)(i) of the Fundamental Rules. Said Rule 9(21)(a)(i) clearly excludes the special pay or personal pay granted to a government servant in view of his personal qualifications or otherwise from the purview of the expression pay and, therefore, whether the incentive award is held either a special pay or personal pay the same would not form part of pay under Rule 9(21)(a)(i) of the Fundamental Rules and consequently would not form part of emoluments under Rule 31 of the Rules for being taken into account for computation of pension of the respondent. The Tribunal, therefore, is wholly in error in directing that the incentive award granted to the respondent may be taken into account for determining his pension. (Para 7)
       The incentive award which the respondent was drawing while continuing as Deputy Executive Engineer cannot be held to be a part of emoluments for the purpose of determining the pension of the respondent under the Pension Rules. (Para 9)
       (ii) Andhra Pradesh Revised Pension Rules of 1980-Rule 31 as amended in 1988 - Expression emoluments -Meaning of-Question of retrospective application of amended provisions of Rule 31-Is amended Rule 31 has any application to existing employees who were in service on the date amended rules came into force ?-(Yes).
       Held : The Pension Rules is a Rule framed by the Governor in exercise of the power under proviso to Article 309 of the Constitution. The relationship between the Government and its servant is not like an ordinary contract of service between a master and servant but a legal relationship something in the nature of status. Origin of Government service is contractual. But once appointed to his post or office, the government servant acquires a status and his rights and obligations are no longer determined by consent of both parties, but by statute or statutory rules which may be framed and altered unilaterally by the Government. The Legislature under Article 309 of the Constitution and the Governor under proviso to Article 309 of the Constitution can make law determining the service conditions of the Government employees and such law can also be retrospectively made. But in the case in hand question of retrospective application of the amended provisions of Rule 31 of the Revised Pension Rules really does not arise. It becomes applicable to all the employees who were in service on the date the amended rules came into force for the purpose of finding out the meaning of the expression emoluments on the basis of which the pension of the employee has to be calculated on superannuation. (Para 4)
       (iii) Fundamental Rules-Proviso to Rule 2 as inserted by Section 7 of Act 23 of 1984-A.P. Revised Pension Rules of 1980-Rule 31-Is proviso to Rule 2 any way affects amendment of Pension Rules?-(No)-Proviso to Rule 2 of Fundamental Rules cannot affect power of Governor to amend Pension Rules in exercise of his power under proviso to Art. 309 of Constitution. (Para 8)

JUDGMENT

Pattanaik, J.-This appeal is directed against the judgment of the Full Bench of Andhra Pradesh Administrative Tribunal in O.A. No. 10380 of 1990. The Tribunal by the impugned order directed that the incentive increments which had been given to the respondent for his meritorious work must be held to be a personal pay and the said personal pay has to be taken into account for determining the emoluments which the respondent was drawing on the date of his superannuation for the purpose of calculating his pension. The respondent, admittedly, was an employee of the erstwhile Hyderabad State and after the merger of the said State and on re-organisation he became an employee of the State of Andhra Pradesh. On the date of his superannuation on 31.12.1989 he was working as a Deputy Executive Engineer in the Irrigation Department and he had been granted four advance increments as incentive award pursuant to GOMs No. 562 GAD dated 17.11.1982 and GOMs No. 127 I&CAD dated 8.4.1988. In calculating his pension since this amount drawn by the respondent as incentive increment was not taken into account he approached the Administrative Tribunal. The Tribunal by the impugned order having directed that the incentive increments drawn by the respondent on the date of his superannuation should be taken as a part of his emoluments and, therefore, should be taken into account for determination of his pension, the State, has come up in appeal.

2. The learned counsel for the appellant contended that the pension of the State Government employee has to be determined in accordance with the Andhra Pradesh Revised Pension Rules of 1980, which has been framed under proviso to Article 309 of the Constitution, hereinafter referred to as the Rules . Under the Rules the expression emoluments means Pay as defined in Rule 9(21)(a)(i) of the Fundamental Rules which a Government servant was receiving immediately before his retirement or on his death. In Rule 9(21)(a)(i) of the Fundamental Rules the expression Pay means : the pay, other than special pay or granted in view of his personal qualifications, which has been sanctioned for a post held by him substantively or in an officiating capacity, or to which he is entitled by reasons of his position in a cadre. Therefore, the incentive award which the respondent was drawing while working as a Deputy Executive Engineer cannot form a part of Pay as defined in Rule 9(21)(a)(i) of the Fundamental Rules and consequently would not form a part of emoluments within the ambit of Rule 31 of the Rules for the purpose of calculation of pension of the Government servant. The Tribunal, therefore, committed gross error in directing that the said incentive award should be taken into account for determining the pension of the respondent. The learned counsel for the respondent on the other hand contended, Rule 31 which was amended in 1988 will not govern the case determining pension of the employees who were already in service and it would apply to those who joined the service after the amendment came into force. The learned counsel further submitted that in view of the proviso to Rule 2 of the Fundamental Rules the Pension Rules could not have been amended to the disadvantage of a person already in service and consequently the amended provisions of Rule 31 of the Revised Pension Rules must be declared to be invalid. Though the Tribunal did not go into the said question even though raised, the respondent is entitled to raise the question in support of the order passed in favour of the respondent by the Tribunal.

3. In view of the rival submissions at the Bar the questions that arise for our consideration are :

(i) Is the amended Rule 31 of the Pension Rules has any application to the existing employees like the respondent or it applies to those employees who would join the service after the amendment has come into force?

(ii) Whether in calculating the pension of the respond

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