Allowed

Lt. Col. (Retd.) C.J.George v. Indian Rare Earths Ltd.

Kerala HC3 Nov 2016WP(C)/11826/2015

Case brief

AI extract

What is this about?

The High Court of Kerala held that the Military Service Pay (MSP) component included in the petitioner's pension must be treated for pay protection purposes. The court set aside the respondent's order denying MSP inclusion, declaring the petitioner entitled to higher pay protection.

What did the court decide?

The respondent's order denying MSP benefit was set aside. The petitioner was declared entitled to pay protection of Rs.30,841/-, and consequential benefits to be calculated within three months.

Lt. Col. (Retd.) C.J.George Vs Indian Rare… — Pension and Retirement Benefits | Kerala HC (2016)

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT:

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THE HONOURABLE MRS. JUSTICE ANU SIVARAMAN

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THURSDAY, THE 3RD DAY OF NOVEMBER 2016/12TH KARTHIKA, 1938

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WP(C).No. 11826 of 2015 (C)

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PETITIONER(S):

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LT. COL. (RETD.) C.J.GEORGE, SENIOR MANAGER(SECURITY) INDIAN RARE EARTHS LTD.,RARE EARTHS DIVISION, UDYOGAMANDAL.P.O., ERNAKULAM(S/O. LATE JOSEPH, AGED 59, CHAKKALAKKAL HOUSE, AASHIYANA, XVI/215 D, KARAMPADY ROAD, ALANGAD.P.O.,ERNAKULAM.)

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BY ADVS.SRI.K.S.MADHUSOODANAN SRI.THOMAS CHAZHUKKARAN SRI.M.M.VINOD KUMAR SMT.K.M.RAMYA SRI.P.K.RAKESH KUMAR SRI.K.S.MIZVER

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RESPONDENT(S):

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1. INDIAN RARE EARTHS LTD.

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(A GOVERNMENT OF INDIA UNDERTAKING DEPARTMENT OF ATOMIC ENERGY) VEER SARVARKAR MARG, NEAR SIDDHI VINAYAK TAMPLE, PRABHADEVI, MUMBAI, 400028, REPRESENTED BY CHAIRMAN AND MANAGING DIRECTOR.

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2. INDIAN RARE EARTHS LTD., (A GOVERNMENT OF INDIA UNDERTAKING DEPARTMENT OF ATOMIC ENERGY), CHAVARA, KOLLAM-691583, REPRESENTED BY ITS HEAD.

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3. INDIAN RARE EARTHS LTD.

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(A GOVERNMENT OF INDIA UNDER TAKING DEPARTMENT OF ATOMIC ENERGY) RARE EARTHS DIVISION, UDYOGAMANDAL, ERNAKULAM REPRESENTED BY ITS HEAD. 683 501

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R1-R3 BY ADV. SRI.M.GOPIKRISHNAN NAMBIAR R1-R3 BY ADV. SRI.P.GOPINATH R1-R3 BY ADV. SRI.P.BENNY THOMAS R1-R3 BY ADV. SRI.K.JOHN MATHAI R1-R3 BY ADV. SRI.JOSON MANAVALAN R1-R3 BY ADV. SRI.KURYAN THOMAS

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THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 03-11-2016, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

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WP(C).No. 11826 of 2015 (C)

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APPENDIX

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PETITIONER(S)' EXHIBITS

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EXT.P1. PHOTOCOPY OF THE LAST PAY CERTIFICATE ISSUED ON 4-8-2010.

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EXT.P2. PHOTOCOPY OF PENSION PAYMENT ORDER ISSUED BY CHIEF CONTROLLER OF DEFENCE ACCOUNTS(PENSION) ALLAHABAD.

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EXT.P3. PHOTOCOPY OF THE NOTIFICATION PUBLISHED IN EMPLOYEMENT NEWS 13-19 JANUARY 2007.

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EXT.P4.PHOTOCOPY OF THE LETTER DATED 14-5-2007 BEARING NO. IREL/HRM/RCRT/2007/2 ISSUED BY 1ST RESPONDENT.

