IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA. CWP No. 1577/2009 alongwith CWP Nos. 2548, 3809, 4281, 4425, 4700, 4701, 5030, 5031, 5033, 5037, 5043, 5044, 5045, 5046, 5047, 5048, 5076/2009, 94, 95, 96, 97, 98, 113, 114, 115, 116, 117, 119, 120, 121, 122, 233, 261, 262, 460, 461, 464, 467, 468, 731, 739, 740, 741, 742, 787, 1305, 1425, 1843, 1882, 2760, 4170, 4433, 4602, 6005, 8890/2010, 2862, 2921, 2937, 7354, 7397, 8288, 8740, 8896, 9683, 10275, 10276, 10801, 11088 of 2011 and 1897 of 2012. Reserved on : 27.11.2013 Decided on: 19.12. 2013 _____________________________________________ 1. CWP No. 1577/2009 Rajesh Chander Sood …Petitioner. Vs. State of H.P. and others. …Respondents. 2. CWP No. 2548/2009 Ashok Kumar Sharma …Petitioner Vs. State of H.P. and others. …Respondents. 3. CWP No. 3809/2009 H.K. Vaidya and others. …Petitioners. Vs. State of H.P. and others. …Respondents. 4. CWP No. 4281/2009 Roshan Lal Parmar …Petitioner. Vs. State of H.P. and others. …Respondents. 5. CWP No. 4425/2009 P.D. Nanda …Petitioner Vs. State of H.P. and others. …Respondents. 6. CWP No. 4700/2009 2 Baldev Kumar …Petitioner Vs. State of H.P. and others. …Respondents. 7. CWP No.4701/2009 Brijesh Kumar Sharma .......Petitioner. Versus State of H.P. and others. …Respondents. 8. CWP No. 5030/2009 Amar Dass …Petitioner. Vs. State of H.P. and others. …Respondents. 9. CWP No.5031/2009 Atma Ram …Petitioner. Vs. State of H.P. and others. …Respondents. 10. CWP No. 5033/2009 M.P. Singh …Petitioner. Vs. State of H.P. and others. …Respondents. 11. CWP No. 5037/2009 Ashwani Kumar …Petitioner. Vs. State of H.P. and others. …Respondents. 12. CWP No. 5043/2009 Ashok Kumar. …Petitioner Vs. State of H.P. and others. …Respondents. 13. CWP No.5044/2009 Surender Pal Sharma …Petitioner. Vs. State of H.P. and others. …Respondents. 14. CWP No. 5045/2009 Avinash Kaur …Petitioner. Vs. State of H.P. and others. …Respondents. 3 15. CWP No. 5046/2009 Ganga Ram. …Petitioner. Vs. State of H.P. and others. …Respondents. 16. CWP No. 5047/2009 Kala Ram. …Petitioner. Vs. State of H.P. and others. …Respondents. 17. CWP No. 5048/2009 Inder Singh Sain. …Petitioner. Vs. State of H.P. and others. …Respondents. 18. CWP No. 5076/2009 Damodar Ram. …Petitioner. Vs. State of H.P. and others. …Respondents. 19. CWP No. 94/2010 Chaman Lal. …Petitioner. Vs. State of H.P. and others. …Respondents. 20. CWP No. 95/2010 Babu Ram. …Petitioner. Vs. State of H.P. and others. …Respondents. 21. CWP No.96/2010 Bharat Bhushan. …Petitioner. Vs. State of H.P. & others …Respondents. 22. CWP No. 97/2010. Bimla Devi …Petitioner. Vs. State of H.P. and others. …Respondents. 23. CWP No. 98/2010 Bhag Singh …Petitioner. 4 Vs. State of H.P. and others. …Respondents. 24. CWP No.113/2010 Nek Chand … Petitioner. Vs. State of H.P. and others. …Respondents. 25. CWP No. 114/2010 Yash Pal Goel …Petitioner. Vs. State of H.P. and others. …Respondents. 26. CWP No. 115/2010 Dhian Singh …Petitioner Vs. State of H.P. and others. …Respondents. 27. CWP No. 116/2010 Katku Ram …Petitioner. Vs. State of H.P. and others. …Respondents. 28. CWP No. 117/2010 Pawan Kumar …Petitioner. Vs. State of H.P. and others. …Respondents. 29. CWP No. 119/2010 Sobha Ram …Petitioner Vs. State of H.P. and others. …Respondents. 30. CWP No. 120/2010 Krishan Chand …Petitioner. Vs. State of H.P. and others. …Respondents. 31. CWP No. 121/2010 Tej Ram Sharma …Petitioner. Vs. State of H.P. and others. …Respondents. 5 32. CWP No. 122/2010 Jagat Ram Sharma. …Petitioner. Vs. State of H.P. and others. …Respondents. 33. CWP No. 233/2010 Pawan Kumar Sharma …Petitioner. Vs. State of H.P. and others. …Respondents. 34. CWP No. 261/2010 Tulsi Ram …Petitioner. Vs. State of H.P. and others. …Respondents. 35. CWP No. 262/2010 Y.S. Thakur. …Petitioner. Vs. State of H.P. and others. …Respondents. 36. CWP No. 460/2010 Phoola Devi. …Petitioner. Vs. State of H.P. and others. …Respondents. 37. CWP No. 461/2010 Kamleshwar Singh …Petitioner. Vs. State of H.P. and others. …Respondents. 38. CWP No. 464/2010 Vineet Kaushik …Petitioner. Vs. State of H.P. and others. …Respondents. 39. CWP No. 467/2010 Shyam Singh. …Petitioner. Vs. State of H.P. and others. …Respondents. 