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IN THE HIGH COURT OF HIMACHAL PRADESH AT SHIMLA
SABINA, SUSHIL KUKREJA, JJ.
State of Himachal Pradesh and Others – Appellants
Versus
Tara Dutt Sharma (Deceased) through his LRs. and Others – Respondents
L.P.A. Nos. 75, 93, 139 of 2022
Decided On : 21-12-2022
Employment and service matter - pay scale - Age of superannuation – Pension - According to respondents-petitioners, after attaining age of superannuation, they retired from Government service prior and their pre-revised pay scales were revised vide Resolution dated - Central Government accepted recommendations of 6th Pay Commission, whereby pension was required to be 50% of average emoluments received during past 10 months or last pay drawn, whichever was more beneficial to retiring employee and revised pension structure was to become effective and 40% of arrears were to be paid in cash for years and remaining 60% in years - Whether financial constraints could be a valid ground for introducing a cut off date while implementing a pension scheme on a revised basis - There are long line of cases, where validity of fixation of cut off date has been considered by Honble Apex Court keeping in view financial implications of the State while providing benefits for its employees/pensioners - In State of Rajasthan and Another vs. Amrit Lal Gandhi and Others, (1997) 2 SCC 342, Hon’ble Apex Court observed that whenever a revision takes place, a cut off date becomes imperative because benefit has to be allowed within financial resources available with Government. (Para 20)
Finding of Court :
In the instant case, stand of State Government is that if cut off date for allowing the financial benefits is fixed w.e.f. , then estimated liability of Rs. 350/- crore will fall on State exchequer, which would be a huge burden on State finances - Therefore, in view of law laid down by Hon’ble Supreme Court, it is well within State Government jurisdiction to allow financial benefits from a specific cut off date keeping in view financial position of State - Hence, cut off date fixed in Office Memorandum dated appellants-State cannot be said to be arbitrary and discriminatory and, in our opinion, same has been fixed on a very valid ground, i.e. financial constraints and as such, learned Single Judge had erred in quashing the Office Memorandum dated to effect that it makes orders effective w.e.f. and in ordering that revised pension in terms of the said Office Memorandum would be payable to the respondents-petitioners w.e.f. alongwith arrears.
Result : All appeals are allowed and consequently all three writ petitions filed by respondents-petitioners are dismissed.
Based on the provided legal document, the key legal principles and considerations are as follows:
The fixing of a cut-off date for the implementation of pension benefits or revisions is within the authority of the government, provided that the reasons for such fixation are rational and not arbitrary or discriminatory (!) (!) (!) .
Financial constraints of the state are recognized as valid grounds for establishing a specific cut-off date. The government’s decision to implement benefits from a particular date, based on its financial position, is considered lawful as long as the reasons are rational and not capricious (!) (!) (!) .
The fixation of a cut-off date must be based on rational considerations such as economic conditions, administrative feasibility, or other relevant circumstances. Even in the absence of explicit reasons, the choice of date is not deemed arbitrary unless it is capricious or whimsical (!) (!) .
The law permits the government to adopt different dates for benefit implementation, especially when there are significant financial implications. Such decisions are within the executive’s domain and should be respected unless shown to be arbitrary or discriminatory (!) (!) .
The right to pension is recognized as a legal right, not a bounty, and is linked to the terms and rules governing the pension scheme. However, the government has the authority to determine the date from which benefits are payable, considering the state’s financial capacity (!) (!) (!) .
The government’s decision to fix a specific date for benefit implementation, particularly when justified by financial constraints, is lawful and does not violate constitutional principles as long as it is rationally connected to legitimate financial considerations (!) (!) (!) .
The courts generally exercise restraint in interfering with the government’s decision regarding the fixation of cut-off dates, recognizing the executive’s expertise and the importance of considering economic and administrative factors (!) (!) (!) .
In the case at hand, the government’s decision to set the cut-off date for pension benefits at a specific date (e.g., 01.04.2013) was based on valid financial considerations, and such a decision is not arbitrary or discriminatory. The government has the constitutional and statutory authority to fix such dates, and courts are unlikely to interfere unless the decision is manifestly capricious (!) (!) (!) .
