The Entitlement Rules 2023 (ER 2023)

 

Disclaimers: It was embarrassing to watch the Chief of Defence Staff (accompanied by the 3 Services Chiefs) expound on the above subject. In stark contrast, the Secretary, Department of Ex-Servicemen Welfare (DESW) whose department is the (surrogate?) author the ER 2023 was missing from the table. Please see the video at Link (https://www.youtube.com/watch?v=Sl5ixAFyGCY ).   

The information provided in this article does not, and is not intended to, constitute legal advice or criticism but to point out a few aspects as perceived by this author. All information, content, and materials available in this article are for general informational purposes only.  Links to all other websites are only for the convenience of the readers who may wish to fact check the statement. Readers of this article should contact qualified legal persons to obtain advice with respect to any particular legal matter/litigation.

Introduction

Pension issues of Defence Forces have had a chequered history in recent times. From blaming Govt approved One Rank One Pension (OROP) scheme for the increasing burden on the Defence budget to

(a) Defence Accounts Department (DAD) getting issued in one working day the impugned CBDT Circular 13 of 2019 for levying income tax for those who superannuated with disability benefits (F No. 25(06)/2015/FIN/PEN obtained through RTI refers). The matter is under challenge in the honourable Supreme Court in Writ Petition (Civil) No. 963 of 2019.

(b) Then DAD’s left hand launching the SPARSH in 2021 at a few hundred crores of Rupees at tax payers’ expense to replace Ashraya and Suvigya (link: https://cgda.nic.in/index.php?page=aashryaN) which were made at considerable expense to the Govt of India while DAD’s right hand, the CGDA was simultaneously showering praise on the latter.

(c) Now, after the announcement of Entitlement Rules 2023, litigation would definitely follow and again DAD would pass it on to the Govt’s law officers (at tax payers’ expense) to fight family pensioners and veterans at individual expense because Pension matters are not covered in Public Interest Litigation as per honourable Supreme Court’s PIL Guidelines 1988 (https://main.sci.gov.in/pdf/Guidelines/pilguidelines.pdf).   

Background Information

The following information is extracted from Chapter 10.2 of 7^th CPC report

“10.2.50. To examine the recent trends in disability cases, the Commission sought data and further clarifications with regard to all cases of pensioners with disability element. The total number of pensioners superannuating with disability element, each year, from 2007-08 to 2013-14, as provided by the Controller General of Defence Accounts (CGDA) is tabulated below:

10.2.51. From above data, the following trends are discernible:

a. As a percentage of the total officer retirees, the number of officers retiring with disability has increased in 2013-14, as compared to 2007-08 (13.6 percent to 19.8 percent).

b. The percentage of JCOs/ORs retiring with disability is, on the other hand, decreasing (18.9 percent to 7.2 percent).

c. The percentage of officers retiring with disability is considerably higher than JCO/ORs retiring with disability.

Financial Year	J COs/ORs	Commissioned Officers	Total	Total JCO/OR Retirees	Total Officer Retirees
2007-08	9,355 (18.9%)	285 (13.6%)	9640 (18.7%)	49396	2096
2008-09	6908 (13.6%)	318 (15%)	7226 (13.6%)	50913	2118
2009-10	2644 (6.8%)	284 (16.6%)	2928 (7.2%)	39133	1712
2010-11	1840 (4.8%)	316 (18.8%)	2156 (5.3%)	38209	1678
2011-12	4765 (9.9%)	321 (19.9%)	5086 (10.2%)	48201	1626
2012-13	5837 (10.9%)	327 (19.9%)	6164 (11.2%)	53446	1643
2013-14	4037 (7.2%)	318 (19.8%)	4355 (7.6%)	55901	1606

Fatalities

This author was unable to find comprehensive data but produces the following

(a) The rank structure of the fatalities was: Officers 8.6%, JCOs 7.3%, and Other Ranks 84.1% Link https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4921413/)

(b) As a representative figure from 2005 to 2017 those killed in action along the LoC only were 1684 personnel – 342 in 2005, 223 in 2006, 221 in 2007, 71 in 2008, 107 in 2009, 187 in 2010, 71 in 2011, 75 in 2012, 64 in 2013, 65 in 2014, 85 of which 4 Officers in 2015, 86 including 11 Officers in 2016, 80 Other ranks + 7 officers in 2017, 4 including a Major on 23 Dec 2017.

