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S.V.DURAIRAJ versus UNION OF INDIA

High Court of Madras

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S.V.Durairaj v. Union of India - W.P.No.2732 of 1997 [2002] RD-TN 95 (25 February 2002)



IN THE HIGH COURT OF JUDICATURE AT MADRAS



DATED: 25.02.2002

CORAM

THE HONOURABLE MR. JUSTICE V.KANAGARAJ

W.P.No.2732 of 1997

S.V.Durairaj .. Petitioner Vs.

1. Union of India

rep. by its Secretary to

Government,

Ministry of Defence,

New Delhi.

2. The Controller of Defence

Accounts (Pensions),

Allahabad.

3. The Record Officer,

Madras Region,

Wellington,

The Nilgris. .. Respondents Petition filed under Section 226 of the Constitution of India praying to issue a Writ of Certiorarified Mandamus as stated therein. For petitioner : Mr.P.Arulmudi

For respondents : Mr.K.Shanmugam,

A.C.G.S.C.

:O R D E R



petitioner has filed this writ petition praying to issue a Writ of Certiorarified Mandamus calling for the records of the third respondent issued in No.03178/SP/17/DG-1 dated 17.6.1992 and quash the same and consequently direct the respondent to pay the pension based on the military service of the petitioner.

2. In the affidavit filed in support of the writ petition, the petitioner would submit that he joined the Indian Army in the Madras Regiment on 13.01.1945 and he was discharged on 15.8.1961 on account of completion of the terms of engagement; that he was paid gratuity amounting to Rs.75/= per month in lieu of pension of Rs.10/= p.m.; that after his service in the army, he was re-employed as Record Keeper on 14.5.1955 in the Ministry of External Affairs, New Delhi; that he repaid the gratuity received for restoring the pension, which at the time of his discharge was Rs.10/- and on enhancement thereafter, the present rate is Rs.1,200/=, and therefore, in spite of several representations made on his part to the second respondent with lawyer's notices dated 5.7.1993 and 28.10.1993, the respondents by the impugned order dated 17.6.1992 rejected his representations exercising option for reservist gratuity in lieu of reservist pension, stating that the option once exercised for reservist gratuity in lieu of reservist pension cannot be revoked; that rejecting his further representation dated 22.5.1993 by their letter dated 29.5.1993, they gave the same reply to his counsel also by letter dated 9.11.1993. Calling the impugned order as arbitrary and in total ignorance of service rendered for 1 6 years and the rejection of the gratuity received by him made on 15.01.1987 in order to get the pension, the petitioner would seek the relief extracted supra.

3. In the counter affidavit filed on behalf of the respondents, it would be revealed that the petitioner was enrolled on 13.01.1945 as a boy and re-mustered into regular service with effects from 15.8.1946 on attainment of the age of 17 years for a term of 7 years with colours and eight years in reserve service; that he was transferred to the reserve service with effects from 15.12.1954 on completion of the colour service and finally discharged on completion of the term engagement with effects from 15.8.1961; that he had opted to receive reservist gratuity in terms of the special army instructions 2/S/54 instead of reservist pension at the time of his transfer to the pension establishment; that the option once exercised is supposed to be final and it could not be revoked under any circumstance and hence the individual's request for reservist pension could not be acceded to; that his service documents have already been destroyed being a nonpensioner on expiry of 25 years from the date of discharge under the provisions of para 592 of Regulations for the Army, 1987; that as the individual was transferred to the pension establishment and discharged with effects from 15.8.1961 is not covered under the provisions of this revised ruling on the subject; that the fact that the petitioner had refunded the amount of reservist gratuity to his re-employer does not entitle him to receive pension from military side; that it is also not known whether his former military service has been counted to pensionable service by his re-employer or otherwise. On such averments, the respondents would seek to dismiss the writ petition.