In summary, the legal framework supports the government’s authority to fix cut-off dates for pension benefits, especially when justified by financial and administrative reasons, and such decisions are presumed valid unless proven to be arbitrary or irrational.
JUDGMENT :
SUSHIL KUKREJA, J.
1. Vide this judgment, the above mentioned three appeals would be disposed of as the issue involved in all these cases is the same.
2. The instant appeals have been filed by the appellants-State, assailing the impugned common order dated 15.07.2021, passed by the learned Single Judge in the petitions (CWPOA Nos. 6391, 6220 and 7876 of 2019) filed by the respondents-petitioners, thereby while allowing the petitions, it was ordered that the revised pension in terms of Office Memorandum dated 21st May, 2013, shall be payable to the respondents-petitioners w.e.f. 01.01.2006 alongwith arrears. For avoiding repetition of facts, the pleadings raised in CWPOA No. 6391 of 2019 shall be taken up for discussion.
3. According to the respondents-petitioners, after attaining the age of superannuation, they retired from the Government service prior to 01.01.2006 and their pre-revised pay scales were revised vide Resolution dated 29th August, 2008. The Central Government accepted the recommendations of 6th Pay Commission, whereby the pension was required to be 50% of the average emoluments received during the past 10 months or the last pay drawn, whichever was more beneficial to the retiring employee and the revised pension structure was to become effective from 01.01.2006 and 40% of the arrears were to be paid in cash for the years 2006-09 and the remaining 60% in the years 2009-10. The recommendation No. 2, accepted by the Government, was as follows:
4. Vide Office Memorandum dated 01.09.2008, the sanction of the President was accorded qua revision of pension of pre-2006 pensioners and Clause-1 and Clause-4.2 of the said Office Memorandum read as under:
...............
4.2 The fixation of pension will be subject to the provision that the revised pension, in no case, shall be lower than fifty percent of the minimum of the pay in the pay band plus the grade pay corresponding to the pre-revised pay scale from which the pension had retired. In the case of HAG+ and above scales, this will be fifty percent of the minimum of the revised pay scale.”
5. Vide Office Memorandum dated 14th October, 2009, the Government of Himachal Pradesh accorded sanction to the Regulation w.e.f. 01.01.2006 of pension/family pension of all the pre-2006 pensioners/family pensioners and Clause 4.2 of the Office Memorandum provided that the fixation of pension will be subject to the provision that the revised pension, in no case, shall be lower than 50% of the minimum of the Pay Band plus the Grade pay, corresponding to the pre-revised pay scale from which the pensioner had retired. Thereafter, vide Office Memorandum dated 21st May, 2013 on the subject Revision of pension of pre-2006 pensioners-reg, the Finance (Pension) Department of the Government of Himachal Pradesh, ordered that in pursuance to instructions contained in Office Memorandum dated 14th October, 2009, the Governor of Himachal Pradesh was pleased to order that pension of pre-2006 pensioners, as revised w.e.f. 01.01.2006, in terms of Pa
Fixing of a cut-off date for granting of benefits is well within the powers of Government as long as the reasons therefor are not arbitrary and are based on some rational consideration.
Financial constraint can justify fixing a cut-off date for payment of revised pension, and the court should consider the State's justification for policy decisions based on financial constraints.
Pension is not a bounty but a recompense for long years of service, and the date from which the pensioner shall be entitled to the benefit of revision cannot be arbitrarily determined by the employer....
Differentiation in pension benefits based on financial constraints is constitutionally valid, affirming the balance between fiscal policy and equality in treatment under law.
Pension entitlement is governed by existing rules, and any revisions depend on state policy, not individual claims based on service length.
Point of Law - Court must maintain judicial restraint in matters relating to the legislative or executive domain.
The court upheld the government's policy decision to set a cut-off date for extending monetary benefits to retirees, affirming that such classifications are permissible under constitutional provision....
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