Note:
1. Please read this carefully and realise the illegality of having Rank Pay only for those who were in the rank of Captain as on 1.1.1986 but not for those who were promoted/joined in the rank of Captain (like AMC officers) after 1.1.1986.
2. This Order of the Hon'ble Supreme Court is of year 2008 (Repeat) 2008. Therefore, as on 4.9.2012 this order must have been implemented. Therefore MoD cannot, though it has, create two categories of officers vide MoD No. 34 (6) 2012 - D (Pay/Services) dated 27.12. 2012 i.e. those who will receive Rank Pay because they were Captains or above as on 1.1.1986 and those who will NOT receive Rank Pay because they were promoted or joined after 1.1.1986 on the authority of the Govt of India/Ministry of Defence delegated to the Services HQ.
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Union
of India and another v. SPS Vains (Retd.)
(Altamas Kabir and Markandey Katju, JJ.)
Union of India and another ------------- Appellant(s)
vs
SPS Vains (Retd.) and others -----------
Respondent(s)
Civil Appeal No. 5566 of 2008, decided on September
9, 2008
[Special Leave Petition (Civil) No. 12357 of 2006]
The judgment of the Court was delivered by Altamas
Kabir, J.
1. Leave granted.
2. Interlocutory
Application No.2 of 2006 filed by Major General S.C. Suri (Retd.) and 67 others
similarly placed as the respondents is allowed.
3. Only a very limited issue falls for our consideration in this appeal
which has been filed by the Union of India through the Secretary, Ministry of
Defence and the Chief of Army Staff through the Adjutant General Army Headquarters,
New Delhi, against the judgment and order of the Punjab and Haryana High Court
allowing the writ petition filed by the respondents herein with the following
directions: - "For the foregoing reasons, the writ petition is allowed and
the respondents are directed to fix minimum pay scale of the Major General
above that of the Brigadier and grant pay above that of a Brigadier as has been
done in the case of post 1.1.1996 retirees and consequently fix the pension and
family pension accordingly. There shall be no order as to costs."
4. As would be evident
from the above, the primary question which falls for decision in this appeal is
whether the High Court had in the exercise of its jurisdiction correctly
directed that officers of the rank of Major General, who had retired prior to
1st January, 1996, when revision of pay scales took effect, be given the
benefit of the provisions of the revised pay scale, notwithstanding the fact
that in terms of the policy only those who retired after the said cut-off date
would be entitled to such benefit. The larger issue involved is whether there
could be a disparity in payment of pension to officers of the same rank, who
had retired prior to the introduction of the revised pay scales, with those who
retired thereafter.
5. The case which has been
made out in the High Court in the writ petition filed by the respondent herein
is that prior to revision of the pay scales from 1.1.1996 the running pay band
from Lieutenant to Brigadier, irrespective of promotion, introduced on the
basis of the Fourth Pay Commission's recommendations, was Rs.2300-100-3900-EB-
150-4500-EB- 5100. The rank pay that was fixed was Rs.200/-, 600/-, 800/-,
1000/- and 1200/- for the ranks of Captain, Major, Lieutenant Colonel, Colonel
and Brigadier, respectively. While a Major General was given a starting salary
of Rs.6700/- on the basis of the recommendations of the Fourth Pay Commission,
a Brigadier could draw Rs.5,100/- and additional rank pay of Rs.1200/- making a
total of Rs.6300/-. Consequently, a Major General always drew higher pay than a
Brigadier and the pension payable to officers on the basis of the
recommendations of the Fourth Pay Commission was calculated on the basis of
salary drawn during the last 10 months prior to retirement. Even on such basis,
a Major General always drew more pension and family pension than a Brigadier.
It has to be kept in mind that the rank of Brigadier is a feeder post for the
promotional rank of Major General.
6. The anomaly arose with
the acceptance by the Government of the recommendations of the Fifth Pay
Commission which has created a situation whereby Brigadiers began drawing more
pay than Major Generals and were, therefore, receiving higher pension and
family pension than Major Generals. In view of the recommendations of the Fifth
Pay Commission, a Brigadier was given a pay scale of Rs.15350-450-17600
together with rank pay of Rs.2,400/- whereas a Major General was given a pay
scale of Rs.18400- 500-22400. In other words, the maximum pay in the pay scale
of Brigadier is 17,600/- and the minimum pay in the pay scale of Major General
is Rs.18,400/-. Inasmuch as, no rank pay was provided for beyond the rank of
Brigadier, the minimum pay provided for a Major General became less than that
of a Brigadier who may had reached the maximum point in his scale.