40. CWP No. 468/2010 Bhola Ram. …Petitioner. 6 Vs. State of H.P. and others. …Respondents. 41. CWP No. 731/2010 Mani Ram …Petitioner. Vs. State of H.P. and others. …Respondents. 42. CWP No. 739/2010 Satya Dev Negi. …Petitioner. Vs. State of H.P. and others. …Respondents. 43. CWP No. 740/2010 Ramesh Chand Dhiman. …Petitioner. Vs. State of H.P. and others. …Respondents. 44. CWP No. 741/2010 Sita Ram. …Petitioner. Vs. State of H.P. and others. …Respondents. 45. CWP No. 742/2010 Ravinder Singh Tegta. …Petitioner. Vs. State of H.P. and others. …Respondents. 46. CWP No. 787/2010 Kanta Devi. …Petitioner. Vs. Himachal Pradesh Horticultural Produce Marketing and Marketing and Processing Corporation Ltd. and another. …Respondents. 47. CWP No. 1305/2010 Dola Ram Thakur. …Petitioner. Vs. State of H.P. and others. …Respondents. 49. CWP No. 1425/2010 Kishori Lal. …Petitioner. 7 Vs. State of H.P. and others. …Respondents. 50. CWP No. 1843/2010 Harish Mitter Moudgil. …Petitioner. Vs. State of H.P. and others. …Respondents. 51. CWP No. 2760/2010 Surender Kumar Jaret. …Petitioner. Vs. State of H.P. and others. …Respondents. 52. CWP No. 4170/2010 Lekh Raj. …Petitioner. Vs. State of H.P. and others. …Respondents. 53. CWP No. 4433/2010 Prem Lal Sharma. …Petitioner. Vs. State of H.P. and others. …Respondents. 54. CWP No. 4602/2010 Rajinder Singh Sublaik. …Petitioner. Vs. State of H.P. and others. …Respondents. 55. CWP No. 6005/2010 Bal Krishan Sharma. …Petitioner. Vs. State of H.P. and others. …Respondents. 56. CWP No. 8890/2010 Surender Kumar Sharma. …Petitioner. Vs. State of H.P. and others. …Respondents. 57. CWP No. 2862/2011 Uday Ram. …Petitioner. Vs. State of H.P. and others. …Respondents. 8 58. CWP No. 2921/2011 Rattan Singh. …Petitioner. Vs. State of H.P. and others. …Respondents. 59. CWP No. 2937/2011 Mohinder Singh. …Petitioner. Vs. State of H.P. and others. …Respondents. 60. CWP No. 7354/2011 Dharam Singh. …Petitioner. Vs. State of H.P. and others. …Respondents. 61. CWP No. 7397/2011 Ram Kumar Sharma & others. …Petitioners. Vs. State of H.P. and others. …Respondents. 62. CWP No. 8288/2011 Shyam Lal and others. …Petitioners. Vs. State of H.P. and others. …Respondents. 63. CWP No. 8740/2011 Nanak Chand. …Petitioner. Vs. State of H.P. and others. …Respondents. 64. CWP No. 8896/2011 Baldev Singh and others. …Petitioners. Vs. State of H.P. and others. …Respondents. 65. CWP No. 9683/2011 Chuni Lal and others. …Petitioners. Vs. State of H.P. and others. …Respondents. 66. CWP No. 10275/2011 Bhagwan Dass. …Petitioner. 9 Vs. State of H.P. and others. …Respondents. 67. CWP No. 10276/2011 Ram Murti. …Petitioner. Vs. State of H.P. and others. …Respondents. 68. CWP No. 10801/2011 Phulkar Chand. …Petitioner. Vs. State of H.P. and others. …Respondents. 69. CWP No. 11088/2011 Bidhi Chand. …Petitioner. Vs. State of H.P. and others. …Respondents. 70. CWP No. 1897/2012 Rajan Jain and others. …Petitioners. Vs. State of H.P. and others. …Respondents. _______________________________________________________ Coram: Hon’ble Mr. Justice Rajiv Sharma, Judge. Hon’ble Mr. Justice V.K. Sharma, Judge. Whether approved for reporting?1 Yes For the Petitioner : Mr. Dilip Sharma, Senior Advocate with Mr. Ajay Mohan Goel, P.D. Nanda, J.R. Gazta, Mr. B.M. Chauhan and T.S. Chauhan, Advocates for the respective petitioners. For the Respondents : Mr. Shrawan Dogra, Advocate General with Ms. Minakshi Sharma, Addl. A.G. and Mr. Vivek Attri, Dy. A.G. for respondent-State. 1 Whether reporters of the local papers may be allowed to see the judgment? yes 10 Mr. K.D. Sood, Sr. Advocate with Mr. Sanjeev Sood, Mr. Ajit Saklani, Ms. Ritta Goswami, Mr. Bhupinder Thakur, Mr. V.B. Verma and Mr. Sushil Guatam, Advocates for the respective respondents. Mr. Sandeep Sharma, Asstt. Solicitor General of India for Union of India. _________________________________________________________ Per Justice Rajiv Sharma, Judge. Since common questions of law and facts are involved in all these petitions, the same were taken up together and are being disposed of by a common judgment. However, in order to maintain clarity, facts of CWP No. 4425/2009, titled P.D. Nanda vs. State of Himachal Pradesh and others have been taken into consideration. 