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REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 6785 OF 2014

EX  NAVY  DIRECT  ENTRY ARTIFICERS ASSOCIATION & ORS. .....APPELLANT(S)

VERSUS

THE UNION OF INDIA & ORS. .....RESPONDENT(S)

J U D G M E N T

A.K.SIKRI, J.

Appellant No. 1 is a registered Association of Ex Navy Direct Entry

Artificers, whereas appellant Nos. 2 to 5 are Ex Direct Entry Artificers of

the Navy.  Primarily, it  is the cause of appellant Nos. 2 to 5 which is

espoused  by  their  Association  as  well  i.e.  appellant  No.  1.   These

appellant Nos. 2 to 5 have rendered actual service of 10 years.  For an

Artificer  to  become  entitled  to  pension,  he  is  supposed  to  render

minimum service of 15 years as per Regulation 78 of the Navy (Pension)

Regulations,  1964.   The  appellants  claim  that  after  their  initial

engagement period of 10 years as Artificers, they were placed in Fleet

Reserve for a period of 10 years and as per Regulations, 50% of the

period of Reserve is to be counted for the purpose of pension.  On that

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basis, it is claimed that 5 years period of Reserve would enure to their

benefit and on adding this period of 5 years with actual service of 10

years, it is to be treated that they have rendered 15 years of service and

are  accordingly  entitled  to  receive  pensionary  benefits.   The

respondents  deny  the  placement  of  appellant  Nos.  2  to  5  in  Fleet

Reserve for  a period of  10 years  as claimed by the said appellants.

Therefore,  the  moot  question  is  as  to  whether  the  appellants,  after

rendering actual service of 10 years in the Navy, were drafted into Fleet

Reserve or not.   

2. The appellants had filed O.A. No. 8 of 2013 before the Armed Forces

Tribunal (hereinafter referred to as the ‘AFT’), Regional Bench, Kochi in

which prayer to grant benefit was sought by them.  The AFT, however,

has not accepted the case set up by the appellants.  As a result, their

O.A. stands dismissed by the AFT vide order dated January 22, 2014.

The  appellants  thereafter  filed  review petition  seeking  review of  that

judgment  which was also dismissed by the AFT on March 25, 2014.

Simultaneously, however, prayer for leave to appeal to this Court have

been granted by the AFT seeking authoritative pronouncement of this

Court on the following questions of law formulated by the Tribunal:

“(1) Whether the applicants’ reserve liabilities imposed at the time of enrolment ipso facto amounted to their being drafted to Fleet Reserve without any specific order to draft them to the Reserve on completion of regular Naval service? If so, whether the period of such reserve liability as per the stipulated scheme was liable to be

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taken  into  account  for  computing  the  length  of  service  of  the applicants for pension purposes?

(2)  Whether the applicants Nos. 2 to 5 were entitled to be treated at  par with the Apprentice Entry Artificers for  pension purposes only  on  the  ground  that  both  of  them  belong  to  the  same homogenous class of Artificers?

3. Both these orders passed in O.A. as well as in review petition have been

assailed  by the  appellants  by way of  instant  appeal  preferred  under

Section 30 of the Armed Forces Tribunal Act, 2007.

4. We now advert  to  the  seminal  facts  which  have  led  to  the  present

litigation.     

5. In the Indian Navy, the sailors are of two classes, the Artificers class and

the non-Artificer class.  Artificers are considered to be skilled sailors and

they work on sophisticated technologies of warships.  For the Artificer

Class,  there  are  two  channels  of  Entry,  known  as  Apprentice  Entry

Artificers and Direct Entry Artificers.  The appellants joined Indian Navy

as Direct Entry Artificers.  At the relevant point of time (i.e. prior to July 3,

1976), the initial engagement of the Apprentice Entry Artificers as well as

of the Direct Entry Artificers (appellants herein) was for 10 years active

service.   On the expiry of  this  term,  they could be drafted into Fleet

Reserve for a period of 10 years.  A person who is kept in Fleet Reserve

can be recalled at any time, during the said period of 10 years, to serve

in the Navy.  

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6. The  Apprentice  Entry  Artificers  (with  education  qualification  of

Matriculation) get 4 years training in Indian Navy during which period

they get a special rate of pay (fixed stipend per month).  After the 4

years  training  period  in  naval  establishment,  the  Apprentice  Entry

Artificers are advanced to the rank of Artificer Vth Class and their initial

engagement of 10 years active service commences.  At the end of it,

they  could  also  be  kept  in  Fleet  Reserve  for  10  years.   It  may  be

mentioned that after one year in the rank of Artificer Vth Class, these

Apprentice Entry Artificers are advanced to the rank of Artificer Acting

IVth Class to complete the engagement 10 years active service.  On the

other hand, Direct Entry Artificers, to which class appellants belong, with

qualification  of  3  years  Diploma  in  Engineering  from  recognized

Universities in the country are directly enrolled to the rank of Artificer

Acting IVth Class with initial engagement of 10 years active service.  It

may also be stated that in the rank of Artificer Acting IVth Class, the

Apprentice  Entry  Artificers  and  Direct  Entry  Artificers  are  merged

together,  and  are  treated  at  par  for  the  purposes  of  rank,  work,

promotions, pay and allowances, leave and other benefits allowed for

sailors.  They are all governed by the same Navy (Pension) Regulations,

1964.  In their respective ranks, they relieve each other when transferred

to ships and establishments.  

