Full Judgment Text
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO.1789 of 2020
RAJASTHAN STATE ROAD TRANSPORT
CORPORATION AND OTHERS ...APPELLANT(S)
VERSUS
GOVERDHAN LAL SONI AND ANR. ...RESPONDENT(S)
WITH
CIVIL APPEAL NO.1812 OF 2020
THE RAJASTHAN STATE ROAD
TRANSPORT CORPORATION
AND OTHER ...APPELLANT(S)
VERSUS
MANGLA RAM
AANWALA ...RESPONDENT(S)
J U D G M E N T
ASHOK BHUSHAN, J.
Signature Not Verified
1. These appeals have been filed by Rajasthan Road
Digitally signed by
MEENAKSHI KOHLI
Date: 2020.09.09
15:54:52 IST
Reason:
Transport Corporation and others (hereinafter
Page 1 of 44
referred to as Corporation) challenging the
judgments dated 05.03.2018 and 30.08.2018
respectively of the Division Bench of Rajasthan
High Court dismissing the D.B.Special Appeals filed
by the appellants. Both the appeals having raised
similar issues it shall be sufficient to refer the
facts and pleadings in Civil Appeal No.1789 of 2020
for deciding both the appeals.
2. Goverdhan Lal Soni, the respondent No.1 was
appointed as Junior Assistant on 02.04.1974 in
Rajasthan State Agro Industries Corporation
Limited. The State Government closed the Rajasthan
State Agro Industries Corporation Limited and
declared all its employees as Surplus. The State
Government took a decision to absorb services of
all surplus employees in different Corporations.
The Bureau of Public Enterprises, Government of
Rajasthan issued a Circular on 02.07.1991
containing guidelines of absorption of surplus
employees in public enterprises. The guidelines
Page 2 of 44
also contained provisions for various benefits to
be extended to the absorbed employees. The
Respondent No.1 in pursuance of Circular dated
02.07.1991 was absorbed by Rajasthan State Road
Transport Corporation vide order dated 03.10.1996.
The Corporation issued a notification dated
12.02.1997 in relation to the absorbed employees
laying down the procedure for the employees, who
want to opt either C.P.F Scheme or the G.P.F. and
Pension Scheme.
3. The respondent gave his option on 22.03.1997
for Pension under Rajasthan State Road Transport
Pension Regulations, 1989. In Rajasthan State Agro
Industries Corporation Limited, the respondent No.1
was governed by Contributory Provident Fund Scheme
and the Pension Scheme was not applicable in
Rajasthan State Agro Industries Corporation
Limited. The Corporation on 29.07.1997 noticing
that the respondent No.1 after coming to the
Page 3 of 44
service of Corporation has given option of Pension
directed for transfer of amount deposited in
Provident Fund Account and family pension so that
same can be deposited in the account of General
Provident Fund as well as pension fund.
4. Rajasthan Agro Industries Corporation Limited
wrote a letter dated 18.08.1998 to Financial
Advisor of the Corporation referring to a letter of
the corporation dated 29.07.1998 informing that
Pension being not applicable in Agro Industries
Corporation, Capital Value, amount in regard to
absorbed employee is not due to corporation. The
letter mentioned that in the Agro Industries
Corporation, Provident Fund Scheme was applied in
which regard contribution of Provident Fund is
deposited in office of Commissioner, Provident
Fund, Government of India, which amount can be
transferred at the level of Corporation. Regional
Provident Fund Commissioner transferred the
Page 4 of 44
contribution of Employees as well as contribution
of Employer deposited with the Provident Fund
Commissioner to the Corporation. Certificate of
account transfer was issued transferring the
aforesaid amount to the corporation.
5. A circular dated 09.02.1999 was issued by the
corporation referring to earlier circular dated
12.02.1997 mentioning that those employees who
produce their option letter to get benefit of
Rajasthan State Road Transport Corporation
Employees Corporation Pension Regulations, 1989,
only upon receipt of capital amount from Rajasthan
State Agro Industries Corporation Limited, they
shall be entitled to get benefit of Corporation
Pension.
6. The respondent, who had joined the corporation
on 10.10.1996, wrote a letter dated 06.07.2010 to
the Finance Advisor and Chief Accounts Officer of
the Corporation praying for approval of pension.
Page 5 of 44
Letter also mentioned that in compliance of letter
of Chief Manager dated 19.02.1997, CPF amount has
been received by Corporation. The respondent No.1
sent several reminders with regard to approval of
his pension. The respondent was superannuated on
30.06.2012. A writ petition No. 8847 of 2012 was
filed by the respondent No.1 in the High Court of
Rajasthan, Bench at Jaipur, praying for following
reliefs: -
“(i) By issuing an appropriate writ, order
or direction to the Respondents to
consider the case of petitioner for
extending the benefits of the GPF and
Pension Scheme of 1989 in the light of the
condition No.11(b) of the Circular dated
02.07.1991 by taking note of his option
form for the same.
