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Judgment
K. Chandru, J.—The writ petition challenges the order of the third respondent dated 30.6.1998 rejecting the request for an invalid pension
claimed by the first petitioner. The reasons found in the impugned order are as follows:
a) The resigned employee had not sought retirement on medical grounds with the benefit of invalid pension.
b) The resigned employee did not satisfy the eligibility conditions for invalid pension as stipulated under Regulation 30 of Indian Bank (Employees'')
Pension Regulations, 1995.
In the writ petition, notice of motion was ordered on 07.6.1999 and subsequently it was admitted on 21.1.2004. On behalf of the second and
third respondents, a detailed counter affidavit dated 17.8.2008 has been filed. In the meanwhile, since the original writ petitioner had passed away
on 06.7.2006, his legal representatives have come on record.
The original petitioner who was an employee of the third respondent bank submitted his resignation on 30.7.1993 and he also requested that his
son may be given an employment on the basis of the non-statutory scheme available in the bank. On 17.9.1993, the medical board certified that he
was completely and permanently incapacitated from doing any work. The petitioner submitted an application for compassionate appointment for
his son. He also submitted his resignation letter on 17.1.1994. The third respondent bank accepted his resignation letter on 15.2.1994. The
petitioner''s son Manoharan was called for an interview and was given an appointment on compassionate ground on 28.3.1994.
On 16.6.1994, a pension scheme was introduced and by a Circular No. 47 (94-95), the employees who retired from 01.1.1986 to 31.10.1993
were asked to exercise an option to come under the pension scheme. The petitioner on 29.6.1994 sent a letter opting for the pension scheme even
though he had resigned from his post on 17.1.1994 and left the service on 15.2.1994. The statutory pension scheme came into force in the bank
with effect from 29.5.1995.
The petitioner once again sent another letter seeking for pension and followed it by a legal notice. It was in response to the same, the impugned
order came to be passed as noted already.
Mr. Muthupandian, learned Counsel appearing for the petitioner submitted that the bank did not give individual notice about the pension
scheme. Since the petitioner had been certified by the medical board as incapacitated to do any work he ought to have been treated as eligible for
an Invalid Pension as contemplated under Regulation 30 of the Indian Bank (Employees) Pension Regulations 1995. The said regulation clearly
states that an employee with minimum 10 years of service and who retires on or after 1.11.1993 on account of permanent incapacitation due to
bodily or mental infirmity, is entitled for such pension.
Per contra, Mr. G. Venkataraman, learned Counsel appearing for the second and third respondent bank drew the attention of this Court to
Regulation 22 and submitted that resignation by an employee of the bank shall entail forfeiture of his entire past service and consequently he shall
not be qualified for any pensionary benefits. In the present case, the original petitioner in order to avail the non-statutory compassionate scheme
and for getting an appointment for his son resigned from the service and therefore he cannot now turn back and claim Invalid Pension on grounds
of physical incapacity. It was also stated that the anvil of the pension scheme was widely published in leading newspapers in July and November
1994 and therefore the petitioner cannot feign ignorance about the introduction of the new scheme. The bank had fulfilled its obligation of providing
an employment to his son and it is not reasonable to claim an invalid pension to which he is not entitled to. It was also submitted that an eligibility
for pension arises out of a statutory scheme and therefore the petitioner''s claim cannot be granted de hors the scheme.
Though Mr. M. Muthupandian, learned Counsel for the petitioner placed reliance upon the judgment of this Court in W.A. No. 1076 of 2006
dated 31.8.2006 (The Management of Indian Overseas Bank rep. by its Chairman and Managing Director v. P.N. Balasubramaniam), the said
case has no relevance as it is not a case of resignation. The Division Bench dealt with the case of a ''retirement'' and a ''voluntary retirement''.
