2023 Supreme(Gau) 1419

THE HIGH COURT OF GAUHATI, ASSAM, NAGALAND, MIZORAM AND ARUNACHAL PRADESH
MICHAEL ZOTHANKHUMA, MARLI VANKUNG, JJ.
State of Mizoram and Ors. - Petitioners
Versus
Sh. H. Zosiamliana and Ors. – Respondents
WA No.15 Of 2021
Decided On : 11-12-2023

Headnote:

Gratuity - Government Service - 7th ROP Rules, 2018 - Section 4(1) of the Payment of Gratuity Act, 1972, Rule 27 of the Central Civil Services Leave Rules, 1972, Rule 70 of the CCS Pension Rules, 1972 - The court analyzed the issue of whether pensioners who retired/died prior to 31.08.2018 and those who retired/died after 31.08.2018 form one homogeneous class in respect of payment of gratuity, leave encashment, and commutation. The court discussed the legal provisions of the Payment of Gratuity Act, 1972, Central Civil Services Leave Rules, 1972, and CCS Pension Rules, 1972, and concluded that the two classes of pensioners, decided based on the cut-off date of 01.09.2018, cannot be considered one homogeneous class for the payment of gratuity, leave encashment, and commutation. The court also highlighted the distinction between recurring benefits such as pension and one-time lumpsum payments like gratuity and commutation, emphasizing that the latter should be calculated based on the pay scale and allowances at the time of retirement, and cannot be carried over to a date subsequent to retirement. The court found that the impugned OM dated 15.01.2019 did not override the provisions of the ROP Rules, 2018, and clarified that pensioners who retired between 01.01.2016 and 31.08.2018 were not entitled to payment of gratuity, commutation, and earned leave in terms of the ROP Rules, 2018. The court held that there was no infirmity with the clarification made by the State Government, as the payment of the above benefits could only be calculated based on the pay scale and allowance at the time of retirement, and not from a date subsequent to retirement.

Fact of the Case:

The case involved two writ appeals against judgments passed in two writ petitions, where the issue was whether pensioners who retired/died between 01.01.2016 and 31.08.2018 could be denied the benefit of the revision of gratuity and commutation of pension in terms of the 7th Revision of Pay Rules, 2018 (ROP Rules). The appellants, State Governments, argued that the actual monetary benefits of pension/monthly pension were to be granted from 01.09.2018 for those who retired/died between 01.01.2016 and 31.08.2018, and that the lump-sum benefits of gratuity, leave encashment, and commutation of pension could not be given to persons who retired/died prior to 01.09.2018. The respondents, writ petitioners, contended that the impugned OM dated 15.01.2019 created two separate classes of pensioners, discriminating against those who retired/died between 01.01.2016 and 31.08.2018. The learned Single Judge allowed the writ petitions, holding that the impugned OM created two categories of pensioners and that the benefits of gratuity and commutation could not be denied to the first category. The appellants filed the present two appeals, challenging the judgments.

Finding of the Court:

The court found that the pensioners who retired/died prior to 31.08.2018 and those who retired/died after 31.08.2018 did not form one homogeneous class in respect of payment of gratuity, leave encashment, and commutation. The court held that the impugned OM dated 15.01.2019 did not override the provisions of the ROP Rules, 2018, and clarified that pensioners who retired between 01.01.2016 and 31.08.2018 were not entitled to payment of gratuity, commutation, and earned leave in terms of the ROP Rules, 2018. The court also emphasized the distinction between recurring benefits such as pension and one-time lumpsum payments like gratuity and commutation, and concluded that the two classes of pensioners, decided based on the cut-off date of 01.09.2018, cannot be considered one homogeneous class for the payment of gratuity, leave encashment, and commutation. The court allowed the writ appeals and dismissed the writ petitions.

Issues: The issue to be decided was whether pensioners who retired/died between 01.01.2016 and 31.08.2018 could be denied the benefit of the revision of gratuity and commutation of pension in terms of the 7th Revision of Pay Rules, 2018 (ROP Rules).

Ratio Decidendi: The court held that the pensioners who retired/died prior to 31.08.2018 and those who retired/died after 31.08.2018 did not form one homogeneous class in respect of payment of gratuity, leave encashment, and commutation. The court emphasized the distinction between recurring benefits such as pension and one-time lumpsum payments like gratuity and commutation, and concluded that the two classes of pensioners, decided based on the cut-off date of 01.09.2018, cannot be considered one homogeneous class for the payment of gratuity, leave encashment, and commutation. The court also found that the impugned OM dated 15.01.2019 did not override the provisions of the ROP Rules, 2018, and clarified that pensioners who retired between 01.01.2016 and 31.08.2018 were not entitled to payment of gratuity, commutation, and earned leave in terms of the ROP Rules, 2018.

Final Decision: The court allowed the writ appeals and dismissed the writ petitions, finding that there was no reason to interfere with the O.M. dated 01.09.2018, and that the impugned judgments were not sustainable.