REPORTABLE

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

CIVIL APPEAL No.14739 of 2015

SENIOR DIVISIONAL MANAGER, LIFE INSURANCE CORPORATION OF INDIA & ORS. ….Appellants

Versus

SHREE LAL MEENA ….Respondent

With: C.A. Nos.3138-3141_of 2019 [  arising from SLP(C) Nos.5716-5719 of 2016  ] C.A. No.10904 of 2016

J U D G M E N T

SANJAY KISHAN KAUL, J.

1. Employees  resigned from service.   We are  concerned  with  one

employee of the Life Insurance Corporation of India; one employee of

the United India Insurance Company Limited and a batch of employees

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of Andhra Bank.  These employees resigned when the pension schemes

in respect of these institutions in question were not in force.  The pension

schemes came into force subsequently, but with retrospective effect.  The

question,  which,  thus,  arose  was  whether  these  employees,  who  had

resigned  from service  post  the  date  from which the  pension schemes

were made applicable, but prior to the date on which the schemes got

notified,  would  be  entitled  to  the  benefit  of  the  pension  schemes  in

question. A Bench of two Judges of this Court found that there was a

divergence of judicial views of this Court, and the matter needed to be

examined by a larger Bench.  The reference order was passed in CA

No.14739/2015 and that is how the matter is before us.

2. We deem it appropriate to set forth the factual matrix, relevant for

the determination of the controversy, in respect of the lead matter and

thereafter, we will analyse the legal principles and accordingly decide the

connected matters.

C.A. No.14739 of 2015

3. Shree Lal Meena, the respondent in the appeal was an employee of

the Life Insurance Corporation of India Limited (for short ‘LIC’).  On

completion of more than 20 years of service, he addressed a letter dated

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15.6.1990 to the LIC, expressing concerns about the poor health of his

wife and himself and the possibility that he may be seeking voluntary

retirement on account thereof.  There being no response to this letter,

Shree  Lal  Meena  followed  the  said  letter  with  another  letter  dated

18.6.1990,  reiterating  the  same  aspect.   Once  again,  there  was  no

response.  Finally, he tendered a letter of resignation on 14.7.1990, for it

to take effect immediately, by waiving off the mandatory notice period of

three months under Regulation 18 of the Life Insurance Corporation of

India  (Staff)  Regulations,  1960  (hereinafter  referred  to  as  the  ‘Staff

Regulations’).  The acceptance of the resignation was communicated by

the  LIC  vide  letter  dated  11.1.1991,  to  take  effect  from  14.7.1990,

waiving off the statutory notice period.

4. It is pertinent to note that there was no scheme or provision for

voluntary retirement applicable to Shree Lal Meena during this period of

time.  Shree Lal Meena was paid all his dues as were admissible to him.

The beneficial scheme operating at the relevant time was a Contributory

Provident Fund Scheme under Regulation 76 of the Staff Regulations.

5. More than 5 years later, the Life Insurance Corporation of India

(Employees)  Pension  Rules,  1995  (for  short  ‘Pension  Rules’)  were

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promulgated,  on  28.6.1995,  but  were  brought  into  force  with

retrospective effect, from 1.11.1993, unless expressly provided against.

The  applicability  of  Section  3(1)(a)  of  the  Pension  Rules  made  the

scheme applicable to all the employees who were in service of the LIC

on or  after  1.1.1986,  but  had retired before  1.11.1993,  given that  the

employees  satisfied  the  other  conditions  provided  for  in  the  Pension

Rules.

6. Shree Lal Meena was in service after 1.1.1986.  He had, however,

resigned with effect from 14.7.1990.  Had he not resigned he would have

continued in service and would have retired sometime around the year

2000.   He  had  also  made  an  endeavour,  prior  to  his  resignation,

proposing voluntary retirement for himself.  Shree Lal Meena was, thus,

of the view that the Pension Rules should be made applicable to him and

accordingly made a request, which was, however, declined on 6.4.1996

by the LIC on the ground that he had ‘resigned’ from service.  He, thus,

issued a notice of demand vide letter dated 28.8.1997, which met with

the same fate and finally filed a writ petition before the Rajasthan High

Court  in 1997 itself,  which was decided in his favour,  by the learned

Single Judge of that Court, vide judgment dated 8.9.2006.

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7. The gravamen of the judgment of the learned Single Judge is the

request made by Shree Lal Meena for voluntary retirement and that it

was  the  absence  of  any  provision  for  the  same  under  the  Staff

Regulations, which had caused him to tender his resignation.  This view

was sought to be supported by the judgment of this Court in JK Cotton

Spinning &Weaving Mills Co. Ltd., Kanpur v. State of U.P.,1 opining

that where an employee voluntarily tenders his resignation, termination

of service, post acceptance of such resignation by the employer would

fall in the category of ‘voluntary retirement’, given all other ingredients

of voluntary retirement were being met.   It  may be noted that  in the

factual contours of the controversy of that judgment, the question really

posed  was  whether  in  the  case  of  services  of  an  employee  being

terminated consequent  to  a  voluntary resignation,  such termination so

brought  about  would  amount  to  retrenchment  within  the  meaning  of

Section  2(s)  read  with  Section  6N  of  the  Uttar  Pradesh  Industrial

Disputes Act, 1947.  As per the provisions of Section 2(s) of that Act, the

definition  of  ‘retrenchment’ excludes  a  case  of  voluntary  retirement.