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7. These  facts  are  noted,  as  stated  by  the  appellants,  because  of  the

reason  that  the  appellants  are  claiming  that  since  Apprentice  Entry

Artificers  are  given  the  pension,  after  counting  the  4  years  training

period  in  Naval  Establishment,  same  treatment  be  given  to  the

appellants as well.  Question No. 2 framed by the AFT and referred to

this Court touches upon this aspect.

8. Reverting to the facts of  the appellants’ case,  as pointed out  above,

appellant Nos. 2 to 5 were engaged as Direct Artificers for a period of 10

years.  All these appellants were engaged prior to July, 1976.  This is the

actual service rendered by them.  According to them, they were drafted

into Fleet Reserve for a period of 10 years and 50% of this period have

been counted for  pension.   On that  basis,  they claim that  they have

become entitled to receive pension.  Therefore, they made a request on

May 10, 2012 to the respondents to grant pension to them.  However,

vide reply dated June 25, 2012, respondents turned down their request

as ‘not tenable in accordance with the extent  rules/regulations’.   The

reason  given  by  the  respondents  was  that  the  appellants  were  not

drafted into Fleet Reserve at all and, therefore, there was no reason to

count 50% of the Fleet Reserve period.  The respondents, in this behalf,

referred to Government  Order  No.  AD/5374/2/76/2214/S/D(N.II)  dated

July 3, 1976 as per which drafting into Fleet Reserve was discontinued

from 1976 onwards and, therefore, the appellants were never drafted

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into Fleet Reserve.  After receiving this rejection of their  request,  the

appellants approach the AFT in the form of O.A. which has met the fate

of dismissal, as already mentioned above.   

9. A perusal of the impugned judgment of the AFT would reveal that the

appellants were enrolled into Navy under Regulation 268(1) of the Navy

Regulations,  Part  III.   Regulation  269  thereof  provides  for  an  initial

engagement of 10 years, followed by liability to remain 10 years in Fleet

Reserve.  However, further 10 years service in Fleet Reserve is subject

to regulations of Fleet Reserve.  At the time of recruitment itself of the

appellants, it  was made clear to them that they would be drafted into

Fleet Reserve only if required and regulations for Indian Fleet Reserve

specifically stipulate that ‘no man can claim to join Fleet Reserve as a

right’.  Therefore, the appellants did not have any automatic right to get

drafted into Fleet Reserve.  In any case, in terms of Government’s letter

dated  July  3,  1976,  transfer  of  sailors  into  Fleet  Reserve  was

discontinued and, therefore,  no orders for  drafting the appellants into

Fleet Reserve were ever made.  There is no notation on records that

they  are  being  drafted  into  Fleet  Reserve  on  expiry  of  their  active

service.   In  this  behalf,  the  AFT  has  quoted  relevant  portion  of

Government’s letter dated July 3, 1976 which is as under:

“SUB: CONDITIONS OF SERVICE OF SAILORS.  I am directed to state that the President is pleased to approve the following modifications in the conditions of service of sailors:--  - - - -

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(f) Transfer to Current Fleet Reserve:-- Transfer of sailors into the Fleet Reserve to be discontinued. -------  

3. Appropriate Government Regulations/Orders will be amended in due course.”

10.The AFT also found that subsequently, Regulations for the Navy was

amended by the Government of India vide SRO.No.106 of 1978 dated

28th March 1978. Relevant portions of the SRO are given below:  

“S.R.O.106:-- In exercise of the powers conferred by section 184 of  the  Navy  Act,  1957  (62  of  1957),  the  Central  Government hereby makes the following regulations further to amend the Navy Ceremonial, Conditions of Service and Miscellaneous Regulations, 1964, namely:--  

2.   In  the  Naval  Ceremonial,  Conditions  of  Service  and Miscellaneous Regulations, 1964--

(i)  in  regulation 269,  in  sub-regulation (1),  for  the brackets and figure “(1)”, the brackets, figure and words “(1) Old Entrants” shall be substituted,  and after  subregulation (1)  as so amended,  the following sub-regulation shall be inserted, namely:--

“(1A)  New Entrants:--(a)  Boys,  Artificer,  Apprentices  and  Direct Entry sailors may be enrolled for a period calculated to permit a period  of  15  years'  service  to  be  completed  from  the  date  of enrolment  or  from  the  date  of  attaining  the  age  of  17  years, whichever is later, provided their services are so long required.