4. During arguments, the learned counsel appearing on behalf of the petitioner having brought forth the facts and circumstances connected to the claim of the petitioner pertaining to the writ petition, would submit that the respondents are restored from denying the option exercised by the petitioner for the reservist pension benefits in lieu of the reservist gratuity, since the repayment of the payment of gratuity amount had been received by the respondents. The learned counsel would also argue that it is a case of legitimate expectation, in such event, and would further argue that fixing the cut-off date for the exercise of such an option is arbitrary. At this juncture, the learned counsel would cite three judgments, viz., (i) NATIONAL BUILDINGS CONSTRUCTION CORPORATION vs. S.RAGHUNATHAN reported in (1998) 7 SCC 66, (ii) F.C.I. vs. KAMDHENU CATTLEFEED INDUSTRIES reported in (1 993) 1 SCC 71; and (iii) DHAN RAJ vs. STATE OF J&K reported in (1998) 4 SCC 30, all concerned with one and the same 'Doctrine of Legitimate Expectation.'

5. So far as the first judgment cited above is concerned, it is held therein:

"The doctrine of "legitimate expectation" has its genesis in the field of administrative law. The Government and its departments, in administering the affairs of the country, are expected to honour their statements of policy or intention and treat the citizens with full personal consideration without any iota of abuse of discretion. The policy statements cannot be disregarded unfairly or applied selectively. Unfairness in the form of unreasonableness is akin to violation of natural justice. It was in this context that the doctrine of " legitimate expectation" was evolved which has today become a source of substantive as well as procedural rights. But claims based on " legitimate expectation" have been held to require reliance on representations and resulting detriment to the claimant in the same way as claims based on promissory estoppel.

Lord Scarman in R. v. IRC, ex p Preston (1985 AC 835) laid down emphatically that unfairness in the purported exercise of power can amount to an abuse or excess of power. Thus the doctrine of "legitimate expectation" has been developed, both in the context of reasonableness and in the context of natural justice.

Lord Diplock in Council of Civil Service Unions v. Minister for the Civil Service (1985 AC 374) laid down that the doctrine of " legitimate expectation" can be invoked if the decision which is challenged in the court has some person aggrieved either (a) by altering rights or obligations of that person which are enforceable by or against him in private law; or (b) by depriving him of some benefit or advantage which either (i) he had in the past been permitted by the decisionmaker to enjoy and which he can legitimately expect to be permitted to continue to do until there has been communicated to him some rational grounds for withdrawing it on which he has been given an opportunity to comment; or (ii) he has received assurance from the decision-maker that it will not be withdrawn without giving him first an opportunity of advancing reasons for contending that it should not be withdrawn."

So far as the second judgment cited above is concerned, it is held therein: "In contractual sphere as in all other State actions, the State and all its instrumentalities have to conform to Article 14 of the Constitution of which non-arbitrariness is a significant facet. There is no unfettered discretion in public law: A public authority possesses power only to use them for public good. This imposes the duty to act fairly and to adopt a procedure which is 'fairplay in action'. Due observance of this obligation as a part of good administration raises a reasonable or legitimate expectation in every citizen to be treated fairly in his interaction with the State and its instrumentalities, with this element forming a necessary component of the decisionmaking process in all State actions. To satisfy this requirement of non-arbitrariness in a State action, it is, therefore, necessary to consider and give due weight to the reasonable or legitimate expectations of the persons likely to be affected by the decision or else that unfairness in the exercise of the power may amount to an abuse or excess of power apart from affecting the bona fides of the decision in a given case. The decision so made would be exposed to challenge on the ground of arbitrariness. Rule of law does not completely eliminate discretion in the exercise of power, as it is unrealistic, but provides for control of its exercise by judicial review. The mere reasonable or legitimate expectation of a citizen, in such a situation, may not by itself be a distinct enforceable right, but failure to consider and give due weight to it may render the decision arbitrary, and this is how the requirement of due consideration of a legitimate expectation forms part of the principle of nonarbitrariness, a necessary concomitant of the rule of law. Every legitimate expectation is a relevant factor requiring due consideration in a fair decision-making process. Whether the expectation of the claimant is reasonable or legitimate in the context is a question of fact in each case. Whenever the question arises, it is to be determined not according to the claimant's perception but in larger public interest wherein other more important considerations may outweigh what would otherwise have been the legitimate expectation of the claimant. A bona fide decision of the public authority reached in this manner would satisfy the requirement of non-arbitrariness and withstand judicial scrutiny. The doctrine of legitimate expectation gets assimilated in the rule of law and operates in our legal system in this manner and to this extent.