2. Petitioner was appointed as Assistant in respondent No.3-corporation on 20.4.1976. He was promoted to the post of Senior Assistant on 23.7.1977. He was promoted to the post of Office Manager on 27.3.1981. He was appointed as Superintendent equivalent to the post of Office Manager (Senior) with effect from 14.3.1984. He was promoted to the post of Manager Marketing from 18.11.1988 in the pay scale of ` 1200-1700. Decision making process of the scheme called as “Himachal Pradesh Corporate Sector Employees (Pension, Family Pension Commutation of pension and Gratuity) Scheme, 1999” was notified on 29.10.1999. 11 3. Petitioner has placed on record the information received under the Right to Information Act the manner in which the decision was taken, which led to issuance of notification dated 29.10.1999 notifying the “Himachal Pradesh Corporate Sector Employees (Pension, Family Pension Commutation of pension and Gratuity) Scheme, 1999” with effect from 1.4.1999. According to note No. 229, the Hon’ble Chief Minister announced that pensionery benefits would be extended to the employees of corporate sector with effect from 1.4.1999. Thereafter, matter was placed before the Cabinet on 12.1.1999 and it was approved. The salient features of the scheme approved by the Cabinet read as under: 1. The Central Civil Services (Pension) Rules 1972 and the Central Civil Services (Commutation of Pension) Rules, 1981 as adopted by the H.P. Government for the State Government employees from time to time shall govern the pensionery benefits to be granted to PSU employees. 2. It shall come into effect from 1st April, 1999 and will apply to all the employees who join the Corporations/Boards after this date. 3. The existing employees of the concerned Corporations as on 31.3.1999 shall have the option either to elect the Pension Scheme or to continue under the existing Provident Fund Scheme. 4. The existing employees who opt for the Pension Rules shall automatically forfeit their claim to employer’s share of CPF including interest thereon to the Corporation. 5. The existing corpus upto 31.3.1999 under the E.P.F. scheme shall be credited to the Consolidated Fund of the State Government. 6. The State Government shall receive Corporation’s monthly contribution/share in respect of all the eligible 12 employees w.e.f. 1.4.1999 at the rate of 12% of the basic pay + DA or at the rate as may be prescribed by the State Government from time to time. 7. The retirement age of 58 years (60 years for class-IV employees), on the pattern of State Government will have to be incorporated in the Service Bye Laws of those Corporations/Boards where it is on higher side. 8. Each Corporation will have to obtain the approval of its Board of Directors for introducing these Pension Rules after the State Government accepts it.” 4. Since the rules envisage transfer of funds maintained with the Regional Provident Fund Commissioner (RPFC) to the State Government and operation of the scheme under the Central Civil Services (Pension) Rules through the Consolidated Fund of the State, it was necessary to consult the Regional Provident Fund Commissioner, A.G. H.P. and the Law Department in this regard. The RPFC, Shimla with whom the CPF was being deposited by the PSUs had agreed to transfer both the shares of CPF of employees and PSUs to Government in respect of regular employees of PSUs while retaining the CPF in respect of employees on part time, daily wages, piece meal rate, casual, contract basis. The Accountant General has made the following observations on 16.8.1999 as per note No. 231: i. “In the proposed scheme all pensionery benefits of the employees of corporate sector are proposed to be governed by the CCS Pension Rules, 1972 and CCS Commutation of Pension Rules, 1981 as amended and adopted by the H.P. Government for State employees. The above rules apply only to the Government servants 13 appointed to substantive Civil Services and posts in connection with the affairs of the State which are borne on pensionable establishment. These rules are not applicable automatically to the