Reduction of pension following compulsory retirement requires prior Board consultation and a reasoned order under Regulation 33.

The Petitioner, a former Deputy General Manager of the erstwhile Dena Bank, retired on March 31, 2017

Following retirement, disciplinary proceedings concluded with a penalty of "compulsory retirement" effective from his date of superannuation due to lapses in a loan account that became an NPA

Initially paid full pension, the Bank reduced his pension to two-thirds starting June 2018 under Regulation 33 of the Dena Bank (Employees’) Pension Regulations, 1995, without a prior reasoned order

The Petitioner's initial challenge in W.P.(C) 9918/2018 resulted in a direction to the Bank to treat the petition as a representation

The Bank subsequently issued an order on December 20, 2019, rejecting the representation and upholding the reduction

1. Whether the present writ petition is barred by res judicata due to the prior disposal of W.P.(C) 9918/2018

2. Whether the reduction of pension from full to two-thirds satisfied the requirements of Regulation 33, specifically regarding prior consultation with the Board of Directors

3. Whether Regulation 48 (recovery of pecuniary loss) could be invoked to sustain the reduction when the original penalty order did not quantify loss or direct recovery

4. Whether the Bank's Staff Accountability Policy influenced the exercise of discretion under Regulation 33

The Court applied Regulation 33 of the Dena Bank (Employees’) Pension Regulations, 1995, which mandates that before awarding a pension lower than the full admissible amount, the Board of Directors must be consulted

It relied on the Supreme Court precedent Vijay Kumar v. Central Bank of India (2025 INSC 848), which established that prior Board consultation is a substantive safeguard for pension, which is "property" under Article 300A of the Constitution

The Court further cited State of Jharkhand v. Jitendra Kumar Srivastava, affirming that pension is an earned benefit and cannot be curtailed without strict adherence to law

Regulation 48 of the Pension Regulations was distinguished as a separate provision for recovering quantified pecuniary loss from pension, requiring its own procedural safeguards

The Court found that the Bank treated the pension reduction as a mechanical consequence of compulsory retirement rather than a distinct discretionary exercise

Regarding the mandatory consultation under Regulation 33(2), the Court determined that the Bank merely sought "post-decisional approval" of an accomplished conclusion, as internal notes showed the pension had been sanctioned before reaching the Board

The Court rejected the Bank’s attempt to justify the reduction via Regulation 48 in its counter-affidavit, noting that neither the original penalty order nor the impugned order quantified any loss or followed the procedures for recovery of loss

Furthermore, the Staff Accountability Policy suggested that in cases not involving fraud or lack of integrity, compulsory retirement is intended to allow employees to retain retiral benefits, a factor the Bank failed to consider when exercising its discretion

The Court quashed the order dated December 20, 2019, holding that the Bank failed to engage in "prior consultation" in the true sense and failed to provide reasons for choosing the minimum two-thirds pension

The Bank was directed to reconsider the Petitioner’s case, provide him an opportunity for representation, and conduct a genuine consultation with the Board

If no fresh order is passed within eight weeks, the Petitioner is entitled to full pension and arrears