…...........  

(1B)(a) In case of the existing sailors, their period of engagement shall be governed by sub-regulation (1), except that they shall not be transferred to Fleet Reserve.  

(b) . . . . . .  

(1C) Persons joining service on or after the 3rd July, 1976 shall be deemed to be New Entrants.”  

11.After  going  through  the  various  provisions  of  Navy  Act,  Navy

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Regulations, Part III and the aforesaid amendments, the AFT culled out

the  relevant  features  in  the  form  of  salient  points  in  the  following

manner:

“25. Salient points that emerge from the above Regulations, which are of relevance in this case are:--  

(a) Sailors having 10 years continuous service shall be liable, if required, for further service in Indian Fleet  Reserve, subject  to provisions  of  Regulations  for  Indian  Fleet  Reserve  (Regulation 269).  

(b)  When  an  active  service  rating  is  within  six  months  of completion  of  his  term  of  enrollment,  the  Commanding Officer has to inform the Registrar of Reserves whether or not he is recommended for Fleet Reserve Service and his service certificate is to be endorsed accordingly (Regulation 11 of Fleet Reserve).

(c)  Qualifications  have  been  specified  for  enrolment  into  Fleet Reserves. Joining Reserves is not a Right (Regulations 4 and 6 of Fleet Reserves).

(d)  Recruiting  officers  are  mandated  to  explain  and  make  the recruits  fully  understand  terms  and  conditions  of  service  and liabilities before they are enrolled into the Navy (Regulation 264 of Regulations for the Navy).

(e) A Fleet Reservist Certificate will be issued to each person on enrolment in Fleet Reserves.  

26. It is evident from the Regulations that a Sailor after his active service  has  to  be  drafted  into  Fleet  Reserve  and  it  is  not  an automatic re-enrollment. There is no specific claim or right to join the Fleet Reserve as there are terms and conditions which have to be  fulfilled  by  a  person  before  he  can  be  drafted  into  Fleet Reserve. It is also evident that,  at the time of initial enrollment no recruit can be given any guarantee/promise of his being enrolled into Fleet Reserve as his performance in the active service and recommendations he receives would decide his eligibility  for  enrollment  into  Fleet  Reserve. Therefore  even prior to the promulgation of policy for discontinuance of drafting into Fleet Reserve from 1976, Respondents 1 and 2 were clearly at liberty to decide if a Sailor is to be enrolled into Fleet Reserve or not. In view of the above, we cannot agree with the submission of

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the  learned  counsel  for  applicants  that  they  were  made  to understand anything else.”

12.The appellants advanced two arguments before the AFT.  In the first

instance,  it  was  argued that  at  the  time of  their  recruitment  into  the

service, which was before the Government’s order dated July 3, 1976

was passed, they were given to understand that they would be rendering

10 years of active service followed by 10 years of Fleet Service.  Thus,

they understood that  50% of  the Fleet  Service was counted towards

pension to enable them to receive pension.  Hence, the Government

was bound by Principle of Promissory Estoppel to accord the aforesaid

benefit to them. Second argument advanced by the appellants was that

the  appellants,  namely,  Direct  Entry  Artificers  and  Apprentice  Entry

Artificers formed a homogenous class.  Thus, when pensionary benefits

were accorded to the Apprentice Entry Artificers, there was no reason to

deny the same to the appellants and such a denial was discriminatory

and violated the provisions of Article 14 of the Constitution of India.  Both

these contentions have been negated by the AFT.  At the same time, as

already noticed above, on both these aspects, questions of law have

been framed while granting leave to appeal to the appellants.   

13.We now proceed to take up the two questions for our consideration.   

Question No. 1 - Whether the applicants’ reserve liabilities imposed at the time of enrolment ipso facto amounted to their being drafted to Fleet Reserve  without  any specific  order  to  draft  them to  the  Reserve  on

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completion of regular Naval service? If so, whether the period of such reserve liability as per the stipulated scheme was liable to be taken into account for computing the length of service of the applicants for pension purposes?

14.To find an answer to the aforesaid question, we shall have to traverse

through some relevant provisions of the Navy Act, the Naval Regulations

Part-III as well as decision taken by the Government to discontinue with

the  policy  of  drafting  into  Fleet  Reserve.   Insofar  as  Navy  Act  is

concerned, following provisions therefrom are relevant for deciding the

controversy.   

“14.  Liability for service of officers and sailors:--  

(1)   Subject  to  the  provisions  of  sub-section  (4),  officers  and sailors shall  be liable to serve in the Indian Navy or the Indian Naval Reserve Forces, as the case may be, until  they are duly discharged, dismissed with disgrace, retired, permitted to resign, or released.