(ii) Hon’ble High Court may kindly quash
and set aside the circular dated
09.02.1999 (Annexure-8) issued in the garb
of Notification dated 12.02.1997.
(iii) Hon’ble High Court may kindly direct
the respondent to grant pension to the
petitioner if petitioner gets retired
during the pendency of the writ petition.”
Page 6 of 44
7. Learned Single Judge of the High Court by
judgment dated 05.07.2017 after noticing the
submission of writ petition as well as the
corporation, held that writ petitioner had already
opted for Pension, his case cannot be distinguished
from an earlier judgment of High Court dated
24.05.2007, Mahaveer Prasad Jain Versus Jaipur
Vidhyut Vitran Nigam Ltd. SB Civil Writ Petition
No. 3116 of 2004. Learned Single Judge allowed the
writ petition directing that writ petitioner be
treated to be entitled to get pension, however, the
same would be subject to petitioner returning the
amount under the CPF Scheme. The appellant
aggrieved by the judgment of learned Single Judge
filed D.B.Special Appeal(writ) No.1799 of 2017
before the Division Bench which appeal was
dismissed on 05.03.2018. This appeal has been filed
challenging the judgment of the Division Bench
dated 05.03.2018.
Page 7 of 44
8. In Civil Appeal No.1812 of 2020, the
respondent Mangla Ram Aanwala was also initially
appointed in Rajasthan State Agro Industries
Corporation Limited and in pursuance of circular
dated 02.07.1991, he was also absorbed in the
corporation by order dated 03.10.1996 on the post
of Junior Accountant. Respondent also gave an
option on 25.02.1997 for opting for GPF and Pension
Scheme. On 30.06.2012, the respondent also attained
the age of Superannuation. Not being given the
benefit of GPF and Pension, S.B.Civil Writ Petition
No.8100 of 2017 was filed by the respondent which
was allowed by learned Single Judge on 29.11.2007
in terms of judgment of the learned Single Judge in
writ petition of Goverdhan Lal Soni(Supra). The
appellant filed Special Appeal Writ No.1314 of 2018
which has been dismissed on 30.08.2018 against
which Civil Appeal No.1812 of 2020 has been filed.
Page 8 of 44
9. We have heard Mrs. Ritu Bhardwaj for the
appellant and Shri Rishabh Sancheti and Shri
P.B.Suresh for the respondents.
10. Learned Counsel for the appellant submits that
respondent was absorbed from Rajasthan State Agro
Industries Corporation Limited where Pension Scheme
was not applicable and the respondent was governed
only by Contributory Provident Fund (CPF) Scheme.
It is submitted that the absorption of Employees in
Rajasthan State Road Transport Corporation was on
the terms and conditions as laid down in circular
dated 02.07.1991 of Bureau of Public Enterprises,
Government of Rajasthan. The Agro Industries
Corporation from where the respondent had come on
absorption in Rajasthan State Road Transport
Corporation was covered only by CPF Scheme, hence,
for availing the benefits of Pension Scheme the
former Organization of the respondent was liable to
transfer not only the balance in CPF Account but
Pension Fund in proportion of Employees own
Page 9 of 44
subscription and Organization’s contribution
respectively.
11. The Rajasthan State Agro Industries
Corporation Limited vide letter dated 18.08.1998
having refused to transfer the capital value amount
regarding absorbed employee, the conditions under
para 11(b) of Circular dated 02.07.1991 were not
fulfilled and the corporation cannot undertake the
liability of payment of pension.
12. It is submitted that on retirement of the
respondent, entire benefit under the CPF Scheme as
well as Gratuity of Rs.10 Lakhs and other benefits
were taken by the respondent. It is submitted that
respondent is already getting the pension from
Employees Provident Fund Organization. The
respondent has also availed the benefit of Loan of
amount of more than Rs.18 Lakhs from the
Corporation which was possible only due to the
reason that the respondent was member of CPF Scheme
Page 10 of 44
and he can avail loan out of contribution of the
employees as well as the contribution of the
Employer.
13. It is further submitted that both learned
Single Judge and Division Bench had not adverted to
mandatory conditions as given in paragraph 11(b)
and without recording any satisfaction and finding
that the mandatory condition has been fulfilled,
direction has been issued for grant of Pension. The
respondent who has already availed the benefit
under CPF Scheme cannot be directed to given the
benefit of Pension which shall amount to extending
the double benefits.
