UNION OF INDIA AND OTHERS versus KESHAB LAL ROY AND OTHERS

Citation: [1996] SUPP. 5 S.C.R. 611 · Decided: 09-09-1996 · Supreme Court of India · Bench: J.S. VERMA · Disposal: Appeal(s) allowed

Judgment (excerpt)

UNION OF INDIA AND OTHERS 
A 
v. 
KESHAB LAL ROY AND OTHERS 
SEPTEMBER 9, 1996 
(J.S. VERMA ANJ? B.N. KIRPAL, JJ.) 
( 
B 
SERVICE LAW: 
Railways-Private Railway Company voluntarily closing its opera-
tion-Employees thereof appointed as fresh entrants in Railways-Claim for C 
counting past service for pension purposes-Tribunal allowing the claim-On 
appeal held, appointment and absorption are two different con-
notaions-When appointed afresh, past se1vices can not be taken into account 
for pension purposes. 
Constitution of India 1950 : 
Article 136-Special Leave Jurisdiction-Plea not raised in courts 
below-Such plea not allowed to be raised for the first time before the 
Supreme Court. 
The respondents were employees of a Private Railway Company 
D 
E 
(ASL Railways), which voluntarily dosed its operation with effect from 
15th February, 1978. In order to mitigate their hardships, these retrenched 
employees were appointed as "Fresh Entrants" in Indian Railways vide 
letter dated 17th March, 1978 written by the Ministry of Railways to the 
General Manager, Eastern Railways. The said letter inter alia clarified that F 
these persons will be considered for appointment and not for absorption. 
Clause V of this letter stipulated that the respondents were to be treated 
as being recruited for the first time "on the date of their appointment on 
the Railway as Temporary Employees". 
As per existing Rules of the Indian Railways, pensionary benefits G 
were given only to the persons who had put in ten years or' service. The 
respondents represented that the service rendered by them to the ASL 
Railways be counted for granting pensionary benefits to them. The repre-
sentation having been rejected, the respondents approached the Central 
Administrative Tribunal. The application of the respondents was allowed H 
611 
612 
SUPREME COURT REPORTS [1996] SUPP. 5 S.C.R. 
A 
by the Tribunal,. on the ground that the respondents and the erstwhile 
employees of the K.F. Railways were similarly situated and as the Railway 
Board had taken into consideration the past service of the employees of 
K.F. Railways for granting pensionary benefits, the same benefit should 
also be extended to the respondents. The appellants contended that the. 
B 
c 
status of the ex-employees of ASL Railways and that of the K.F. Railways 
was different and distinguishable, in as much as while the former was 
taken over by the Government of India, the latter had gone into voluntary 
liquidation. The respondents contended that some ex employees of ASL 
Railways who had joined other private Railway Companies, which later on 
taken over by the Indian Railways were given the benefits of their previous 
service with ASL Railways in granting pensionary benefits. This submis-
sion was made for the first time in appeal before this Court. 
Allowing the appeal, this Court 
HELD: 1.1. It is clear from the letter dated 17th March, 1978 that 
D the Railways did not intend to give benefit to the respondents of their past 
service and that is why, they, on their selection were regarded as "ap-
pointed" and not "absorbed" and their pay was also fixed at the minimum 
of ihe relevant pay scale. [615-G] 
E 
1.2. Clause V of the letter clearly mentions that the r~spondents were 
to be treated as recruited for the first time "on the date of their appoint-
ment in the Railways as temporary employees". [615-H, 616-A] 
2. Even though as per clause IX of the letter dated 17th Match, 1978, 
the services of the newly appointed employees was pensionable, the letter 
F 
contained no stipulation that the services rendered by the employees in the 
erstwhile private company would be taken into consideration for granting 
pensionary benefits. [616-B] 
3. K.F. Railways was purchased outright without any liability and 
was not taken over by the Government. Some of the employees of K.F. 
G Railways joined other privately owned Railway companies which were 
subsequently taken over as going concern by the Indian Railways and their 
employees were given the benefit of their earlier continu~us service. So the. 
respondents and the employees of K.F. Railways stand on different footing' 
and are not similarly situated. In. the case of ASL Railways, it voluntarily 
H went into liquidation and was not taken over or purchased by the Indian 
U.O.I. v. KL.ROY [KIRP AL, J.] 
613 
Railways. [616-C-D; 617-D] 
. 4. The contention that in respect of some employees of the ASL 
Railways, who had joined other com

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