Punjab-Haryana High Court
Baij Nath Gupta vs State Of Punjab And Ors on 21 January, 2025
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2. Pe oners are re red employees of Punjab Pollu on Control
Board (PPCB - Board). They had re red prior to 01.01.1996. By way of these
pe ons, they pray for issuance of appropriate writ :
x to quash the le'er memo dated 05.09.2011 (Annexure P-14) and
memo dated 30.11.2012 (Annexure P-15) vide which respondent No.1-
State has declined to grant the pensionary benefits to the re red
employees of PPCB, i.e. pe oners.
x to quash part of no fica on dated 26.12.2006 (Annexure P-7A) to the
extent that same has been enforced prospec vely, instead of being
enforced from 01.01.1996. [relief added by way of amendment in the
pe on]
x to direct the respondents to grant benefits of pension to the
pe oners under Pension Scheme implemented w.e.f. 26.12.2006 in
terms of promise made by PPCB vide its le’er dated 25.07.1997
(Annexure P4).
3.1 According to the pe oners, employees of the Board being
covered by the provisions of Employees Provident Fund and Miscellaneous
Provisions Act, 1952 (hereina er referred as ‘the Act 1952’), were subscribing
a part of their salary towards Employees Provident Fund and Family Pension
Scheme in accordance with the provisions of the Act 1952. An equal amount
being the employers share was paid by the Board and both these amounts
were deposited with the Regional Provident Fund Commissioner, Punjab,
Chandigarh.
3.2 The Board in its mee ng dated 07.02.1995 considered the item
rela ng to implementa on of pension scheme for the employees of the
Board and agreed in principle to grant pension to its employees. Vide le’er
dated 27.03.1995 (Annexure P-2), the Board sent the copies of the proposed
dra8 pension scheme to the Government in the Department of Science
Technology and Environment, Punjab, Chandigarh, conveying the decision of
the Board and desired that before obtaining the sanc on of the Government
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and implementa on of the scheme, it may be examined by the
Administra ve Department, Bureau of Public Enterprise, Finance Department
and Regional Provident Fund Commissioner, Punjab, Chandigarh.
3.3 Under the Act 1952, the Government of India introduced
Employees’ Pension Scheme for all subscribers of EPF w.e.f. 16.11.1995. The
scheme was made admissible to the employees, who were subscribing
towards the EPF. However, para 39 of the Employees’ Pension Scheme, 1995
provided that Government of India could exempt the no fied pension
scheme for such employees, who may opt for a pension scheme, wherein
pensionary benefits were at par or more favourable to the employees.
3.4 In view of the above said Employees’ Pension Scheme, 1995,
which came into existence on 16.11.1995 under the provisions of the EPF Act,
1952, the Board vide its le’er dated 08.02.1996 (Annexure P-3), approached
the Government of India as well as Government of Punjab reques ng for
necessary exemp on under para 39 of the Employees Pension Scheme, 1995,
as pensionary benefits under the Board’s own proposed scheme were more
beneficial than the Employees’ Pension Scheme, 1995. The said request was
repeated vide another le’er dated 22.08.1997 (Annexure P-5).
3.5 A mee ng was held on 11.11.1999 under the Chairmanship of
the Special Secretary, Department of Science Technology and Environment,
Punjab, Chandigarh with the Board Authori es, wherein it was decided vide
(Annexure P-6) to recommend the proposed scheme of the Board to the
Government of Punjab for its implementa on and grant of its permission for
implementa on of the scheme. Dra8 rules were also proposed to be sent to
the Government for its concurrence a8er approval of the Regional Provident
Fund Commissioner.
3.6 Therea8er, the Special Secretary to Government of Punjab,
Department of Science Technology and Environment, vide le’er dated
20.01.2000 (Annexure P-7) directed the Board to send dra8 regula on
rela ng to the Pension Scheme for the employees of the Board in terms of
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sub Sec on 3A of Sec on 12 of the Water (Preven on and Control of
Pollu on) Act, 1974 for obtaining the approval of the Government of Punjab.
In compliance of the said direc on, dra8 regula ons were placed in 107th
mee ng of the Board held on 07.07.2000 and the Board approved the
Pension Scheme under the name and style as “Punjab Pollu on Control
Board Pension Regula ons”. The said regula ons were recommended vide
le’er dated 29.08.2000 (Annexure P-17) to be effec ve from 01.01.1996, i.e.
the date on which recommenda ons of 4th Punjab Pay Commission were
implemented.
