Law Web: Whether government can refuse to grant disability pension to employee if he has waived his right to claim disability pension?

As held by this Court, a Right to Equality guaranteed

under Article 14 of the Constitution of India would also apply

to a man who has no choice or rather no meaningful choice,

but to give his assent to a contract or to sign on the dotted

line in a prescribed or standard form or to accept a set of

rules as part of the contract, however unfair, unreasonable

and unconscionable a clause in that contract or form or rules

may be. We find that the said observations rightly apply to

the facts of the present case. Can it be said that the mighty

Union of India and an ordinary soldier, who having fought for

the country and retired from Regular Army, seeking reemployment

in the Territorial Army, have an equal

bargaining power. We are therefore of the considered view

that the reliance placed on the said document would also be

of no assistance to the case of the respondents.

25. The respondents herein are directed to grant disability

pension to the appellant in accordance with the rules and

regulations as are applicable to the Members of the

Territorial Army with effect from 1st January 2012. The

respondents are directed to clear arrears from 1st January

2012 within a period of three months from the date of this

judgment with interest at the rate of 9% per annum. {Para 23}

REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 2275 OF 2019

PANI RAM Vs UNION OF INDIA

Author: B.R. GAVAI, J.

Dated: DECEMBER 17, 2021.

1. The appeal challenges the judgment and order dated

10th October 2018 passed by the Armed Forces Tribunal,

Regional Bench, Lucknow (hereinafter referred to as “AFT”),

vide which the O.A. No. 149 of 2018 filed by the appellant for

grant of disability pension came to be dismissed. The

appellant also challenges the order dated 31st October 2018

passed in M.A. No. 1839 of 2018 in O.A. No. 149 of 2018,

vide which though, the application for leave to appeal was

allowed, but the AFT framed a different question of law.

2. The facts in brief giving rise to the present appeal are as

under:

After serving for about 25 years in Infantry of the

Regular Army, the appellant got reenrolled

in the Territorial

Army as a fulltime

soldier on 1st August 2007. While serving

in Territorial Army, on 5th April 2009, the appellant was

granted 10 days’ part of annual leave from 15th April 2009 to

24th April 2009, to proceed to his home, which was at a

distance of few kilometers from the Unit where he was

posted. After availing the said leave, when the appellant was

coming back on his scooter to rejoin his duty, on 24th April

2009, he met with a serious accident. Initially, the appellant

was admitted to the District Hospital, Pithoragarh from

where he was shifted to the 161 Military Hospital at

Pithoragarh. On 25th April 2009, the appellant was evacuated

by helicopter to the Base Hospital at Lucknow, where his

right leg was amputated up to the knee. Thereafter, he was

shifted to the Artificial Limb Centre (hereinafter referred to as

‘ALC’) at Pune. On 14th September 2009, he was discharged

from ALC and was granted 28 days’ sick leave with the

instruction to report back to the ALC. After the expiry of sick

leave, he was readmitted

to ALC on 11th October 2009. On

21st October 2009, the Medical Board was held at ALC which

assessed the appellant’s disability to be 80%. However, it

could not give any opinion about the attributability aspect of

the injury. On 07th November 2009, the appellant was

discharged from ALC with instruction to report back to his

Unit.

3. As per Regulation No. 520 of the Regulations for the

Army, 1987, a Court of Inquiry (hereinafter referred to as

“CoI”), was held from 13th November 2009 onwards to

investigate into the circumstances under which the appellant

had sustained injury. The CoI found that the injury

sustained by the appellant was attributable to military

service and it was not due to his own negligence. The said

finding of CoI was duly approved by the Station Commander

Respondent

No. 3, on 11th January 2010. On 25th October

2010, a recategorization

Medical Board was held at ALC,

which maintained appellant’s disability at 80% and declared

it as attributable to military service. Subsequently, on the

basis of the opinion of the Invaliding Medical Board

(hereinafter referred to as ‘IMB’), on 1st January 2012, the

appellant was invalided out of service with 80% disability

which was attributable to military service.

4. The appellant, therefore, approached AFT for grant of

disability pension as is applicable to the personnel of Regular

Army, in accordance with Regulation No. 292 of the Pension

Regulations for the Army, 1961. The claim of the appellant

was resisted by the respondents on the ground that the

appellant, after discharging from mechanized infantry as a

pensioner, was reenrolled

in 130 Infantry Battalion

(Territorial Army), Ecological Task Force, Kumaon, on 1st

August 2007 as an ExServiceman

(ESM). The claim of the

appellant has been denied by the respondents on the ground

that the appellant was not entitled to any pensionary benefits

in view of the letter of the Government of India, Ministry of

Defence, dated 31st March 2008.