17.   Provisions  as  to  discharge.—(4) Every  sailor  who  is dismissed,  discharged,  retired,  permitted  to  resign  or  released from service shall  be furnished by the prescribed officer  with  a certificate  in  the  language which  is  the  mother  tongue of  such sailor and also in the English language setting forth—

(a) the authority terminating his service;

(b)  the cause for such termination; and

(c) the full period of his service in the Indian Navy and the Indian Naval Reserve Forces.

[184A. Power to make regulations with retrospective effect.— The  power  to  make  regulations  conferred  by  this  Act  shall include the power to give retrospective effect, from a date not earlier  than  the  date  of  commencement  of  this  Act,  to  the regulations or any of them, but no retrospective effect shall be given to any regulation so as to prejudicially affect the interests of any person to whom such regulation may be applicable.”

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15.The relevant  regulations from the  Pension Regulations  for  the Navy,

1964 are re-produced below:

“78.  Minimum qualifying service for pension – Unless otherwise provided, the minimum service which qualifies for service pension is fifteen years.

79.  Service  qualifying  for  pension  and  gratuity  –  (1)  All service from the date of enrolment or advancement to the rank of ordinary seaman or equivalent to the date of discharge shall qualify for pension or gratuity with the exception of -----

87.  Sailors transferred to the reserve—A sailor transferred to the reserve after  earning a service pension shall  be granted such pension from the date of his transfer.

……..

92.  Reservist pension and gratuity--(1)  A reservist who is not in receipt of a service pension may be granted, on completion of the  prescribed naval and reserve qualifying service of ten years each, a reservist pension of rupees eleven per mensem or a gratuity of rupees nine hundred in lieu of pension.

(2)  A reservist who is not in receipt of a service pension and whose qualifying service is less than the period of engagement but not less than fifteen years may, on completion of the period of engagement or on earlier discharge from the serve otherwise than  at  his  own  request,  be  granted  a  reservist  pension  at rupees seven hundred and fifty in lieu of pension.”

16.Navy Regulations Part III laid down the conditions of service of sailors in

the Navy.  Some of the provisions thereof, with which we are concerned,

are as under:

“261.  Recruitment – The Chief of the Naval Staff may recruit sailors required for the Service.

(2)  Recruitment  of  sailors  shall  be  made  through  boy  entry, artificer apprentice entry, and direct entry, as necessary…. ……..

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268.  Engagements – (1) Boys, Artificer Apprentices and Direct Entry  sailors  shall  be  enrolled  for  co0ntinuous  service  as provided in sub-regulation (1) of Regulation 269.

269.   Continuous  Service  –  (a)  Old  Entrants  Boys,  Artificer Apprentices  and  Direct  Entry  sailors  may  be  enrolled  for  a period calculated to permit a period of 10 years’ service to be completed from the date of attaining 17 years of age or from the  date  of  being  ranked  in  the  Man’s   rank  on  successful completion of initial training, whichever is later, provided their services are so long required.

Continuous  Service  sailors  of  all  Branches shall  be liable,  if required,  for  a  further  10  years’  service  in  the  Indian  Fleet Reserve,  subject  to  the  provisions  of  the  Regulation  for  the Indian Reserve.

(1-A)  New Entrants:- (a)  Boys, Artificer-Apprentices and Direct Entry sailors may be enrolled for a period calculated to permit a period of 15 years service to be completed from the date of attaining the age of 17 years,  whichever is later, provided their  services are so long required. ……. (1-B)  (a)  In  case  of  the  existing  sailors,  their  period  of engagement shall be governed by sub regulation (1) except that they shall not be transferred to Fleet Reserve. ……….

(1-C)  Persons joining service on or after the 3rd July, 1976 shall be deemed to be New Entrants.”

17.It will also be apt to reproduce Regulation 269 (unamended) as it existed

prior  to  the  amendments  carried  out  in  the  year  1978,  which  is  as

follows:

“269.  Continuous Service: – (1)  Boys, Artificer Apprentices and Direct  Entry sailors may be enrolled for  a period calculated to permit a period of 10 years’ service to be completed from the date of attaining 17 years of age or from the date of being rated in the Mans rate on successful completion of initial training, whichever is later, provided their services are so long required.  

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Continuous  Service  sailors  of  all  Branches  shall  be  liable,  if required,  for  a  further  10  years’  service  in  the  Indian  Fleet Reserve,  subject  to  the  provisions  of  the  Regulations  for  the Indian Fleet Reserve.”

18.We have already reproduced portions of Government of India’s decision

dated 3rd July, 1976 whereby transfer of Sailors into Fleet Reserve was

discontinued.  Likewise, we have already extracted the relevant portions

of  SRO  106  dated  28th March,  1976.  In  addition,  it  would  also  be

pertinent  to  note  Regulations  for  Indian  Fleet  Reserve  which  are  as

follows:

“4.  Regulation 4, lays down Qualification criteria in respect of Character, Efficiency, Medical Status and Age for joining the fleet reserve.

6.  Claim to join Fleet Reserved:--No man can claim to join the Fleet Reserve as a right.

……..