Since  the  employee  had tendered his  resignation  voluntarily,  and had

subsequently  claimed  compensation  on  account  of  retrenchment,  this

1 AIR 1990 SC 1808

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Court, in that case had opined against the employee.  The learned Single

Judge  of  the  Rajasthan  High  Court  also  recorded  that  there  was  no

dispute that Shree Lal  Meena had the requisite years of service to be

entitled to pensionary benefits if the scheme had existed at the relevant

point of time.

8. LIC, aggrieved by this order, appealed to the Division Bench of the

High  Court,  which  endeavour,  however,  failed  as  the  appeal  was

dismissed vide order dated 16.8.2011.  The plea of the LIC, based on the

judgment of this Court in Reserve Bank of India & Anr. v. Cecil Dennis

Solomon & Anr.2 and of the Division Bench of the Punjab & Haryana

High Court in  J.M. Singh v. Life Insurance Corporation of India &

Ors.3 was repelled.

9. The present appeal has thereafter been filed by the LIC, in which

the reference order was passed.

10. In order to appreciate the reasoning of the Courts below, supported

by the respondent in the appeal and the arguments advanced on behalf of

the appellant also on the same lines, but repelled by the Courts below, we

consider it necessary to first appreciate the Pension Rules, which have

2 (2004) 9 SCC 461 3 CWP No.10157/1996 decided on 8.1.2010

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been brought into force.

11. Rule 2 is the definition rule, defining the various expressions used

in the Pension Rules.  The relevant Rule 2(j) reads as under: “2.  Definitions  –  In  these  rules,  unless  the  context  otherwise requires –  

xxxx xxxx xxxx xxxx

(j)  “employee”  means  any  person  employed  in  the  service  of  the Corporation on full-time work on permanent basis and who opts and is governed by these rules but does not include an employee retired before the commencement of these rules and who is drawing pension from the  Pension Fund  of  the  Oriental  Government  Security  Life Assurance Company Limited in accordance with sub-regulation (2) of regulation 76 of the Life Insurance Corporation of India (Staff) Regulations, 1960, made under the Act;”

12. A reading of  the aforesaid clause shows that  there is a  specific

exclusion of an employee in whose case the twin conditions of having

‘retired’ before the commencement of the Pension Rules and drawing of

pension under the Staff Regulations is satisfied.  Rule 2(s) reads as under: “2.  Definitions  –  In  these  rules,  unless  the  context  otherwise requires –  

xxxx xxxx xxxx xxxx

(s) “retirement” means,-

(i)  retirement  in  accordance with the provisions contained in  sub- regulation (1) or sub-regulation (2) or sub-regulation (3) of regulation 19 of the Life Insurance Corporation of  India (Staff)  Regulations, 1960 and rule 14 of the Life Insurance Corporation of India Class III and  Class  IV  Employees  (Revision  of  Terms  and  Conditions  of

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Service) Rules, 1985 made under the Act;

(ii) voluntary retirement in accordance with the provisions contained in rule 31 of these rules;”

13. Thus, the definition of ‘retirement’ envisages two eventualities –

first  a  person who had retired  in  terms of  the Staff  Regulations;  and

secondly,  a  voluntary  retirement  under  the  provisions  of  the  Pension

Rules themselves.

14. Another relevant provision to be taken note of is Rule 23 of the

Pension Rules, which reads as under: “23. Forfeiture of service - Resignation or dismissal or removal or termination  or  compulsory  retirement  of  an  employee  from  the service of  the Corporation shall  entail  forfeiture of  his entire  past service and consequently shall not qualify for pensionary benefits.”

15. The aforesaid Rules, thus, show that resignation entails forfeiture

of  the  entire  past  service  and  consequently  would  not  qualify  for

pensionary  benefits.   Rule  31  deals  with  ‘Pension  on  voluntary

retirement’, which is admissible on completion of 20 years of qualifying

service, with a notice of not less than 90 days in writing.

16. The moot point which, thus, arises for consideration is the effect of

the retrospective application of these Rules in the given factual scenario.

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Had the Pension Rules been only prospective in application, there is no

doubt that Shree Lal Meena could not even have endeavoured to prefer a

claim.   In  order  to  appreciate  this  aspect,  the  extent  to  which

retrospectivity applies would have to be analysed, strictly on the basis of

these Pension Rules, which are also contributory in their character.

