Back
2018 Supreme(SC) 482
SUPREME COURT OF INDIA
Adarsh Kumar Goel, Uday Umesh Lalit, JJ.
United Bank of India and others – Appellants
VERSUS
United Bank of India Retirees’ Welfare Association and others etc. – Respondents
CIVIL APPEAL NOS.5252-5255 OF 2018 (Arising out of SLP(Civil) Nos.7368-71 of 2017)
Decided On : 16-05-2018
IMPORTANT POINTS
Providing different rates of DA in pension for retiring before and after the cut-off date is not creating a class within a class.
Courts should not tinker in policy matters.
Doctrine of merger.
Headnote:(a) Service law – Retiral benefits – Dearness allowance to pensioners – Different rates for those retiring before and after 01.11.2002 – Held, being based on different parameters the classification is not arbitrary – Not a case of creating a class within a class – Flat rate as contended not justified – More over this being a policy matter – Court should not tinker. (Para 24, 25)
(1994) 4 SCC 68; Civil Appeal Nos.8420-8421 of 2013 – Relied upon
(1983) 1 SCC 305; (2013) 2 SCC 772; (1990) 4 SCC 207; (1991) 2 SCC 104; (1997) 4 SCC 569; (2006) 11 SCC 709 – Referred
(b) Doctrine of merger – Admission of SLP against a High Court judgment – Impugned judgment merges with the decision in the SLP. (Para 26)
(2000) 6 SCC 359 – Relied upon
Facts of the case:
By its Judgment and Orders under appeal, the High Court held that there was no justification for making a distinction between pre November, 2002 retirees and post November, 2002 retirees and the appellant must pay dearness relief to all pensioners at the same rate.
A Memorandum of Settlement dated 29.10.1993 was entered into between the managements of 58 banks as represented by the Indian Banks’ Association on one hand and their workmen as represented by the All India Bank Employees’ Association on the other. Said memorandum recited that the parties had agreed to introduce pension scheme in banks for the workmen/employees in lieu of employers’ contribution to the provident fund and that the pension scheme so agreed was to be broadly on Central Government/Reserve Bank of India pattern.
The Bipartite Settlement dated 02.06.2005 was operational for a period of five years from 01.11.2002. Thereafter 9th Bipartite Settlement was arrived at between the parties on 27.04.2010 and was made operational for five years from 01.11.2007.
in case of employees who had retired during the period 01.04.1998 to 31.10.2002, dearness relief at the rate of 0.24% was awardable upto Rs.3550/-of basic pension per month and thereafter the percentage for amounts in excess of Rs.3550/-was successively at reduced rates. On the other hand, in case of employees who retired during the period 01.11.2002 to 30.04.2005 the percentage of 0.18% was without any such tapering formula.
The idea of tapering formula under the Bipartite Settlement dated 27.04.2010 was retained with respect to pre November 2002 retirees while the dearness relief to post November 2002 retirees was to be at the flat rate of 0.18 %.
Respondent Nos.1 to 4 herein preferred Writ Petition which was allowed.
Finding of the Court:
Providing different rates of DA in pension for retiring before and after the cut-off date is not creating a class within a class.
Result: Appeals allowed.
JUDGMENT
Uday Umesh Lalit, J.
Leave granted.
2. These appeals by special leave are directed against (i) the common Judgment and Final Order dated 26.09.2016 passed by the High Court at Calcutta in APO Nos.315 and 316 of 2015; and (ii) against the order dated 05.12.2016 passed by the High Court at Calcutta in RVWO Nos.57 and 58 of 2016 in aforementioned APO Nos.315 and 316 of 2015. By its Judgment and Orders under appeal, the High Court held that there was no justification for making a distinction between pre November, 2002 retirees and post November, 2002 retirees and the appellant must pay dearness relief to all pensioners at the same rate.
3. A Memorandum of Settlement dated 29.10.1993 was entered into between the managements of 58 banks as represented by the Indian Banks’ Association on one hand and their workmen as represented by the All India Bank Employees’ Association on the other. Said memorandum recited that the parties had agreed to introduce pension scheme in banks for the workmen/employees in lieu of employers’ contribution to the provident fund and that the pension scheme so agreed was to be broadly on Central Government/Reserve Bank of India pattern. Paragraph 6 of the memorandum dealt with Dearness Allowance relief to the pensioners and it stipulated:
“Dearness relief to pensioners will be granted at such rates as may be determined from time to time in line with the Dearness Allowance formula in operation in Reserve Bank of India”
4. In exercise of powers conferred by Clause (f) of sub-Section (2) of Section 19 of Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970, the Board of Directors of the Union Bank of India after consultation with the Reserve Bank of India and with the previous sanction of the Central Government made “Union Bank of India (Employees’) Pension Regulations, 1995 (hereinafter referred to as the “Pension Regulations”). Paragraph 2(d) defined “average emoluments” to be the average of pay drawn by an employee during last 10 months of service in the bank while Para 2(s) defined “pay”. Para 37 of the Pension Regulations was as under:
“Dearness Relief-(1) Dearness relief shall be granted on basic pension or family pension or invalid Pension or on compassionate allowance in accordance with the rates specified in Appendix II.”
Appendix II to the Pension Regulations dealt with Dearness Allowance on basic pension. It categorized employees as under:-
“(a) Those workmen who had retired on or after 01.01.1986 and before 01.11.1992 and those officers who had retired on or after 01.01.86 but before 01.07.1993.
(b) Those workmen who retired on or after 01.11.1992 and officers who retired on or after 01.07.1993 and
(c) Those employees who would retire on or after 01.04.1998.”
Different rates of Dearness Allowance relief as percentage of basic pension were prescribed in respect of aforesaid three categories in said appendix II as under:
“APPENDIX-II
(See Regulation 37)
Dearness relief on basic pension shall be as under:
(1) In the case of employees who were in the workmen cadre and who retired on or after the 1st day of January, 1986, but before the 1st day of November, 1992; and in the case of employees who were in the officers ? cadre and who retired on or after the 1st day of January, 1986, but before the 1st day of July, 1993, dearness relief shall be payable for every rise or be recoverable for every fall, as the case may be, of every 4 points over 600 points in the quarterly average of the all India Average Consumer Price Index for Industrial Workers in the series 1960 = 100. Such increase or decrease in dearness relief for every said four points shall be calculated in the manner given below:-
Scale of basic pension
(1)
The rate of dearness relief as a per month percentage of ba