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EXT.P5. PHOTOCOPY OF THE OFFICE MEMORANDUM BEARING NO.3/19/2009-ESST. (PAY II) DATED 5-4-2010.

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EXT.P6. PHOTOCOPY OF THE OFFICE MEMORANDUM BEARING NO. 3/19/2009-ESST. (PAY II) DATED 5-4-2010.

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EXT.P7.PHOTOCOPY OF THE REPRESENTATION TO 2ND RESPONDENT TO REFIX HIS PAY IN TUNE WITH PARA 4 (B) (II) WITH RESPECT TO THE PROTECTION OF LAST PAYT DATED 6-8-2009.

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EXT.P8. PHOTOCOPY OF PAY FIXATION ORDER BEARING NO.X265 DATED 12.3.2009

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EXT.P9: PHOTOCOPY OF THE FORWARDING LETTER DATED 28.8.2009

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EXT.P10: PHOTOCOPY OF REPRESENTATION THROUGH PROPER CHANNEL DATED 21.6.2013

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EXT.P11: PHOTOCOPY OF THE JUDGMENT IN W.P(C ) NO.13170/2014 DATED 11.8.14

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EXT.P12: PHOTOCOPY OF THE ORDER DATED 25.914 OF THE GENERAL MANAGER (HRM) OF 1ST RESPONDENT

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EXT.P13: PHOTOCOPY OF THE REPRESENTATION TO CMD OF ST RESPONDENT

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EXT.P14: PHOTOCOPY OF THE REPLY OF MINISTER DATED 6.12.2012

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RESPONDENT'S EXHIBITS

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ANNEXURE-R1(A): TRUE COPY OF THE POLICY ON PAY FIXATION OF RE-EMPLOYED PENSIONERS IN PSUS LIKE THAT THE RESPONDENTS GOVERNED BY DPE OM NO.F.NO.3(34)/12-DPE-(WC) GL-XX/12 DATED 14.12.2012 (WITHOUT ANNEXURES)

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ANNEXURE-R1(B): TRUE COPY OF RELEVANT EXTRACT OF THE ORDERS OF CENTRAL CIVIL SERVICE (FIXATION OF PAY OF RE-EMPLOYED PENSIONER) ORDERS, 198 IN CLAUSE 2(4)(B)

//TRUE COPY//

P.A. TO JUDGE

ANU SIVARAMAN, J.

W.P.(C) No.11826 of 2015

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Dated this the 3^rd day of November, 2016

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JUDGMENT

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The issue raised in this writ petition is with respect

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to the protection of pay available to retired defence personnel, who was employed in a Central Government Public Sector Undertaking. The petitioner is a retired Lt.Colonel. He had left the Army after 33 years of service, drawing a total pay of Rs.53,930/- including Military Service Pay (hereinafter referred to as 'MSP' for short) of Rs.6,000/-. By Ext.P2, he was held entitled to pension amounting to Rs.26,965/-. He joined service as Manager (Security) in the Indian Rare Earths Limited on a scale of pay of Rs.14,500/- to Rs.18,700/-. Ext.P3 notification dated 19.01.2007 would show that the post of Security Officer was to be filled up by appointment of graduate Commissioned Officer not below the rank of Captain or equivalent, retired from Indian Defence Services.

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The petitioner was issued with Ext.P4 order of

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appointment dated 14.05.2007. In the matter of fixation of

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his pay, the petitioner sought the benefits granted in Exts.P5 and P6 Office Memorandum issued by the Department of Personnel and Training, Union of India. The main dispute which survives for consideration in this case is with regard to the inclusion of the MSP component in the non-ignorable part of his pension for fixing of his pay. It is contended by the petitioner that the respondents have relied on the Office Memorandum issued by the Department of Personnel and Training to reduce the amount of Rs.6,000/- which was being granted to the petitioner as MSP from his pay for the purpose of reckoning the pay, which is to be protected on his reemployment. However, it is contended that the MSP component of his pension, which by Ext.P6 Office memorandum dated 08.11.2010 was held to be not deductible

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from the pay fixed on the re-employment has not been taken into account, it is contended.