Link:

http://timesofindia.indiatimes.com/articleshow/62511387.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst

(c) The details of defence personnel killed in different operations / encounters during the last four calendar years are as under:-

Year	Army		Navy		Air Force
	Officers	PBOR	Officers	Sailor	Officers	Airmen
2014	02	27	02	06	07	06
2015	02	48	02	Nil	Nil	Nil
2016	06	59	Nil	01	04	13
2017	05	34	Nil	Nil	06	07

Link: https://pib.gov.in/Pressreleaseshare.aspx?PRID=1541717  

Office of CDS/Secretary, DMA and Pension matters

Defence Pensions related matters are the responsibility (and accountability) of Dept of Ex-Servicemen Welfare (DESW) (please refer to page 46 of GoI, Allocation of Business Rules, 1961 for more information).  DESW has a Secretary to the GoI, an Apex scale pay of Rs 2, 25, 000) who should have presided over the press briefing. Anyways

Entitlement Rules 2023 (ER 2023)

Dept of Ex-Servicemen Welfare formulated ER 2023 as file No. 16(3)/2023/D(Pen/Pol)/Vol II indicates and published it on 21.09.2023.

FAQ on ER 2023 states, perhaps half in hope, “It is stated that there are no policy or entitlement related changes in this ER and the same has been revised/updated keeping in view the provisions as laid down in Base MoD letter on the subject dated 31.01.2001, aimed to streamline the procedure followed for assessment and entitlement without any ambiguity to avoid litigation. The same will be applicable in case of death and disability reported/recorded after 21.09.2023” (emphasis supplied).

This contradicts directly para 2(ii) of ER 2023 which states, “Superseding Clause. These Rules shall supersede all previous Entitlement Rules for Casualty Pensionary Awards to Armed Forces Personnel. Where any provision in these rules is found contrary to the provisions of any previously existing rules, regulations or policies, on the subject of Casualty Pensionary Awards, the provisions given in these rules shall take precedence” (emphasis supplied). 

Source: https://desw.gov.in/en/circulars/frequently-asked-questions-entitlement-rules-2023-and-gmo-2023  

The stage for litigation is already set as ER 2023 violates judgments of the honourable Supreme Court and High Courts as enumerated in subsequent paragraphs.

If the disability did not exist on enrolment then it occurred in service

The administrative order in ER 2023 seeks to negate in Para 7 this judgment without the help of legislation:   

In Sukhvinder Singh vs UoI & Others in CA No. 5605 of 2010 on 25 June 2014 (https://main.sci.gov.in/jonew/judis/41771.pdf), the honourable Supreme Court has held

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2. Succinctly stated, the facts germane for deciding the present Appeal are that consequent to the Primary Medical Examination for Recruitment having been conducted vis-à-vis the Appellant/Petitioner on 22nd December, 2000, he was enrolled in the Indian Army as a Combatant Soldier on 15th March, 2001. It bears noting that Rule 5 of the Entitlement Rules for Casualty Pensionary Awards, 1982, provides that (a) a member is presumed to have been in sound physical and mental condition upon entering service except as to physical disabilities noted or recorded at the time of entrance (b) in the event of his subsequently being discharged from service on medical grounds any deterioration in his health which has taken place is due to service. Even though this provision postulates a casualty we find no logical reason not to extrapolate it to even simple injuries or disabilities.

