IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE P.N.RAVINDRAN TUESDAY, THE 17TH MARCH 2009 / 26TH PHALGUNA 1930 WP(C).No. 2771 of 2009(E) ------------------------- PETITIONER: --------------- P.V.SREEKUMARAN, RETIRED FINANCIAL ASSISTANT TO THE DIRECTOR OF PHYSICAL PLANT, KERALA AGRICULTURAL UNIVERSITY, VELLANIKKARA, THRISSUR, RESIDING AT KOUSTHUBHAM, PALAMETTU STREET, SEKHARIPURAM, PALAKKAD-10. BY ADV. SRI.N.HARIDAS SRI.P.N.SASIDHARAN RESPONDENTS: --------------- 1. STATE OF KERALA, REPRESENTED BY ITS CHIEF SECRETARY, GOVERNMENT SECRETARIAT, THIRUVANANTHAPURAM. 2. KERALA AGRICULTURAL UNIVERSITY, K.A.U. P.O., VELLANIKKARA, THRISSUR-680656, REPRESENTED BY ITS REGISTRAR. 3. COMPTROLLER, KERALA AGRICULTURAL UNIVERSITY, K.A.U. P.O., VELLANIKKARA, THRISSUR-680 656. 4. DEPUTY COMPTROLLER, KERALA AGRICULTURAL UNIVERSITY, K.A.U. P.O., VELLANIKKARA, THRISSUR-680 656. BY SR.GOVT. PLEADER SRI.T.T.MUHAMOOD ADV. SRI.RENJITH THAMPAN FOR R2 THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 17/03/2009, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: P.N.RAVINDRAN, J. ---------------------------------------------- W.P(C) No. 2771 of 2009-E --------------------------------------------- Dated this the 17th day of March, 2009. J U D G M E N T Heard Sri.N.Haridas, the learned counsel appearing for the petitioner, Sri.T.T.Muhamood, the learned Government Pleader appearing for the State of Kerala and Sri.Renjith Thampan, the learned standing counsel appearing for respondents 2 to 4. 2. The petitioner is a former employee of Kerala Agricultural University. He retired from service on 30.6.2007 on attaining the age of superannuation. At the time of retirement the petitioner was working as Financial Assistant to the Director of Physical Plant in the Kerala Agricultural University. 3. Even before his retirement, the petitioner had submitted the necessary application for payment of pension. Shortly after his retirement, by Exhibit P1 order dated 12.9.2007, the Deputy Comptroller of the Kerala Agricultural University sanctioned to the petitioner, pension at the rate of Rs.9,743/- per mensem with effect from 1.7.2007. The sum of Rs.3,30,000/- was also sanctioned as DCRG, besides other benefits. 4. The petitioner had prior to his retirement submitted an W.P(C) No. 2771 of 2009-E 2 application for payment of commuted value of pension under the Pension (Commutation) Rules. On that application, the Deputy Comptroller issued Exhibit P2 order dated 12.9.2007 allowing the petitioner to commute 40% of his pension. By Exhibit P2 the Deputy Comptroller sanctioned payment of the sum Rs.5,34,045/- as commuted value of pension to the petitioner. It was also ordered that with effect from 1.9.2007, the monthly pension will stand reduced from Rs.9,743/- to Rs.5,846/-. The petitioner was however not paid the commuted value of pension, though only reduced pension after deducting the commuted value was being paid to him. After the pensionary benefits were revised, following the 2004 pay revision, the pensionary benefits payable to the petitioner were revised by Exhibit P3 order dated 31.7.2008. The pension was raised from Rs.9,743/- to Rs.10,472/- per mensem with effect from 1.7.2007. The commuted value of pension was raised from Rs.5,34,045/- to Rs.5,73,924/-, the commuted portion of the pension was enhanced from Rs.3,897/- to Rs.4,188/- and the pension payable after commutation with effect from 1.9.2007 was raised from Rs.5,846/- to Rs.6,284/-. By Exhibit P3, arrears of pension at the revised rate was also ordered to be paid to the petitioner. W.P(C) No. 2771 of 2009-E 3 5. Aggrieved by the reduction in pension, though the commuted value of pension had not been disbursed, the petitioner moved the Vice Chancellor and Comptroller of the Kerala Agricultural University by submitting Exhibit P4 representation. This writ petition was thereafter filed seeking the following reliefs: “i) Issue a writ of mandamus or any other appropriate writ, order or direction directing respondents 2 to 4 to release the commuted value of pension payable to the petitioner amounting to Rs.5,73,924/- with interest at the rate of 12% per annum from 1.9.2007 till date of payment. ii) issue writ of mandamus or any other appropriate writ, order or direction commanding respondents 2 to 4 to release arrears of pension payable to the petitioner deducted from the pension amount of the petitioner with effect from 1.9.2007 till date, amounting to Rs.78,803/- also with interest at the rate of 12% per annum from 1.9.2007 till date of payment.” 6. The petitioner contends that as the commuted value was not paid, the respondents are not entitled to reduce the monthly pension and that reduction in pension can take effect only from the month in which the commuted value of pension is disbursed. 