By the Court.—The petitioner was an Assistant Engineer in the U.P. Power Corporation. It appears that a criminal case under Section 13(1) of the Prevention of Corruption Act and for certain other offences is pending against him. The petitioner retired on 30.6.2000. He is aggrieved by the order dated 23rd September, 2000 of the U.P. Power Corporation by which the gratuity of the petitioner has been withheld pending vigilance proceedings which appear to have preceded the criminal case. However the petitioner has been permitted provisional pension. A portion of this order by which gratuity has been withheld has been challenged by the petitioner.

2. We have heard Sri Ranjit Saxena counsel for the petitioner and Sri Anil Mehrotra counsel for the U.P. Power Corporation. It is stated by Sri Anil Mehrotra learned Standing Counsel for the Corporation that the Civil Service Regulations dealing with the subject pension and gratuity have been adopted by the Corporation and the arguments were heard on the foundation that the Civil Service Regulations were applicable. It is also stated by Sri Anil Mehrotra that the U.P. Retirement Benefit Rules, 1961 as well as the U.P. Liberalised Pension Rules, 1961 are applicable and have been adopted by the Corporation.

3. Sri Ranjit Saxena, counsel for the petitioner submitted that the State Government does not have any power to withhold pension under Regulation 351-A of the Civil Service Regulations. According to him gratuity and pension are conceptually different and pension alone can be withheld or forfeited under Regulation 351-A. A Division Bench of this Court in Krishna Kumar v. State of U.P. and others, 1998 (4) AWC 595, has taken the view that gratuity can be withheld under Section 4 of the Payment of Gratuity Act and pension under Regulation 351-A. Sri Ranjit Saxena however placed reliance upon a recent decision in Bhagwati Prasad Verma v. State of U.P. through Secretary, Basic Education, decided on 10.9.07 [MANU/UP/1246/ 2007] in which the learned Judges have held that gratuity is not covered under Regulation 351-A and that recovery from gratuity can be made under separate rules framed by the State Government, namely Rule 10(1) of U.P. Liberalised Pension Rules, 1961 and Rule 9 of the U.P. Retirement Benefit Rules, 1961. The Division Bench in Bhagwati Prasad Verma’s case did not follow Krishna Kumar’s decision on the ground that Section 4 (6) (1) of the Payment of Gratuity Act, 1972 which provides for forfeiture of gratuity and which was relied upon in Krishna Kumar’s case is not applicable to persons holding posts under the State Government or the Central Government in view of Section 2 (e) of that Act.

4. Both Gratuity and Pension are retirement benefits. They are paid as of right to the employee for past services rendered. The purpose of both is to provide financial security to the retired employee. These are common features between gratuity and pension. However gratuity is a lump sum payment made to the employee on his retirement while pension is a recurring periodical payment to the employee after his retirement usually for the rest of his life. It is in this sense that gratuity and pension are different concepts. Article 366 (17) of the Constitution of India defines pension to include gratuity. This definition was considered by the Apex Court in State of U.P. v. U.P. University Colleges Pensioners’ Association, [MANU/SC/0478/1994] and the Apex Court has held that the legislature often wants to give an enlarged meaning to a particular word and that the definition in clause (17) has enlarged the meaning of the word ‘pension’ and cannot be applied for all purposes.

5. In order to appreciate the controversy we would refer first to the relevant provisions of the Civil Service Regulations relating to the withholding or forfeiture of pension and thereafter shall proceed to consider the impact of the U.P. Liberalised Pension Rules and U.P. Retirement Benefit Rules, 1961. The main part o