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9. We are of the persuasion, therefore, that firstly, any disability not recorded at the time of recruitment must be presumed to have been caused subsequently and unless proved to the contrary to be a consequence of military service. The benefit of doubt is rightly extended in favour of the member of the Armed Forces; any other conclusion would be tantamount to granting a premium to the Recruitment Medical Board for their own negligence. Secondly, the morale of the Armed Forces requires absolute and undiluted protection and if an injury leads to loss of service without any recompense, this morale would be severely undermined. Thirdly, there appears to be no provisions authorising the discharge or invaliding out of service where the disability is below twenty per cent and seems to us to be logically so. Fourthly, wherever a member of the Armed Forces is invalided out of service, it perforce has to be assumed that his disability was found to be above twenty per cent. Fifthly, as per the extant Rules/Regulations, a disability leading to invaliding out of service would attract the grant of fifty per cent disability pension.

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(Emphasis supplied)

It may be noted that the honourable Supreme Court has held CA No. 3752 of 2023 in SLP (C) 22633 of 2017 held that for a subsequent order or provision or amendment to be considered a clarification to the original provision it must not expand or alter the scope of the original provision and the original provision must be sufficiently vague of ambiguous so as to require such clarification.

A clarification must not have the effect of saddling any party with an unanticipated burden or withdrawing from any party an anticipated benefit. An explanation or clarification may not expand or alter the scope of the original provision.

Link: https://main.sci.gov.in/supremecourt/2017/24140/24140_2017_3_1502_44529_Judgement_16-May-2023.pdf

Violation of Article 14 of the Constitution of India - Right to Equality

The announcement that effective date of the ER 2023 is 21.09.2023 contradicts Para 2(ii) of ER 2023. Further it is discriminatory as it splits the disabled veterans/family pensioners into two classes – those granted disability benefits before 21 Sep 2023 as per ER 1982 and those who have the same disabilities as the former but who will be considered for disability benefits under ER 2023 from 21 Sep 2023.

“14. Equality before law.—The State shall not deny to any person equality before the law or the equal protection of the laws within the territory of India.”

D.S. Nakara & Others vs Union of India on 17 December, 1982; Equivalent citations: 1983 AIR 130, 1983 SCR (2) 165 (Source: https://indiankanoon.org/doc/1416283/ )

Writ Petition Nos. 5939-41 of 1980; Date of Judgment; 17^th December 1982

ACT: - Constitution of India, Article 14 - Central Civil Services (Pension) Rules, 1972 and Regulations governing pension for Armed Forces Personnel - Liberalisation in computation of pension effective from specified date divides pensioners so as to confer benefit on some while denying it to others - Classification arbitrary, devoid of rational nexus to object of liberalisation and violative of Article 14 (emphasis supplied)

“Constitution of India, Article 14:  Doctrine of severability- Severance may have effect of enlarging scope of legislation. Rules and Regulations governing grant of pension - Pension is a right- Deferred portion of compensation for service rendered - Also a social-welfare measure.

HEAD NOTE: - By a Memorandum dated May 25, 1979, the Government of India liberalised the formula for computation of pension in respect of employees governed by the Central Civil Services (Pension) Rules, 1972 and made it applicable to employees retiring on or after March 31, 1979. By another Memorandum issued on September 23, 1979 it extended the same, subject to certain limitations, to the Armed Forces' personnel retiring on or after April 1, 1979. Petitioners 1 and 2 who had retired in the year 1972 from the Central Civil Service and the Armed Forces' service respectively, and petitioner No. 3, a registered society espousing the cause of pensioners all over the country, challenged the validity of the above two memoranda in so far as the liberalisation in computation of pension had been made applicable only to those retiring on or after the date specified and the benefit of liberalisation had been denied to all those who had retired earlier.

Counsel for petitioners contended that all pensioners entitled to receive pension under the relevant rules form a class irrespective of the dates of their retirement and there cannot be a mini-classification within this class; that the differential treatment accorded to those who had retired prior to the specified date is violative of Art. 14 as the choice of specified date is wholly arbitrary and the classification based on the fortuitous circumstance of retirement before or subsequent to the specified date is invalid; and that the scheme of liberalisation in computation of pension must be uniformly enforced with regard to all pensioners.