7. The respondents have filed a counter affidavit wherein it is stated that the University is facing acute shortage of funds and therefore the commuted value of pension was not paid. The reduction in pension though commuted value was not paid is W.P(C) No. 2771 of 2009-E 4 justified relying on Rule 5(2) of the Pension (Commutation) Rules which stipulates that the date of effect for the reduction in pension shall be the 1st of the month in which the commuted value is drawn by the pensioner or the 1st of the fourth month of the issue of authorisation by the Accountant General including the month of issue of authorisation, whichever is earlier. 8. Relying on the stipulation in Rule 5(2) of the Pension (Commutation) Rules, respondents 2 to 4 contend even if commuted value of pension is not disbursed, the pensioner can be paid only reduced pension with effect from the 4th month of issue of the authorisation and that is the reason why reduced pension after commutation was disbursed to the petitioner with effect from 1.7.2007. The respondents however concede that the authorisation to pay pension to employees of the Kerala Agricultural University is not issued by the Accountant General but by the Comptroller of the University itself. 9. It is brought to my notice that the sum of Rs.5,73,924/- being the revised commuted value of pension was paid to the petitioner on 10.2.2009 after this writ petition was filed. Therefore the only points now raised before me by the learned counsel for the petitioner were the petitioner's entitlement for interest on the W.P(C) No. 2771 of 2009-E 5 belated payment of commuted value and his entitlement to receive full pension without taking note of the commutation till January 2009. The learned counsel for the petitioner submits that as commuted value of pension was paid only on 10.2.2009, the petitioner is entitled to receive full pension till January 2009. The petitioner contends that as no authorisation from the Accountant General is required to sanction or pay pension to employees of the Kerala Agricultural University, the date of effect for the reduction of pension can only be the first of the month in which commuted value is paid to the petitioner. The learned counsel for the petitioner contends that as commuted value was paid to the account of the petitioner only on 10.2.2009, reduction in pension will take effect only from 1st February 2009 and till then the petitioner is entitled to receive full pension. The learned standing counsel contends that it is the practice of the University to pay reduced pension with effect from the 4th month of issue of the authorisation. 10. I have considered the submissions made at the Bar by the learned counsel appearing on either side. It is not in dispute that no authorisation is issued by the Accountant General in the matter of payment of pension to employees of the Kerala Agricultural University. Therefore in my opinion, the date of effect W.P(C) No. 2771 of 2009-E 6 for the reduction of pension can only be the 1st of the month in which commuted value is drawn by the pensioner. In the instant case, the commuted value was paid to the petitioner only on 10.2.2009. Therefore reduction of pension can only be with effect from 1st of February 2009. The petitioner is therefore entitled to receive the full pension upto 31.1.2009. The respondents have admittedly not paid to the petitioner the full pension that he was entitled to. 11. The learned counsel for the petitioner submits that only after 17 months, payment of commuted value was made to the petitioner and therefore he is entitled to interest on the commuted value of pension. The learned counsel for the petitioner relies on the decision of the Apex Court in Dua V. State of Hariyana (2008(3) KLT 58) in support of his contention. The learned standing counsel for the Kerala Agricultural University submitted that the University is facing acute shortage of funds, that the monthly pension commitment is over 2.25 crores and that there was no wilful default in disbursing the commuted value of pension to the petitioner. 12. On going through the pleadings and the materials on record, it cannot be said that there was deliberate delay on the part of the University in paying the commuted value of pension to the W.P(C) No. 2771 of 2009-E 7 petitioner till January 2009. The petitioner does not dispute the fact that the University is facing financial problems. From the facts disclosed in the pleadings, I am not inclined to award to the petitioner interest on the delayed payment of commuted value of pension. In these circumstances, I dispose of this writ petition with a direction to respondents 3 and 4 to draw and disburse to the petitioner arrears of pension at the rate stipulated in Ext.P3, for the period from 1.7.2007 to 31.1.2009, without taking note of the commuted portion of the pension. Payment as directed above shall be made within three months from today. The petitioner's claim for interest on the delayed payment of commuted value of pension is declined. However it is clarified that if payment of arrears of pension is not made within the time stipulated above, the petitioner will be entitled to interest on such arrears at the rate of 7.5% per annum from this date onwards till the date of payment. Sd/- P.N.RAVINDRAN JUDGE //True Copy// PA to Judge ab