Summary
The Supreme Court set aside interest on commuted pension from retirement because the employee had not made the required pre-retirement commutation application and received payment within a reasonable time after his later application. It distinguished commuted pension from gratuity and expressly left the award of interest on gratuity undisturbed.
Issues
- Whether interest on commuted pension could run from retirement without a timely pre-retirement application.
- What effect the provisional-pension order and earlier proceedings had on that claim.
Provisions considered
- Rules 6 and 13(1), 13(3), Central Civil Services (Commutation of Pension) Rules, 1981The date of entitlement depends on the application route. A qualifying pre-retirement application can make commutation payable immediately after retirement; a later application does not justify interest automatically from retirement. (¶¶ 25–30, 45–46)
- Rule 4, Central Civil Services (Commutation of Pension) Rules, 1981Commutation of provisional pension sanctioned under Rule 69 during the relevant proceedings is prohibited. The employee accepted the provisional-pension order without challenge. (¶¶ 17–19, 34–35, 44, 46)
- Rule 9(4) and 9(6), Central Civil Services (Pension) Rules, 1972An old suspension revoked years before retirement did not establish a pending departmental proceeding. The Court explained the criminal-cognizance requirement but proceeded on an assumption favorable to the employee concerning the revision. (¶¶ 32–33, 39–44)
Held
- Commuted pension is an optional lump-sum pension benefit requiring an application. Once a qualifying application is made, the rules confer entitlement; administrative delay can in an appropriate case support interest even without an express interest rule. (¶¶ 20–30, 45)
- No pre-retirement application under Rule 13(3) was claimed. Payment followed within a reasonable time of the November 2012 application, so interest from 1 August 2008 was unjustified. (¶¶ 37, 45–46)
- The earlier suspension had been revoked long before retirement. Even assuming the pending revision was not a qualifying criminal proceeding, the authorities’ contemporaneous position was not wholly baseless, and the employee had accepted rather than challenged the provisional-pension order. (¶¶ 39–44, 46)
- The ruling addressed interest on commuted pension alone. It expressly left interest on death-cum-retirement gratuity undisturbed. (¶ 46–47)
Result
Appeal allowed to the extent of setting aside the Tribunal’s direction for interest on commuted value of pension. Interest on gratuity not interfered with. No order as to costs.