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Ext.P12 is the order issued by the first

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W.P.(C) No.11826 of 2015 -3-

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respondent on the petitioner's representation which was directed to be considered by this Court. Ext.P12 relies on Ext.P5 Office Memorandum to hold that the petitioner is not entitled to calculate Rs.53,930/-, as the last pay drawn by him in the Army since the same is inclusive of the MSP also. It is stated that the element of the MSP is to be deducted from the pay fixed for the purpose of pay protection on the basis of Ext.P5 as well as letter dated 24.07.2009. It is further contended that Ext.P6 Office Memorandum provides that in respect of Defence Officers/personnel, whose pension contains an element of MSP, that need not be deducted from the pay fixed on re-employment.

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In Paragraph 15 of Ext.P12, it is stated that the MSP is not to be included in his pay for re-fixation. It is further stated that the element of the MSP in the pension need not be deducted from the pay fixed on re-employment, since no element of MSP is separately shown in the pension. A tabulation is also shown in Ext.P12. Without deducting the

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amount of the MSP component from the non-ignorable part of the pension it is stated that the pay available for protection in terms of Exts.P5 and P6 Office Memorandum would only be Rs.27,841/- and that the petitioner's pay has been fixed in the minimum of the pay band to which he was appointed at Rs.29,333/-. It is therefore contended that the pay fixed being higher than the pay which was liable to be protected, the petitioner is not entitled to the benefit claimed.

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Heard the learned counsel for the petitioner and the learned Standing Counsel appearing for the respondents.

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The only claim raised before me in this writ petition is with regard to the deduction of the MSP component from the non-ignorable part of the pension of the petitioner. The pension drawn by the petitioner, going by Ext.P2 was Rs.26,965/-. Even according to the respondents, Ext.P5 provides for ignoring an amount of Rs.4,000/- from the said pension. Therefore, the respondents have reckoned Rs.22,965/- as the non-ignorable part of pension, which is to

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be reduced from the pay fixed. The contention of the petitioner is that a further amount of Rs.3,000/- being the component of the MSP in the petitioner's pension is also to be reduced from the non-ignorable part of the pension and only an amount of Rs.19,695/- can therefore be reduced from the petitioner's pay which is arrived at as Rs.50,806/-, in the computation shown in Ext.P12. If this benefit is granted on the strength of Ext.P6, it is contended that the petitioner would be entitled to Rs.30,841/- as Basic Pay + Grade Pay + DA to be protected after deduction of the non-ignorable part of the pension. This being higher than the total Basic Pay + DA as calculated at the minimum of the pay band to which he was appointed, he is entitled to a protection of the said amount, it is contended.

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The learned counsel for the respondents would submit that the Office Memorandum relied on by the petitioner as Exts.P5 and P6 are not applicable in the case of a Central Public Sector Undertaking. It is contended in the counter

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W.P.(C) No.11826 of 2015 -6-

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affidavit filed on behalf of the respondents that, the guidelines applicable to fixation of pay in respect of the Board level executives and below Board level executives of Central Public Sector Enterprises is Ext.R1(a) Office Memorandum issued by the Department of Public Enterprises dated 14.12.2012. It is contended that below Board level employees of Central Public Sector Undertakings would also be entitled only to fixation in the pay band to which they are appointed. In the above view of the matter, it is contended that the fixation of pay of the petitioner at Rs.29,333/- as contained in Ext.P12 is perfectly in order.

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In have considered the contentions advanced in detail. Ext.R1(a) Office Memorandum specifically provides that all appointments in Central Public Sector Enterprises are on permanent absorption basis. It is further stated that in cases where a person from Government service including Defence Services joins a Central Public Sector Enterprises on a permanent absorption basis, there is a need of protect his/her

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emoluments. It is further stated that pension, if any, drawn on account of service rendered in Government is regulated as per DoPT orders. The Office Memorandum goes on to hold that persons engaged on deputation from Government service will be governed by the guidelines issued by the Department of Public Enterprises.

