IMPORTANT POINT
When reason for prescribing age limit for Bank Guards for benefit of pension was that they had rendered a minimum 20 years of service, putting a cut off date for age limit in 1965 had no rationale and could be termed as arbitrary.

Headnote:(i) State Bank of India Employees Pension Fund Rules-Rules 7 and 8-Bank Security Guards who had served in Army-Benefit of pension fund-Pension denied to respondents on ground that they exceeded age limit of 35 years as on 1-1-1965-Age limit and cut off date of 1-1-1965 was question in writ and Division Bank directed Bank to admit respondents to pension fund-Appeal-Reason for prescribing maximum age limit of 35 which later on was increased to 38 for induction into pension fund appeared to be that employee would be able to render minimum service of 20 years-No rationale appeared for cut off date-Respondent had rendered 20 years of service after confirmation-No reason to differ with view taken by High Court.
       Held : The reason for prescribing the maximum age limit of 35 or 38, as the case may be, for the purpose of induction into pension fund appears to be that the employee would be able to render minimum service of 20 years as contemplated by Rule 22 of the Pension Fund Rules. However, there does not appear to be any rationale or discernible basis for fixing the cut off date as 1.1.1965, notwithstanding their earlier confirmation in Bank service. True, a new benefit has been conferred on the ex-servicemen and therefore a cutoff date could be fixed for extending this new benefit, without offending the ratio of the decision in D.S. Nakara and others vs. Union of India [AIR 1983 SC 130]; but, there could be no arbitrariness or irrationality in fixing such date. Minimum qualifying service being the essential consideration, even according to the Bank, there is no reason why the ex-servicemen like the respondents, who from the date of their confirmation had put in more than twenty years of service, even taking the retirement age as 58, should be excluded. No reason is forthcoming in the counter-affidavit filed by the Bank for choosing the said date. When it is decided to extend the pensionary benefits to ex-servicemen drawing pension, the denial of the benefit to some of the serving employees should be based on rational and intelligible criterion. In substance, that is the view taken by the High Court and we see no reason to differ with that view. (Para 6)
       (ii) State Bank of India Employees Pension Fund Rules-Rules 7 and 8-Maximum age limit prescribed for purpose of induction into pension fund on cut off date-Reason was that employee had rendered minimum 20 years of service-Service rendered in Army by respondents, bank guards, could not be said liable to be clubbed with their service in Bank for purpose of pension. (Para 7)
       (iii) State Bank of India Employees Pension Fund Rules-Rules 7 and 8-Maximum age limit prescribed for purpose of induction into pension fund on cut off date-Reason was that employee had rendered minimum 20 years of service-Respondents had joined service of Imperial Bank of India in 1950 and in 1955 and on formation of State Bank of India, they were absorbed in service of SBI with effect from 1-7-1955-They rendered service of more than 24 years when they retired in 1980-They were entitled to pension benefit. (Para 8)

JUDGMENT

P. Venkatarama Reddi, J.-The respondents in Civil Appeal No.3431/2000 served in the Army as Sepoys and joined the service of State Bank of India (hereinafter referred to as the Bank ) as Security Guards. The 2nd respondent (Abbas), who is no more and whose L.Rs. are on record, was appointed by the Bank on 22.8.1962. The 4th respondent (Marimuthu) was appointed on 8.9.1957 and 5th respondent (Raju) was appointed on 1.9.1955. By that time, they were aged 37, 35 and 38 years respectively. The 2nd respondent rendered 22 years of service, the 4th respondent 24 years of service and the 5th respondent 22 years of service in the Bank, by the time they retired at the age of 60. There is no need to refer to the other two respondents (Respondent Nos. 1 & 3) as the first respondent has already got the relief during the pendency of the writ petition and the third respondent was denied relief by the High Court. They are unnecessarily shown as respondents. Though the S.L.P. was filed against 14 respondents who were writ petitioners, all excepting five, were deleted from the array of respondents subsequently. Hence this appeal is effective against three respondents only.

2. A writ petition under Article 226 of the Constitution was filed in the Madras High Court in the year 1986 seeking a direction to the Bank to admit them to the benefit of pension fund and to pay pension. The pension was denied to them on the ground that they exceeded the age limit of 35 years as on 1.1.1965. It may be stated here that the age limit was increased to 38 years later on and that is how some of the original writ petitioners got the relief. The prescription of the age limit of 35 years as well as the cutoff date of 1.1.1965 was questioned before the High Court. The learned single Judge of the High Court dismissed the writ petition. This led to the filing of writ appeal by the aggrieved employees. The Division Bench, by the impugned judgment dated 4.2.1998, set aside the order of the learned Single Judge and allowed the appeal in part. The Division Bench of the High Court directed the Bank to admit appellant Nos. 3, 10, 11 & 13 to the pension fund with effect from April, 1983. That means, the respondents 2, 4 & 5 in this appeal, apart from one more person (whose name has been deleted from S.L.P. in view of non-compliance with Office Report) have got the relief from the High Court. Hence, this appeal by the Bank.

3. Civil Appeal No. 3432 of 2000 is in the nature of a cross-appeal filed by four persons who were appellant Nos.4, 6, 12 & 14 in the writ appeal, to whom relief was denied by the High Court.

4. The State Bank of India Employees Pension Fund came into existence on the 1st July. 1955. In exercise of the powers conferred by Section 50 of the State Bank of India Act (Act 23 of 1955) certain rules were framed governing the establishment and maintenance of the pension fund under the caption State Bank of India Employees Pension Fund Rules . Rules 7 & 8 are relevant for this case. They read as follows:

"7. Save as provided in rule 8, every whole time permanent employee in the service of the Bank who is entitled to pension benefits under the terms and conditions of his service shall become a member of the fund from -

(a) the date from which he is confirmed in the service of the Bank or

(b) the date from which he may be required to become a member of the fund under the terms and conditions of his service.

8. Save as provided in rule 25, no employee shall be eligible to become a member of the fund-

(a) if he is a member of the Imperial Bank of India Employees Pension and Guarantee Fund or if he is engaged in any country outside India and appointed for service in such country;

(b) if he is below 21 years of age;

(d) whose service is specially declared by the Bank to be non pensionable."

5. It should be noted that

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2003 Supreme(SC) 770

IMPORTANT POINTWhen reason for prescribing age limit for Bank Guards for benefit of pension was that they had rendered a minimum 20 years of service, putting a cut off date for age limit in 1965 had no rationale and could be termed as arbitrary.

Cases Referred (1)

IMPORTANT POINT
When reason for prescribing age limit for Bank Guards for benefit of pension was that they had rendered a minimum 20 years of service, putting a cut off date for age limit in 1965 had no rationale and could be termed as arbitrary.