17. The undisputed fact is that as on the date when Shree Lal Meena

was revolving the thought in his mind of voluntary retirement, there was

no such provision in the Staff Regulations applicable.  Thus, his repeated

communications setting forth a thought process for ‘voluntary retirement’

had no legal backing on that date.  It is in these circumstances that no

response was forthcoming to his letters, when he talked about a concept

which did not exist.  Conscious of this aspect and wanting to leave the

services  of  the  LIC,  Shree  Lal  Meena  took  recourse  to  what  was

permissible  on  that  date,  i.e.,  ‘resignation’.   Section  3  of  the  Staff

Regulations  has  a  heading ‘Termination’.   The  other  expression  used

before the relevant Regulation 18 is ‘Determination of  Service’.   The

Regulation itself uses the expression ‘leave or discontinue’ service.  In

whatever manner these expressions are understood, in legal and common

parlance, they amount to, first a unilateral act on the part of an employee,

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desirous of not continuing with her/his service with the employer and

then, the acceptance of the same by the employer, subject to a notice

period, which, in the present facts, had been waived at the request of the

employee.  Thus, on the relevant date he took a conscious decision to dis-

engage  himself  from  the  services  of  the  appellant,  on  the  terms  &

conditions as prevalent on that date.   As to what happened five years

hence, in our view, would have no bearing on any benefit,  which can

accrue to such employee as a respondent, except to the extent which is

specifically made applicable to him.

18. It is trite to say that statutory provisions must be given their clear

meaning  unless  there  is  ambiguity  in  the  wordings.4  There  is  no

ambiguity in the Pension Rules in question as to require any import to be

given that is different from its plain words.  The Pension Rules have been

brought into force from a retrospective date of 1.11.1993.  Thus, they

would logically apply to all employees in service on or after 1.11.1993.

The respondent was not such a person.  There is only one further twist to

the  Pension  Rules.   Rule  3(1)(a)  of  the  Pension  Rules  refers  to

4 Grundy v. Pinniger  (1852) 21 LJ Ch 405; Pinner v. Everett  [1969] 3 All ER 257: “In determining the meaning of any word or phrase in a statute the first question to ask always is what is the natural or ordinary meaning of that word or phrase in its context in the statute. It is only when that meaning leads to some result which cannot reasonably be supposed to have been the intention of the legislature that it is proper to look for some other possible meaning of the word or phrase”.  

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applicability of these Pension Rules even to such of the employees who

“retired” on or after 1.1.1986 and before 1.11.1993.  Even for such of the

employees,  there  is  a  requirement  for  an  option  to  be  exercised,  in

writing, that within a period of time of 120 days from the notified date

they  become  member  of  the  Life  Insurance  Corporation  of  India

(Employees)  Pension  Fund,  and  refund within  60 days  thereafter,  the

entire  amount  of  LIC’s  contribution  to  the  Provident  Fund,  including

interest accrued thereon.  This is so, as employees who retired during this

period of  time had availed of  the  contributory provident  fund benefit

under the then existing Staff Regulations, and would have to surrender

the benefits under those Regulations to the extent they were contributed

for by the LIC, for the new Pension Rules to be made applicable to them.

The expression used in Rule 3(1)(a) is clear and unequivocal – ‘retired’.

It has not used any alternative expression also, for determination of the

relationship of employer-employee, like ‘resignation’. In the same Rules,

expressions  like  ‘resignation’,  ‘dismissal’,  ‘removal’ have  been  used,

more  specifically  in  Rule  23  of  the  Pension  Rules.   When  different

expressions are used in the same Rules, in different contexts then all of

them cannot be given the same meaning.5

5 Member, Board of Revenue v. Arthur Paul Benthall (1955) 2 SCR 842; Kanhaiyalal Vishindas Gidwani

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19. What  is  most  material  is  that  the  employee  in  this  case  had

resigned.   When  the  Pension  Rules  are  applicable,  and  an  employee

resigns, the consequences are forfeiture of service, under Rule 23 of the

Pension Rules.  In our view, attempting to apply the Pension Rules to the

respondent would be a self-defeating argument.  As, suppose, the Pension

Rules  were  applicable  and  the  employee  like  the  respondent  was  in

service and sought to resign, the entire past service would be forfeited,

and consequently, he would not qualify for pensionary benefits. To hold

otherwise would imply that an employee resigning during the currency of

the Rules would be deprived of pensionary benefits, while an employee

who resigns  when these  Rules  were  not  even  in  existence,  would  be

given the benefit of these Rules.

20. Now turning to the discussion of the judicial pronouncements in

this behalf, we are of the view that any judgment has to be read for the

law  it  lays  down,  by  reference  given  to  a  factual  matrix.   Lines  or

sentences here and there should not be read in absolute terms, de hors the

factual matrix in the context of which those observations were made.6

v. Arun Dattatray Mehta (2001) 1 SCC 78: “It is true that when the same statute uses two different words then prima facie one  has to construe that these two  different  words  must have been used to  mean differently.”  6 CIT v. Sun Engineering Works (P.) Ltd. (1992) 4 SCC 363.  