3.7 However, the Government approved and no fied the above-said
Scheme vide No fica on dated 26.12.2006 (Annexure P-7A) as “Punjab
Pollu on Control Board Employees Pension/Gratuity and General Provident
Fund Regula ons” under Sub Sec on 3A of Sec on 12 of the Water
(Preven on and Control of Pollu on) Act, 1974 as recommended by the
Board, but made the said Scheme effec ve from 26.12.2006.
4.1 It is contended by the pe oners that by changing the date of
implementa on of the Scheme from 01.01.1996 to be effec ve from
26.12.2006, great hardship and discrimina on has been caused to the
employees, who had re red from the services of the Board during the period
of 01.01.1996 to 26.12.2006. This ac on of the Government in changing the
date of implementa on of the Scheme is against the specific
recommenda ons of the respondent-Board sent vide le’er dated 29.08.2000
and again on 22.09.2006, whereby the Pension Scheme was recommended to
be made effec ve from 01.01.1996.
4.2 The ma’er was taken by the Board with the Government vide its
le’er dated 03.07.2008 (Annexure P-8) to safeguard the interest of the
affected employees by reques ng for retrospec ve approval of the Scheme
w.e.f. 01.01.1996 to cover the employees, who had re red prior to
26.12.2006 under its Pension Scheme so as to save them from the financial
hardship and discrimina on. It was pointed out that only seven employees
had re red between 1.1.1996 & 26.12.2006. The ma’er was again taken up
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by the Board with the Government by reitera ng its stand vide le’er dated
14.01.2010 (Annexure P-9). Affected employees even submi’ed affidavit
(Annexure P-11) to the effect that they will not demand any arrears up to
date of no fica on or pension commuta on and that they are willing to
deposit employers share with interest. Said affidavits were sent vide le’er
dated 9.12.2010 (Annexure P-10) by the board to the government.
4.3 In a mee ng held on 14.01.2011 between the officers of the
Board and that of the Government, it was decided to discuss the financial
posi on of the Board a8er taking into considera on the proposed pensionary
liability of the employees. The Board vide its le’er dated 25.01.2011
(Annexure P-12) clarified to the Government regarding the financial posi on
up to 2025-26 to be sa sfactory and even therea8er also.
4.4 Pe oners made various oral and wri’en representa ons to the
respondent-Board as well to the Government for payment of pension and to
make the Pension Scheme applicable w.e.f. 01.01.1996. It is contended that
in the proposal sent to the Government, it was clearly s pulated that
financial liability of this account shall be met by the Board from its own
sources without there being any burden on the Government. However, the
representa on made by pe oner No.1 on 05.09.2011 was declined by the
respondent No.1 vide impugned order dated 30.11.2012 (Annexure P-15), on
the basis of an earlier le’er dated 05.09.2011, because in the le’er dated
05.09.2011 (Annexure P-14), while replying to the Government memo dated
04.08.2011, the Board had conveyed its inability to bear the liability due to
funds constrains, which was totally in contradic on to the earlier le’er dated
25.01.2011 in respect of the fund posi on of the Board and its readiness to
bear the liability specifically ll 2025-26.
4.5 Pe oners have further referred to Sec on 37 and 38 of the
Water (Preven on and Control of Pollu on) Act, 1974 in order to contend
that State Board has its own funds and it may spend as much amount as it
thinks fit for performing its func ons. It is also contended that Punjab
Pollu on Control Board is flushed with funds and as such the ac on of the
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respondents in declining implementa on of the Scheme w.e.f. 01.01.1996, in
contradic on to the earlier stand, is null and void.
5.1 Respondent No.1 in its reply submi’ed that Punjab Pollu on
Control Board was cons tuted by the State Government in July, 1975 vide
No fica on dated 30.07.1975 as a result of adop on of Water (Preven on
and Control of Pollu on) Act, 1974. The Act 1952 was made applicable to the
employees of the Board from October, 1978, but the pension has been
discon nued w.e.f. 01.01.2004 in view of the Circular dated 02.03.2004. As
the employees of the Board have been represen ng since long to start its
own Pension Scheme, the ma’er was referred to the State Government for
approval of the dra8 scheme sent by the Board and that the Government of
Punjab, Department of Science Technology and Environment, vide its
No fica on dated 26.12.2006 has approved the regula on for grant of
pension to the employees of the Board effec ve from 26.12.2006, i.e. date of
No fica on.