employees of PSUs until amendment is made in these rules. ii. The draft scheme does not indicate the source from which pensionery benefits to the employees of PSUs will be made. iii. The Heads of Account under which such transactions will be accounted for has also not been indicated in the said scheme. iv. The authority who will be responsible for maintaining GPF accounts of such employees has also not been indicated. v. Whether the State Government indents to make pensionery benefit out of Consolidated Fund of State or the State Government would like to create a Pension and Gratuity Fund for the purpose, needs to be indicated.” 5. The Law Department gave the opinion that the AD before framing any scheme shall have to amend the various enactments under which the PSU’s have been established and after framing the scheme the AD shall have to issue notification under section 5 of Payment of Gratuity Act, 1972 and also under section 17 of Employees Provident Fund and Miscellaneous Provisions Act, 1952. The Law Department also has opined that it was not possible to frame a scheme for the employees of public sector undertakings which have been established under the provisions of Central enactments for that purpose the Company Act shall have to be examined separately. It also opined that since in terms of Article 283 (1) only public money received by or on behalf of the State Government can 14 be credited to consolidated fund as such for the purpose of crediting the public fund so created for the employees of public sector undertaking, the views of Accountant General have to be obtained. 6. The Financial Commissioner-cum-Secretary (Finance) on 27.9.1999 observed to create a central account and transfer the corpus of various corporations to a non-governmental entity so created specifically for the purpose. Opinion of the Law Department was again sought on the following issues as per note No. 244: i. Can a scheme be framed through suitable salutatory enactment for Pension to PSUs payable through the consolidated fund or would this is hit by some constitution bar? ii. Can a PSU employee pension scheme be framed which is not to be operated through consolidated fund but through or fund kept separately but which would be maintained by a special cell of State Government employees and which would envisage budgetary support also without statutory enactment? iii. If (ii) above requires statutory enactment then what form can such an enactment take can such an enactment be restrictive and cover only such Boards/Corporations/Cooperatives as are specified or will this constitute discrimination which can be held to be unconstitutional.” 7. Senior Law Officer gave the opinion as per note No. 246 and opined that amicable salutation to the problem can be achieved if all the Public Sector Undertakings are directed to amend their rules/regulations framed under the Act whereunder these were established for making a provision to the 15 effect that pensionery benefits shall be admissible to the employees of the undertakings as per the pension scheme framed by the State Government in this behalf and in such event there would be no necessity to enact a special law or to amend the respective enactments because every Act under which a Public Undertaking was established might have delegated powers to the Board of the respective Public Sector Undertakings to frame rules regulating the condition of service of the employees of the Public Sector Undertakings. Thereafter, as per note No. 247, it was noted that since the proposed scheme no longer involve the consolidated fund of the State, it was not to include the Milkfed and involve creation of a corporate Pension Cell in the Finance Department. It was noted as discussed and verbally conveyed by Chief Minister, ex-post approval of CMM be obtained. The Law Department was requested to vet the draft notification. Secretary (Law) as per note No. 249, opined that repeal and saving clause was required to be deleted from the scheme as the State Government has no power to repeal the rules, regulations and orders etc. issued by the competent authority of the Public Sector Undertaking under the powers conferred