DR. HIRA LAL versus STATE OF BIHAR & ORS.

Citation: [2020] 2 S.C.R. 907 · Decided: 18-02-2020 · Supreme Court of India · Bench: UDAY UMESH LALIT · Disposal: Appeal(s) allowed

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Judgment (excerpt)

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 [2020] 2 S.C.R. 907
907
DR. HIRA LAL
v.
STATE OF BIHAR & ORS.
(Civil Appeal Nos. 1677-1678 of 2020)
FEBRUARY 18, 2020
[UDAY UMESH LALIT AND INDU MALHOTRA,JJ.]
Service Law:
Retiral benefits – 10% of pension and full amount of gratuity
– Withholding of – On account of pending criminal proceedings –
On the basis of Circulars dated 22.8.1974 and 31.10.1974 r/w.
Government Resolution dated 31.7.1980 – Challenged in writ
petition – Single Judge of High Court dismissed the petition – Order
affirmed in LPA – Appeal to Supreme Court – Held: Rule 43(b) of
Bihar Pension Rules, 1950 which provides for withholding of
pension does not cover a situation where judicial or departmental
proceedings are pending – The Circulars and the Government
Resolution being administrative/executive orders (not issued in
exercise of the power u/Art. 309 of Constitution) have no force of
law – Right to receive pension and gratuity are right to property
protected under Art. 300A of the Constitution – It cannot be taken
away by an executive fiat or administrative instruction – In absence
of statutory Rules, State could not have withheld the pension and
gratuity on the basis of executive instructions – Therefore, the State
was unjustified in withholding 10% pension – However, after
amendment of r. 43 on 19.7.2012 by insertion of clause(c), State is
empowered to withhold 10% of pension amount – State is directed
to release the 10% of pension amount from 31.3.2008 (date of
superannuation) till 19.7.2012 – As per r. 27 of Pension Rules,
‘pension’ includes ‘gratuity’ – Therefore, entire gratuity amount also
could not have been withheld – State is directed to release 90% of
the gratuity amount – Bihar Pension Rules, 1950 – rr. 43 and 27.
Allowing the appeals, the Court
HELD: 1. A reading of Rule 43(b) of Bihar Pension Rules,
1950 would indicate that the State Government was empowered
to withhold or withdraw the whole or part of the amount of pension,
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SUPREME COURT REPORTS
[2020] 2 S.C.R.
permanently or for a specified period, if the pensioner was “found
to be guilty of grave misconduct” in any departmental or judicial
proceeding, or to have “caused pecuniary loss to Government
by misconduct or negligence”, during the tenure of his service.
Rule 43(b) did not cover a situation where judicial or departmental
proceedings were pending. [Paras 11.2 and 12.1][913 G-H; 914-
A]
2. The Circulars dated 22.08.1974 and 31.10.1974, and
Government Resolution No. 3104 dated 31.07.1980, were merely
administrative instructions/executive orders. They were not
issued in exercise of the power under Article 309 of the
Constitution and cannot be said to have the force of law. The
absence of statutory rules permitting withholding of pension or
gratuity, the State could not do so by way of executive instructions.
[Para 13.1][917 A-B; 918-H; 919-A]
State of Jharkhand and Ors. v. Jitendra Kumar
Srivastava and Ors. (2013) 12 SCC 210 : [2013] 8 SCR
177 – relied on.
3. The position has however changed with the amendment
to the Bihar Pension Rules on 19.07.2012 by the Governor of
Bihar in exercise of the powers under Article 309 of the
Constitution, whereby Clause (c) has been inserted in Rule 43.
Rule 43 (c) provides that where a departmental proceeding or
judicial proceeding is initiated during the service period of a
Government servant, and prosecution had been sanctioned but
not concluded till superannuation, the provisional pension payable
shall be less than the maximum admissible amount, but shall in
no case be less than 90%. [Paras 13.2 and 13.3][919-B; 919D-E]
4. It is well settled that the right to pension cannot be taken
away by a mere executive fiat or administrative instruction.
Pension and gratuity are not mere bounties, or given out of
generosity by the employer. An employee earns these benefits
by virtue of his long, continuous, faithful and un-blemished
service. The right to receive pension of a public servant has been
held to be covered under the “right to property” under Article
31(1) of the Constitution. The right to receive pension has been
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held to be a right to property protected under Article 300A of the
Constitution even after the repeal of Article 31(1) by the
Constitution (Forty-Fourth Amendment) Act, 1978 w.e.f.
20.06.1979. [Paras 13.4 and 13.6][919 E-F; 923 C-D]
Deokinandan Prasad v. State of Bihar (1971) 2 SCC
330 : [1971] 0 Suppl. SCR 634; D.S. Nakara and Ors.
v. Union of India (1983) 1 SCC 305 : [

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