In Council of Civil Service Unions v. Minister for the Civil Service (1985 AC 374) the House of Lords indicated the extent to which the legitimate expectation interfaces with exercise of discretionary power. The impugned action was upheld as reasonable, made on due consideration of all relevant factors including the legitimate expectation of the applicant, wherein the considerations of national security were found to outweigh that which otherwise would have been the reasonable expectation of the applicant. Lord Scarman pointed out that "the controlling factor in determining whether the exercise of prerogative power is subject to judicial review is not its source but its subject-matter". Again in Preston, in re (1985 AC 835) it was stated by Lord Scarman that "the principle of fairness has an important place in the law of judicial review" and "unfairness in the purported exercise of a power can be such that it is an abuse or excess of power". These decisions of the House of Lords give a similar indication of the significance of the doctrine of legitimate expectation. Shri A.K. Sen referred to Shanti Vijay and Co. v. Princess Fatima Fouzia which holds that court should interfere where discretionary power is not exercised reasonably and in good faith." So far as the third judgment cited above is concerned, it is held therein: "Even otherwise, we do not find any justifiable criteria for the State Government to draw the line between those who retired earlier and those who retired after 9.6.1981. Both such set of employees were equally placed in the same Undertaking/Corporation temporary in character and all having served in the organisations for more than 20 years. In fact, the appellants have served with the Government for more than 30 to 40 years. The person serving for such a long period earns his legitimate expectation. It is not something which he seeks with a begging bowl. It is inappropriate for a State Government to take up a stand to get its own order to be held illegal, by giving restrictive interpretation to deny benefit to its own employees who had worked for such a long period. In fact, in the Constitution Bench decision of this Court in D.S.Nakara v. Union of India [(1983) 1 SCC 305] this Court held that criterion of date of enforcement of the revised scheme entitling benefits of the revision to those retiring after specified date while depriving the benefits to those retiring prior to that date was violative of Article 14. Even otherwise, while considering the question of grant of pensionary benefits the State has to act to reach the constitutional goal of setting up a socialist State as stated and the assurance as given in the Directive Principles of State policy. A pension is a part and parcel of that goal, which secures to a person serving with the State after retirement of his livelihood. To deny such a right to such a person, without any sound reasoning or any justifiable differentia would be against the spirit of the Constitution. We find in the present case the stand taken by the State Government to be contrary to the said spirit. In the aforesaid D. S. Nakara this Court has very clearly recorded the following: (SCC petitioners.327-28, para 36)

"36. Having set out clearly the society which we propose to set up, the direction in which the State action must move, the Welfare State which we propose to build up, the constitutional goal of setting up a socialist State and the assurance in the Directive Principles of State Policy especially of security in old age at least to those who have rendered useful service during their active years, it is indisputable, nor was it questioned, that pension as a retirement benefit is in consonance with and in furtherance of the goals of the Constitution. The goals for which pension is paid themselves give a fillip and push to the policy of setting up a welfare State because by pension the socialist goal of security of cradle to grave is assured at least when it is mostly needed and least available, namely, in the fall of life." The learned counsel would end up his arguments laying emphasis that he is entitled to the pension as sought for and would pray to allow the writ petition.

6. In reply, the learned Additional Central Govt. Standing Counsel appearing on behalf of the respondents would submit that from among the two Schemes, one the gratuity scheme and the other the pension scheme, a retired army personnel has to give option of his choice and once the option is exercised, the same cannot be revoked; that as on 1.4.1968, the persons who retired after this date are eligible for change of option and the petitioner having not fallen under this category, is not eligible for pension in lieu of gratuity which he had opted originally. The learned counsel submits that the Rules do not permit the petitioner to exercise his option seeking pensionary benefits in lieu of gratuity, and therefore, is not entitled to.