14. Learned counsel appearing for the respondents
in both the appeals have refuted the submission of
the counsel for the appellant and submits that the
entire contribution of the respondent which was
credited were transferred by the Regional Provident
Fund Commissioner with regard to which a
Page 11 of 44
certificate of account transfer has also been
issued by Regional Provident Fund Commissioner
which has been brought along with the counter
Affidavit filed on behalf of respondent No.1,
Goverdhan Lal Soni. Regional Provident Fund
Commissioner having transferred the entire amount
to the corporation, nothing more was due to be
transferred.
15. The respondent has exercised the option of
Pension benefit within the period prescribed i.e.
before 31.03.1997. The case of the respondent was
fully covered by the judgment of the Rajasthan High
Court dated 05.07.2017 in Mahaveer Prasad Jain’s
Case. He submits that the judgment of learned
Single Judge dated 05.07.2017 was also affirmed by
the Division Bench vide judgment dated 19.12.2007
in Jaipur Vidhyut Vitran Nigam Ltd. through its
Chairman versus Mahaveer Prasad Jain, which appeal
was dismissed on 19.12.2007.
Page 12 of 44
16. It is submitted that Special Leave Petition
against the Division Bench judgment dated
19.12.2007 has also been dismissed by this Court
vide its order dated 09.05.2008 in Special Leave to
Appeal (Civil) No.10904 of 2008. The case of
Mahavir Prasad Jain was also a case of absorption
from Rajasthan State Agro Industries Corporation
Limited into Rajasthan State Electricity Board
(Jaipur Vidhyut Vitran Nigam Ltd.).
17. The notification dated 12.02.1997 laid down
procedure to be adopted in relation to absorbed
employees. Subsequent circular dated 09.02.1999
informing that only on transfer of Capital amount
from the concerned department benefit of Pension
can be extended was not applicable on the
respondent No.1 since he was already covered by
1991 circular and has exercised his option on
22.03.1997 with regard to receiving of payment
under GPF Scheme as well as Gratuity. With regard
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to Pension under CPF Scheme it is submitted that
the said pension has been accepted since the
respondent had no option. The gratuity amount was
paid directly in account of the respondent.
18. It is further submitted that both the
Rajasthan State Agro Industries Corporation Limited
as well as Rajasthan State Road Transport
Corporation are two arms of the Government and it
was the State responsibility to ensure that the
respondent No.1 could have received the Pension in
pursuance of his option exercised on 22.03.1997.
19. Learned counsel for the parties have relied on
several judgments of this Court and Rajasthan High
Court which shall be referred to while considering
the submission in detail.
Page 14 of 44
20. From the pleadings of the parties and materials
on record, following undisputed facts have
emerged:-
i) the respondents in these appeals were
employees of Agro Industries Corporation
who were declared surplus after the Agro
Industries Corporation was closed.
ii) Bureau of Enterprises issued guidelines
dated 02.07.1991 for absorption of surplus
employees of the State Public Enterprises.
The guidelines enumerated the benefits and
mechanism for receiving the benefits by
the absorbed employees.
iii) that by order dated 03.10.1997, the
respondents were absorbed in Rajasthan
State Road Transport Corporation. The
respondents while working under the
Rajasthan State Agro Industries
Page 15 of 44
Corporation Limited were covered by only
CPF Scheme.
iv) Both Employees and Employer’s
contributions towards the Provident Fund
were deposited with the Regional Provident
Fund Commissioner. The Regional Provident
Fund Commissioner transferred both
Employees contribution of Provident Fund
as well as Employer’s contribution of
Provident Fund to the Rajasthan State Road
Transport Corporation and certificate of
account transfer was also issued by office
of Regional Provident Fund Commissioner,
certifying the above said transfer. After
the absorption, respondent opted for the
Pension Scheme within the prescribed
period i.e. 31.03.1997.
Page 16 of 44
v) The respondent in Rajasthan State Road
Transport Corporation were continued in
the CPF Scheme and the contribution of the
Employees and Employers were deposited and
after retirement of the respondent, the
entire amount accumulated has been paid to
the respondent with gratuity and other
benefits.
21. The corporation has both CPF and Pension
Scheme. The Pension Scheme which is applicable in
the Corporation is Rajasthan State Road Transport
Corporation Employees’ Pension Regulations 1989.
Regulation 3 of the Regulations, 1989 provides for
exercise of option by the existing regular
employees for pensionary and gratuity benefits.
Bureau of Public Enterprises, Government of
Rajasthan, had issued guidelines dated 02.07.1991
under which surplus employees of State Public
Enterprises were to be absorbed in other Public
Enterprises.
Page 17 of 44
22. Before we enter into the submissions raised by
the counsel of the parties it is necessary to
notice the relevant statutory Regulations
applicable in the RSRTC and the Circular dated
02.07.1991 by which Bureau of Public Enterprises,
State Enterprises Department, Government of
Rajasthan issued terms and conditions for
absorption of surplus employees of State Public
Enterprises. The Rajasthan State Road Transport
Corporation Employees Pension Regulations, 1989
have been framed in exercise of power under Section
45 of the Road Transport Corporation Act, 1950.