by the Statutes in which said Public Sector Undertakings have been established. It was further opined by him that after the rules, regulations 16 or orders are amended by the respective Public Sector Undertakings providing that the pensionery benefits of the employees shall be regulated by the scheme framed by the State Government then on amendment, such rules regulations, orders shall cease to have effect on the matters covered under the scheme. It is in this backdrop, the scheme called “Himachal Pradesh Corporate Sector Employees (Pension, Family Pension Commutation of Pension and Gratuity) Scheme, 1999 was notified on 29.10.1999 with effect from 1.4.1999. 8. The object of the scheme is to provide for the constitution, custody control and operation of Pension Fund for the payment of pension/commutation of pension and gratuity to the employees of the Public Sector Undertakings. The scheme has come into force with effect from 1.4.1999. According to sub-para (2) of para 1, all pensionery benefits of the employees of the participating H.P. Corporate Sector were to be determined in accordance with the provisions laid down in Central Civil Services (Pension) Rules, 1972, the Central Civil Services (Commutation of Pension) Rules, 1981 as amended and adopted by the Himachal Pradesh Government for the State Government employees save as otherwise provided in the scheme. According to para 2, the scheme was made applicable to the employees of Himachal Pradesh Corporate Bodies as 17 specified in appendix appended to the scheme with a further rider that the governing body/Board of Directors of these Corporate Bodies would provide in their respective bye laws/rules/regulations governing their conditions of service by amending respective service bye laws/rules/ regulations that pension, family pension and commutation of pension and gratuity would be payable to the employees/beneficiaries under the scheme. The scheme was made applicable to those employees who opt for benefits under the scheme. The employees were required to give an option in writing in the form within a period of 30 days from the date of notification of the scheme. It was further stipulated in the scheme that any employee who did not exercise his/her option within the specified period for whatsoever reasons would be deemed to have exercised option for this scheme. Para 3 is a definition clause. It has defined the expression “Board”, “H.P. Corporate Sector” and “employee”. “Existing employees” has been defined to mean any employee in the service of the Himachal Pradesh Corporate Sector on regular basis as on 1.4.1999. It has also defined the terms “Pension Sanctioning Authority”, “Pension Disbursing Authority”, “Participating H.P. Corporate Sector”, “Head of Department” and “Head of Office”. According to para 4 of the scheme, any claim to pension was to be regulated 18 by the provision of the scheme in force at the time when an employee retires or is retired or dies or is discharged as the case may be. The existing employees of the Corporation as on 1.4.1999 had the option either to elect the pension scheme or to continue under existing provident fund scheme, 1995. It was further stipulated therein that all the employees who opted for pension scheme were to automatically forfeit their claim to employer’s share of CPF including interest thereon to the State Government as well as other claims under CPF schemes by whatsoever name called in respect of all past accumulations upto 31.3.1999. The amount of their subscriptions to the fund alongwith interest was to be transferred to GPF account to be allotted and maintained by the concerned Corporate Sector Organization as per rules adopted by them. Para 5 provides that the entire amount of the PSUs contribution including interest thereon in the CPF account upto 31.3.1999 was to be transferred to a corpus fund to be administered and maintained by the Government of Himachal Pradesh in the Finance Department. PSUs contribution/share in respect of all the eligible employees with effect from 1.4.1999 at the rate of 12% of the basic pay plus D.A. or at the rate as the State Government may prescribe from time to time but not less than the rate provided as above was to be 19 transferred to the corpus called the ‘pension contribution’. The concerned PSUs were also required to transfer the pension contribution as per sub-para (3) of para 5 to the State Government latest by 10th of the succeeding month provided that in the event of non- transfer of the contribution upto 10th of succeeding month interest at the rate of 12% per annum was payable by the PSUs for any delayed payment. The disbursement of pension was visualized under para 6 of the scheme. 