Whether pension of an employee can be withheld during pendency of departmental/criminal proceedings?

In   case   of  State   of   Jharkhand   and   others
(supra),  the   Supreme   Court   formulated   the   following
questions for consideration :­
"2. Crisp and short question which arises for
consideration in these cases is as to whether, in
the absence of any provision in the Pension Rules,
the   State   Government   can   withhold   a   part   of
pension and/or gratuity during the pendency of
departmental/criminal proceedings ?”  
7. After   taking   into   consideration,   the   various
expositions on the subject, the Supreme Court in paras 16
and 17 of the judgment held thus :­ 
“16. The fact remains that there is an imprimatur to the
legal principle that the right to receive pension is recognised
as a right in “property”. Article 300­A of the Constitution of
India reads as under: 
“300­A. Persons not to be deprived of property save by
authority   of   law.   ­   No   person   shall   be   deprived   of   his
property save by authority of law.” 
Once we proceed on that premise, the answer to the
question posed by us in the beginning of this judgment
becomes too obvious. A person cannot be deprived of this
pension   without   the   authority   of   law,   which   is   the

constitutional mandate enshrined in Article 300­A of the
Constitution. It follows that attempt of the appellant to take
away a part of pension or gratuity or even leave encashment
without any statutory provision and under the umbrage of
administrative instruction cannot be countenanced. 
17.  It hardly needs to be emphasised that the executive
instructions   are   not   having   statutory   character   and,
therefore, cannot be termed as “law” within the meaning of
aforesaid Article 300­A. On the basis of such a circular,
which   is   not   having   force   of   law,   the   appellant   cannot
withhold even a part of pension or gratuity. As we noticed
above, so far as statutory Rules are concerned, there is no
provision for withholding pension or gratuity in the given
situation. Had there been any such provision in these Rules,
the position would have been different.” 
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                             
BENCH AT AURANGABAD
WRIT PETITION NO. 2630 OF 2014
PURUSHOTTAM KASHINATH KULKARNI AND OTHERS
V
STATE OF MAHARASHTRA AND OTHERS

CORAM : S.S. SHINDE & P.R. BORA, JJ.
Dated: February 16, 2016
Citation: 2016 (5) ALLMR410

Rule. Rule made returnable forthwith and heard
finally by consent of the learned counsel appearing for the
parties. 
2. This Petition seeks directions to the Respondent
No.5 to release the amount of gratuity, pension and group
insurance as against the LIC Master Policy No. CGI­20053
and 20256. 
3. The learned counsel appearing for the petitioner
submits that, merely on the ground that, the criminal case
is pending against the petitioner, the amount of pension and
gratuity is withheld by the Respondents. The said action of

the respondents withholding pension and gratuity amount
on the ground that, the criminal case is pending against the
petitioner, is contrary to the law laid down by the Hon'ble
Supreme Court in the case of State of Jharkhand and ors
V/s  Jitendra  Kumar  Srivastava   and   anr.1 Therefore, he
submits that, the Petition may be allowed. 
4. On the other hand, the learned A.G.P. appearing
for   the   respondent/State   invited   our   attention   to   the
averments in the affidavit in replies filed on behalf of the
Respondent   No.5.   He   submits   that,   the   office   of   the
Liquidator has withheld the amount of D.A. and also the
other amounts since the crimes are registered against the
petitioner and other employees. 
5. We   have   given   careful   consideration   to   the
submissions   of   the   learned   counsel   appearing   for   the
petitioner   and   the   learned   A.G.P.   appearing   for   the
respondents. With their able assistance, we have perused
the pleadings in the Petition, annexures thereto and the
judgment in the case of  State  of  Jharkhand  and  others
1 (2013) 12 S.C.C. 210

(supra) and we are of the opinion that, the Petition deserves
to be allowed for the reasons set out hereinbelow. 
6. In   case   of  State   of   Jharkhand   and   others
(supra),  the   Supreme   Court   formulated   the   following
questions for consideration :­
"2. Crisp and short question which arises for
consideration in these cases is as to whether, in
the absence of any provision in the Pension Rules,
the   State   Government   can   withhold   a   part   of
pension and/or gratuity during the pendency of
departmental/criminal proceedings ?”  
7. After   taking   into   consideration,   the   various
expositions on the subject, the Supreme Court in paras 16
and 17 of the judgment held thus :­ 
“16. The fact remains that there is an imprimatur to the
legal principle that the right to receive pension is recognised
as a right in “property”. Article 300­A of the Constitution of
India reads as under: 
“300­A. Persons not to be deprived of property save by
authority   of   law.   ­   No   person   shall   be   deprived   of   his
property save by authority of law.” 
Once we proceed on that premise, the answer to the
question posed by us in the beginning of this judgment
becomes too obvious. A person cannot be deprived of this
pension   without   the   authority   of   law,   which   is   the

constitutional mandate enshrined in Article 300­A of the
Constitution. It follows that attempt of the appellant to take
away a part of pension or gratuity or even leave encashment
without any statutory provision and under the umbrage of
administrative instruction cannot be countenanced. 
17.  It hardly needs to be emphasised that the executive
instructions   are   not   having   statutory   character   and,
therefore, cannot be termed as “law” within the meaning of
aforesaid Article 300­A. On the basis of such a circular,
which   is   not   having   force   of   law,   the   appellant   cannot
withhold even a part of pension or gratuity. As we noticed
above, so far as statutory Rules are concerned, there is no
provision for withholding pension or gratuity in the given
situation. Had there been any such provision in these Rules,
the position would have been different.” 
8. During   the   course   of   hearing,   the   learned
counsel appearing for the petitioner submits that, enquiry
initiated under Section 88 of the Maharashtra Co­operative
Societies Act, 1960, has been completed and the petitioner
has   been   exonerated   in   the   said   enquiry,   however,   the
offences are pending against the petitioner. 
9. Keeping in view the exposition of the Supreme
Court   in   the   case   of  State   of   Jharkhand   and   others
(supra), and in particular, the observations in paras 14 and
15 thereof, in our opinion, the action of the respondents to

withholding   the   amount   of   pension,   gratuity   and   leave
encashment cannot be countenanced. In the light of above,
we   direct   the   Respondents   to   calculate   the   amount   of
pension, gratuity and leave encashment and pay the same
to   the   petitioner,   as   expeditiously   as   possible,   and
preferably within four months from today. 
10. The Petition is allowed in above terms and same
stands disposed of. 
11. The Rule is made absolute in the above terms. 
( P.R. BORA, J. )       ( S.S. SHINDE, J. )

Print Page