Important Point
Office Memorandum dated 14.4.1987 for calculation of pension at basic pay excluding deputation allowance retrospectively from 1.1.86 is neither arbitrary nor violative of Articles 14 & 16 of the Constitu­tion.

Judgment

Mrs. Sujata V. Manohar, J.-The respondents in both these appeals retired as Audit Officers from the Office of the Accountant General, Andhra Pradesh, after more than 30 years of service. The respondents, some time prior to their retirement, had been sent on deputation to the Andhra Pradesh Secretariat and they continued to be on deputation till the date of their retirement. Each person when he is sent on deputation has an option either to opt for the pay in the parent office plus a deputation allowance or to opt for the sale of pay in the deputation post. Both the respondents had opted for retaining their pay in the parent office plus a deputation allowance. The respondent in Civil Appeal No. 3343 of 1990 (L.V. Vishwanathan) retired on 31.1.1987 while the respondent in Civil Appeal No. 8851 of 1994 (M.S. Sabhesan) retired on 31.5.1986. At the time of their retirement, under Rule 33 of the Central Services Pension Rules which are applicable to the respondents, emoluments for the purpose of calculation of pension were defined to mean pay as defined in Fundamental Rule 9(21). Fundamental Rule 9(21) is as follows :-

“9(21): (a) Pay means the amount drawn monthly by a Government servant as-

(i) the pay, other than special pay or pay 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 reason of his position in a cadre; and

(ii) overseas pay, special pay and personal pay; and

(iii) any other emoluments which may be specially classed as pay by the President.

.................’’

It is an admitted position that the Government of India treated depu­tation allowance as special pay, Emoluments, therefore, at the time of the retirement of the respondents included deputation allowance for the purpose of calculation of pension.

2. After the Fourth Central Pay Commission Report, Government orders were issued in June 1986 revising the pay scales with effect from 1st of January, 1986. Thereafter under an Office Memorandum dated 14th of April, 1987 issued by the Government of India, Ministry of Personnel, Public Grievances and Pensions there was a revision in the provisions regulating, inter alia, pension. In the opening part of the Office Memorandum it is stated that “In pursuance of the Government decisions on the recommendations of the Fourth Central Pay Commission the Presi­dent is pleased to introduce the following modifications in the rules regulating pension, death-cum-retirement gratuity and family pension under the CCS (Pension) Rules, 1972.” The modifications were applied retrospectively from 1st of January, 1986 so as to coincide with the revision in the pay scales. As per the modifications, the term `emolu­ments’ for the purposes of calculating various retirement benefits including pension, was re-defined to mean basic pay as defined in Fundamental Rule 9(21)(a)(i) which the Government servant was receiv­ing immediately before his retirement. Similarly, the term `average emoluments’ was to be determined with reference to the emoluments drawn by a Government servant during the last ten months of his serv­ice.

3. As a result of this modification only sub-clause (i) of Fundamental Rule 9(21)(a) would constitute basic pay, excluding sub-clauses (ii) and (iii). Therefore, since special pay is excluded from sub-clause (i), the basic pay would have to be calculated by excluding deputation allowance. In consequence, Rule 33 of the CCS Pension Rules was amend­ed in 1988 with retrospective effect from 1.1.1986. Previously, Rule 33 of CCS Pension Rules defined “emoluments” as follows:

“The expression `Emoluments’ means pay as defined in Rule 9(21) of the Fundamental Rules (including Dearness Pay as determined by the order of the Government issued from time to time) which a Government servant was receiving immediately before his retirement or on the date of his death.”

The amen