9. It is not in dispute that all the PSUs amended their bye laws towards the implementation of scheme notified on 29.10.1999. Petitioner has also given his option on 12.11.1999. 10. Respondent-State has amended rule 2 of the Central Civil Services (Pension) Rules, 1972 on 15.5.2003. Notification dated 15.5.2003 reads as under: 1. Short title and commencement:- 1. (1) These Rules may be called the Central Civil Services (Pension) (Himachal Pradesh First Amendment) Rules, 2003. (2) They shall come into force from the date of publication in the Rajpatra Himachal Pradesh. 2. Amendment of rule- 2:- 2. After clause (h) of rule-2 of the Central Civil Services (Pension) Rules, 1972 the following new clause (i) shall be inserted, namely:- “(i) All appointments made in the State Government of Himachal Pradesh on 20 or after the date of publication of the notification in Rajpatra, Himachal Pradesh. 11. Petitioner and similarly situate persons were legitimately expecting that the scheme notified on 29.10.1999 would continue and they would be entitled to pension. However, respondent-State started a process of repealing notification dated 29.10.1999, which has come into force with effect from 1.4.1999. The decision making process the manner in which the scheme notified on 29.10.1999 was repealed on 2.12.2004 with effect from 1.4.1999. 12. Petitioner has sought the information under Right to Information Act the manner in which scheme notified on 29.10.1999 was repealed vide notification dated 2.12.2004. This noting portion starts from page 62 of the paper book of CWP No.4425/2009. Serious reservations about the scheme had been expressed from time to time as per note No. 148. It is also borne out from the notes that the group of officers were asked to re-examine the entire scheme about the feasibility of the operationalization of scheme. The constitution of the committee was as under: 1) Managing Director, H.P. Financial Corporation Chairperson/Chairman) 2) Managing Director, HPSIDC (Member) 3) Managing Director, HRTC (Member) 4) Managing Director, H.P. Civil Supplies Corporation (Member) 21 13. The report of the Managing Director H.P. Financial Corporation is at page 100 of CWP No. 1577/2009. According to the recommendations of the committee, pension scheme for Corporate Sector employees based on contribution by the State Government was not viable on a self sustaining basis mainly due to the following reasons: i) “Uncertainty in the rate of interest regime. ii) Declining recruitment in the Corporate Sector would deplete the size of the corpus to be created and it would be difficult to honour liabilities accruing after 10-12 years. iii) The pension plan envisages payment of pension to corporate sector employees. Government employees at present are entitled to pension @ 50% of the basic pay last drawn with linkage to ADA. This return does not appear to be possible from the pension fund proposed to be created for corporate sector employees.” 14. The report of group of officers was received as per page 62 of CWP No. 4425/2009 in the month of October, 2003. It was proposed by Secretary (IF) vide note Nos. 151, 152 and 153 that the scheme notified on 29.10.1999 be rescinded. Initially, opinion of the Law Department was sought but the proposal was withdrawn and it was decided to seek additional opinion from the eligible PSU’s as per note Nos. 151, 152 and 153. Thereafter, ACS (Finance), as per note No.154, has sought the opinion of the Law Department whether scheme could be withdrawn with retrospective effect or 22 with immediate effect. The Law Department, as per note No. 157, opined that if the