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21. The judgment in JK Cotton Spinning & Weaving Mills Co. Ltd.,

Kanpur7 has, thus, to be considered in that context.  What was the issue

in that  case?  The first  paragraph of  the judgment itself  clarifies  that

aspect.   Whether  determination  of  an  employer-employee  relationship

amounted to retrenchment, within the meaning of the provisions of the

Act applicable is what was being looked into.  We have already noticed,

while referring to the facts of that case hereinbefore, that the employee in

question tried to act clever by half.  He firstly resigned.  The resignation

was  accepted  and  the  consequent  monetary  benefit  flowed  to  him.

Thereafter,  he  sought  to  bring  his  resignation  within  the  meaning  of

‘retrenchment’ under  Section  2(s)  read  with  Section  6N of  the  Uttar

Pradesh Industrial Disputes Act, 1947.  The definition of ‘retrenchment’

itself  clearly  excluded  voluntary  retirement  of  the  workman.   The

employee, having voluntarily resigned, the termination of relationship of

employer  and  employee  could  not  come  within  the  meaning  of

‘retrenchment’.  This Court analysed the difference between the meaning

of resignation and retrenchment.  The resignation was voluntary.  It is in

this context that it was observed that a voluntary tendering of resignation

would be similar to voluntary retirement and not retrenchment.  Nothing

7 (supra)

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more and nothing less.   Thus,  in  our  view,  the  High Court,  both the

learned  Single  Judge  and  the  Division  Bench,  appeared to  have  read

much more into this judgment than the legal proposition which it sought

to propound.  The principles in the context of the controversy before us

are well enunciated in the judgment of this Court in  Reserve Bank of

India & Anr.  v.  Cecil  Dennis Solomon & Anr.8 On a  similar  factual

matrix, the employees had resigned some time in 1988.  The RBI Pension

Regulations  came  in  operation  in  1990.   The  employees  who  had

resigned  earlier  sought  applicability  of  these  Pension  Regulations  to

themselves.  The provisions, once again, had a similar clause of forfeiture

of  service,  on  resignation  or  dismissal  or  termination.   The  relevant

observations are as under:

“10.  In  service  jurisprudence,  the  expressions  “superannuation”, “voluntary  retirement”,  “compulsory  retirement”  and “resignation” convey different connotations. Voluntary retirement and resignation involve voluntary acts on the part of the employee to leave service. Though both involve voluntary acts, they operate differently. One of the basic distinctions is that in case of resignation it can be tendered at any time, but in the case of voluntary retirement, it can only be sought  for  after  rendering prescribed period of  qualifying service. Other fundamental distinction is that in case of the former, normally retiral benefits are denied but in case of the latter, the same is not denied. In case of the former, permission or notice is not mandated, while in case of the latter, permission of the employer concerned is a requisite  condition.  Though resignation  is  a  bilateral  concept,  and becomes effective on acceptance by the competent authority, yet the

8 (supra)

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general rule can be displaced by express provisions to the contrary. In Punjab  National  Bank  v.  P.K.  Mittal  [AIR  1989  SC  1083]  on interpretation  of  Regulation  20(2)  of  the  Punjab  National  Bank Regulations,  it  was held that  resignation would automatically  take effect from the date specified in the notice as there was no provision for any acceptance or rejection of the resignation by the employer. In Union of India v. Gopal Chandra Misra [(1978) 2 SCC 301]  it was held in the case of a judge of the High Court having regard to Article 217 of the Constitution that he has a unilateral right or privilege to resign his office and his resignation becomes effective from the date which he, of his own volition, chooses. But where there is a provision empowering the employer not to accept the resignation, on certain circumstances  e.g.  pendency  of  disciplinary  proceedings,  the employer can exercise the power.

11.  On  the  contrary,  as  noted  by  this  Court  in  Dinesh  Chandra Sangma v. State of Assam [(1977) 4 SCC 441] while the Government reserves its right to compulsorily retire a government servant, even against his wish, there is a corresponding right of the government servant to voluntarily retire from service. Voluntary retirement is a condition  of  service  created  by  statutory  provision  whereas resignation  is  an  implied  term  of  any  employer-employee relationship.”

22. In our view, the aforesaid principles squarely apply in the facts of

the  present  case  and  the  relevant  legal  principles is  that  voluntary

retirement is a concept read into a condition of service, which has to be

created  by  a  statutory  provision,  while  resignation  is  the  unilateral

determination  of  an  employer-employee  relationship,  whereby  an

employee cannot be a bonded labour.