Counsel for respondents contended that a classification based on the date of retirement is valid for the purpose of granting pensionary benefits; that the specified date is an integral part of the scheme of liberalisation and the Government would never have enforced the scheme devoid of the date; that the doctrine of severability cannot be invoked to sever the specified date from the scheme as it would have the effect of enlarging the class of  pensioners covered by the scheme and when the legislature has expressly defined the class to which the legislation applies it would be outside the judicial function to enlarge the class; that there is not a single case where the court has included some category within the scope of provisions of a law to maintain its constitutionality; that since the scheme of liberalisation has financial implications, the Court cannot make it retroactive; that if more persons divided the available cake the residue falling to the share of each, especially to the share of those who are not before the court would become far less and therefore no relief could be given to the petitioners that pension is always correlated to the date of retirement and the court cannot change the date of retirement and impose fresh commutation benefit which may burden the exchequer to the tune of Rs. 233 crores; and that the third petitioner has no locus standi in the case.

Allowing the petitions,

HELD: Article 14 strikes at arbitrariness in State action and ensures fairness and equality of treatment. It is attracted where equals are treated differently without any reasonable basis. The principle underlying the guarantee is that all persons similarly circumstanced shall be treated alike both in privileges conferred and liabilities imposed. Equal laws would have to be applied to all in the same situation and there should be no discrimination between one person and another if as regards the subject-matter of the legislation their position is substantially the same.

Article 14 forbids class legislation but permits reasonable classification for the purpose of legislation. The classification must be founded on an intelligible differentia which distinguishes persons or things that are grouped together from those that are left out of the group and that differentia must have a rational nexus to the object sought to be achieved by the statute in question. In other words, there ought to be causal connection between the basis of classification and the object of the statute.

The doctrine of classification was evolved by the Court for the purpose of sustaining a legislation or State action designed to help weaker sections of the society. Legislative and executive action may accordingly be sustained by the court if the State satisfies the twin tests of reasonable classification and the rational principle correlated to the object sought to be achieved.

A discriminatory action is liable to be struck down unless it can be shown by the Government that the departure was not arbitrary but was based on some valid principle which in itself was not irrational, unreasonable, or discriminatory.

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In the instant case, looking to the goals for the attainment of which pension is paid and the welfare State proposed to be set up in the light of the Directive Principles of State Policy and Preamble to the Constitution it indisputable that pensioners for payment of pension form a class. When the State considered it necessary to liberalise the pension scheme in order to augment social security in old age to government servants it could not grant the benefits of liberalisation only to those who retired subsequent to the specified date and deny the same to those who had retired prior to that date. The division which classified the pensioners into two classes on the basis of the specified date was devoid of any rational principle and was both arbitrary and unprincipled being unrelated to the object sought to be achieved by grant of liberalised pension and the guarantee of equal treatment contained in Art. 14 was violated inasmuch as the pension rules which were statutory in character meted out differential and discriminatory treatment to equals in the matter of computation of pension from the dates specified in the impugned memoranda.

(ii) Prior to the liberalisation of the formula for computation of pension average emoluments of the last 36 months' service of the employee provided the measure of pension. By the liberalised scheme, it is now reduced to average emoluments of the last 10 months' service. Pension would now be on the higher side on account of two fortuitous circumstances, namely, that the pay scales permit annual increments and usually there are promotions in the last one or two years of the employee's service. Coupled with it a slab system for computation has been introduced and the ceiling of pension has been raised. Pensioners who retired prior to the specified date would suffer triple jeopardy, viz., lower average emoluments, absence of slab system and lower ceiling.

(iii) Both the impugned memoranda do not spell out the raison d'etre for liberalising the pension formula. In the affidavit in opposition it is stated that the liberalisation was decided by the government in view of the persistent demand of the employees represented in the scheme of Joint Consultative Machinery. This would clearly imply that the pre-liberalised scheme did not provide adequate protection in old age, and that a further liberalisation was necessary as a measure of economic security. The government also took note of the fact that continuous upward movement of the cost of living index and diminishing purchasing power of rupee necessitated upward revision of pension. When the government favourably responded to the demand it thereby ipso facto conceded that there was a larger available national cake, part of which could be utilised for providing higher security to retiring employees. With this underlying intendment of liberalisation, it cannot be asserted that it was good enough only for those who would retire subsequent to the specified date but not for those who had already retired.