5.2 Respondent No.1 submi’ed further that it has been clearly
men oned in Regula on No.3, Chapter II of the No fica on that these
regula ons shall apply to the employees of the Board, who were/are
appointed on or before 31.12.2003 on regular basis and were working
immediately before the date of issuance of the regula on and opted for
these regula ons.
5.3 The request of the employees, who had re red prior to
26.12.2006 was duly considered and examined by the Board from me to
me and the ma’er was taken up with the Government for covering these
employees in the Pension Scheme. In this regard, the Government of Punjab,
vide memos issued from me to me raised queries, which were replied by
the Board. Finally, the Government of Punjab, Department of Science,
Technology, Environment & Non-conven onal Energy vide its memo dated
8.8.2012 (Annexure R-1/1) sought queries from the Board as to whether the
Board was ready to bear financial liability on account of payment of pension
to the employees re red prior to 26.12.2006. The Board in its reply dated
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24.08.2012 (Annexure R-1/2) to the Government of Punjab in mated that
Board cannot bear the financial liability of the employees, who had re red
from services of Board from 01.01.1996 to 25.12.2006, which was calculated
to be ₹1.25 crores, as had been earlier conveyed to the Government vide
le’er dated 09.08.2011 (Annexure R-1/3). Keeping in view the financial
liability as well as totality of the ma’er, the Government of Punjab vide its
le’er dated 30.11.2012 rejected the representa on of the employees for
extending the benefits of the Pension Scheme.
5.4 It is further the stand of respondent No.1 that as per se’led
legal proposi on, all the rules, regula ons, no fica ons etc. are implemented
prospec vely and not with retrospec ve effect. Since the pe oners had
re red from services of the Board earlier and the Pension Regula ons were
no fied on 26.12.2006, so the Pension Regula ons cannot be implemented
with retrospec ve effect from the date of re rement of pe oner No.1.
Representa ons made by the pe oners to implement the regula ons with
retrospec ve effect have already been rejected.
6. In the separate reply filed by respondent No.2-Board, it has
taken almost the same stand as taken by respondent No.1.
7. It is contended by learned counsel for the pe oners that once
the Board had recommended the implementa on of the Pension Scheme to
be effec ve w.e.f. 01.01.1996 and had had also informed the govt. that its
financial condi on was good, it was not just for the Government to
implement the scheme w.e.f. 26.12.2006. It is argued that by making the
Pension Scheme applicable from 26.12.2006, the Government has
discriminated with the employees, who had re red prior to this date. It is
argued that all the re red employees, whether re red prior to date of
no fica on or therea8er, form a homogeneous class and so, there is no
jus fica on for fixing the cut-off date as 26.12.2006 for implementa on of
the Pension Scheme. It is further contended that the Government has not
provided any valid reasons for fixing the cut-off date to be 26.12.2006 and as
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such, the decision of the Government in implemen ng the scheme w.e.f.
26.12.2006 is not sustainable.
8. Refu ng the aforesaid conten ons, it is argued by learned
counsel for the respondents that there is no discrimina on in fixing a
par cular cut-off date for making the scheme applicable for only those
employees of the board, who were appointed on or before 31st December,
2003 and were working before 26.12.2006 i.e., date of publica on of the
pension regula ons. It is submi’ed that the employees, who had re red
prior to this cut-off date, were availing the benefit of Contributory Provident
Fund Scheme and so, it cons tutes a separate class. A8er availing the benefit
of said Contributory Fund Scheme on the re rement, it is not open to the
pe oners to contend that the Pension Scheme as no fied for the employees
appointed on regular basis up to 31.12.2003 and who were working
immediately before the date of issuance of the regula ons, is discriminatory.
Employees, who no longer were in service immediately before the
implementa on of the regula ons, cannot be treated as a homogeneous
class. It is also contended that it is always open for the employer to extend
the further benefits to the employees prospec vely. It is the policy ma’er, in
which the High Court cannot intervene in its writ jurisdic on.