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23. In UCO Bank & Ors. v. Sanwar Mal9, once again, in the case of a

similar pension scheme, the observations were made as under:

“6. To sum up, the Pension Scheme embodied in the regulation is a self- supporting scheme. It is a code by itself. The Bank is a contributor to the pension fund. The Bank ensures availability of funds with the trustees to make  due  payments  to  the  beneficiaries  under  the  Regulations.  The beneficiaries are employees covered by Regulation 3. It is in this light that  one has  to  construe  Regulation  22 quoted  above.  Regulation  22 deals with forfeiture of service.  Regulation 22(1) states that resignation, dismissal, removal or termination of an employee from the service of the Bank shall entail forfeiture of his entire past service and consequently shall  not  qualify for pensionary benefits.  In other words,  the Pension Scheme disqualifies such dismissed employees and employees who have resigned from membership of the fund. The reason is not far to seek. In a self-financing scheme, a separate fund is earmarked as the Scheme is not based  on  budgetary  support.  It  is  essentially  based  on  adequate contributions from the members of the fund. It  is for this reason that under Regulation 11, every bank is required to cause an investigation to be made by an actuary into the financial condition of the fund from time to time and depending on the  deficits,  the Bank is  required  to  make annual contributions to the fund. Regulation 12 deals with investment of the fund whereas Regulation 13 deals with payment out of the fund. In the case of retirement, voluntary or on superannuation, there is a nexus between retirement and retiral benefits under the Provident Fund Rules. Retirement is allowed only on completion of qualifying service which is not there in the case of resignation. When such a retiree opts for self- financing Pension Scheme, he brings in accumulated contribution earned by him after completing qualifying number of years of service under the Provident  Fund  Rules  whereas  a  person  who  resigns  may  not  have adequate  credit  balance  to  his  provident  fund  account  (i.e.  bank’s contribution) and, therefore, Regulation 3 does not cover employees who have resigned. Similarly, in the case of a dismissed employee, there may be forfeiture of his retiral benefits and consequently the framers of the Scheme have kept out the retirees (sic resigned) as well as dismissed employees  vide  Regulation  22.  Further,  the  pension  payable  to  the beneficiaries under the Scheme would depend on income accruing on

9 (2004) 4 SCC 412

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investments and unless there is adequate corpus, the Scheme may not be workable and, therefore, Regulation 22 prescribes a disqualification to dismissed  employees  and  employees  who  have  resigned.  Lastly,  as stated  above,  the  Scheme contemplated  pension  as  the  second retiral benefit in lieu of employers’ contribution to contributory provident fund. Therefore, the said Scheme was not a continuation of the earlier scheme of  provident  fund.  As  a  new  scheme,  it  was  entitled  to  keep  out dismissed employees and employees who have resigned.

7. In the light of our above analysis of the scheme, we now proceed to deal with the arguments advanced by both the sides. It was  inter alia urged on behalf of the appellant bank that under Regulation 22, category of employees who have resigned from the service and who have been dismissed or removed from the service are not entitled to pension, that the pension scheme constituted a separate fund to be regulated on self- financing principles, that prior to the introduction of the pension scheme, there was in existence a provident fund scheme and the present scheme conferred a second retiral benefit to certain classes of employees who were entitled to become the members/beneficiaries of the fund, that the membership of the fund was not dependent on the qualifying service under the pension scheme, that looking to the financial implications, the scheme framed mainly covered retirees because retirement presupposed larger  number of  years  of  service,  that  in the case of  resignation,  an employee can resign on the next day of his appointment whereas in the case of retirement, the employee is required to put in a certain number of years of service and consequently, the scheme was a separate code by itself, that the High Court has committed manifest error in decreeing the suit of the respondent inasmuch as it  has not considered the relevant factors contemplated by the said scheme and that the pension scheme was introduced in terms of the settlement dated 29.10.1993 between the IBA and All-India Bank Employees' Association, which settlement also categorically rules out employees who have resigned or who have been dismissed/removed from the service.”

xxxx xxxx xxxx xxxx xxxx

“9.  We  find  merit  in  these  appeals.   The  words  “resignation”  and “retirement”  carry  different  meanings  in  common  parlance.  An employee can resign at any point of time, even on the second day of his appointment but in the case of retirement he retires only after attaining