2. If removal of arbitrariness can be brought about by severing the mischievous portion, the discriminatory part ought to be removed retaining the beneficial portion.

In the instant case, the petitioners do not challenge, but seek the benefit of the liberalised pension scheme. Their grievance is of the denial to them of the same by arbitrary introduction of words of limitation. There is nothing immutable about the choosing of an event as eligibility criteria subsequent to a specified date. If the event is certain but its occurrence at a point of time is considered wholly irrelevant and arbitrarily selected having an undesirable effect of dividing a homogeneous class and of introducing discrimination the same can be easily severed and set aside. It is therefore just and proper that the words introducing the arbitrary fortuitous circumstance which are vulnerable as denying equality be severed and struck down. (In Exhibit P-1) the words: "That in respect of the Government servants who were in service on the 31st March, 1979 and retiring from service on or after that date,” and (in Exhibit P-2), the words: "the new rates of pension are effective from Ist April 1979 and will be applicable to all service officers who became/become non-effective on or after that date" are unconstitutional and are struck down with the specification that the date mentioned therein will be relevant as being one from which the liberalised pension scheme becomes operative. Omitting the unconstitutional part it is declared that all pensioners governed by the 1972 Rules and Army Pension Regulations shall be entitled to pension as computed under the liberalised pension scheme from the specified date, irrespective of the date of retirement. Arrears of pension prior to the specified date as per fresh computation is not admissible.

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(ii) The reading down of the impugned memoranda by severing the objectionable portion would not render the liberalised pension scheme vague, unenforceable, or unworkable. The Court is not legislating in reading down the memoranda; when the Court strikes down the basis of classification as violative of Art. 14 it merely sets at naught the unconstitutional portion, retaining the constitutional portion. There is no difficulty in implementing the scheme omitting the event happening after the specified date, retaining the more human formula for computation of pension. The pension will have to be recomputed in accordance with the provisions of the liberalised pension scheme as salaries were required to be recomputed in accordance with the recommendation of the Third Pay Commission but becoming operative from the specified date. The Court is satisfied that the additional financial liability that may be imposed by bringing in pensioners who retired prior to April 1, 1979 within the fold of the liberalised pension scheme is not too high to be unbearable or such as would have detracted the Government from covering the old pensioners under the scheme. The severance of the nefarious unconstitutional part does not adversely affect future pensioners and their presence in these petitions is irrelevant. 

 (iii) To say that by its approach the Court is restructuring the liberalised pension scheme is to ignore the constitutional mandate. The Court is not conferring benefits by its approach; it is only removing the illegitimate classification and after its removal the law takes its own course.

 (iv) It is not correct to say that if the unconstitutional part is struck down the Parliament would not have enacted the measure. The executive, with parliamentary mandate, liberalised the pension scheme. It is implicit in the scheme that the need to grant a little higher rate of pension to the pensioners was considered eminently just. One could have understood persons in the higher pay bracket being excluded from the benefit of the scheme because it would have meant that those in the higher pay bracket could fend for themselves. Such is not the exclusion. The exclusion is of a whole class of people who retired before a certain date. Parliament would not have hesitated to extend the benefit otherwise considered eminently just and this becomes clearly discernible from p.35 of the 9th Report of the Committee on Petitions (6th Lok Sabha), April 1979.

 (v) Whenever classification is held to be impermissible and the measure can be retained by removing the unconstitutional portion of the classification, the resultant effect may be of enlarging the class. In such a situation the court can strike down the words of limitation in an enactment. That is what is called reading down the measure. There is no principle that severance limits the scope of legislation but can never enlarge it.

 (vi) The absence of precedent does not deter the court. Every new norm of socio-economic justice, every new measure of social justice commenced for the first time at some point of time in history. If at that time it was rejected as being without a precedent, law as an instrument of social engineering would have long since been dead.