Regulation 3(l) defines ‘option’ which is to the
following effect:
“3(l) “Option” means a written consent of
the existing regular employee for
pensionary and gratuity benefits alongwith
the adoption of the General Provident Fund
Regulations 1989 or to continue as member
of the existing CPF scheme covered under
the BPF Act, 1952 within a period of 90
days from the date of publication of RSRTC
Pension Regulations. Any existing employee
who does not exercise the option within
specified period of 90 days shall be
Page 18 of 44
deemed to have exercised option in favour
of the Pension & CPF Regulations.”
23. Regulation 3(k) has defined “existing employee”
as meaning ‘an employee who is in service of the
Corporation as on 1.4.1989’. The option under
Regulation 3(l) was contemplated from existing
employee.
24. Several employees including the respondent who
became surplus in their earlier employment were
absorbed by Rajasthan State Road Transport
Corporation vide order dated 03.10.1996. The
Corporation issued a notification dated 12.02.1997
with regard to 30 employees who had come from
Rajasthan State Agro Industries Corporation
Limited, out of whom some employees wanted to take
benefit of Contribution Provident Fund and some
employees wanted to take benefit of Corporation
Pension Scheme. The notification contained
necessary instructions with regard to the above.
Learned counsel for the appellant has relied and
referred to Clause 2(vi) of the notification which
Page 19 of 44
is relevant with regard to the respondent. Clause
2(vi) is as follows:
“2(vi)Those employees who give their
option under Employee Pension
Scheme, 1989, their deducted
Provident Fund Contribution amount
of earlier service on receiving back
from P.F. Commissioner office by
their employer will be forwarded to
Corporation as per instructions
given by R.S.R.T. Corporation about
pension, gratuity, P.F. and Leave
encashment etc. For receiving the
above contribution after editing by
Accounts Department (Establishment),
Head Office, this amount will be
received. After receiving amount,
concerned amount of pension to
Manager (Pension) and concerned
amount of General Provident Fund to
A.G.M. (G.P.F.) will be forwarded.”
25. After issuance of notification dated
12.02.1997, the Corporation asked for option from
employees who were absorbed in the Corporation to
give their option. As noted above, the option under
Regulation 3(l) was to be taken from the ‘existing
employees’ but after absorption of employees in the
Corporation from Rajasthan State Agro Industries
Corporation Limited, the Corporation adopted same
Page 20 of 44
statutory mode with regard to the absorbed
employees as per statutory scheme. Hence, option
was asked from absorbed employees. The respondent
gave option on 27.03.1997, i.e., before 31.03.1997
which was last date for option.
26. Another Regulation which needs to be noted is
Regulation 43 of Regulations, 1989 which deals with
transfer to pension fund by Corporation. Regulation
43 is as follows:
TRANSFER TO PENSION FUND BY CORPORATION
“43.
The Corporation shall transfer the
pension contributions @ 10% on the basic
wages plus D.A. to the R.S.R.T.C. pension
th
Fund latest by 10 of succeeding month.
The employer’s share with interest
except for those existing employees as on
01.04.1989, who have opted for continuing
the C.P.F. benefits shall be transferred
to the R.S.R.T.C. Pension Fund and the
employee’s share with interest shall be
transferred to the R.S.R.T.C. GPF Fund.”
27. The second part of Regulation 43 as extracted
above contemplates transfer of employer’s share for
existing employees who have opted for Pension Fund
and employees’ share with interest in the G.P.F.
Fund.
Page 21 of 44
28. Clause 2(vi) of notification dated 12.02.1997
as extracted above is also in the same line as of
Regulation 43.
29. The respondent having opted for pension,
Regulation 43 read with notification dated
12.02.1997 becomes relevant and applicable with
regard to the respondent.
30. Now, we come to the Circular dated 02.07.1991
issued by the Bureau of Public Enterprises,
Government of Rajasthan, which is the guidelines
for absorption of surplus employees of State Public
Enterprises. We had heard this appeal earlier and
reserved the judgment. At the time of preparation
of judgment we found ambiguity in the record of the
appeal pertaining to correct wordings of clause
11(b) of Circular dated 02.07.1991. By our orders
dated 29.07.2020 we directed both the parties to
bring on record correct clause 11(b) of Circular
dated 02.07.1991. In pursuance of our order dated
29.07.2020 both the parties have filed their
affidavits. In the affidavit filed in application
Page 22 of 44
I.A.No.76182 of 2020 filed by the respondent, the
copy of Circular dated 02.07.1991 has been brought
on record. At the time of hearing on 14.08.2020,
learned counsel for the petitioner has also not
disputed the correctness of the copy of the
Circular dated 02.07.1991 as brought on the record
by respondent. Clause 11 of the Circular dated
02.07.1991 which is relevant for the present case
brought on record by I.A.No.76182 of 2020 is to the
following effect:
“11. In case the surplus employees covered
under CPF Scheme, on absorption:-
(a) In an enterprise having CPF Scheme,
the balance in CPF account of the surplus
employees shall be transferred to the
absorbing enterprise. On absorption the
surplus employees would be governed by CPF
Scheme and rules of the absorbing
enterprise.