Consequently, on retirement, the pension of a Brigadier became more than that
of a Major General, since rank pay is also taken into consideration for the
purpose of calculating pension and family pension. The pension of a Major
General thus became Rs.9,200/-, while that of a Brigadier was Rs.9,550/-.
7. It is this anomaly,
when pointed out, which prompted the Government to step up the pension of Major
Generals who had retired prior to 1.1.1996, from Rs.9,200/- to Rs.9,550/-
giving them the same pension as was given to Brigadiers. Before the High Court
it was urged on behalf of the writ petitioners, who at the time of their
retirement had held the rank of Major General or Air Vice Marshal, that while the writ petitioners and others
similarly placed officers who had retired prior to 1.1.1996 were given the same
pension as that of a Brigadier, those officers of similar rank who had retired
after 1.1.1996 were given pension according to clause 12(c) of Special Army
Instructions 2/S/1998, as a result whereof they were getting much higher
pension and family pension than the writ petitioners, despite being of the same
rank.
It was pointed out that by
virtue of the aforesaid Special Instruction the initial pay of an officer
promoted to the rank of Major General would be fixed at the stage next above
the pay notionally arrived at by increasing his pay, including rank pay of
Brigadier, by one increment in the revised scale at the relevant stage. It is this classification within a class
which led to the filing of the writ petition before the High Court. Before the
High Court it was urged further that such differentiation between officers
holding the same rank on the date of retirement was wholly erroneous and
violative of the provisions of Article 14 of the Constitution.
8. Rejecting the submissions made on behalf of Government that there could
be no fresh fixation of pay once an officer had retired and the only re-fixation
possible would be that of pension, the High Court allowed the writ petition and
disposed of the same with the directions indicated hereinabove.
9. The said decision of
the High Court has been questioned in this appeal by the Union of India and the
Chief of Army Staff.
10. Before us, the Union
of India has taken a stand that the High Court misinterpreted the policy
relating to fixation of pay of officers of the Defence Services and had also
misunderstood the scope of the policy with regard to those officers who had
retired prior to the revision of the pay scales and that their pay scales had
already been revised at the time of their superannuation from service. In their
case, therefore, the question of revision of pay scale could not arise and they
could only claim that their pension, including family pension, should not be
lower than that of a Brigadier which is a feeder post for the post of Major
General having higher and more onerous responsibilities.
11. In this regard reference was made to a communication dated 7.6.1999
addressed to the Chiefs of the three wings of the Defence Services on behalf of
the Ministry of Defence, Government of India, in which a differentiation
appears to have been made between officers who had retired prior to 1.1.1996
and those who retired thereafter since a reference was made to two of the Ministry's letters
dated 3.2.1998 dealing with post 1.1.1996 and the other dated 24.11.1997 dealing
with pre 1.1.1996 cases.
12. Reference was also made to Special Army Instruction dated 19.12.1997
indicating that in pursuance of the recommendations of the Fifth Central Pay
Commission and the Government decision thereupon, the existing pay scales admissible
to Army Officers would be revised with effect from January, 1996. The said
Instruction also indicated that the said provisions would apply to all officers
who were on the effective strength of the Army as on 1.1.1996 and those who
joined thereafter, and also to trainee officers who were undergoing Pre-Commission
training on 1.1.1996 and trainee officers who joined after the said date.
Reference was also made from the said Instruction to paragraph 9 thereof
dealing with the stepping up of pay of Major Generals on promotion from the
rank of Brigadier prior to 1.1.1996. In the said paragraph it has been
specifically indicated that pay of all officers promoted to the rank of Major
General prior to 1.1.1996 would be stepped up to become equal to the pay fixed
for Brigadiers in the revised pay scale as on 1.1.1996, subject to certain
conditions.