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Ext.P12 order also relies on Ext.P5 Office Memorandum to contend that Rs.4,000/- minus the ignorable part of pension is to be reduced from the pay in the pay band + Grade Pay to be reckoned for pay fixation at the time of re-employment. A reading of Ext.P12 would show that the respondents have proceeded on the basis that Exts.P5 and P6 Office Memorandums are applicable in the case of the petitioner. The contention in Ext.P12 which is sought to be made clear with the help of a tabulation is that the pay to which the petitioner would be entitled on protection in terms of Exts.P5 and P6 would be less than the pay which has been

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fixed by taking into account his pay at the minimum of the

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pay band with the component of DA which amounts of Rs.29,333/-. However, while relying on Exts.P5 and P6 to state that the petitioner would not be entitled to count the MSP while fixing the pay for pay protection as also to contend that Rs.4,000/- would be liable to be deducted from the ignorable part of pension, in terms of Ext.P5, the contention now advanced is to the effect that the provision contained in Ext.P6 to the effect that the MSP component in the petitioner's pension is also to be deducted from the non-ignorable part of pension of the petitioner, is alone not applicable in the petitioner's case. This argument is clear from the second sub-clause of paragraph 15 of Ext.P12 order wherein, it is stated that since no element of the MSP is separately shown in the petitioner's pension, the question of deduction of element of the MSP does not arise.

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The first contention urged by the counsel appearing for the respondents with regard to the nonapplicability of the Office Memorandum framed by the

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Department of Personnel and Training must fail on the short ground that the respondents themselves in Ext.P12 have applied the provisions of Exts.P5 and P6 Office Memoranda for fixing the pay of the petitioner, which is liable for protection. However, when it comes to the last part of Ext.P6 for deduction of the MSP component from the ignorable part of the pension alone, Ext.P12 states that such component is not separately shown.

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It is not in dispute before me that the MSP component in the petitioner's pay was Rs.6,000/-. It is also not in dispute that the pension fixed was exactly 50% of the pay of the petitioner which was arrived at by including the MSP component as well. In the above circumstances, it is safe to conclude that the MSP component in the petitioner's pension would be Rs.3,000/-, which is 50% of the MSP pay which was included in his pay. Ext.P6 provides that the MSP cannot be included in the pay of the petitioner for the purpose of protection. It further provides that the component of MSP in

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the pension is to be deducted from the non-ignorable part of pension or that it is to be given credit for fixation of pay for the purpose of protection. Since the earlier part of the Office Memorandum which is favorable to the respondents have been taken into account by the respondents, I am of the view that the further condition contained in Ext.P6 to the effect that in case of Defence personnel whose pension contains element of MSP, that need not be deducted from the pay fixed on re-employment has also to be taken into account. This admittedly has not been done in Ext.P12 on the short ground that the element of MSP is not separately shown in the pension. Since it is not in dispute before me that the element of MSP in the pension is Rs.3,000/- or 50% of the MSP which was included in the pay, I am of the opinion that the fixation of pay of the petitioner for protection at Rs.27,841/- was erroneous. The component of MSP element in the petition that is Rs.3,000/- ought to have been added to this figure. In the result, the petitioner is entitled to protection of pay of

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Rs.30,841/-, which is greater than the amount of

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Rs.29,333/-, which is fixed as his pay in the pay band to which he was appointed.

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In the above circumstances, I am of the view that Ext.P12 which denies the benefit of the MSP component in the pension for fixation of the petitioner's pay for protection is erroneous and the same is set aside. It is declared that the petitioner is entitled to protection of his pay by including the MSP element in pension drawn by him also for the purpose of pay protection and the pay to be protected would therefore be Rs.30,841/-. It is declared so. The consequential benefits shall be calculated and disbursed to the petitioner within a period of three months from the date of receipt of a copy of this judgment.

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Writ petition is ordered accordingly.

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Sd/ANU SIVARAMAN, JUDGE

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Lt. Col. (Retd.) C.J.George v. Indian Rare Earths Ltd.

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Lt. Col. (Retd.) C.J.George v. Indian Rare Earths Ltd.

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