 (vii) The court is not making the scheme of liberalisation retroactive by its approach. Retro-activeness is implicit in the theory of wages. When revised pay-scales are introduced from a certain date, all existing employees are brought on to the revised scales adopting a theory of fitments and increments for past service. The benefit of revised scales is not limited to those who enter service subsequent to the date fixed for introducing revised scales but is extended to all those in service prior to that date. Even in the case of the new retiral benefit of gratuity under the Payment of Gratuity Act, 1972, past service was taken into consideration. The scheme of liberalisation is not a new retiral benefit; it is an upward revision of an existing benefit. Pension has correlation to average emoluments and the length of qualifying service and any liberalisation would pro tanto be retroactive in the narrow sense of the term.

 Assuming the government had not prescribed the specified date and thereby provided that those retiring, pre and past the specified date, would all be governed by the liberalised pension scheme it would be both prospective and retroactive. Only the pension will have to be recomputed in the light of the formula enacted in the liberalised pension scheme and effective from the date the revised scheme comes into force. A statute is not properly called retroactive because a part of the requisites for its action is drawn from a time antecedent to its passing.

 (viii) There is no question of pensioners dividing the pension fund which, if more persons are admitted to the scheme, would pro rata affect the share. The pension scheme, including the liberalised scheme, is non-contributory in character. The payment of pension is a statutory liability undertaken by the Government. Whatever becomes due and payable on account of pension is recognised as an item of expenditure and is budgeted for every year. At any given point of time there is no fixed or pre-determined pension fund which is divided amongst eligible pensioners.

 (ix) The date of retirement of each employee remaining as it is, there is no question of fresh commutation of pension of the pensioners who retired prior to 31st March 1979 and have already availed of the benefit of commutation. It is not open to them to get that benefit at this late date because commutation has to be availed of within the specified time limit from the date of actual retirement.

 3. The discernible purpose underlying the pension scheme must inform the interpretative process and it should receive a liberal construction.

 (i) Pension is a right; not a bounty or gratuitous payment. The payment of pension does not depend upon the discretion of the Government but is governed by the rules and a government servant coming within those rules is entitled to claim pension.

 (ii) The pension payable to a government employee is earned by rendering long and efficient service and therefore can be said to be a deferred portion of the compensation for service rendered.

 (iii) Pension also has a broader significance in that it is a social-welfare measure rendering socio-economic justice by providing economic security in old age to those who toiled ceaselessly in the hey-day of their life.

 (iv) Pension as a retirement benefit is in consonance with and in furtherance of the goals of the Constitution. The goals for which pension is paid themselves give a fillip and push to the policy of setting up a welfare state. The preamble to the Constitution envisages the establishment of a socialist republic. The basic framework of socialism is to provide a decent standard of life to the working people and especially provide security from cradle to grave. Article 41 enjoins the State to secure public assistance in old age, sickness and disablement. Every state action whenever taken must be directed and must be so interpreted as to take society one step towards the goal of establishing a socialist welfare society. While examining the constitutional validity of legislative/administrative action, the touchstone of Directive Principles of State Policy in the light of the Preamble provides a reliable yardstick to hold one way or the other..

 4. Any member of the public having sufficient interest can maintain an action for judicial redress for public injury arising from breach of public duty or from violation of some provision of the Constitution or the law and seek enforcement of such public duty and observance of such constitutional or legal provision. The locus standi of petitioner No. 3 which seeks to enforce rights that may be available to a large number of old, infirm retirees is unquestionable as it is a non-political, non-profit, voluntary organisation registered under the Societies Registration Act, 1860 and its members consist of public spirited citizens who have taken up the cause of ventilating legitimate public problems.”

 Civil Appeal No(s).2966/2011 in Union of India vs S P S Vains  & Others with Contempt Petition (C) No.64/2009 inn C.A. No.5566/2008; Date : 08-12-2017 (Link: https://main.sci.gov.in/supremecourt/2011/2910/2910_2011_Order_08-Dec-2017.pdf

“Upon hearing the counsel the Court made the following Order in C.A.No.2966/11 etc.