11.  Enrolment:-- The Registrar of Reserves is authorized to enrol or  re-enrol  ratings  in  the  Royal  Indian  Fleet  Reserve,  acting under the authority of the Officer Commanding the Royal Indian Navy.

(a)   When  an  Active  Service  rating  is  within  six  months  of completing his terms of enrolment the Commanding Officer of the ship in which he is serving is to inform the Registrar whether or not  he  is  recommended  for  Fleet  Reserve  Service  and  is  to endorse his Service Certificate accordingly.

13.   Fleet  Reservist  Certificate:--  Every  man  on  enrollment  or re-enrollment in Royal Indian fleet Reserve is to be issued with a Fleet  Reservist  Certificate  (Form  RINF.3P).   This  certificate identifies the man as a member of the Royal Indian Fleet Reserve and contains a detachable Emergency Movement Order for use on General Mobilisation.

19. Regulation  19  lays  down mandatory  training  period  for reservists.

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21.   Notations  on  Service  Certificates:--  On  the  conclusion  of each  period  of  training  the  Registrar  will  cause  the  following information to be entered in the Service Certificates of the ratings concerned:--

(a)  Character. (b)  Ability in substantive rating held. (c) Fitness to hold non-substantive rating (vide Article 7(v)]

The Registrar is to sign the Service Certificate on page 4 as being satisfied that the prescribed training has been carried out and that the man is in possession of his Fleet Reservist Certificate and know where to report on mobilization.”

19.Following position emerges from the conjoint reading of the aforesaid

provisions:

(i) Once a person is enrolled as Sailor/Officer in the Indian Navy, he is

liable to serve in the Indian Navy or in the Indian Naval Forces, as the

case may be, until  he is discharged, dismissed with disgrace, retired,

permitted to resign or released.

(ii) In  the  event  of  discharge,  dismissal  etc,  i.e.,  at  the  time  of

severance from Naval service, every sailor has to be furnished with a

certificate in his mother tongue and also in English language.  Such a

certificate states the authority terminating his services; the cause of such

termination;  and the full period of service in the Indian Navy and the

Indian Naval Reserve Forces.   

(iii) In order to become qualified to receive service pension, minimum

service of 15 years is required.

20.Calculating the qualifying period for the purpose of pension and gratuity,

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entire service from the date of enrolment or advancement to the rank of

ordinary seaman or equivalent till the date of discharge is to be counted.

Thus, whereas full continuous service in the Navy is to be reckoned for

pension,  insofar  Fleet  Reserve  is  concerned  those  who  are  drafted

thereinto are entitled to count 50% of the period of Fleet Reserve as

reckonable service towards pension.

21.Insofar  as,  drafting  into  Fleet  Reserve  is  concerned,  Regulations  in

respect thereof provide as under:

(i) Those  Sailors  who are  having  10 years’  service  as Sailors  are

eligible for drafting in Indian Fleet Reserve.

(ii) As  per  Regulation  269,  those  who  have  rendered  10  years’

service,  their  service  is  to  be  treated  as  continuous  service.  This

Regulation  further  provides  that  continuous  service  of  Sailors  of  all

branches shall be liable, if required, for a further 10 years’ service in the

Indian Fleet Reserve.

(iii) Regulation 4 of the Regulations for Indian Fleet Reserve lays down

qualification  criteria  in  respect  of  character,  efficiency, medical  status

and age for joining the Fleet Service, which means only those who fulfill

qualifications contained in Regulation 4 can be considered for drafting

into Fleet Reserve.  Further, Regulation 6 specifically declares that no

person can join the Fleet Reserve as a matter of right.  The manner of

enrolment is mentioned in Regulation 11, as per which, Commanding

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Officer has to make a specific recommendation for such an enrolment,

i.e., he has  to say as to whether or not he is recommending a particular

Sailor  for  Fleet  Reserve service and his  service certificate has to be

endorsed accordingly.

(iv) In case of  positive recommendation,  a Fleet  Reserve certificate

has to be issued to such a person on enrolment in Fleet Reserve.

22.It  is  clear  from  the  above  that  liability  to  serve  in  the  Indian  Fleet

Reserve, if required, as stipulated in Regulation 269, is only when such

a Sailor is drafted into Indian Fleet Reserve.  There has to be, thus, a

positive act of enrolment in the Fleet Reserve. A person who is enrolled

as Artificer in the Indian Navy and completes 10 years’ of service, cannot

presume that he stands automatically enrolled in Fleet Reserve.

23.So far  as  Appellant  Nos.  2  to  5  are  concerned,  there  was  no  such

enrolment in Fleet Reserve.