9. Learned State counsel has relied upon “State of Punjab and
others v. Amar Nath Goyal and others“, Law Finder Doc Id # 84235;
“Himachal Road Transport Corpora#on and another v. Himachal Road
Transport Corpora#on Re#red Employees Union”, Civil Appeal No.7230 of
2012, decided by Hon’ble Supreme Court on 22.02.2021; and “PUDA
Employees Welfare Society (Regd.) v. State of Punjab and others” Law
Finder Doc Id # 2657177.
10. I have considered submissions of both the sides and have
appraised the record carefully.
11. It is not disputed and rather, it is the own case of the pe oners
that employees of the Board were covered by the provisions of the Act 1952
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and they were subscribing a part of their salary towards Employees’
Provident Fund and Family Pension Scheme, in accordance with the
provisions of the said Act. An equal amount being employor’s share was also
being paid by the Board and both these amounts were being deposited with
the Regional Provident Fund Commissioner, Punjab for credi ng the same in
Employees’ Provident Fund Account and the Family Pension Scheme, which
are maintained by the Regional Provident Fund Commissioner, Punjab,
Chandigarh.
12. It is no doubt true that the Board as per its resolu on, had
recommended to the Government to implement the Pension Regula ons to
be effec ve from 01.01.1996, but a8er no cing the financial liability and a8er
seeking necessary queries from the Board in this regard, the Government has
made the said regula ons effec ve from 26.12.2006.
13.1 A similar ques on, i.e. implementa on of the Pension Scheme
from a par cular date, was considered by Hon’ble Supreme Court in
Himachal Road Transport Corpora#on’s case (supra). In that case, the
employees of the Himachal Road Transport Corpora on were governed by
the Contributory Provident Fund Scheme. The Corpora on introduced a
Pension Scheme in the year 1995 by issuing No fica on dated 06.10.1995
and adopted Central Civil Service Pension Rules, 1972. Pension Scheme was
given effect to from 05.06.1995, i.e. from the date the Scheme was approved
by the Cabinet/Government. Union of Re red Employees of the Corpora on
consisted of the employees, who had re red prior to 05.06.1995. They
approached Administra ve Tribunal to challenge the cut-off date for grant of
pension to only those employees, who were in service of the Corpora on as
on 05.06.1995. They claimed that they were en tled for the pension as the
others similarly situated employees between 05.06.1995 to 06.10.1995 and
that ac on of the Corpora on in denying pension to the pe oners be
declared null, illegal and void. They pleaded the fixa on of the cut-off date to
be arbitrary and discriminatory.
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Tribunal dismissed the pe on of the Employees Union, who then
approached Himachal Pradesh High Court. The High Court allowed the writ
pe on by quashing the cut-off date on the ground that no reasons were
forth coming from the Corpora on for picking up the cut-off date, i.e.
05.06.1995 for implementa on of the Scheme. The High Court declared the
Scheme no fied on 06.10.1995 to be made applicable to the Members of the
Employees Union and other similarly situated persons with the condi on that
they will have to deposit the amount received by them under the
Contributory Provident Fund Scheme within a reasonable me. The said
judgment of the Himachal Pradesh High Court was assailed by the
Corpora on before Hon’ble Supreme Court.
13.3 Hon’ble Supreme Court a8er no cing that all the re red
employees of the Union were governed by the Contributory Provident Fund
Scheme, held as under:-
“15. In the case of D.S. Nakara, (1983) 1 SCC 305, this Court had treated
the pension re rees only, as a homogeneous class and all the pensioners
governed by The 1972 Rules, were treated as a class, because payment of
pension was a con nuing obliga on on the part of the State, ll lifelong to
the pensioners, unlike the beneficiaries of the Contributory Provident Fund.
In the said case, it was never held that the pension re rees and the
employees in service, cons tute a homogeneous class. In the case of R.L
Marwaha v. Union of India and others, 1987 (4) SCC 31 , this Court has held
that fixing of a date for grant of benefit, must have nexus with the object
sought to be achieved. There cannot be any dispute on the proposi on.
Further, the case of Union of India and another v. Deoki Nandan Aggarwal,
1992 Supp.(1) SCC 323 relates to fixa on of cut-off date, for grant of
liberalized Pension Scheme. Even in the case of Subrata Sen and others v.
Union of India and others (2001) 8 SCC 71, where a cut-off date was fixed
for the purpose of applicability of revised pension scheme, this Court has
held that all re red employees cons tute one homogeneous class and there
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cannot be pressed into service, to decide the issue which arises on the facts
of this case.