Mr. G. Venkataraman, learned Counsel for the respondent Bank placed reliance upon the judgment of the Supreme Court in UCO Bank and
Others Vs. Sanwar Mal, , for the purpose of contending that the Supreme Court had upheld the validity of forfeiture of gratuity in respect of
resignation of an employee relating to a very same scheme. He placed reliance upon the passages found in paragraphs 8 and 9 of the said
judgment, which may be usefully extracted below:
Para 8. Shri R.P. Bhatt, learned Senior Counsel appearing on behalf of the respondent in Civil Appeal No. 1506 of 2003 inter alia urged that
Regulation 22 to the extent it provides for forfeiture of service and disqualifying those who have resigned for pensionary benefits is an arbitrary and
unreasonable classification and repugnant to Article 14 of the Constitution, that Regulation 22 was contrary to the objects of the Pension Scheme
embodied in the Regulations, that employees who have resigned after completing qualifying service contemplated by Regulation 14 were entitled to
opt for pension as they were in a position to bring in their contribution of retiral benefits to their credit for having worked for a minimum service of
10 years in the Bank and that the respondent had worked for more than 10 years after which he resigned and, therefore, he fulfilled the qualifying
service contemplated by Regulation 14 and consequently, he was entitled to the benefit of the Pension Scheme.
Para 9. We find merit in these appeals. The words �resignation� and �retirement� carry different meanings in common parlance. An
employee can resign at any point of time, even on the second day of his appointment but in the case of retirement he retires only after attaining the
age of superannuation or in the case of voluntary retirement on completion of qualifying service. The effect of resignation and retirement to the
extent that there is severance of employment (sic is the same) but in service jurisprudence both the expressions are understood differently. Under
the Regulations, the expressions �resignation� and �retirement� have been employed for different purpose and carry different meanings.
The Pension Scheme herein is based on actuarial calculation; it is a self-financing scheme, which does not depend upon budgetary support and
consequently it constitutes a complete code by itself. The Scheme essentially covers retirees as the credit balance to their provident fund account is
larger as compared to employees who resigned from service. Moreover, resignation brings about complete cessation of master-and-servant
relationship whereas voluntary retirement maintains the relationship for the purposes of grant of retiral benefits, in view of the past service. Similarly,
acceptance of resignation is dependent upon discretion of the employer whereas retirement is completion of service in terms of regulations/rules
framed by the Bank. Resignation can be tendered irrespective of the length of service whereas in the case of voluntary retirement, the employee
has to complete qualifying service for retiral benefits. Further, there are different yardsticks and criteria for submitting resignation vis-�-vis
voluntary retirement and acceptance thereof. Since the Pension Regulations disqualify an employee, who has resigned, from claiming pension, the
respondent cannot claim membership of the fund. In our view, Regulation 22 provides for disqualification of employees who have resigned from
service and for those who have been dismissed or removed from service. Hence, we do not find any merit in the arguments advanced on behalf of
the respondent that Regulation 22 makes an arbitrary and unreasonable classification repugnant to Article 14 of the Constitution by keeping out
such class of employees. The view we have taken is supported by the judgment of this Court in the case of Reserve Bank of India v. Cecil Dennis
Solomon. Before concluding we may state that Regulation 22 is not in the nature of penalty as alleged. It only disentitles an employee who has
resigned from service from becoming a member of the fund. Such employees have received their retiral benefits earlier. The Pension Scheme, as
stated above, only provides for a second retiral benefit. Hence there is no question of penalty being imposed on such employees as alleged. The
Pension Scheme only provides for an avenue for investment to retirees. They are provided avenue to put in their savings and as a term or condition
which is more in the nature of an eligibility criterion, the Scheme disentitles such category of employees as are out of it.
The learned Counsel also brought to the notice of this Court another judgment of the Supreme Court in Union Bank of India v. Venkatesh
Gopal Mahishi and Anr. reported in (2006) 12 SCC 20 . In that case, the Supreme Court dealt with the case of a voluntary retirement submitted
by an employee on medical grounds and also the request for an appointment of the employee''s son on compassionate grounds. The bank dealt
with the case on the basis of non-statutory scheme providing for compassionate appointment on grounds of voluntary retirement on medical
grounds. It was thereafter the employee moved the High Court of Bombay seeking for pension under the Pension Regulations, 1995. The
employee''s case was allowed by placing reliance upon an earlier judgment of the Bombay High Court in Madhav K. Kirtikar Vs. Bank Of India, .