 Mr. Nidhesh Gupta, learned senior counsel for the respondents in C.A.No.2966/2011 submits that the benefits that were conferred on the persons as per the judgment rendered by this Court in Union of India and another vs. SPS Vains (Retd.) & Ors., (2008) 9 SCC 125 qua the Sixth Pay Commission keeping in view the cut-off date dated 01.01.2006 have not been given to the respondents.

 Elaborating further, it is urged by the learned counsel that the benefits have been given exclusively to the petitioners who had approached the Tribunal though not to the categories who were entitled to the said benefit. Be it clarified, when a question of pay fixation comes, the same cannot be limited to the petitioners who have approached the Court.

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K.J.S. Buttar vs Union Of India And Anr on 31 March, 2011 in Civil Appeal No. 5591 of 2006 (Link: https://main.sci.gov.in/jonew/bosir/orderpdf/1263933.pdf)

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11. In our opinion, the restriction of the benefit to only officers who were invalided out of service after 1.1.1996 is violative of Article 14 of the Constitution and is hence illegal. We are fortified by the view as taken by the decision of this Court in Union of India & Anr. vs. Deoki Nandan Aggarwal 1992 Suppl.(1) SCC 323, where it was held that the benefit of the Amending Act 38 of 1986 cannot be restricted only to those High Court Judges who retired after 1986.

12. In State of Punjab vs. Justice S.S. Dewan (1997) 4 SCC 569 it was held that if it is a liberalization of an existing scheme all pensioners are to be treated equally, but if it is introduction of a new retrial benefit, its benefit will not be available to those who stood retired prior to its introduction. In our opinion the letter of the Ministry of Defence dated 31.1.2001 is only liberalization of an existing scheme.

13. In Union of India & Anr. vs. S.P.S. Vains (Retd.) & Ors. 2008(9) SCC 125 it was observed:

“26. 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.

27. 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.

28. 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 D.S. Nakara 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 counterproductive 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.

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 case. 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.

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Denial of accrued benefits cannot be from a retrospective date

 The CDS was at pains to state that ER 2023 will not be applicable with retrospective date but from 21 Sep 2023. Please see FAQ at https://desw.gov.in/en/circulars/frequently-asked-questions-entitlement-rules-2023-and-gmo-2023         

 It appears that someone did apply his/her mind and found out that benefits accrued cannot be cancelled with retrospective effect. Summaries of a few judgments are given below.

 (a)        The honourable High Court of Punjab & Haryana, in CWP No. 12658 of 2017 order dated 27.07.2017 has held that “law cannot be changed retrospectively other than by legislative action and even if the legislature may have the power to legislate retrospective laws, the same cannot be take away the accrued rights. In the instant case, respondents have attempted to tacitly extinguish the rights of petitioners in a retrospective manner and that too, through an administrative action which is clearly impermissible in law.”

 (b)        The honourable Supreme Court in Motilal Padampat Sugar Mills Co. Ltd. vs. State of Uttar Pradesh & others, (1979) 2 SCC 409 has held that “mere claim of change of policy would not be sufficient to exonerate Government from its liability and obligations and the Government would be compelled to carry out promise made by it.”

 (c)        The honourable Supreme Court in Lalaram & others vs. Jaipur Development Authority & another, (2016) 11 SCC 31, the honourable Supreme Court further stressed on the importance of complying with a promise made by the State on the basis of a public policy in the absence of which immense prejudice is caused to the other party involved and invoking the doctrine of promissory estoppel for ensuring the same.

 (d) The honourable Supreme Court in Ex-Major N.C. Singhal vs. Director General, Armed Forces Medical Services, New Delhi & another, (1972) 4 SCC 765, has held that “conditions of services cannot be altered or modified to prejudice an employee/ retiree by a subsequent administrative instruction having retrospective effect.”

 

Jai Hind

E & O E

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