Six Days Short Of 20 Years’ Service, Insurance Employee Qualifies For Special VRS Pension Subject To Scheme Terms: Madras HC

In brief

The question

Whether the petitioner’s service, though short of 20 years by six days, could be treated as 20 years of qualifying service for eligibility to opt for special voluntary retirement and claim pension.

The court held

The Court allowed the writ petition and set aside the order dated 31 July 2019.

It also directed

It directed the first respondent to sanction pension to the petitioner under the special voluntary retirement scheme, subject to the terms and options in Clause 5.1 of the 2019 Administrative Instructions, within eight weeks of receiving a copy of the order.

The connected miscellaneous petition was closed, with no order as to costs.

01Facts

The petitioner was appointed by National Insurance Company Limited under the disability quota on 12 March 1984.

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She applied for voluntary retirement on 5 March 2004; her retirement was accepted, but her pension claim was rejected for failure to complete 20 years of qualifying service.

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She contended that she was short of 20 years by only six days and sought to have her service counted as qualifying service under the applicable special voluntary retirement scheme.

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The rejection, dated 31 July 2019, was challenged by writ petition.

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The respondents maintained that 20 years’ qualifying service was mandatory and, alternatively, that the petitioner had to satisfy the scheme’s conditions.

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02Issues

i.Whether the petitioner’s service, though short of 20 years by six days, could be treated as 20 years of qualifying service for eligibility to opt for special voluntary retirement and claim pension.

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ii.Whether the delay in filing the writ petition warranted denial of relief.

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03Law Applied

The Court considered the Administrative Instructions for Implementation of the Provisions of the General Insurance (Employees’) Pension Amendment Scheme, 2019, including the requirement of 20 years’ qualifying service for the relevant special voluntary retirement option and the conditions under Clause 5.1.

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It applied State Bank of Patiala v. Pritam Singh Bedi, AIR 2014 SC 2714, which held, in the context of Regulation 18 of the applicable pension regulations, that a broken period of service exceeding six months is treated as one year; employees with more than 19 years and six months’ service were therefore treated as having completed 20 years.

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The respondents’ reliance on Central Bank of India v. Tara Chand, (2020) 18 SCC 452, and U.P. Roadways Retired Officials & Officers Association v. State of U.P., (2024) 9 SCC 331, was noted in support of applying scheme terms and pension principles.

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04Reasoning

Applying Pritam Singh Bedi, the Court held that the petitioner’s shortfall of six days did not prevent her from satisfying the 20-year qualifying-service threshold; it accordingly found her eligible to opt for special voluntary retirement under the 2004 scheme.

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The Court rejected the respondents’ objection that no individual exception could be made, reasoning that the petitioner qualified by applying the governing service-rounding principle rather than by receiving an exemption from the rules.

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It also declined to deny relief for delay, having regard to the petitioner’s disability-quota appointment and retirement on account of her physical condition.

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Pension remained subject to the applicable scheme terms and Clause 5.1.

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