(b) In an enterprise having pension
scheme, the balance in CPF Account of
surplus employees would be transferred to
absorbing enterprise for credit to the GPF
Account of the employees and the Pension
Fund in proportion of employees own
subscription and organisation’s
contribution respectively. The eligible
period of service rendered in relieving
enterprise would be considered as
Page 23 of 44
qualifying service under pension scheme of
absorbing enterprise.”
31. The petitioner also filed affidavit on
14.08.2020 and has not disputed the correctness of
clause 11 as brought on record by the respondent.
32. Both CPF and Pension Schemes are beneficial
Schemes for the employees which are of different
nature. In a Contributory Provident Fund Scheme
Employer makes matching contributions to the
Employees contribution and both are kept in
separate account and on retirement of employees
both are released to the employee along with the
interest. The Pension is a periodic payment to the
employee after the retirement from the service by
the Employer. Payment of Pension is made under
scheme floated by Employer. Pension Scheme
contemplates a fund out of which the pension is
payable to an employee. The payment of pension is
dependent on various considerations and conditions.
This Court in Pepsu Road Transport Corporation,
Page 24 of 44
Patiala versus Mangal Singh and others, (2011) 11
SCC 702, while considering Pension Scheme and
contributory Provident Fund Scheme under Pepsu Road
Transport Corporation Employees’ Pension/Gratuity
and General Provident Fund Regulations, 1992 made
following observations in paragraph 34:-
“34. Pension is a retirement benefit
partaking of the character of regular
payment to a person in consideration of
the past services rendered by him. We
hasten to add that although pension is not
a bounty but is claimable as a matter of
right, yet the right is not absolute or
unconditional. The person claiming pension
must establish his entitlement to such
pension in law. The entitlement might be
dependent upon various considerations or
conditions. In a given case, (sic whether)
the retired employee is entitled to
pension or not depends on the provisions
and interpretation of the rules and
regulations. The contributory provident
fund appears to be a simple mechanism
where an employee is paid the total amount
which he has contributed along with the
equal contribution made by the employer
ordinarily at the time of retirement of an
employee. In short, we quote what was
repeatedly said by this Court that
“pension is payable periodically as long
as the pensioner is alive whereas CPF is
paid only once on retirement.” Therefore,
conceptually, pension and CPF are separate
and distinct.”
Page 25 of 44
33. Now reverting to the facts of the present case,
we need to first consider as to what were the
conditions which were to be fulfilled by the
respondent for receiving the pension. As noted
above, paragraph 11(b) of guidelines dated
02.07.1991 was applicable in the present case with
which both the parties are in agreement. It is the
case of both the parties that it is clause 11(b)
which is applicable in the case of the respondent.
34. Clause 11 begin with the words “in case surplus
employees were covered under CPF scheme on
absorption;”- in an Enterprise having Pension
Scheme, (i) the balance in CPF account of surplus
employee will be transferred to absorbing
Enterprise for credit of CPF account of the
employee, and (ii) the pension fund in proportion
of employees’ own subscription and organization’s
contribution respectively; (iii) the eligible
period of service rendered in relieving Enterprise
Page 26 of 44
would be considered as qualifying service under
Pension Scheme of absorbing Enterprise.
35. The circular dated 02.07.1991 provided for
absorption from one State Public Enterprise to
another Public Enterprise. All Public Enterprises
were not governed by common CPF and Pension Scheme,
for example, Rajasthan Agro Industries Corporation
Limited did not have a pension scheme for its
employees whereas Rajasthan State Road Transport
Corporation ltd. has Pension Scheme. When an
employee who is governed by CPF Scheme in his
erstwhile employment opts for CPF Scheme in
absorbing Enterprise, the balance amount in CPF
account is transferred and the employees continue
in CPF Scheme. There can be two categories of
surplus employees, one category may have in its
erstwhile Employment Pension Scheme and another
category may have only CPF Scheme. In a case where
in erstwhile employment employee is governed by
Page 27 of 44
Pension Scheme and he opts for Pension Scheme in
the absorbing Enterprise, there is no difficulty in
implementing of Pension Scheme since balance in CPF
account as well as Pension Fund shall be
transferred in corresponding accounts in absorbing
Enterprise.
