Pension reduction under Rule 139 requires formal proof of grave misconduct or an unsatisfactory entire service career.

The respondents, Nabin Narayan and Ramchandra Rajak, retired as high-ranking engineers from the Water Resources Department of Jharkhand in 2017 and 2018, respectively.

Post-retirement, their pensions were approved.

Subsequently, the State issued show-cause notices alleging irregularities in desilting soil disposal schemes executed during 2014-15.

Despite the respondents' explanations, the State issued second show-cause notices under Rule 139 of the Jharkhand Pension Rules, 2000, proposing a 5% pension deduction for two years.

The penalty was finalized in August 2022 without conducting a full-fledged departmental enquiry.

The respondents challenged these orders in writ petitions.

A Single Judge quashed the penalties, ruling that Rule 139 can only be invoked if the employee’s entire service career is found unsatisfactory.

The State filed these Letters Patent Appeals (LPA) against the Single Judge's order.

Rule 43(b) empowers the State to withhold or withdraw pension if a pensioner is found guilty of "grave misconduct" in departmental or judicial proceedings conducted in the same manner as dismissal proceedings.

Rule 139(c) allows the State to revise pension orders if the pensioner's service was not "thoroughly satisfactory" or if there is proof of "grave misconduct".

Proof of "grave misconduct" for pension reduction must be culled from proceedings that comply with Rule 43(b) requirements, as established in State of Bihar & Ors. v. Mohd. Idris Ansari (1995 Supp (3) SCC 56).

Service cannot be declared unsatisfactory based on a single misdemeanor, as affirmed in Swetabh Kumar v. State of Jharkhand & Ors. (2024 SCC OnLine Jhar 2256).

The Court observed that Rule 139(c) provides two distinct grounds for pension reduction: "not thoroughly satisfactory" service or "proof of grave misconduct".

Regarding the first ground, the Court held that the phrase "thoroughly satisfactory" requires the authority to review the employee's entire service record; a single instance of irregularity is insufficient to form such an opinion.

Regarding the second ground, the Court emphasized that "grave misconduct" must be proved through a formal departmental or judicial proceeding.

In the present case, the State merely issued show-cause notices and failed to initiate a full-fledged enquiry, appoint an enquiry officer, or serve a formal charge memo.

The Court reasoned that since Rule 43(b) mandates that post-retirement proceedings must follow the procedure for dismissal from service, the same standard of procedural due process applies when invoking Rule 139(c) for grave misconduct.

Consequently, the summary procedure adopted by the State was legally unsustainable.

The Court held that a single allegation of irregularity does not satisfy the "thoroughly unsatisfactory" criterion of Rule 139(c), nor can it constitute "proof of grave misconduct" in the absence of a formal enquiry conducted under the procedures stipulated in Rule 43(b).

The delay in filing the appeals was condoned, but the appeals were dismissed on merits.