24.In fact,  the appellants were conscious of  the aforesaid position.  That

was the reason that Principle of Promissory Estoppel was invoked on

the ground that since their  enrolment was prior to July 03, 1976, the

decision of the Government of India to discontinue transfer of Sailors

into Fleet Reserve as contained in communication dated July 03, 1976 is

not binding on them.  Even if we proceed on that basis, the legal position

that  has  been  culled  out  from  the  relevant  statutory  provision  and

17

enumerated above, clearly shows that there was no promise held out to

these appellants that after the completion of continuous service of 10

years as Sailors, they would be drafted into Fleet Reserve.  The Tribunal

has correctly remarked that at the time of initial enrolment no recruit can

be given any guarantee/promise of his being enrolled into Fleet Reserve

as  his  performance  in  the  active  service  and  recommendations  he

receives would decide his  eligibility for  enrolment into Fleet  Reserve.

Therefore, even prior to the promulgation of policy for discontinuance of

drafting into Fleet Reserve from 1976, Respondent Nos. 1 and 2 were

clearly at liberty to decide if a Sailor is to be enrolled into Fleet Reserve

or not.  It may be pertinent to mention that the aforesaid view of ours has

not been taken for the first time.  We are not treading on unchartered

territory.   Precisely,  this  very  question  has  been decided  by a  three

Judge Bench of this Court in T.S. Das & Ors. v. Union of India & Anr.1.

The factual background in which the aforesaid judgment is rendered is

identical as can be seen from the following question posed therein for

determination:

“25. In the absence of an express order of the competent authority to  take  the  applicants  on  the  Fleet  Reserve  Service,  the  moot question is: whether the applicants can be treated as deemed to be in the Fleet Reserve Service on account of the stipulation in the appointment  letter—that  on  completion  of  10  years  of  naval service as a Sailor, they may have to remain on Fleet Reserve Service for another 10 years. That condition in the appointment letter  cannot  be  read  in  isolation.  The  governing  working conditions of Sailors must be traced to the provisions in the 1957 Act  or  the  Regulations  framed  thereunder  concerning  service

1 (2017) 4 SCC 218

18

conditions. From the provisions in the 1957 Act, there is nothing to indicate  that  the  Sailor  after  appointment  or  enrolment  is “automatically” entitled to continue in Fleet Reserve Service after completion  of  initial  active  service  period  of  10  years.  The provisions,  however, indicate that  on completion of  initial  active service  of  10  years  or  enhanced  period  as  per  the  amended provisions is entitled to take discharge in terms of Section 16 of the Act. The applicants assert that none of the applicants opted for discharge. That, however, does not mean that they would or in fact have continued to be on the Fleet Reserve Service after expiration of the term of active service as a Sailor. There ought to have been an express order issued by the competent authority to draft the applicant concerned in the Fleet Reserve Service. In the absence of  such  an  order,  on  completion  of  the  term  of  service  of engagement,  the  Sailor  concerned  would  stand  discharged. Concededly,  retention  on  the  Fleet  Reserve  Service  is  the prerogative  of  the  employer,  to  be  exercised  on  case-to-case basis.  In  the  present  case,  however,  on  account  of  a  policy decision, the Fleet Reserve Service was discontinued in terms of Notification dated 3-7-1976.”

25.The Court reproduced the aforesaid notification dated July 7, 1976 and

continue with the discussion in the following manner:

“27.  As  noted  hitherto,  none  of  the  relevant  provisions  even remotely suggest that the Sailor is “automatically”  transferred to the Fleet Reserve Service. Whereas, it is expressly provided that on  expiration  of  the  term  of  service  of  engagement  the  Sailor would be placed on Fleet Reserve Service only if an express order in that behalf is passed by the competent authority to draft him on the Fleet Reserve and not otherwise. Section 16 of the Act merely gives an option to the Sailor to take a discharge after expiration of term of service of engagement. It is not a deeming provision that if such option is not exercised by the Sailor concerned, he would be treated as having been drafted on the Fleet Reserve Service for another 10 years “automatically”.

28.  Regulation  269  spells  out  the  conditions  of  service.  It reinforces  the  position  that  the  services  of  a  Sailor  would  be continued “so long required” or “if required”. The second part of sub-regulation  (1)  of  that  Regulation  uses  the  expression  “if required”, for further 10 years' service in the Indian Fleet Reserve, subject  to the provisions of the Regulations for the Indian Fleet Reserve. This view taken by the Tribunal (Principal Bench, New Delhi)  in  Niranjan  Chakroborty  v.  Union  of  India  [Niranjan

19

Chakroborty  v.  Union  of  India,  2010  SCC  OnLine  AFT  803] commends to us.

29.  As aforesaid, on introducing the new policy on 3-7-1976, the Fleet Reserve was discontinued and instead the Sailors in service at  the relevant  time were given an option to continue in active service for a further term of 5 years. Some of the Sailors opted to continue till completion of 15 years, who, then became eligible for “service pension” having qualifying service.