16. Though there are long line of cases, where validity of fixa on of cut-
off date is considered by this Court, we confine and refer to the case law
which is relevant to the facts of the case on hand. In the case of State of
Punjab v. Amar Nath Goyal, (2005) 6 SCC 754, while examining the validity
of cut-off date fixed for grant of benefit of increased quantum of death-cum-
re rement gratuity, this Court has held that the financial constraint pleaded
by the Government, was a valid ground for fixa on of cut-off date and such
fixa on was not arbitrary, irra onal or viola ve of Ar cle 14 of the
Cons tu on. While differen a ng the facts with the case of D.S. Nakara,
this Court held in para 29 of the judgment, which reads as under: –
“29. D.S. Nakara which is the mainstay of the case of the employees arose
under special circumstances, quite different from the present case. It was a
case of revision of pensionary benefits and classifica on of pensioners into
two groups by drawing a cut-off line and gran ng the revised pensionary
benefits to employees re ring on or a8er the cut-off date. The criterion
made applicable was “being in service and re ring subsequent to the
specified date”. This Court held that for being eligible for liberalised
Pension Scheme, applica on of such a criterion is viola ve of Ar cle 14 of
the Cons tu on, as it was both arbitrary and discriminatory in nature. The
reason given by the Court was that the employees who re red prior to a
specified date, and those who re red therea8er formed one class of
pensioners. The a’empt to classify them into separate classes/groups for
the purpose of pensionary benefits was not founded on any intelligible
dirreren a, which had a ra onal nexus with the object sought to be
achieved. However, it must be noted that even in cases of pension,
subsequent judgments of this Court have considerably watered down the
rigid view taken in D.S. Nakara as we shall see later in T.N. Electricity Board
v. R. Veerasamy (“Veerasamy“). In any event, this is not a case of a
con nuing benefit like pension; it is a one- me benefit like gratuity.”
17. In the case of Govt. of Andhra Pradesh & others v. N. Subbarayudu &
others (2008) 14 SCC 702, by no cing that a rigid view was taken in the case
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of D.S. Nakara, this Court has considerably watered down the same and has
held that fixing the cut-off date is an execu ve func on based on several
factors like economic condi ons, financial constraints, administra ve and
other circumstances. This Court further held that even if no reason is
forthcoming from execu ve, for fixa on of a par cular date, it should not be
interfered by Court, unless cut-off date leads to some blatantly capricious or
outrageous result.
18. In the case of Suchet Singh Yadav and others v. Union of India and
others (2019) 11 SCC 520, of which one of us is a party, (Hon’ble Ashok
Bhushan, J.), while examining the claim of commissioned officers of defence
forces, i.e., Army, Air force and Navy, who re red prior to 01.01.1996, for
grant of next higher pay scale, on the strength of Order of Government of
India dated 21.11.1997, which was issued in consequence of
implementa on of Fi8h Pay Commission Report, this Court has not accepted
the plea of discrimina on. In the said judgment, it is held that pensioners,
for purposes of pension, cons tute one class and schemes which classify
pensioners on basis of cut-off date are impermissible unless such
classifica on is founded on some ra onal principle. On the facts of the case,
in the aforesaid judgment, it is held that the Order which was issued by the
Government of India on 21.11.1997, is applicable only to exis ng officers
and not re rees. Further in the case of All Manipur Pensioners Associa#on
by its Secretary v. The State of Manipur and others, (2019) 9 Scale 282, of
which, one of us is a party, (Hon’ble M.R.Shah, J.), when validity of Office
Memorandum dated 21.04.1999, issued for revising the quantum of pension
by fixing the cut-off date on 01.01.1996 is ques oned, this Court has held
that all pensioners form only one homogeneous class and held that such a
fixa on of date for extending the benefits of revised benefits to the
pensioners, is arbitrary and violates Ar cle 14 of the Cons tu on.