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the  age  of  superannuation  or  in  the  case  of  voluntary  retirement  on completion  of  qualifying  service.  The  effect  of  resignation  and retirement to the extent that there is severance of employment (sic is the same) but in service jurisprudence both the expressions are understood differently.  Under  the  Regulations,  the  expressions  “resignation”  and “retirement”  have  been  employed  for  different  purpose  and  carry different  meanings.  The Pension Scheme herein is  based on actuarial calculation; it is a self-financing scheme, which does not depend upon budgetary support and consequently it constitutes a complete code by itself.  The Scheme essentially  covers retirees as the credit  balance to their provident fund account is larger as compared to employees who resigned  from  service.  Moreover,  resignation  brings  about  complete cessation  of  master-and-servant  relationship  whereas  voluntary retirement maintains the relationship for the purposes of grant of retiral benefits, in view of the past service. Similarly, acceptance of resignation is  dependent  upon  discretion  of  the  employer  whereas  retirement  is completion of service in terms of regulations/rules framed by the Bank. Resignation can be tendered irrespective of the length of service whereas in  the  case  of  voluntary  retirement,  the  employee  has  to  complete qualifying  service  for  retiral  benefits.  Further,  there  are  different yardsticks  and  criteria  for  submitting  resignation  vis-à-vis  voluntary retirement  and  acceptance  thereof.  Since  the  Pension  Regulations disqualify an employee, who has resigned, from claiming pension, the respondent  cannot  claim  membership  of  the  fund.  In  our  view, Regulation  22  provides  for  disqualification  of  employees  who  have resigned  from  service  and  for  those  who  have  been  dismissed  or removed from service. Hence, we do not find any merit in the arguments advanced  on  behalf  of  the  respondent  that  Regulation  22  makes  an arbitrary and unreasonable classification repugnant to Article 14 of the Constitution by keeping out such class of employees.  The view we have taken is supported by the judgment of this Court in the case of Reserve Bank  of  India  v.  Cecil  Dennis  Solomon  &  Anr.  (supra).   Before concluding  we  may  state  that  Regulation  22  is  not  in  the  nature  of penalty as alleged.  It  only disentitles an employee who has resigned from service from becoming a member of the fund.  Such employees have  received  their  retiral  benefits  earlier.   The  Pension  Scheme,  as stated above, only provides for a second retiral benefit.  Hence, there is no question of penalty being imposed on such employees as  alleged. The  Pension  Scheme  only  provides  for  an  avenue  for  investment  to retirees.  They are provided avenue to put in their savings and as a term

18

or condition which is more in the nature of an eligibility criterion, the Scheme disentitles such category of employees as are out of it.”

24. We  may  only  note  that  in  the  above  discussed  judgement,  an

argument  assailing  the  Regulation  for  forfeiture  of  service,  based  on

Article  14  of  the  Constitution  of  India  was  repelled.   The provisions

under the new Regulations were held not to be in the nature of penalty,

but a disentitlement, as a consequence of having resigned from service

and, thus, being disentitled from having become a member of the fund.

There are other judgments also in the same line, but not laying down any

additional principles and, thus, it would suffice to just mention them, i.e.

M.R. Prabhakar & Ors. v. Canara Bank & Ors.10 and J.M. Singh v.

Life Insurance Corporation of India & Ors.11  

25. There are  some observations on the principles of  public sectors

being  model  employers  and  provisions  of  pension  being  beneficial

legislations.12  We may, however, note that as per what we have opined

aforesaid, the issue cannot be dealt with on a charity principle. When the

Legislature, in its wisdom, brings forth certain beneficial provisions in

10 (2012) 9 SCC 671 11 (supra) 12 Shashikala Devi v. Central Bank of India, (2014) 16 SCC 260; Asger Ibrahim Amin v. Life Insurance Corporation of India (2016) 13 SCC 797

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the form of Pension Regulations from a particular date and on particular

terms and conditions, aspects which are excluded cannot be included in it

by implication.  The provisions will have to be read as they read unless

there is some confusion or they are capable of another interpretation.  We

may also note that while framing such schemes, there is an important

aspect  of  them  being  of  a  contributory  nature  and  their  financial

implications.  Such financial implications are both, for the contributors

and  for  the  State.   Thus,  it  would  be  inadvisable  to  expand  such

beneficial schemes beyond their contours to extend them to employees

for whom they were not meant for by the Legislature.

26. We are, thus,  of the view that  the impugned orders in this case

cannot be sustained and are liable to be set aside, and the writ petition

filed by the respondent consequently stands dismissed.

C.A. No.10904 of 2016

27. The  appellant  joined  the  respondent  United  India  Insurance

Company Limited as a Clerk on 13.8.1960 and served for a long period

of  32 years.   He,  however,  tendered his  resignation  on 1.10.1993 for

“family reasons”, but on his own, termed it as “premature retirement”, so

as to claim future benefits.  Request for waiving of notice period was also

20

made.   The  letter  of  resignation  was  accepted  on  30.11.1993,  giving

effect to such resignation from that day itself.  It is relevant to note that at

the  time  the  appellant  resigned,  he  was  governed  by  the  General

Insurance (Termination, Superannuation and Retirement of Officers and

Development Staff) Scheme, 1976 (for short ‘1976 Scheme’), which had

no concept of voluntary retirement.  However, almost three years after

the appellant resigned, an amendment was made to the 1976 Scheme by

inserting clause 4(4A), introducing the concept of Voluntary Retirement

Scheme on 1.11.1996.  This clause, however, was made retrospectively

applicable  from  1.11.1993.   It  appears  that  the  object  was  to  have

consonance with the General Insurance (Employees’) Pension Scheme,

1995 (hereinafter referred to as the ‘1995 Scheme’).

