Authorities must consider circumstances beyond an employee’s control before withholding pension for lack of a joint account.

The petitioner, a retired Income Tax Department employee, superannuated on 31 December 2023. His pension, gratuity and other retirement benefits were withheld because he had not opened a joint bank account with his wife.

He challenged the Central Administrative Tribunal’s dismissal of his application, which had accepted the employer’s position that a joint account was required under the applicable pension rules.

The petitioner relied on his estrangement from his wife and pending divorce proceedings; the Court also noted that a competent court had ordered him to pay her maintenance.

Whether the requirement of a joint bank account with the employee’s spouse could be relaxed where the employee showed circumstances preventing him from opening one.

Whether the petitioner was entitled to payment of his withheld pension, gratuity and other retirement benefits, with interest, despite not having opened a joint account.

Rule 57 of the Central Civil Services (Pension) Rules, 2021 provides for the processing of pension cases and requires the retiring government servant to submit Form 6-A.

Note 2 to Form 6-A contemplates that the government servant be the primary holder of a joint bank account, while Note 3 allows the Head Office to consider the employee’s circumstances and relax that requirement if satisfied that the inability to open a joint account arose for reasons beyond the employee’s control.

The Court also applied the principle that pension and gratuity are rights rather than bounty, and stated that delayed gratuity attracts statutory interest; it referred to Gagan Bihar Prusty v. Paradip Port Trust, SLP (C) Nos. 4468/2022, regarding payment of statutory interest on delayed gratuity.

The Court held that the employer and Tribunal had treated the joint-account requirement as absolute and failed to consider the discretion conferred by Note 3 to Form 6-A.

In light of the petitioner’s estrangement from his wife, pending divorce proceedings and the circumstances placed before the Court, it found that his inability to open a joint account was sufficiently established.

The Court therefore concluded that the benefits could be paid into the petitioner’s individual account, while separately requiring him to continue paying the maintenance ordered in favour of his wife.

The respondents were directed to pay the pension arrears, regular pension, gratuity and other admissible retirement benefits, including leave encashment, into the petitioner’s specified bank account by 30 November 2026. The Court awarded 6% annual interest on pension arrears and other specified retirement benefits, and statutory interest at 10% per annum on gratuity for the period from 1 February 2024 to 30 November 2026.

The petitioner was also directed to pay the maintenance ordered by the competent court and to place a copy of the judgment before the courts dealing with the parties’ matrimonial proceedings.