19. Coming back to the facts of the case on hand, by applying the case
law which is referred above, it is clear that all the members of the
respondent-Union, while in service, were governed by Contributory
Provident Fund Scheme. All those employees who re red before
05.06.1995, were paid all re ral benefits, applicable to them. As the Pension
Scheme was not in existence during the relevant me, it was not the case of
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viola on of any service condi ons either. The Pension Scheme is introduced
by way of no fica on dated 06.10.1995, by giving effect from 05.06.1995,
on which date the Cabinet has approved the Scheme. The employees who
were governed by the Contributory Provident Fund Scheme and re red prior
to 05.06.1995 and the employees who were in service and con nued a8er
05.06.1995, of the appellant- Corpora on, cannot be treated as a
homogeneous class. The re red employees, who were governed by the
Contributory Provident Fund Scheme, on their re rement had already
received the benefits of such Scheme, cons tute different class than those
employees who were in service as on 05.06.1995. There is a valid reason for
giving effect to the Pension Scheme from 05.06.1995, though the
no fica on was issued on 06.10.1995. The cut-off date, i.e., 05.06.1995 is
fixed on the ground that the Cabinet has approved the Scheme from such
date. As already no ced above, it is always open for the employer to
introduce new Schemes and benefits, having regard to financial health of
the employer. Whenever such new benefit is extended for the exis ng
employees, re red employees cannot seek such benefit, merely on the
ground that they too were the former employees of the Corpora on. In
spite of specific plea of the appellant-Corpora on that the benefit of the
Scheme was extended from 05.06.1995, in view of approval granted by the
Cabinet to the Scheme, the High Court has erroneously recorded a finding
that no reason has been assigned to choose such cut-off date. It is true that
all pensioners cons tute one class and whenever, revision is effected,
ordinarily such benefit is to be extended to all the pensioners but at the
same me, the scenario in the case on hand, is totally different. On the facts
of this case, it is to be no ced that when the members of the respondent-
Union re red, there was no Pension Scheme at all. They were merely
governed by the Contributory Provident Fund Scheme and, on re rement,
they were already granted the benefit of such Scheme. In that view of the
ma’er, only on the spacious plea that all the employees of the Corpora on
cons tute homogeneous class, cannot ques on the cut-off date fixed for
grant of Pension Scheme.
20. It is profitable to refer a judgment of this Court, in the case of State of
Rajasthan and Another v. Amrit Lal Gandhi and others (1997) 2 SCC 342.
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The ra o decided in the said case is iden cal to the issue on hand in the
present case. In the aforesaid case, pursuant to recommenda ons made in
the year 1986, by a commi’ee appointed by University Grants Commission,
the Syndicate and Senate of the University has recommended for
introducing a Pension Scheme for the employees of the University. The State
Government’s approval was sought, which was given for introducing the
Scheme with effect from 01.01.1990. When such fixa on of cut-off date
from 01.01.90 was found fault with by the High Court and the High Court
issued direc ons to give effect from 01.01.1986, while reversing the
judgment of the High Court, this Court has held that fixa on of cut-off date
from 01.01.1990 cannot be said to be arbitrary or discriminatory. Relevant
paragraph Nos. 16 and 17 of the judgment, read as under:
“16. Applying the ra o of the aforesaid decisions to the present case, we
find no jus fica on for the High Court having subs tuted the date of 1-1-
1986 in lieu of 1-1-1990. It is evident that for introducing a pension scheme,
which envisaged financial implica ons, approval of the Rajasthan
Government was required. In the le’er of 16-4-1991, wri’en to the Vice-
Chancellors of different universi es of Rajasthan, it was stated as follows:
“As per the direc on in regard to the aforesaid subject, the State
Government has decided to introduce Pension Scheme in the
Universi es of the State w.e.f. 1-1-1990. In this regard the State
Legislature has passed University Pension Rules and General
Provident Fund Rules. Therefore, by enclosing a copy of University
Pension Regula ons and General Provident Fund Regula ons with
this le’er, it is requested that by obtaining approval of the
competent body or Syndicate of the University, these Regula ons
be implemented in the University together and necessary
informa on regarding implementa on be in mated.”
17. The Syndicate and Senate of the University, when they had forwarded
their recommenda ons in 1986, did not contain a specific date with effect
from which the pension scheme was to be made applicable. Their
recommenda ons were subject to approval. The approval was granted by
the Government, a8er the State Legislature had passed the University
Pension Rules and General Provident Fund Rules. The Government had
stated in its affidavit before the High Court that the jus fica on of the cut-
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off date of 1-1-1990 was “wholly economic”. It cannot be said that the
paying capacity is not a relevant or valid considera on while fixing the cut-
off date. The University could, in 1991, validly frame Pension Regula ons to
be made applicable prospec vely. It, however, chose to give them limited
retrospec vely so as to cover a larger number of employees by taking into
account the financial impact of giving retrospec ve opera on to the
Pension Regula ons. It was decided that employees re ring on or a8er 1-1-
1990 would be able to exercise the op on of gePng either pension or
provident fund. Financial impact of making the Regula ons retrospec ve
can be the sole considera on while fixing a cut-off date. In our opinion, it
cannot be said that this cut-off date was fixed arbitrarily or without any
reason. The High Court was clearly in error in allowing the writ pe ons
and subs tu ng the date of 1-1-1986 for 1-1-1990.”