28. It is in the year 2011 that the judicial pronouncement by this Court

in Sheel Kumar Jain v. New India Assurance Company Limited13 gave

benefit of this scheme to certain employees.  The judgment was delivered

on 28.7.2011.  Once again, almost after two years, the appellant made a

representation dated 4.4.2013 seeking pension on the basis of the 1995

Scheme,  resting  his  case  on  the  aforesaid  judgment.   There  was  no

response to this  representation,  resulting in the appellant  filing a writ

13 (2011) 12 SCC 197

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petition  before  the  Bombay  High Court.   The  Division  Bench  of  the

Bombay  High  Court,  in  terms  of  the  impugned  judgment  dated

07.04.2016 rejected the same.  The reasoning of the Division Bench was

that the case of the appellant was of resignation and not of voluntary

retirement. The appellant had tendered his resignation before 1.11.1993,

while the conditions for availing of the benefit were: (i) the employees

must have retired on or after 1.11.1993, and before the notified date; and

(ii)  the employee  must  have exercised the option to  voluntarily  retire

within  120  days  from the  notified  date,  to  become a  member  of  the

General  Insurance  Corporation  (Employees’)  Pension  Fund  while

refunding the amount of  Provident Fund contributed by the insurance

company.  These two aspects were stated to be absent in the case of the

appellant,  who  had  never  opted  for  voluntary  retirement  within  the

requisite period nor refunded the amount, which were pre-requisites for

availing the benefit of the new pension scheme.

29. The opinion of the Division Bench was also based on a relevant

fact, that the condition in terms of clause 4(4A) required completion of

55 years of age, while the appellant was not of 55 years of age on the

date of his resignation or its acceptance.  The said clause reads as under:

22

“(4A)  Not-withstanding  anything  contained  in  the  foregoing  sub- paragraphs, an Officer or a person of the Development staff may be permitted,  subject  to  vigilance  clearance,  to  seek  voluntary retirement, -  

(a) on completion of 55 years of age or at  any time thereafter on giving ninety days notice in writing to the appointing authority of his intention to retire; or

Provided that on a written request from an officer or a person of the Development Staff, such notice may be waived in full or in part by the appointing authority; or

(b) in accordance with the provisions contained in paragraph 30 of the  General  Insurance (Employees’)  Pension Scheme,  1995,  made under  section  17A  of  the  General  Insurance  Business (Nationalisation)  Act,  1972,  (57  of  1972)  and  published  under notification of the Government of India, in the Ministry of Finance (Department of Economic Affairs) Insurance Division number S.O. 585 (E) dated 28th June, 1995.”

30. The last relevant aspect is that the 1995 Scheme provided in clause

22 as under:

“22. Forfeiture of service - Resignation or dismissal or removal or termination  or  compulsory  retirement  of  an  employee  from  the service of the Corporation or a Company shall entail forfeiture of his entire past service and consequently shall not qualify for pensionary benefits.”

31. Thus,  once again, there is this clause of forfeiture of  service in

case of resignation.

32. In order to elucidate the legal principle further, we may note that

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Sheel Kumar Jain14 took note of the judgment of the three Judges’ Bench

in Sudhir Chandra Sarkar v. Tata Iron and Steel Co. Ltd. & Ors.15  An

uncovenanted  employee  of  respondent-Company,  paid  on  a  monthly

basis, sought to recover a sum as gratuity, for continued service rendered

over  29  years,  under  the  Retiring  Gratuity  Rules,  1937,  after  having

resigned from service.  The employee was paid the provident fund dues.

The High Court of Patna opined against the employee.  When the matter

reached  this  Court,  one  of  the  contentions  raised  by  the  respondent-

Company  was  that  the  employee  had  resigned  and  not  retired  from

service.   It  was  noticed  that  Rule  1(g)  defines  ‘retirement’ as  “the

termination of  service by reason of  any cause  other  than removal  by

discharge due to misconduct.”  The employee had not been removed by

discharge  due  to  misconduct.   The  termination  of  service,  being  on

account  of  resignation,  it  was held to  qualify within the definition of

‘retirement’ under the Rules.  The rest of the judgment, dealing with the

principles as to how gratuity should be treated, is not relevant.

33. We,  thus,  notice  that  all  that  was  opined  by  the  three  Judges’

Bench in the aforesaid case was based on the definition of ‘retirement’ as

14 (supra) 15 (1984) 3 SCC 369

24

per  the  Retiring  Gratuity  Rules,  1937,  which  was  expansive  and  all

inclusive, excluding only the removal by discharge due to misconduct.

Thus, nothing more could have been read into this judgment.

