Pension cannot be withheld after conviction without a specific order under the applicable Pension Rules.

The petitioner, formerly employed as a Lineman with the respondent department, was implicated in a corruption case registered by the Lokayukt, Indore, along with other officials. He was suspended and subsequently superannuated on 31 August 2006. Owing to the pendency of the criminal proceedings, he was sanctioned 50% provisional pension under Rule 64 of the Madhya Pradesh Civil Services (Pension) Rules, 1976.

The trial court convicted the petitioner under Sections 7, 12(1)(d), 13(1)(a) and 13(2) of the Prevention of Corruption Act, 1988, and Section 120-B of the IPC, by judgment dated 21 February 2007. Thereafter, the respondents discontinued his provisional pension and withheld his pension and other retiral benefits.

The petitioner’s criminal appeal was dismissed by the High Court on 5 February 2025, and his Special Leave Petition remained pending before the Supreme Court, where he had been exempted from surrendering until further orders.

The petitioner challenged the continued withholding of his pension, alleging that no order had been passed in accordance with Rule 64, and that the action violated natural justice. The State contended that, in view of the petitioner’s conviction and the amended Rule 64, it was competent to withhold the pension, although it was unable to confirm whether any specific withholding order had been passed.

1. Whether the respondents could withhold the petitioner’s pension and retiral benefits after his conviction without passing a specific order in accordance with Rule 64 of the Madhya Pradesh Civil Services (Pension) Rules, 1976?

2. Whether, in the absence of an identifiable order withholding pension, the petitioner was entitled to consideration of his claim for restoration of provisional pension in light of Kanhaiyalal Damde v. State of Madhya Pradesh?

The Court applied Rule 64 of the Madhya Pradesh Civil Services (Pension) Rules, 1976, governing provisional pension and the withholding or alteration of pensionary benefits during or after disciplinary or criminal proceedings.

The Court also relied on Kanhaiyalal Damde v. State of Madhya Pradesh, W.P. No. 20032 of 2020, wherein it was held that pension cannot be withheld merely on account of an employee’s conviction in the absence of an order passed in accordance with the applicable Pension Rules.

The Court further proceeded on the principle that an administrative decision affecting pensionary rights must be supported by a reasoned and speaking order, consistent with natural justice.

The Court noted that the respondents had not produced or identified any specific order authorising the withholding of the petitioner’s pension after his conviction.

Although the State asserted that the amended Rule 64 empowered it to withhold pension, its counsel conceded that it was unclear whether any such order had actually been passed.

Applying the principle in Kanhaiyalal Damde, the Court held that conviction by itself could not justify withholding pensionary benefits without an order issued in accordance with the Pension Rules.

Rather than directly directing immediate restoration, the Court required the competent authority to examine the petitioner’s representation and determine the issue through a reasoned and speaking order.

The competent authority was directed to decide the representation by a reasoned and speaking order within four weeks of its submission.

If the authority concludes that the pension ought to be restored, it must restore it immediately and pay the arrears within two weeks of the decision; if it reaches the contrary conclusion, it must provide reasons in a speaking order.

The authority was specifically directed to keep in mind the legal principle laid down in Kanhaiyalal Damde.

The Court therefore granted procedural relief and required reconsideration, without itself finally determining the petitioner’s entitlement to restoration of pension.