30.  The  quintessence  for  grant  of  reservist  pension,  as  per Regulation 92, is completion of the prescribed Naval and Reserve qualifying service of 10 years “each”. Merely upon completion of 10 years of active service as a Sailor or for that matter continued beyond  that  period,  but  falling  short  of  15  years  or  qualifying Reserve Service, the Sailor concerned cannot claim benefit under Regulation 92 for grant of reservist pension. For, to qualify for the reservist pension, he must be drafted to the Fleet Reserve Service for a period of 10 years. In terms of Regulation 6 of the Indian Fleet Reserve Regulations, there can be no claim to join the Fleet Reserve as a matter of right. None of the applicants were drafted to  the  Fleet  Reserve  Service  after  completion  of  their  active service. Hence, the applicants before the Tribunal, could not have claimed the relief of reservist pension...”

26.In the absence of any such assurance of enrolment of drafting into Fleet

Reserve, at the time of initial  recruitment, the Principle of Promissory

Estoppel cannot be invoked.  The Tribunal has, in this behalf, taken note

of certain judgments2 of this Court and on that basis rightly concluded

that mere recruitment/enrolment  for  active as well  as reserve service

without  making  any  order  of  transfer  to  Indian  Fleet  Reserve  under

Regulation 269 of Navy Regulation Part  III  as well  as Regulations of

Indian  Fleet  Reserve,  it  cannot  be  treated  that  any  promise  was

accorded to  the  appellants  about  drafting  into  Fleet  Reserve,  at  any

2 Motilal Padampat Sugar Mills Co. Ltd. v. State of Uttar Pradesh & Ors. (1979) 2 SCC 409; Bakul Cashew Co.  & Ors. v. Sales Tax Officer, Quilon & Anr. (1986) 2 SCC 365

20

time.  We would, at this juncture, like to reproduce para 31 of T.R. Das

case.   

“31. The original applicants contend that if the Government Policy dated 3-7-1976 is applied to the serving Sailors, inevitably, it will result in retrospective application thereof to their detriment. That is forbidden by Section 184-A of  the Act.  This argument  does not commend to us. In that, the effect of the Government Policy is to disband the establishment of the Reserve Fleet Service with effect from 3-7-1976. As found earlier, drafting of Sailors to the Reserve Fleet  Service was not automatic,  but dependent on an express order to be passed by the competent authority in that behalf on case-to-case basis. The Sailors did not have a vested or accrued right for being placed in the Reserve Fleet Service. Hence, no right of  the  Sailors  in  active  service  was  affected  or  taken  away because of the Policy dated 3-7-1976...”

27.It would, however, be pertinent to mention here that in T.R. Das, though

the Court had specifically held that such direct Entry Artificers were not

entitled to reservist pension, they were entitled for special pension, in

terms of Regulation 95 of the Pension Regulations. The relevant portion

of the discussion which ensued on this aspect is contained in paras 34

and 36 of the judgment in T.R. Das and these paras read as under:

“34.  The next  question is  whether the Sailors  appointed before 1973 were entitled to a special pension, in terms of Regulation 95 of the Pension Regulations. Indeed, this is a special provision and carves out a category of Sailors, to whom it must apply. Discretion is vested in the Central Government to grant special pension to such Sailors,  who fall  within  the excepted category. Two broad excepted  categories  have been noted  in  Regulation  95.  Firstly, Sailors who have been discharged from their duties in pursuance of the government policy of reducing the strength of establishment of the Indian Navy; or secondly, of reorganisation, which results in paying  off  of  any  ships  or  establishment.  In  the  present  case, clause (i) of Regulation 95 must come into play, in the backdrop of the policy decision taken by the Government as enunciated in the Notification dated 3-7-1976. On and from that date, concededly, the Fleet Reserve Service has been discontinued. That, inevitably results in reducing the strength of the establishment of the Fleet

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Reserve of the Indian Navy to that extent, after coming into force of  the  said  policy. None of  the  Sailors  have been or  could  be drafted to the Fleet Reserve after coming into force of the said policy—as  that  establishment  did  not  exist  anymore  and  the strength of establishment of the Indian Navy stood reduced to that extent. Indisputably, the Sailors appointed prior to 3-7-1976, had the  option  of  continuing  on  the  Fleet  Reserve  Service  after expiration  of  their  active  service/empanelment  period.  As  noted earlier,  in  respect  of  each  applicants  the  appointment  letter mentions the period of  appointment as 10 years of initial  active service  and  10  years  thereafter  as  Fleet  Reserve  Service,  if required.  The option  to  continue  on  the  Fleet  Reserve  Service could  not  be  offered  to  these  applicants  and  similarly  placed Sailors, by the Department, after expiration of their empanelment period of 10 years or less than 15 years as the case may be. It is for that reason, such Sailors were simply discharged on expiration of  their  active  service/empanelment  period.  In  other  words,  on account of discontinuation of the Fleet Reserve establishment of the Indian Navy, in terms of Policy dated 3-7-1976 it has entailed in reducing the strength of establishment of the Indian Navy to that extent.