36. In this context, we refer to Clause 12 of
Circular dated 02.07.1991 which is to the following
effect:
“(12)In case the surplus employees were
covered by pension scheme, on
absorption:-
(a)In an enterprise having pension
scheme the relieving enterprise
would transfer the balance of GPF
Account of the employee and his
share in the Pension Fund of the
relieving organisation to the
absorbing organisation for credit
to GPF Account and Pension Fund
respectively.
(b)In an enterprise having CPF Scheme,
the balance of GPF Account and
share in Pension Fund would be
transferred to the absorbing
enterprise for credit to the CPF
Account. On absorption, the surplus
employees would be governed by CPF
Scheme and rules of the absorbing
enterprise.”
Page 28 of 44
37. The respondent in his earlier employment was
covered by the CPF Scheme and both employee’s
contribution as well as employer’s contribution
were deposited in the Provident Fund. Alongwith
affidavit filed by the respondent in this appeal
Certificate of Accounts Transfer, issued by the
Regional Provident Fund Commissioner, Jaipur has
been brought on record. The total deposit of
respondent No.1 with the Regional Provident Fund
Commissioner, Jaipur was (a) contribution of
employee Rs.92,504/-; (b) contribution of employer
Rs.1,01282/-. Both the above amounts were
transferred to the Rajasthan Road State Transport
Corporation after the respondent was absorbed in
the Rajasthan State Road Transport Corporation.
38. The contention which has been pressed by the
learned counsel for the appellant before us is that
there was no transfer of capital amount of the
erstwhile employer of respondent. Learned counsel
for the appellant has relied and refer to the
Page 29 of 44
letter dated 18.09.1998 issued by the Rajasthan
State Agro Industries Corporation Limited. This has
been brought on record as Annexure-P/1. A perusal
of Annexure-P/1 indicates that Rajasthan State Road
Transport Corporation by letter dated 29.07.1998
requested the Rajasthan State Agro Industries
Corporation Limited for transferring capital value
amount in regard to the respondent. The erstwhile
employer of the respondent informed the appellant
that capital value amount in regard to the absorbed
employees is not due to the Rajasthan State Road
Transport Corporation. The appellant was informed
that contribution of Provident Fund amount is
deposited in the account of Commissioner, Provident
Fund, Government of India which can be got
transferred. The question to be answered is as to
whether apart from transfer of employee’s
contribution and employer’s contribution deposited
in the account of Commissioner, Provident Fund,
there is any other amount which required to be
Page 30 of 44
transferred to the appellant for the purpose of
making the respondent eligible for the benefit of
pension. Regulation 43 of the Regulations, 1989 is
the provision of transfer of Pension Fund by
Corporation. The Regulation makes it clear that
except those employees who have opted for
continuing to CPF, employer’s share shall be
transferred to the Rajasthan State Road Transport
Corporation Pension Fund and the employees share
with interest shall be transferred to Rajasthan
State Road Transport Corporation GPF Fund. For the
employees who were entitled to grant of pension
there is mention of only two Funds that is Pension
Fund and GPF Fund. The employer’s share was to be
transferred to Pension Fund and employee’s share
shall be transferred to GPF Fund. Clause 11 sub-
cause (b) of Circular dated 02.07.1991 also refers
to only two accounts i.e. GPF Account and Pension
Fund. As per clause 11(b) in an Enterprise having
pension scheme, the balance in CPF Account of
Page 31 of 44
surplus employees would be transferred to absorbing
Enterprise for credit to the GPF Account of the
employees and the Pension Fund in proportion of
employees own subscription and organisation’s
contribution respectively. Thus, employee’s
contribution shall go to the GPF Account and
employer’s proportion should be credited to the
Pension Fund. Clause 11(b) makes it clear that when
the respondent was absorbed in Rajasthan State Road
Transport Corporation, the balance in CPF Account
of the surplus employees would be transferred in
GPF Account and the Pension Fund respectively. The
certificate issued by the Regional Provident Fund
Commissioner which has been filed at Annexure R-8
makes it clear that contribution of employee
Rs.92.504/- and contribution of employer
Rs.101282/- have been transferred to the Rajasthan
State Road Transport Corporation which was the
amount credited with Regional Provident Fund
Commissioner. The entire amount having been
Page 32 of 44
transferred to the Rajasthan State Road Transport
Corporation it was the obligation of the Rajasthan
State Road Transport Corporation to credit the
aforesaid amount in respect of Pension Fund and GPF
Fund. Neither Regulations, 1989 nor Circular dated
02.07.1991 refers to any capital amount. There was
no obligation of erstwhile employer of the
respondent to transfer any capital amount. Neither
any such capital amount was contemplated by 1989
Regulations or by Scheme of absorption dated
02.07.1991. The Circular dated 02.07.1991 is in
conformity with the Regulations, 1989 and a reading
of Regulation 43 of Regulations 1989 as well as
Circular dated 02.07.1991 makes it abundantly clear
that for benefit of Pension Scheme what was
required to be transferred by the erstwhile
employer was the employees contribution which was
to get transferred into the GPF Account and the
employer’s contribution to be credited in the
Pension Fund. Nothing more was required to be done
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by the respondent or erstwhile employer for
fulfilling any condition or statutory requirement
with regard to the respondent’s claim of pension.