It must be noted that the same judgment was relied upon by the Division Bench of this Court in the IOB''s case (cited supra), for the purpose of
granting pension to an employee who voluntarily retired before 01.11.1993.
However, the Supreme Court in the Union Bank of India''s case (cited supra) distinguished the said judgment of the Bombay High Court on
the ground that the case did not relate to an Award staff but related to an officer. In this context, it is relevant to refer to the following passages
found in paragraphs 22 and 28 of the said judgment:
Para 22. High Court has allowed the writ petition of Respondent 1 simply relying upon the decision of the learned Single Judge in Madav Kirtikar1
in which the learned Single Judge found the officers of the bank who had voluntarily retired between 1-1-1986 and 31-10-1993 eligible for
pension, irrespective of their retirement on attaining the age of superannuation or under the scheme of voluntary retirement. The High Court has not
given any finding on the fundamental issue whether the claim of Respondent 1 who, admittedly, was an award staff at the time of retirement on
medical grounds in the year 1993, is covered under the Pension Regulations, 1995 or not. In our view, the decision of the learned Single Judge in
Madav Kirtikar1 as relied upon by the Division Bench in its impugned order, is not of any help or assistance either on facts or on law to the case of
Respondent 1. In that case, the employee of the bank was an officer who sought voluntary retirement under the provisions of the Officers�
Service Regulations governing the terms and conditions of voluntary retirement under the scheme in the normal circumstances and not on medical
grounds. Secondly, in that case there was no question of appointment of dependant of the retiree on compassionate grounds.
Para 28. As we have held that Respondent 1, having retired as award staff, is not entitled to the grant of pension under the Pension Regulations,
1995, we do not consider it necessary and expedient to go into the other abovementioned points raised by the learned Counsel for the parties.
But the Supreme Court had made a factual mistake of holding that the Pension Regulations will not apply to Award staff of the bank. But when
this was brought to the notice of the Supreme Court by way of an interim application, the Supreme Court made a correction in its earlier judgment
vide an order dated 08.1.2008, which has since been reported in Union Bank of India Vs. Venkatesh Gopal Mahishi and Another, . The relevant
passages found in the said order may be extracted below:
Para 3. In the judgment dated 12-1-2007, this Court recorded three submissions made by Shri Raju Ramachandran, Senior Advocate appearing
on behalf of applicant Bank. The first submission as recorded in the judgment was, �Pension Regulations do not apply to Respondent 1 as he is
an award staff�. This submission appears to have been mistakenly mentioned in the judgment dated 12-1-2007 and it needs to be suitably
corrected to the extent that �there was no scheme/provision of voluntary retirement in the terms and conditions of service applicable to the
award staff to which Respondent 1 belonged.
Para 4. The rectification of the abovesaid submission is essential because this factual mistake has been recorded in the judgment as a submission of
the learned Senior Counsel appearing on behalf of the appellant Bank due to oversight. The applicant Bank in this application has categorically
submitted that the Pension Regulations are applicable to all employees of the Bank irrespective of whether they are officers or award staff.
Para 5. Thus, in the factual situation as noticed above, the first submission recorded in the judgment dated 12-1-2007 shall stand rectified and
corrected to the above extent which shall form part of the main judgment. We may make it clear that this order of change/rectification of the factual
mistake of first submission noticed in the judgment will have no bearing or effect on the final result of the appeal which was decided on other issues
and contentions on merits.
(Emphasis Added)
Therefore, the attempt of the petitioner to draw sustenance from the decision of the IOB''s case (cited supra) has no bearing to the present
case since the Supreme Court has already upheld the forfeiture clause. Hence, there is no case made out for the petitioner to demand Invalid
Pension on the basis of the Pension Regulations applicable to the second respondent bank. The writ petition will stand dismissed. However, there
will be no order as to costs.