5. The AFT though held, that the injury sustained by the

appellant which resulted into 80% disability was found by

the competent authority to be aggravated and attributable to

the military service, rejected the claim of the appellant on the

ground that a separate scheme and service conditions have

been created for the Members of Ecological Task Force

(hereinafter referred to as ‘ETF’), which was accepted by the

appellant and as such, he was not entitled to disability

pension.

6. The appellant thereafter filed M.A. No. 1839 of 2018 in

O.A. No. 149 of 2018 for grant of leave to appeal against the

judgment and order dated 10th October 2018, wherein the

appellant had framed the following question of law of general

public importance:

“Whether the terms and conditions of service of a

member of the Territorial Army (TA) during the

period of his embodiment with the T.A. will be

governed by the statutory rules which provide for

grant of ‘disability pension’ or by the departmental

orders which deny the grant of the disability

pension to the members of a particular unit of the

T.A. to which such individual belongs.”

7. The AFT vide order dated 31st October 2018 though,

allowed the application for grant of leave to appeal, framed a

different question of law, as under:

“Whether the members of Ecological Task Force of

Territorial Army are entitled to pensionary benefits

at par with the members of regular Army in spite of

the aforementioned MOD letter dated 31.03.2008

whereby pensionary benefits have been denied.”

8. The said order dated 31st October 2018, passed by AFT

is also a subject matter of challenge in the present appeal.

9. We have heard Shri Siddhartha Iyer, learned Counsel

appearing on behalf of the appellant and Shri Vikramjit

Banerjee, learned Additional Solicitor General, appearing on

behalf of the respondentUnion

of India.

10. It is the specific case of respondentUnion

of India that

separate terms and conditions were provided by it vide

communication dated 31st March 2008, which provides that

the members of ETF would not be entitled for disability

pension. Vide the said communication, the Government of

India has communicated to the Chief of Army Staff, the

sanction of the President of India for raising two additional

companies for 130 Infantry Battalion (Territorial Army)

Ecological under Rule 33 of Territorial Army Act, Rules 1948.

11. The respondents rely on Clause (iv) of SubPara

(d) of

Para 1 of the said communication dated 31st March 2008 :

“(iv) Pension entitlement of Territorial Army

personnel earned for the earlier regular Army

Service, will remain untouched and will be ignored

in fixing their pay and allowances.”

12. The respondents also rely on a document titled

“Certificate” dated 30th August 2007, signed by the appellant

wherein under condition (f), it is stated thus :

“(f) That, I will not be getting any enhance pension

for having been enrolled in this force.”

13. It will be relevant to refer to subsection

(1) of Section 9

of the Territorial Army Act, 1948 :

“Sec. 9. Application of the Army Act, 1950.

(1) Every officer, when doing duty as such officer,

and every enrolled person when called out or

embodied or attached to the Regular Army], shall,

subject to such adaptations and modifications as

may be made therein by the Central Government by

notification in the Official Gazette, be subject to the

provisions of the Army Act, 1950, and the rules or

regulations made thereunder in the same manner

and to the same extent as if such officer or enrolled

person held the same rank in the Regular Army as

he holds for the time being in the Territorial

Army ..”

14. It could thus be seen that every such officer or enrolled

person in Territorial Army when holds the rank, shall be

subject to the provisions of Army Act, 1950 and the rules or

regulations made thereunder, equivalent to the same rank in

the Regular Army.

15. Chapter 5 of the Pension Regulations for the Army,

1961 deals with Territorial Army. The Regulation No. 292 of

the Pension Regulations for the Army, 1961 read thus:

“292. The grant of pensionary awards to the

members of the Territorial Army shall be governed

by the same general regulations as are applicable to

the corresponding personnel of the Army except

where they are inconsistent with the provisions of

regulations in this Chapter”

16. It could thus be seen that the grant of pensionary

awards to the members of the Territorial Army shall be

governed by the same rules and regulations as are applicable

to the corresponding persons of the Army except where they

are inconsistent with the provisions of regulations in the said

chapter.

17. Chapter 3 of the Pension Regulations for the Army,

1961, deals with Disability Pensionary Awards, in which

Regulation No. 173 reads thus:

“173. Primary Conditions for the grant of

Disability Pension

Unless otherwise specifically provided a disability

pension consisting of service element and disability

element may be granted to an individual who is

invalided out of service on account of a disability

which is attributable to or aggravated by military

service in nonbattle

casualty and is assessed at 20

per cent or over.”