21. The High Court, without no cing the difference of factual background, in
the cases relied on by the respondent-writ pe oner and without
independently considering the issue in ques on, has allowed the writ
pe on. In view of the same, we are of the view that judgment of the High
Court deserves to be set aside.”
14. Similar issue was also considered by Hon’ble Supreme Court in
Amar Nath Goyal‘s case (supra) and it was observed as under:-
“26. It is difficult to accede to the argument on behalf of the employees
that a decision of the Central Government/State Government to limit the
benefits only to employees, who re re or die on or a8er 1.4.1995, a8er
calcula ng the financial implica ons thereon, was either irra onal or
arbitrary. Financial and economic implica ons are very relevant and
germane for any policy decision touching the administra on of the
Government, at the Centre or at the State level.
XXX XXX XXX XXX
32. The importance of considering financial implica ons, while providing
benefits for employees, has been noted by this Court in numerous
judgments including in the following two cases. In State of Rajasthan and
another v. Amritlal Gandhi and others, 1997(1) SCT 699 (SC) : AIR 1997
Supreme Court 782 this Court went so as far as to note that:
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“… Financial impact of making the Regula ons retrospec ve can be
the sole considera on while fixing a cut-off date. In our opinion, it
cannot be said that this cut-off date was fixed arbitrarily or without
any reason. The High Court was clearly in error in allowing the writ
pe ons and subs tu ng the date of 1.1.1986 for 1.1.1990.” [Ibid at
p. 78 (para 17)] (emphasis supplied).
33. More recently, in Veerasamy (supra), this Court observed that,
financial constraints could be a valid ground for introducing a cut-off date
while implemen ng a pension scheme on a revised basis. 1999(3) SCC 414 at
p. 421 (para 15)]. In that case, the pension scheme applied differently to
persons who had re red from service before 1.7.1986, and those who were
in employment on the said date. It was held that they could not be treated
alike as they did not belong to one class and they formed separate classes.
34. In State of Punjab and others v. Boota Singh and another, 2000(3)
SCC 733, (“Boota Singh”) a8er considering several judgments of this Court in
D.S. Nakara (supra) to K.L. Rathee v. Union of India, 1997(3) SCT 478 (SC) :
1997(6) SCC 7, it was held that D.S. Nakara (supra) should not be interpreted
to mean that the emoluments of persons who re red a8er a no fied date
holding the same status, must be treated to be the same. [2000(3) SCC 733
at p. 735 (para 8)].
35. In State of Punjab and another v. J.L. Gupta and others, 2000(2) SCT
8 (SC) : 2000(3) SCC 736, where one of us was on the Bench (Sabharwal, J.),
the views expressed in Boota Singh (supra) were reiterated, and it was held
that for the grant of addi onal benefit which had financial implica ons, the
prescrip on of a specific future date for conferment of addi onal benefit,
could not be considered arbitrary. [Ibid at p. 737 (para 4)].
36. In Ramrao and others v. All India Backward Class Bank Employees
Welfare Associa#on and others, 2004(1) SCT 775 (SC) : 2004(2) SCC 76, a
Division Bench of this Court said, even for the purpose of effec ng
promo on, the fixing of a cut-off date was neither arbitrary, unreasonable
nor did it offend Ar cle 14 of the Cons tu on. Moreover, the Court held
that possible hardship to be endured by a person as a result did not make
cut-off dates viola ve of Ar cle 14. [Ibid at p. 88 (para 33)].
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37. In the instant case before us, the cut-off date has been fixed as 1.4.1995
on a very valid ground, namely, that of financial constraints. Consequently,
we reject the conten on that the fixing of the cut-off date was arbitrary,
irra onal or had no ra onal basis or that it offends Ar cle 14.”