xxx xxx xxx

36.  Thus understood, all Sailors appointed prior to 3-7-1976 and whose tenure of initial active service/empanelment period expired on or after 3-7-1976 may be eligible for a special pension under Regulation 95, subject, however, to fulfilling other requirements. In that, they had not exercised the option to take discharge on expiry of engagement (as per Section 16 of the 1957 Act) and yet were not  and could not  be drafted by the competent  authority to the Fleet  Reserve  because  of  the  policy  of  discontinuing  the  Fleet Reserve Service w.e.f. 3-7-1976. The cases of such Sailors (not limited  to  the  original  applicants  before  the  Tribunal)  must  be considered  by  the  competent  authority  within  three  months  for grant of a “special pension” from three years prior to the date of application made by the respective Sailor  and release payment after  giving  adjustment  of  gratuity  and death-cum-retirement-gratuity (DCRG) already paid to them from arrears.  They  shall  be  entitled  for  interest  @  9%  p.a.  on  the arrears, till the date of payment.”

28.We,  thus,  answer  question  no.  1  in  the  negative  and  hold  that  the

appellants are not entitled to count 50% of the Fleet Reserve as they

were never drafted into the said reserve.  Consequently, the appellants

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are not  entitled to reservist  pension.   However, their  cases would be

considered for grant of special pension on same lines as was done in

T.R. Das judgment and directed in para 36 of the said judgment.   

Question No. 2 - Whether the applicants Nos. 2 to 5 were entitled to be treated at par with the Apprentice Entry Artificers for pension purposes only on the ground that both of them belong to the same homogeneous class of Artificers?

29.Insofar  as  Apprentice  Entry  Artificers  are  concerned they are  getting

pension  and  the  appellants’  claim  that  since  Artificer  is  one

homogeneous class, whether the Entry thereto is after completing the

Apprenticeship  course  or  it  is  a  direct  entry  (as   in  the  case  of

Appellants) all the Artificers are to be treated alike. There is no quarrel

about this proposition. However, in the instant case, we are concerned

with the question as to whether the appellants are eligible for service

pension even after they have rendered only 10 years of service (as they

are held not entitled to count any period of Fleet Reserve in which they

were never drafted).  Had Apprentice Artificers also got the pension on

rendition of 10 years’ service, there would have been some force in the

argument of the appellants.  However, that is not so.  As already noted

above, insofar as Apprentice Entry Artificers are concerned, they had

undergone  4  years’  training  in  Naval  establishment.  Thereafter,  they

were advanced to the rank of Artificer V and their initial engagement of

10 years’ active service commenced.     After one year in the rank of

Artificer Vth Class, these Apprentice Entry Artificers were advanced to

23

the rank of Artificer acting IVth Class.  In their cases,  the training period

of four years has been counted for  considering their  eligibility for  the

purpose of pension.  This has happened pursuant to the judgment of this

Court in  Anuj Kumar Dey & Anr.  v.   Union of India & Ors.3.  In the

cases  of  Apprentice  Entry  Artificers,  the  Government  had  refused to

reckon the period for the purpose of pension.  The question before this

court was as to whether the training period spent on Apprentice Artificers

was liable to be taken into account for pension purposes.  The Court

decided the question in favour of the Apprentice Entry Artificers.  Thus,

these  Apprentice  Entry  Artificers  became  entitled  to  pension  on  the

inclusion of training period towards the service.  Their case is, therefore,

entirely different from the appellant’ who are Direct Entry Artificers and

had no benefit of such training.

30.An attempt was made by learned counsel for appellants to argue that

Anuj Kumar Dey  does not lay down correct law as the training period

could  not  have  been  reckoned  for  calculating  qualifying  period  for

pension.   However, it  is  not  open to the appellants to raise such an

argument.   In  the  first  place,  this  argument  would  not  enure  to  the

benefit of the appellants as it would not entitle them to pension in any

case.  Even if the contention of the appellants is presumed as correct,

the  only  effect  thereof  would  be  to  hold  that  even  Apprentice  Entry

3 (1997) 1 SCC 366

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Artificer are not entitled to pension.  We may note, however, that learned

counsel for  appellants was candid in his submission that   he did not

want  Apprentice  Entry  Artificers  to  be  deprived  of  their  pension.

Secondly, in  any case,  in  the absence of  Apprentice  Entry Artificers,

such an argument cannot be considered. Thirdly, the law laid down in

Anuj Kumar Dey has held the filed for more than 20 years and there is

no reason to  upset  the  same.   For  all  these reasons,  we  reject  the

contention and answer Question no. (2) against the appellants.

31.As a consequence, this appeal stands dismissed insofar as claim for

reservist pension is concerned.  However, their cases for grant of special

pension shall be considered as directed above.   

No order as to costs.

.............................................J. (A.K. SIKRI)

.............................................J. (ASHOK BHUSHAN)

NEW DELHI; MAY 08, 2018.