13. Yet another communication to the three Chiefs of the Defence Services
dated 3.2.1998 issued by the Ministry of Defence, Government of India relating
to the implementation of the Government's decision on the recommendations of the
Fifth Central Pay Commission regarding pensionary benefits for officers and
personnel below officers rank belonging to the armed forces, retiring on or after 1.1.1996, which would,
however, have no application to those who had superannuated prior to 1.1.1996.
14. Learned Additional Solicitor General submitted that the Ministry of
Defence, Government of India, had taken a considered decision in fixing
1.1.1996 as a cut-off date since the pay scales were revised with effect from
the said date, and the pay scales of officers who had retired prior to the said
date had already been fixed and there was no question of re-fixation of their
pay scales and all they were entitled to was pension which was not less
than that received by Brigadiers who had been given the benefit of the revision
of pay scales and, were, therefore, drawing a higher salary resulting in higher
pension.
15. The learned Additional
Solicitor General urged that the High Court had erred in directing that the pay
of Major Generals who had retired prior to 1.1.1996 be re-fixed according to
the revised pay scales so as to give them the benefit of higher pension than
officers of the rank of Brigadier.
16. The case of the respondents however, was that in view of the
Constitution Bench decision of this Court in D.S. Nakara and others vs. Union
of India (1983) 1 SCC 305, the fixation of a cut-off date as a result of which
equals were treated as unequals, was wholly arbitrary and had been rightly
interfered with by the High Court. One of the questions posed in the aforesaid
decision was whether a class of pensioners could be divided for the purpose of
entitlement and payment of pension into those who retired by a certain date and
those who retired thereafter. The question was answered by the
Constitution Bench holding that such division being both arbitrary and
unprincipled the classification did not stand the test of Article 14.
17. Several other
decisions were also relied upon by the respondents, which, in fact, followed
D.S. Nakara's case (supra) and there is, therefore, no need to deal with them
separately.
18. It was also the respondents' case that though there was no dispute
that Major Generals were entitled to higher pensionary benefits than that
enjoyed by Brigadiers, the appellant
erroneously insisted that the cut-off date had to be fixed in view of the
limited financial resources available to cover the additional expenses to be
incurred on account of revision of pay scales.
19. On behalf of the respondents reliance was also placed on two letters
addressed by the Chairman, Chief of Staff Committee, dated 8.2.2006 and 21.2.2006,
along with the recommendation made by the Air Chief Marshal on 17.2.2006, stating
that it was necessary to correct the injustice and discrimination which had
been aimed at denying those officers who had retired prior to 1.1.1996, the
benefits of the pension enjoyed by officers who retired after the said date.
20. Mr. Nidhesh Gupta,
learned Senior Counsel who appeared for the respondents, submitted that the judgment of the High Court did not call
for any interference as the same had been rendered on the touchstone of Article
14 of the Constitution and in consonance with the principle of administrative
fair play. He submitted that officers of the rank of Major General, who had
retired prior to 1.1.1996 should not be
made the target of the bureaucratic error committed by the Government in
refixing the scale of pay of Brigadiers after 1.1.1996 in such a manner so
that by adding the rank pay to their basic pay, their pay at the time of
retirement was higher than that of a Major General which was a superior rank, thereby
creating an anomaly in the pension entitlement of officers of the two aforesaid
ranks.
21. Mr. P.N. Lekhi, learned senior counsel who appeared for the added
respondents, while adopting Mr. Gupta's submissions referred to the decision of this Court in R.Viswan and others vs. Union
of India and others, (1983) 3 SCC 401, on the question of morale and submitted
that the arbitrary decision to discriminate between the two sets of officers belonging
to the same rank in the matter of payment of pension was bound to adversely affect
the morale of senior officers of the rank of Major General which was in
fact the feeder post to the rank of Lieutenant General from amongst whom the
Chief of Army Staff is ultimately chosen.
22. From the submissions made the dispute appears to be confined only to
the question whether officers of the rank of Major General in the army and
of equivalent rank in the two other wings of the Defence forces, who had
retired prior to 1.1.1996, have been
validly excluded from the benefit of the revision of pay scales in keeping with
the recommendations of the Fifth Central Pay Commission by virtue of Special
Army Instruction 2(S) 98.