After transfer of the amount aforesaid, the
respondent having given option regarding opting the
pension scheme, it was statutory obligation of the
appellant to credit both the aforesaid amounts and
thereafter continues to deposit 10% in the Pension
Fund and after retirement calculates the pension
accordingly.
39. The notification dated 12.02.1997 specially
Clause 2(vi) on which reliance has been placed by
the learned counsel for the appellant also does not
refer to any sum as a capital amount which needs to
be transferred to the appellant for making employee
eligible for Pension. The circular dated 09.02.1999
filed by the appellant as Annexure-P/2 does refer
to capital amount but it relies on notification
dated 12.02.1997 specifically on Clause 2(vi).
Clause 2(vi) of notification dated 12.02.1997 does
not refer to any capital amount. Thus, the
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statement in Circular dated 09.02.1999 that only
upon receipt of capital amount from Rajasthan State
Agro Industries Corporation Limited employees were
entitled to get benefit of Corporation Pension is
unfounded and without any basis. Clause 2(vi)
contemplates that those employees who give their
option under Employee Pension Scheme, 1989 their
deducted Provident Fund Contribution amount of
earlier service on receiving back from P.F.
Commissioner Office by their employer will be
forwarded to Corporation. We have already noticed
that both employee’s contribution and employer’s
contribution which were deposited with Provident
Fund Commissioner Office was transferred to
Corporation. Thus, what was contemplated by Clause
2(vi) of notification dated 12.02.1997 was complied
with.
40. We are satisfied that there was no justifiable
ground for the appellant for not sanctioning the
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claim of pension of the respondent after his
retirement.
41. Learned counsel for the appellant has
emphasized that the respondent continued to receive
pension under the CPF Scheme which fact has not
been denied by the respondent. The respondent’s
case was that the said amount was accepted by the
respondent since he had no option his pension
having not been sanctioned by the appellant. We are
of view that it was open for the Corporation-
appellant while sanctioning the pension to the
respondent to deduct the amount of pension received
by him under CPF Scheme and the pension could have
been accordingly fixed by reducing the pension
amount already received by the respondent which
respondent was getting under CPF Scheme but that
could not have been a reason for denying pension to
the respondent. The payment of gratuity to the
respondent was also made of Rs. 10 lakh which was
paid in the account of the respondent.
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42. Learned Single Judge allowing the writ petition
filed by the respondent for grant of pension has
put a condition that said entitlement is subject to
refund of the amount received by him under the CPF
Scheme. Learned Single Judge has also rightly
directed that neither the appellant nor the
respondent shall be entitled for any interest
meaning thereby that whatever amount was received
by the respondent he was to refund it without any
interest accrued on it and whatsoever amount was to
be received by the respondent under his entitlement
to pension he was not to receive any interest. It
is useful to refer to direction of the learned
Single Judge contained in paragraph 5 which is to
the following effect:
“5. In the circumstances, the writ
petition is allowed. It is directed that
the petitioner shall be treated to be
entitled to get pension. However, the same
would be subject to his returning/
refunding the amount received by him under
the CPF Scheme. In view of the aforesaid
direction, neither the petitioner nor the
respondents would be entitled to any
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interest. The exercise may be conducted by
the respondents within fifteen days of the
amount of CPF is refunded/returned to
them.”
43. Counsel for the respondent has placed reliance
on the judgment of Rajasthan High Court in the writ
petition of Mahaveer Prasad Jain. The Division
Bench judgment of Rajasthan High Court in D.B.
Special Appeal(writ) No.1326 of 2007 decided on
19.12.2007 in Jaipur Vidhyut Vitran Nigam Ltd.
through its Chairman and Anr. versus Mahaveer
Prasad Jain ,reported in 2008 (2) WLN 337, need to be
noticed in some detail.
44. In the above case decided by the Division Bench
the surplus employee was an employee of Rajasthan
State Agro Industries Corporation Limited who was
absorbed in Jaipur Vidhyut Vitran Nigam. The case
of pension of the employee was allowed by the
learned Single Judge against which Special Appeal
was filed against the judgment of Learned Single
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Judge. The appellant accepted that respondent would
be governed by the pension scheme and his case is
covered by clause 11(b) of Circular dated
02.07.1991. The Division Bench has held that
employee being not covered by Pension Scheme in his
earlier employment, his case is governed by clause
11 of Circular dated 02.07.1991. In paragraph 6
Rajasthan High court made the following
observation:
“6. We now advert to the second
contention. The counsel for the appellant
informed us that the Rajasthan State
Electricity Board (as it then was) had
both the Central Provident Fund Scheme as
well as Pension Scheme for its employees.