7. In consideration of the pleadings by parties, having regard to the materials placed on record and upon hearing the learned counsel for both, it comes to be known that the petitioner, who was discharged from service on completion of the terms of engagement on 15.8.1961, was to give his option either for the payment of pension or gratuity and since at the time that he retired, the pension was only Rs.10/= per month and the gratuity was Rs.750/= per month and in lieu of pension, the petitioner had opted for the gratuity.

8. But a new Scheme was introduced effective from 1.4.1968 under which even according to the petitioner, the rate of pension at present is Rs.1,200/= and therefore, the petitioner seeking to change his option from that of the gratuity to that of the pensionary benefits, is also said to have repaid the gratuity amount that he had received, giving option for reservist pension.

9. Several representations have been made on the part of the petitioner and they have also been considered by the respondents in proper perspective and ultimately by the impugned order, the third respondent expressing their inability to comply with the request of the petitioner stating thereby that the option exercised by the petitioner for reservist gratuity in lieu of reservist pension cannot be revoked at that belated stage since there is no provision in the existing Rules to enhance the gratuity also from the original amount of Rs.750/= already received by the petitioner, and hence they are not in a position to comply with the requests of the petitioner, thus ultimately rejecting the claim of the petitioner for such an option. It is only challenging the said order dated 17.6.1992, the petitioner has come forward to file the above writ petition in the year 1997.

10. Needless to mention that five years after passing of the impugned order, the petitioner stating that even after the passing of the order, he approached the respondents/authorities to consider his plea that correspondences were in vogue and that when ultimately his request was turned down, he was left with no choice, but to approach this Court by means of the writ petition, has come forward with the plea of promissory estoppel, legitimate expectation, arbitrariness, etc.

11. On the part of the respondents, right from the beginning till the time of arguments, they maintain that the Rules do not permit them accepting the option given by the petitioner in a highly belated stage thereby expressing that in accordance with the prevailing Rules, there is no such option that could be entertained since the present Rules could be applied only to those who retired after 1.4.1968, and therefore, the petitioner having retired prior to the said cut-off date, is not eligible to the same since no retrospective effect has been given to the present Scheme. Therefore, the respondents outright rejected the request of the petitioner that once the option is exercised, it cannot be revoked and a change of option is not permissible for the petitioner in accordance with the present Rules, and therefore, they would express their inability to comply with the request of the petitioner.

12. Though on the part of the petitioner legal dictums and doctrines such as estoppel, legitimate expectation and arbitrariness could be pleaded, whether they could be applied to the present case is the point of for determination. After decades, the petitioner has come forward to give a change of option within which time, not only the Rules have changed, but also the records are lost, and therefore, the petitioner cannot maintain to accept his option based on the Rules that existed at the time that he retired in the year 1961. Unless sufficient safeguards are provided with in the new Rules or Schemes formulated, giving retrospective effect being permitted, such options for those who have retired like the petitioner, the doctrines such as estoppel or legitimate expectation cannot be put up against such law or Rule or regulation or even executive instructions. In the absence of such law or Rule or regulation or on the factual position of the case, these doctrines could be applied, but they cannot surmount the existing laws, Rules and regulations and therefore, these doctrines cannot be applied to the facts and circumstances and the position of law that prevail in the case in hand.

13. The respondents are left with no option but to reject the request of the petitioner for change of option from the reservist gratuity to reservist pension. Therefore, in the above circumstances, the only option that is left with for this Court is to say that this Court cannot cause its interference into the impugned order passed by the third respondent herein, nor could it direct the respondents to pay pension to the petitioner based on the military service of the petitioner as prayed for. In result, there is no merit in the writ petition and hence the same fails and dismissed. No costs.

gs.

25.02.2002

To

1. The Secretary to the Government of India,

Ministry of Defence,

New Delhi.

2. The Controller of Defence

Accounts (Pensions),

Allahabad.

3. The Record Officer,

Madras Region,

Wellington,

The Nilgris.

gs.

V.KANAGARAJ,J.

Order in

W.P.No.2732 of 1997




Copyright

Reproduced in accordance with s52(q) of the Copyright Act 1957 (India) from judis.nic.in, indiacode.nic.in and other Indian High Court Websites

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