34. We may also add that there are some observations in the aforesaid

case that pension and gratuity are both retiral benefits and an employee,

with  long years  of  service  should  be  assured  social  security  to  some

extent,  in  the  form  of  either  pension  or  gratuity  or  provident  fund,

whichever retiral benefit is operative in the industrial establishment.  In

the given facts of the appeal before us, the benefit of provident fund has

been given as that was the scheme applicable at the relevant stage of

time.  The  principle  laid  down  is  not  that  all  of  them  should  be

simultaneously  be  granted,  but  that,  at  least  one  of  them  should  be

granted,  though  there  is  no  prohibition  against  more  than  one  being

granted.

35. In  view of  what  we have  discussed aforesaid,  all  three  aspects

stated by us are relevant and disentitle the appellant to any relief.  We

have already explained the difference between resignation and voluntary

retirement.   Mere  categorisation  by  the  appellant  himself  of  his

resignation as “premature retirement” is of no avail.  The same principle

25

discussed aforesaid, of forfeiture of service, would be applicable here and

the appellant did not have the requisite age when he resigned even were

the 1976 Scheme to be made applicable.

36. We  may  also  find  that  the  appellant  remained  silent  for  years

together and that  this Court,  taking a  particular  view subsequently,  in

Sheel Kumar Jain16, would not entitle stale claims to be raised on this

behalf,  like that  of  the appellant.   In fact  the appellant  slept  over the

matter for almost a little over two years even after the pronouncement of

the judgment.

37. Thus,  the  endeavour  of  the  appellant,  to  approach  this  Court

seeking the relief, as prayed for, is clearly a misadventure, which is liable

to be rejected, and the appeal is dismissed.

SLP(C) Nos.5716-5719 of 2016

38. Leave granted.

39. The  appellants  in  this  case  were  employees  of  the  respondent-

Bank, viz., Andhra Bank, who resigned from service during the window

period of 1991 and 1993 after giving three months’ notice.  The grounds

for  resignation  varied.   The  employees  were  governed  by  the  then

16 (supra)

26

existing  Service  Rules,  being  the  Andhra  Bank  Officers’  Service

Regulations,  1982.  It  was much later  that  Andhra Bank (Employees)

Pension  Regulations,  1995  (for  short  ‘Pension  Regulations’)  were

introduced,  effective  from  its  date  of  notification.   There  was  no

retrospectivity involved in this case.  But the Pension Regulations were

made applicable for employees, who ‘retired’ on or after 01.01.1986 but

before 01.11.1993.

40. The  appellants  sought  benefit  under  these  Pension  Regulations,

even  though  they  had  ‘resigned’ from  their  job,  which  request  was

rejected.

41. A Division Bench of the Andhra Pradesh High Court, in terms of

the impugned order dated 09.10.2015 rejected the petition filed by the

appellants on the ground that when the appellants resigned, there was no

Pension Regulations providing for voluntary retirement in existence, and

merely because the Pension Regulations have been made applicable for

persons retiring within a past period of window, it would not give the

same benefit  to  the  employees  who had  resigned  from service.   The

reasoning of the judgment is predicated on  M.R. Prabhakar & Ors. v.

Canara Bank & Ors.17

17 (supra)

27

42. It is relevant to note that  M.R. Prabhakar & Ors.18 dealt with a

similar scheme for employees of the Canara Bank, and the plea was that

such of the employees who had resigned must be construed as voluntarily

retired, thus, entitling them to pensionary benefits.  Suffice to say that,

once again, the principle was of differentiation between the concept of

‘voluntary retirement’ and ‘resignation’.  Regulation 2(y) as applicable to

the employees of Canara Bank, being pari materia to Rule 2(y) under the

Pension Regulations of 1995, had brought in ‘voluntary retirement’ in the

definition of ‘retirement’, but had not considered it appropriate to bring

in the concept of ‘resignation’.  Service jurisprudence, recognising the

concept  of  ‘resignation’ and ‘retirement’ as different,  and in the same

regulations these expressions being used in different connotations, left no

manner of  doubt that  the benefit  could not be extended, especially as

resignation  was  one  of  the  disqualifications  for  seeking  pensionary

benefits, under the Regulations.

43. In view of the legal principles discussed by us hereinbefore, this

appeal, thus, must also fail and, is accordingly dismissed.

18 (supra)

28

44. The net result of the aforesaid discussion is that C.A. No.14739 of

2015 is allowed while C.A.No.10904 of 2016 and C.A. Nos. 3138-3141

of  2019  @  SLP©Nos.5716-5719  of  2016  are  dismissed,  leaving  the

parties to bear their own costs.

45. The reference is answered accordingly.

46. We, however, make it clear that for amounts already paid to the

respondent in C.A. No. 14739 of 2015, under the interim directions dated

26.11.2015, refund of the same would not be claimed.

..….….…………………….C.J.I. [Ranjan Gogoi]

...……………………………J. [Sanjay Kishan Kaul]

...……………………………J. [K.M. Joseph]

New Delhi. March 15, 2019.

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