According to the counsel the employees of
the Board were given option to either opt
for CPF Scheme or Pension Scheme. On the
absorption of the original petitioner
(respondent No. 1 herein), his CPF Account
was closed and instead GPF Account was
opened by the Board on 02.08.2001.
Moreover he was asked to deposit
employee's share of CPF amount which he
did. A perusal of the paragraph 13 of the
guidelines would show that it is in two
parts. Clause (a) thereof applies where
the employee was covered under CPF Scheme
and absorbing enterprise also has CPF
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Scheme. Clause (a) provides that the
balance in the CPF Account of surplus
employee shall be transferred to the
absorbing enterprise and on absorption the
surplus employee would be governed by the
CPF Scheme and the rules of absorbing
enterprise while Clause (b) of Para 11
provides that where the absorbing
enterprise is having CPF Scheme, the
balance in the CPF account of the surplus
employees shall be transferred to the
absorbing enterprise for credit to the CPF
Account of the employees and the Pension
Fund in proportion of employees and the
pension fund in proportion of the
employees subscription and organisation's
contribution respectively. It further
provides that the eligible period of
service rendered in relieving enterprise
would be considered as qualifying service
under pension scheme of absorbing
enterprise. In view of the admitted fact
that the CPF account of the present
respondent was closed after he was
absorbed in the RSEB and that he was
called upon to deposit employees' share of
CPF amount which he did, it is apparent
that the present appellants accepted that
the respondent would be governed by the
pension scheme and that his case is
covered by 11(b). In this view of the
matter, the rejection of the petitioner's
claim for pension was not legally proper.
Merely because the respondent No. 1 had
withdrawn the entire CPF amount prior to
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his absorption would not make any
difference because the CPF account was
closed by the Board on the employee's
absorption.”
45. In the above case also the balance of C.P.F.
amount was deposited in absorbing organization even
though in the said case the employee has withdrawn
the entire C.P.F. amount prior to his absorption in
the subsequent employment. In the present case the
respondent has not withdrawn any amount and both
the employees and employer contributions were
transferred to the Rajasthan State Road Transport
Corporation by Regional Provident Fund
Commissioner. Against the judgment of the Division
Bench of the Rajasthan High Court dated 19.12.2007,
Special Leave Petition (C)No.10904 of 2008 was also
filed by Jaipur Vidyut Vitran Nigam Ltd. which was
dismissed by this Court on 09.05.2008.
46. In view of the foregoing discussion, we are of
the considered opinion that respondent had made out
a case for grant of pension by the appellant and
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both the learned Single Judge and the Division
Bench did not commit any error in allowing the
claim of the respondent for pension.
47. The direction of learned Single Judge in
paragraph 5 as stated above amply protected the
interest of the appellant.
48. We may also notice that the respondent, who
attainted the age of superannuation on 31.10.2012,
immediately filed the writ petition in the year
2012 itself being Writ Petition No.8847 of 2012
which writ petition was entertained and direction
was issued by the learned Single Judge. No delay
was caused by the respondent in approaching the
High Court for relief of Pension. Before filing the
writ petition the respondent has also sent
representation in the year 2010 raising his claim
for Pension which ought to have alerted the
appellant to take appropriate steps.
49. There being an interim order passed by this
Court on 13.08.2018 in this appeal, the impugned
judgment of the High Court could not be given
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effect by the appellant. Learned Single Judge while
allowing the writ petition of the respondent
although directed the appellant to return the
benefit received by him under the CPF Scheme but
had not fixed any time for deposit. In ends of
justice we allow a period of two months from this
order to the respondent to refund the entire amount
under the C.P.F. Scheme including excess gratuity.
On such deposit being made by the respondent, the
Rajasthan State Road Transport Corporation shall
sanction the pension to the respondent and take
steps regarding payment of pension but without any
interest thereon.
50. But looking to the facts of the present cases,
to balance equities between the parties ends of
justice be served in directing the Corporation to
pay pension to the respondents only with effect
from the date on which deposit is made by
respondents. The pension received by respondents
under CPF Scheme shall be allowed to be retained by
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the respondents. This means that the amount
received as pension under the CPF need not be given
back by the respondents and the same shall not be
deducted when the pension is computed and paid by
the appellant to the respondents. Subject to above
modifications in the impugned judgment of the High
Court, we dismiss both the appeals.
............................J.
( ASHOK BHUSHAN )
............................J.
( K.M. JOSEPH )
New Delhi,
September 09, 2020.
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