15. A similar issue has also been considered by a co-ordinate Bench
of this Court in PUDA Employees Welfare Society’s case (supra). In that case,
the employees of the Punjab Urban Planning and Development Authority (in
short ‘PUDA’) had sought to quash the order of the Government, whereby
proposal to implement a Pension Scheme as approved by the Competent
Authority was rejected by the Government. A8er referring to “The State of
UDar Pradesh v. Associa#on of Re#red Supreme Court and High Court
Judges at Allahabad”, 2024 AIR (SC) 475; “Union of India and others v. M.
Selvakumar” 2017(3) SCC 504; and “State of Orissa v. Orissa Khadi and
Village Industries Board Karamchari Sangh“, 2023(4) Scale 332, it was held
by this Court as under:-
“39. It is well se’led law that the scope of judicial review in examining the
policy ma’ers is very limited. The Courts do not and cannot examine the
correctness, suitability or appropriateness of a policy, nor are the Courts
advisers to the execu ve on the ma’ers of policy, which the execu ve is
en tled to formulate. Judicial review of a policy decision and to issue
mandamus to frame policy in a par cular manner are absolutely different. It
is within the realm of the execu ve to take a policy decision based on the
prevailing circumstances for be’er administra on and it is not within the
domain of the Courts to legislate. The Courts do interpret the laws and in
such an interpreta on, certain crea ve process is involved. The Courts have
the jurisdic on to declare the law as uncons tu onal. That too, where it is
called for. The Court is called upon to consider the validity of a policy
decision only when a challenge is made that such policy decision infringes
fundamental rights guaranteed by the Cons tu on or any other statutory
right. Any proposal for implementa on of pension policy is subject to the
approval of the Government of Punjab, which was never granted by the
Government in the present case in view of poor financial posi on of the
Authority.
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40. Similar issue has already been decided by this Court in CWP No.8501 of
2015 and other connected cases, #tled as “Punjab Water Supply and
Sewerage Board’s Employees Union vs State of Punjab and others”,
wherein the employees of Punjab Water Supply and Sewerage Board were
claiming similar relief and the same has been dismissed vide judgment dated
02.07.2024.”
16. It is thus clear from the above legal posi on that fixing the cut-
off date is an execu ve func on based on several factors like economic
condi ons, financial constraints, administra ve and other circumstances.
Even if no reason is forthcoming from execu ve, for fixa on of a par cular
date, it should not be interfered by Court, unless cut-off date leads to some
blatantly capricious or outrageous result. Financial impact of making the
Regula ons retrospec ve can be the sole considera on while fixing a cut-off
date.
17. The above legal posi on is squarely applicable to the facts of the
present case. In this case also, the pe oners were earlier governed by the
Act, 1952, i.e. the benefits of the Contributory Provident Fund. All the
employees like pe oners, who re red before 26.12.2006, were paid all
re ral benefits, applicable to them. As the Pension Scheme was not in
existence during that me, it cannot be the case of viola on of any service
condi ons either. The Pension Scheme is introduced by way of no fica on
dated 26.12.2006, by giving effect from this date, when the Cabinet has
approved the Scheme. The employees who were governed by the
Contributory Provident Fund Scheme and re red prior to 26.12.2006 and the
employees who were in service and con nued a8er this date, cannot be
treated as a homogeneous class. As already no ced above, it is always open
for the employer to introduce new Schemes and benefits, having regard to
financial condi on of the employer. Whenever such new benefit is extended
for the exis ng employees, re red employees cannot seek such benefit,
merely on the ground that they too were the former employees of the
Corpora on.
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18. The Government has fixed a specific cut-off date for
implementa on of the Pension Regula on. The said cut-off date has been
fixed a8er the Pollu on Control Board expressed its inability to bear the
financial burden regarding the pension payable to the pe oners as per the
representa ons made by them. The Policy decision is in the hands of the
Government and the High Court should not interfere in said Policy decision
by way of judicial review or by issuing any writ in this regard. The ac on of
the respondents cannot be held to be discriminatory in this regard.
19. On account of the en re discussion as above, this Court holds
that there is no merit in any of these pe ons. As such, both these pe ons
are hereby dismissed.
Photocopy of this order be placed on the connected case file.
January 21, 2025 (DEEPAK GUPTA)
Sarita JUDGE
Whether speaking/reasoned? Yes
Whether reportable? Yes
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