1. Resignation from service — Claim for gratuity under Payment of Gratuity Act — Forfeiture of past service under Rule 26, CCS Pension Rules. (Para 1 , 2 , 3 , 4 , 5 , 6 , 7 , 8 , 9 , 10 , 11 , 12 , 13 )
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2026 Supreme(Online)(Del) 4789
IN THE HIGH COURT OF DELHI AT NEW DELHI
Anil Khetarpal, J
VIMLA SINGH EX PGT HISTORY – Appellant
Versus
COMMISSIONER KENDRIYA VIDYALAYA SANGHATHAN – Respondent
W.P.(C) No. (Not Specified)
An employee governed by statutory rules providing for gratuity is excluded from the Payment of Gratuity Act, 1972 under Section 2(e). Consequently, if such rules (like Rule 26 of CCSP Rules) mandate forfeiture of service upon resignation, the employee cannot invoke the PG Act to override those rules.
Headnote:(A) Payment of Gratuity Act, 1972 - Definition of 'Employee' - Exclusion Clause - An employee governed by statutory rules or a distinct rule-based framework (such as the CCSP Rules) providing for payment of gratuity is excluded from the ambit of the PG Act under Section 2(e). (Para 20, 22)
(B) Statutory Overriding Effect - Section 14 of PG Act - The overriding effect of Section 14 is applicable only if the person first falls within the definition of an 'employee' under Section 2(e). If the employee is excluded by the definition, the question of inconsistency between the PG Act and other rules does not arise. (Para 25)
(C) Central Civil Services (Pension) Rules, 1972 - Rule 26 - Effect of Resignation - Resignation results in the automatic forfeiture of past service, rendering the employee ineligible for pensionary benefits and gratuity linked to qualifying service. (Para 26, 27)
Issues: Whether a Petitioner governed by the CCSP Rules can claim gratuity under the Payment of Gratuity Act, 1972, despite Rule 26 of the CCSP Rules providing for forfeiture of service upon resignation.
Legal Category Hierarchy
-
employment and labour law
- gratuity
- pension
- resignation
- practice and procedure
Table of Contents
2. Petitioner argued PG Act mandates gratuity even on resignation; Respondent argued Rule 26 applies and PG Act excluded. (Para 15 , 16 )
3. Writ petition dismissed; impugned orders of Tribunal upholding forfeiture of gratuity upon resignation affirmed. (Para 30 , 31 , 32 )
4. What is the scope of the exclusion clause in Section 2(e) of the Payment of Gratuity Act?
An employee governed by statutory rules providing for gratuity is excluded from the definition of 'employee' under Section 2(e) and cannot invoke the PG Act. (Para 20 , 21 , 22 , 23 )
5. Does Section 14 of the PG Act override inconsistent rules even when the employee is excluded from the Act?
No, Section 14's overriding effect only applies if the employee falls within the ambit of the PG Act; if excluded, the question of inconsistency does not arise. (Para 24 , 25 )
6. What is the effect of Rule 26 of the CCS (Pension) Rules on resignation?
Rule 26 is mandatory and unambiguous; upon resignation, past service stands forfeited and no qualifying service survives for pensionary benefits. (Para 26 , 27 )
7. Was the judgment in Chairman, Railway Board v. C.R. Rangadhamaiah applicable to this case?
No, that case dealt with retrospective amendments to service rules affecting vested rights, whereas Rule 26 existed at the time of appointment and resignation. (Para 28 )
J U D G M E N T
ANIL KSHETARPAL, J.:
Judgment reserved on: 18.02.2026
Judgment pronounced on: 25.02.2026
Judgment uploaded on: 25.02.2026
1. Through the present Writ Petition, the Petitioner seeks issuance of a writ of certiorari for quashing the Impugned Orders dated 30.05.2023 and 17.07.2023 [hereinafter referred to as ‘Impugned Orders’] passed in O.A. No.81/2018 and R.A. No.97/2023, respectively, passed by the learned Central Administrative Tribunal, Principal Bench, New Delhi [hereinafter referred to as ‘the Tribunal’], whereby her claim for gratuity came to be rejected. The Petitioner further challenges the correctness of the Tribunal’s view in declining to examine the validity of Rule 26 of the Central Civil Services (Pension) Rules, 1972 [hereinafter referred to as ‘CCSP Rules’], which, according to her, was erroneously treated as determinative of her entitlement.
2. The solitary issue which arises for consideration is whether the Petitioner, having resigned from service, is entitled to gratuity under the Payment of Gratuity Act, 1972 [hereinafter referred to as ‘the PG Act’], or whether her claim stands defeated by virtue of Rule 26 of the CCSP Rules, which provides for forfeiture of past service upon resignation.
FACTUAL MATRIX:
3. In order to appreciate the controversy, it is necessary to briefly advert to the relevant facts.
4. The Petitioner was appointed as Post Graduate Teacher (History) in a school run by the Kendriya Vidyalaya Sanghathan [hereinafter referred to as ‘KVS’] on 09.07.1995. She continued to serve in the said capacity without interruption. It is not in dispute that the Petitioner rendered service from 09.07.1995 till 18.08.2008. On 18.08.2008, she tendered her resignation. According to the Petitioner, the resignation was compelled by chronic back pain and prolonged ill health, which made it difficult for her to continue in service.
5. The resignation was accepted by the Respondent on 23.04.2009 with effect from 18.08.2008. Consequently, the Petitioner completed 13 years and 1 month of qualifying service.
6. At the time of entering service, the Petitioner had opted for the GPF-cum-pension scheme. The service conditions of employees of the Respondent were regulated by its bye-laws, and the Respondent had adopted the provisions of the CCSP Rules.
7. After acceptance of her resignation, the Petitioner sought release of retiral benefits, including gratuity and pension. The Respondent declined the same on the ground that resignation entails forfeiture of past service in terms of Bye-law No.26, which is pari materia to Rule 26 of the CCSP Rules.
8. Aggrieved by the denial of gratuity, the Petitioner approached the Controlling Authority under the PG Act. By order dated 05.09.2012, the Controlling Authority directed payment of gratuity to the Petitioner, placing reliance upon the law laid down by the Supreme Court that any provision inconsistent with Section 4 of the PG Act would be inoperative.
9. The Respondent challenged the said order by filing W.P.(C) No.2771/2015 before this Court and obtained an interim stay against the recovery of the gratuity amount. In the said proceedings, the Respondent reiterated its stand that on account of resignation, the Petitioner was not entitled to gratuity or pension. The said Writ Petition is pending before this Court.
10. Thereafter, the Petitioner filed W.P.(C) No.11329/2016 before the Division Bench of this Court, inter alia, challenging the validity of Bye-law No.26. By order dated 14.12.2017, the said Writ Petition was permitted to be withdrawn with liberty to approach the Tribunal in respect of her claim for pension.
11. Pursuant to the liberty so granted, the Petitioner filed O.A. No.81/2018 before the Tribunal. In the said OA, she questioned the validity of Bye-law No.26 and sought the grant of pension and consequential benefits. The Tribunal vide Impugned Order dated 30.05.2023, dismissed O.A. No.81/2018. The Tribunal held that in view of Rule 26 of the CCSP Rules