23. On behalf of the
appellant, Union of India, it has been sought to be contended that since the pay
scale of those officers who had retired prior to 1.1.96 had already been fixed
at the time of their retirement, the question of re-fixation of their pay
scales on account of the revision could not be accepted as they would only be
entitled to the benefits of higher pension on account of such revision. The
learned Additional Solicitor General, Mr. Vikas Singh, had contended that since
an anomaly had been created in the pension payable to officers of the rank of
Major Generals, who on account of the revision of pay scales were receiving
less pension than Brigadiers who were lower in rank, the Government had stepped
up the pension of Major Generals who had retired prior to 1.1.1996, so that
they did not receive pension less than what was given to officers of the rank
of Brigadier.
24. The said decision of the Central Government does not address the
problem of a disparity having created within the same class so that two
officers both retiring as Major Generals, one prior to 1.1.1996 and the
other after 1.1.1996, would get two
different amounts of pension. While the officers who retired prior to
1.1.1996 would now get the same pension as payable to a Brigadier on account of
the stepping up of pension in keeping with the Fundamental Rules, the other set
of Major Generals who retired after 1.1.1996 will get a higher amount of
pension since they would be entitled to the benefit of the revision of pay
scales after 1.1.1996.
25. In our view, it would be arbitrary to allow such a situation to
continue since the same also offends the provisions of Article 14 of the
Constitution.
26. The question regarding creation of different classes within the same
cadre on the basis of the doctrine of intelligible differentia having nexus
with the object to be achieved, has fallen for consideration at various
intervals for the High Courts as well as this Court, over the years. The said
question was taken up by a Constitution Bench in the case of D.S. Nakara
(supra) where in no uncertain terms throughout the judgment it has been repeatedly
observed that the date of retirement of an employee cannot form a valid
criterion for classification, for if that is the criterion those who retired by
the end of the month will form a class by themselves.
In the context of that case, which is similar to that
of the instant case, it was held that Article 14 of the Constitution had been
wholly violated, inasmuch as, the Pension Rules being statutory in character,
the amended Rules, specifying a cut off date resulted in differential and
discriminatory treatment of equals in the matter of commutation of pension. It
was further observed that it would have a traumatic effect on those who retired
just before that date. The division which classified pensioners into two
classes was held to be artificial and arbitrary and not based on any rational
principle and whatever principle, if there was any, had not only no nexus to
the objects sought to be achieved by amending the Pension Rules, but was
counter productive and ran counter to the very object of the pension scheme. It
was ultimately held that the classification did not satisfy the test of Article
14 of the Constitution.
27. The Constitution Bench
has discussed in detail the objects of granting pension and we need not,
therefore, dilate any further on the said subject, but the decision in the
aforesaid case has been consistently referred to in various subsequent judgments
of this Court, to which we need not refer.
28. In fact, all the
relevant judgments delivered on the subject prior to the decision of the
Constitution Bench have been considered and dealt with in detail in the
aforesaid case.
29. The directions
ultimately given by the Constitution Bench in the said case in order to resolve
the dispute which had arisen, is of relevance to resolve the dispute in this
case also.
30. However, before we
give such directions we must also observe that the submissions advanced on behalf of the Union of India cannot be accepted
in view of the decision in D.S. Nakara's case (supra). The object sought to be achieved was not to create a class within a
class, but to ensure that the benefits of pension were made available to all persons
of the same class equally. To hold otherwise would cause violence to the
provisions of Article 14 of the Constitution. It could not also have been the
intention of the authorities to equate the pension payable to officers of two different
ranks by resorting to the step up principle envisaged in the Fundamental Rules
in a manner where the other officers belonging to the same cadre would be receiving
a higher pension.
31. We, accordingly, dismiss the appeal and modify the order of the High
Court by directing that the pay of all pensioners in the rank of Major General
and its equivalent rank in the two other Wings of the Defence Services be notionally
fixed at the rate given to similar officers of the same rank after the revision
of pay scales with effect from 1.1.1996, and, thereafter, to compute their pensionary benefits on such basis with
prospective effect from the date of filing of the writ petition and to pay them
the difference within three months from date with interest at 10% per annum.
The respondents will not be entitled to payment on account of increased pension
from prior to the date of filing of the writ petition.
32. The appeal is accordingly dismissed.
33. There will be no order
as to costs.
Altamas
Kabir JJ
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