1. Compassionate employment claim by widow of deceased bank peon rejected based on income computation including notional interest on terminal benefits. (Para 4 , 5 )
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2026 Supreme(Online)(Del) 20197
IN THE HIGH COURT OF DELHI AT NEW DELHI
Devendra Kumar Upadhyaya, CJ, Tejas Karia, J
Anita – Appellant
Versus
Punjab and Sind Bank – Respondent
LPA 208/2025 | CM APPL. 16832/2025 | CM APPL. 36023/2026
Advocates:
For the Appellants/Petitioners: Abhishek Kumar
For the Respondents: Rajat Arora, Niraj Kumar, Sourabh
For the Appellants/Petitioners: Abhishek Kumar
For the Respondents: Rajat Arora, Niraj Kumar, Sourabh
Compassionate appointment cannot be denied by treating terminal benefits or family pensions as a substitute for employment, nor by attributing notional interest to such benefits as part of the family's income.
Headnote:(A) Compassionate Appointment - Notional Income - Calculation of income by attributing interest to terminal benefits - Attributing a monthly income based on the assumption that terminal benefits are invested at a specific rate is without basis and cannot be used to disqualify a candidate, as terminal benefits are service entitlements and not necessarily income-generating assets. (Para 13, 15)
(B) Compassionate Appointment - Family Pension and Terminal Benefits - Effect on eligibility - Grant of family pension or payment of terminal benefits cannot be regarded as a substitute for or a bar to compassionate employment, as the object of such appointment is to alleviate immediate financial hardship. (Para 17)
Issues: Whether the inclusion of notional interest on terminal benefits and family pension in the computation of family income can be used to deny compassionate appointment under the Respondent's scheme.
Legal Category Hierarchy
- administrative law
- practice and procedure
- service law
Table of Contents
2. Appellant challenged inclusion of notional interest and family pension in income; respondent argued strict compliance with Scheme and no right to compassionate appointment. (Para 6 , 7 )
3. Notional income cannot be attributed to corpus of terminal benefits without evidence of investment; benefits received do not bar compassionate employment. (Para 13 , 14 , 15 , 16 , 17 )
4. Compassionate appointment scheme's 'notional income' covers actual or capable income, not entirety of terminal benefits unless retained in income-bearing form. (Para 15 )
5. Appeal allowed; impugned order set aside; respondent directed to grant compassionate appointment within two months. (Para 19 )
6. Can notional income on terminal benefits be included in family income for compassionate appointment eligibility?
No, unless there is evidence the corpus was retained in income-bearing form; attributing notional interest without basis is unsustainable. (Para 13 , 14 , 15 , 16 )
7. Does receipt of family pension or other service benefits bar compassionate appointment?
No, such benefits cannot substitute for or defeat a compassionate appointment claim; they are independent entitlements. (Para 17 )
8. What is the proper construction of 'notional income' in a compassionate appointment scheme?
It includes income actually received or capable from assets actually held, not notional income from a corpus the family need not retain in income form. (Para 15 )
TEJAS KARIA, J. (Oral)
CM No. 56431/2026 (Early Hearing)
1. Having heard learned Counsel for the Parties and perused the averments made in the Application, the same is allowed.
2. The next date fixed, i.e., 29.09.2026 stands cancelled.
3. With the consent of learned Counsel for the Parties, the Appeal is taken up for hearing finally.
LPA 208/2025
4. The present intra court Appeal has been preferred assailing the order dated 13.02.2025 (“Impugned Order”) passed in W.P.(C) 13949/2024 (“Writ Petition”). By the Impugned Order, learned Single Judge dismissed the Writ Petition, holding that there was no illegality, arbitrariness or unreasonableness in the decision of the Respondent declining the request of the Appellant for compassionate employment.
5. The brief facts germane to the filing of the present Appeal are set out hereunder:
5.1. The Appellant’s late husband, Mr. Ashok Kumar, entered the service of the Respondent on 18.09.1995 as a Peon in the subordinate cadre and remained in continuous employment until his demise on 23.09.2022. He was survived by the Appellant, his widow, who is the sole surviving member of his family.
5.2. With effect from 07.01.2023, the Appellant commenced receiving a pension of ₹3,000/- per month from the All India Punjab and Sind Bank Employees Welfare Society (“Welfare Society”). She also commenced receiving a family pension of ₹22,583/- per month with effect from 04.02.2023.
5.3. On 15.02.2023, the Appellant submitted an application to the Respondent seeking appointment on compassionate grounds. The Respondent rejected the said application on 10.12.2023.
5.4. On 30.12.2023, the Appellant submitted a revised application for appointment on compassionate grounds (“Appointment Application”) to her home branch. On the same date, she surrendered her membership of the Welfare Society and refunded a sum of ₹42,000/-, representing the pension received by her over a period of fourteen months, as certified by the Welfare Society in its letter dated 20.02.2025.
5.5. Thereafter, the Appellant instituted W.P.(C) 10672/2024 before the learned Single Judge, seeking a direction to the Respondent to consider her for appointment to a suitable post on compassionate grounds as no decision was taken on the Appointment Application. By order dated 02.08.2024, this Court disposed of the said writ petition with a direction to the Respondent to consider the Appointment Application in accordance with the applicable guidelines, scheme or policy governing compassionate appointment and to take a decision thereon within six weeks. It was further directed that if the decision was averse to the Appellant a reasoned order shall be passed.
5.6. In compliance with the order dated 02.08.2024, the Competent Authority of the Respondent considered the Appellant’s case and, by letter dated 10.09.2024 (“Rejection Order”), rejected the Appointment Application. The Rejection Order records that the Appellant’s case was governed by Clause 5.1 of the scheme titled ‘PSB Jeevan Sahara: Comprehensive Scheme For Appointment On Compassionate Grounds And Payment Of Ex-Gratia Amount In Lieu Of Appointment On Compassionate Grounds’, circulated by the Respondent vide Circular No. 722/2022-23 dated 18.11.2022 (“Scheme”). Annexure-A to the Rejection Order (“Annexure-A”) computes the Appellant’s family income, including notional income, at ₹33,422.37 per month, which exceeded both 60% of the deceased employee’s last drawn net salary and the prescribed threshold of ₹20,000/- per month.
5.7. Annexure-A to the Rejection Order further recorded that the Appellant received a sum of ₹18,22,540.19 towards provident fund, gratuity and group insurance. Upon adjustment of the liabilities of the deceased employee, aggregating ₹3,18,072.14, the net corpus was computed at ₹15,04,468.05. The investments available with the Appellant, comprising deposits and policies of the Life Insurance Corporation of India (“LIC”) and aggregating ₹35,570/-, were also taken into account
