Case: K. L. Rathee Vs. Union Of India &amp; Ors

On 1.5.1968 the petitioner retired from Government service as Secretary, Industrial Licensing Policy Inquiry Committee and Joint Secretary to the Government of India in the Ministry of Industrial Development and Company Affairs, New Delhi. The petitioner got pension and other retirement benefits according to the Government rules in force at that time. On 25.5.1979 the Government of India introduced Liberalised Pension Formula. The main feature of this Formula was that it introduced revised method of calculation of pension based on slab system and raised monthly pension to Rs. 1,500/- per month. The benefit of the Liberalised Pension Formula, 1979 was made available only to those Government servants who retired on or after 31.3.1979. A Writ Petition was filed in this Court challenging the fixation of the cut-off date of 31.3.1979 for payment of liberalised pension. It was claimed that irrespective of the date of retirement, the benefit of the Liberalised Pension Formula must be made available to all the pensioners. This Court upheld the contention of the petitioner and held that all the pensioners governed by 1972 Rules will be governed by this liberalised scheme of pension irrespective of the date of their retirement. In that case, D.S. Nakara and others v. Union of India and others, 1983(2) SCR 165, it was argued on behalf of the petitioners that all petitioners entitled to receive pension under the relevant rules formed a class irrespective of the date of their retirement. There could not be a mini classification within this class. The classification based on retirement before or subsequent to the specified date was invalid. The scheme of liberalisation in computation of pension must be uniformly enforced with regard to all pensioners.2. On the basis of the judgment of this Court on 22.10.1983 the Government issued orders extending the benefit of the judgment to all pensioners covered by CCS (Pension Rules) as well as Liberalised Pension Rules, 1950.3. After promulgation of the Order dated 22.10.1983 doubts arose regarding the extent of the benefit of various liberalisations made from time to time in Pension Rules. It was clarified by the Government that only the benefit of this liberalisation should be allowed to all pensioners as had been mentioned in the Government Orders dated 22.10.1983. In all other respects the rules, prevalent on the date of retirement of the pensioners, will apply.4. According to the clarification issued by the Ministry of Finance, the revised pension is to be computed on the average emoluments drawn during the last 10 months of service. This rule will apply to all the pensioners. However, the definition of emoluments as in force at the time of the retirement of an employee has not undergone any change. The case of the petitioner is that following Nakaras case he has to be given the same amount of pension as other employees of his rank irrespective of the date of retirement.

Court's reasoning:
6. We are unable to uphold this contention. Nakaras case (supra) dealt with the manner of calculation of pension on the basis of average emoluments of a retired Government employee. Prior to the liberalisation of the formula for computation of pension made by the memorandum dated 25th May, 1979, average emoluments of the last thirty months of service of the employee provided the basis for calculation of pension. The 1979 memorandum provided that average emoluments must be calculated on the basis of the emoluments received by a Government servant during the last ten months of the service. That apart, a new slab system for computation of pension was introduced and the ceiling on pension was raised. As a result of these changes, the pensioners who retired prior to the specified date suffered triple jeopardy, viz., lower average emoluments, absence of slab system and the lowerview of the aforesaid, this writ petition must fail and is dismissed with no order as to costs.