18. The perusal thereof will reveal that an individual who is

invalided out of service on account of disability, which is

attributable or aggravated by Military Service in nonbattle

casualty and is assessed 20% or more, would be entitled to

disability pension. The respondents are not in a position to

point out any rules or regulations, which can be said to be

inconsistent with Regulation No. 292 or 173, neither has any

other regulation been pointed out, which deals with the

terms and conditions of service of ETF.

19. The communication of the Union of India dated

31st March 2008, vide which the President of India has

granted sanction, itself reveals that the sanction is for raising

two additional companies for 130 Infantry Battalion

(Territorial Army) Ecological.

20. It is thus clear that the ETF is established as an

additional company for 130 Infantry Battalion of Territorial

Army. It is not in dispute that the other officers or enrolled

persons working in the Territorial Army are entitled to

disability pension under Regulation No. 173 read with

Regulation No. 292 of Pension Regulations for the Army,

1961. When the appellant is enrolled as a member of ETF

which is a company for 130 Infantry Battalion (Territorial

Army), we see no reason as to why the appellant was denied

the disability pension. Specifically so, when the Medical

Board and COI have found that the injury sustained by the

appellant was attributable to the Military Service and it was

not due to his own negligence.

21. In case of conflict between what is stated in internal

communication between the two organs of the State and the

Statutory Rules and Regulations, it is needless to state that

the Statutory Rules and Regulations would prevail. In that

view of the matter, we find that AFT was not justified in

rejecting the claim of the appellant.

22. The respondents have heavily relied on the document

dated 30th August 2007, titled “Certificate”. No doubt that

the said document is signed by the appellant, wherein he had

agreed to the condition that he will not be getting any

enhanced pension for having been enrolled in this force.

Firstly, we find that the said document deals with enhanced

pension and not disability pension. As already discussed

hereinabove, a conjoint reading of Section 9 of the Territorial

Army Act, 1948 and Regulation Nos. 292 and 173 of the

Pension Regulations for the Army, 1961, would show that a

member of the Territorial Army would be entitled to disability

pension. In any case, in this respect, even accepting that the

appellant has signed such a document, it will be relevant to

refer to the following observations of this Court in the case of

Central Inland Water Transport Corporation Limited

and Another v. Brojo Nath Ganguly and Another1 :

“89. ……We have a Constitution for our country.

Our judges are bound by their oath to “uphold the

Constitution and the laws”. The Constitution was

enacted to secure to all the citizens of this country

social and economic justice. Article 14 of the

Constitution guarantees to all persons equality

1 (1986) 3 SCC 156

before the law and the equal protection of the laws.

The principle deducible from the above discussions

on this part of the case is in consonance with right

and reason, intended to secure social and economic

justice and conforms to the mandate of the great

equality clause in Article 14. This principle is that

the courts will not enforce and will, when called

upon to do so, strike down an unfair and

unreasonable contract, or an unfair and

unreasonable clause in a contract, entered into

between parties who are not equal in bargaining

power. It is difficult to give an exhaustive list of all

bargains of this type. No court can visualize the

different situations which can arise in the affairs of

men. One can only attempt to give some

illustrations. For instance, the above principle will

apply where the inequality of bargaining power is

the result of the great disparity in the economic

strength of the contracting parties. It will apply

where the inequality is the result of circumstances,

whether of the creation of the parties or not. It will

apply to situations in which the weaker party is in a

position in which he can obtain goods or services or

means of livelihood only upon the terms imposed by

the stronger party or go without them. It will also

apply where a man has no choice, or rather no

meaningful choice, but to give his assent to a

contract or to sign on the dotted line in a prescribed

or standard form or to accept a set of rules as part

of the contract, however unfair, unreasonable and

unconscionable a clause in that contract or form or

rules may be. This principle, however, will not apply

where the bargaining power of the contracting

parties is equal or almost equal. This principle may

not apply where both parties are businessmen and

the contract is a commercial transaction. In today's

complex world of giant corporations with their vast

infrastructural organizations and with the State

through its instrumentalities and agencies entering

into almost every branch of industry and commerce,

there can be myriad situations which result in

unfair and unreasonable bargains between parties

possessing wholly disproportionate and unequal

bargaining power. These cases can neither be

enumerated nor fully illustrated. The court must

judge each case on its own facts and

circumstances.”

23. As held by this Court, a Right to Equality guaranteed