Differential treatment in pension benefits based on classification is unconstitutional if it lacks a reasonable basis, violating the equality clause under Article 14 of the Constitution.

JUDGMENT

A.K. Jayasankaran Nambiar, J.

As both these Writ Appeals involve a common issue, they are taken up together for consideration and disposed by this common judgment.

2. The appellants in the above Writ Appeal are retired employees of the Kerala State Road Transport Corporation [KSRTC]. They are aggrieved by the alleged discrimination meted out to them in the matter of enhancement of Dearness Relief on their pensionary entitlements. Apparently, the State Government follows the practice of declaring Dearness Allowance/Dearness Relief [DA/DR] to its employees and pensioners immediately on the Central Government declaring DA/DR for its employees and pensioners. In 2017 also, a similar exercise was undertaken through G.O.(P).No.6/2017/Fin. dated 19.1.2017 by enhancing the rate of DA/DR payable to employees/pensioners from 9% to 12% with effect from 1.7.2016. The State Government employees and pensioners accordingly received enhanced DA and DR at the rates of 105% with effect from 1.7.2016, 109% with effect from 1.1.2017 and 112% with effect from 1.7.2017. As regards the employees and pensioners of KSRTC, the Government orders enhancing the rates of DA and DR do not automatically apply but have to be specifically made applicable through Government orders issued from time to time. The usual practice is that on a Government order being issued, there would be a consequential order passed by the KSRTC extending the benefit of the G.O. to its employees and pensioners.

3. In terms of Ext.P1 G.O. and Ext.P2 order of the KSRTC, the enhancement of DA for employees of KSRTC followed the same pattern as the State Government employees, and accordingly, they were paid the enhanced DA @ 112% with effect from March, 2021. For the pensioners of KSRTC, however, the enhanced DR was paid only @ 109% with effect from March, 2021. The appellants herein therefore challenged the said G.O. and the orders of the KSRTC in the writ petitions inter alia contending that in offering differential rates of enhancement of DA/DR to the employees and pensioners of the KSRTC, the pensioners had been adversely discriminated against in the matter of sanctioning of DR. The learned Single Judge, who considered the writ petitions, dismissed the same on the finding that the employees and pensioners did not form a homogeneous group for the disbursement of DA/DR, and hence, in view of the fact that they formed different categories, they could not allege discrimination. The learned Judge also found that the appellants were not equal to the serving employees, since, by the living standards, a retired employee had to spend less when compared to the serving employee.

4. We have heard Sri.P.K. Suresh Kumar, the learned senior counsel, duly assisted by Sri.T.P. Pradeep, the learned counsel for the appellants, Sri.Deepu Thankan, the learned Standing Counsel for the respondent KSRTC as also Sri.Bijoy Chandran, the learned Government Pleader for the official respondents of the State.

5. Before us, it is the contention of the learned senior counsel on behalf of the appellants that while it may be true that the KSRTC was not obliged to extend the benefit of enhanced DA/DR to its employees and pensioners based on the Government Orders issued in respect of the State Government employees and pensioners, once it was decided to implement the said Government Orders even in the KSRTC, there could not have been a discrimination meted out to pensioners. It is his further contention that a discrimination would be manifest when the object of the benefit extended otherwise applies equally to both categories of persons namely employees and pensioners. The contention, in other words, is that DA/DR being an allowance to remedy the malaise of inflation, had to be seen as affecting both categories of persons namely, employees and pensioners, equally, and when so viewed, restricting a portion of the benefit to pensioners alone would fly in the face of Article 14 of the Constitution of India. He places r