Summary
| Category | Data |
|---|---|
| Court | Supreme Court of India |
| Case Number | C.A. No.-014660-014660-2025 |
| Diary Number | 7615/2023 |
| Judge Name | HON’BLE MR. JUSTICE RAJESH BINDAL |
| Bench | HON’BLE MR. JUSTICE RAJESH BINDAL; HON’BLE MR. JUSTICE MANMOHAN |
| Precedent Value | Binding authority; affirms existing precedent |
| Overrules / Affirms | Affirms BSES Yamuna Power Ltd. v. Ghanshyam Chand Sharma (2020) |
| Type of Law | Service law; Employment law; Administrative law |
| Questions of Law |
|
| Ratio Decidendi |
Rule 26 of the CCS Pension Rules, 1972, unequivocally mandates that resignation entails forfeiture of past service, precluding pension entitlement even after over 20 years of service. A resignation notice cannot be treated as voluntary retirement without negating the distinction between the two concepts. The Court followed BSES Yamuna Power Ltd. v. Ghanshyam Chand Sharma in confirming absolute service forfeiture on resignation. Under Section 4 of the Payment of Gratuity Act, 1972, gratuity is payable upon termination after five years, irrespective of resignation or retirement. Leave encashment dues are payable to the legal heirs of the deceased employee as per service rules. |
| Judgments Relied Upon |
|
| Logic / Jurisprudence / Authorities Relied Upon by the Court |
|
| Facts as Summarised by the Court |
|
Practical Impact
| Category | Impact |
|---|---|
| Binding On | All subordinate courts and administrative tribunals handling pension disputes under CCS Pension Rules |
| Persuasive For | High Courts in service and employment matters; tribunals considering gratuity claims |
| Distinguishes | Earlier approaches in Reserve Bank of India v. Cecil Dennis Solomon and Shashikala Devi that favoured liberal interpretation of resignation |
| Follows | BSES Yamuna Power Ltd. v. Ghanshyam Chand Sharma (2020) |
What’s New / What Lawyers Should Note
- Clarifies that resignation under Rule 26 of the CCS Pension Rules, 1972, results in forfeiture of all past service, even after more than 20 years.
- Confirms that a resignation notice cannot be recast as voluntary retirement to claim pensionary benefits.
- Reinforces that gratuity under Section 4 of the Payment of Gratuity Act, 1972, is payable upon termination after five years, regardless of resignation.
- Establishes that leave encashment dues must be paid to the legal heirs of a deceased employee.
- Affirms the binding precedential value of BSES Yamuna Power Ltd. on the resignation–pension distinction.
Summary of Legal Reasoning
- Examined Rule 26 of the CCS Pension Rules, 1972, and held that resignation unequivocally entails forfeiture of past service and pensionary benefits.
- Interpreted Rules 36, 48 and 48-A to confirm pension is limited to cases of retirement or voluntary retirement, not resignation.
- Applied the principle from BSES Yamuna Power Ltd. to reaffirm the distinction between resignation and voluntary retirement and disallow reclassification of a resignation notice.
- Interpreted Section 4 of the Payment of Gratuity Act, 1972, to mandate gratuity payment upon termination after five years, irrespective of resignation.
- Directed release of leave encashment dues and interest to the legal heirs of the deceased employee.
Arguments by the Parties
Petitioner (Legal Heirs of Ashok Kumar Dabas)
- The resignation letter was unhappily worded and should not preclude pension entitlement.
- Having completed over 20 years’ service, the deceased was entitled to pension under Rule 48-A.
- Gratuity is payable under Section 4 of the Payment of Gratuity Act, 1972, after five years’ service.
- Leave encashment dues must be released.
Respondent (Delhi Transport Corporation)
- Rule 26 mandates forfeiture of all past service and pensionary benefits on resignation.
- Deceased employee’s resignation cannot be converted into voluntary retirement.
- Gratuity may not be payable under the CCS Pension Rules.
- Leave encashment is payable and will be released.
Factual Background
Ashok Kumar Dabas joined the Delhi Transport Corporation as a conductor in 1985 and opted for the new pension scheme introduced in 1992. He resigned on 07.08.2014, acceptance followed on 19.09.2014, and his request to withdraw resignation was declined on 28.04.2015. He applied for pension, gratuity and leave encashment; the Corporation granted only the provident fund. His applications before the Central Administrative Tribunal and the Delhi High Court were dismissed, leading to this appeal.
Statutory Analysis
CCS Pension Rules, 1972
- Rule 26: Resignation entails forfeiture of past service.
- Rule 36: Pension granted only on retirement or compulsory retirement under Rules 48/48-A.
- Rule 48/48-A: Voluntary retirement after 30/20 years of qualifying service.
Payment of Gratuity Act, 1972
- Section 4: Gratuity is payable upon termination of employment after continuous service of not less than five years, including in cases of resignation.
No exemption notification under Section 5 of the Act applies to the Corporation.
Dissenting / Concurring Opinion Summary
The judgment was delivered unanimously by a two-judge bench (Justice Rajesh Bindal and Justice Manmohan) with no dissent.
Alert Indicators
- ✔ Precedent Followed