Notional Increment for pensionary benefits on 1st July on retirement on superannuation wef 30th June is not allowed – CAT Madras Bench Order dated 13.03.2019

Notional Increment for pensionary benefits on
1st July on retirement on superannuation wef 30th June is not allowed – CAT
Madras Bench Order dated 13.03.2019
Central Administrative Tribunal
Madras Bench
MA/310/00071/2019 (in) (&) OA/310/00170/2019
Dated 13th March Two Thousand Nineteen
P R E S E N T
Hon’ble Mr. R.Ramanujam, Member(A)
&
Hon’ble Mr.P.Madhavan, Member(J)
1. K.Kandasamy
2. K.Rajarajacholan
3. M.Samathuvam
4. R.Kannan                 .. Applicants
By Advocate M/s.P.Chandrasekaran
  
Vs.
  1. Union of India, rep by the
    Chairman, CBEC,
    North Block,
    New Delhi 110 001.
  2. Union of India, rep by the
  3. Department of Personnel & Training,
    North Block, New Delhi.
  4. The Principal Chief Commissioner of Central Tax,
    121, Mahatma Gandhi Salai,
    Nungambakkam, Chennai 600 034.
  5. The Chief Commissioner of Customs,
    (Preventive),
    No.1, Williams Road, Cantonment,
    Trichy 620 001.
  6. The Commissioner of GST Central Excise,
    No.1, Foulks Compound,
    Anaimedu, Salem 636 001.
  7. The Commissioner of Customs
    Preventive),
    No.1, Williams Road, Cantonment,
     Trichy 620 001.                                    
    … Respondents
ORDER
[Pronounced by Hon’ble Mr.P.Madhavan, Member(J)]

MA for joining the applicants together and filing a single application is
allowed.
2. The above OA is filed seeking the following relief:-

“To direct the respondents to grant one Notional
Increment for the period from 01.7.2016 to 30.6.2017 to the
applicants 3 & 4 and 01.7.2017 to 30.6.2018 to the 1st and 2nd
applicants as they have completed one full year of service
though their increment fell on 01.7.2017 and 01.7.2018
respectively, for the purpose of pensionary benefits.”

3. According to the applicants, they retired from service on 30th June of their
respective years of superannuation and since they will be completing an year of
service on 1st of July they are entitled to one more increment and it has to be counted
for pensionary benefits.

4. The very same question came up before this Bench in OA 1710/2018 & Batch
and the claim raised by the applicants therein was rejected on the basis of the law laid
down by the Hon’ble Apex Court. The Hon’ble Supreme Court in Chief General
Manager v. U.V.George & Others (2008) 14 SCC 699 had laid down the law relating
to the retirement of a Central Government employee under FR 56. It was held that a
person is considered as retired on his attaining 60 years and they are permitted to
continue till 30.6.18 only for the purpose of pay and allowances only. “We are
unable to countenance with the decision of the Tribunal and the High Court. As
already noticed they were retired w.e.f. 16.12.95 and 03.12.95 respectively, but
because of the provision under FR 56(a) they were allowed to retire on the last date
of the month, the grace period of which was granted to them for the purpose of pay
and allowances only. Legally they were retired on 16.12.95 and 03.12.95
respectively and therefore, by no stretch of imagination can it be held that their
pensionary benefits can be reckoned from 1.1.96. The relationship of employer
and employee was terminated in the afternoon of 16.12.95 and 3.12.95
respectively.”

5. The same principle was followed by the Hon’ble Madras High Court in
A.V.Thiyagarajan vs. The Secretary to Government (W.P.No.20732/2012 dated
27.11.2012)
and by Hon’ble Karnataka High Court in Union of India & 3 Others v.
YNR Rao (WP 18186/2003)
. In YNR Rao’s case it is observed in Para-5 that –

“5. But for the provisions of FR 56, which provides that a Government
Servant shall retire from service on the afternoon of last date of the month in
which he had attained the age of 58 years, the respondent, who was born on
9.3.1937 would have retired on 8.3.1995. The provision for retirement from
service on the afternoon of the last date of the month in which the
Government Servant attains the age of retirement instead of on the actual
completion of the age of retirement in FR 56 was introduced in the year 1973-74 for accounting and administrative convenience. What is significant is the
proviso to clause (a) of FR 56 which provides that an employee whose date of
birth is first of a month, shall retire from service on the afternoon of the last
date of the preceding month on attaining the age of 58 years. Therefore, if the
date of birth of a government servant is 1.4.1937 he would retire from service
not on 30.4.1995, but on 31.3.1995. If a person born on 1.4.1937 shall retire
on 31.3.1995, it would be illogical to say a person born on 9.3.1937 would
retire with effect from 1.4.1995. That would be the effect, if the decision of
the Full Bench of the CAT, Mumbai, is to be accepted. Therefore, a
government servant retiring on the afternoon of 31.3.1995 retires on 31.3.1995
and not from 1.4.1995. We hold that the decision of the Full Bench (Mumbai)
of the CAT that a government servant retiring on the afternoon of 31st March is
to be treated as retiring with effect from the first day of April, that is same as
retiring on the forenoon of first of April, is not good law.”

The grace period so given cannot be tagged with his substantive service for counting
further increments.

6. Further, Rule 10 of CCS (Pension) Rules does not permit to take into
consideration emoluments which fell due after retirement.

7. From the above, it can be seen that an employee legally retires on attaining
superannuation (60 years) and as per the decision, the relationship of employer
employee is terminated. They continue thereafter as a grace period given to the
employee under FR 56. There is no provision to consider this grace period alongwith
his service prior to his retirement. So, we are of the view that the applicants had
failed to make out a prima facie case. We are bound to follow the law laid down by
the Hon’ble Supreme Court and there is no merit in the contentions raised by the
applicants.

8. Hence we dismiss the OA accordingly. No costs.

Read also :  7वें वेतन आयोग : लेवल 1 एवं 2 में परिवहन भत्ते में 48 से 61 प्रतिशत तक का नुकसान
(P.Madhavan)
Member(J)
 (R.Ramanujam)
 Member(A)
13.03.2019

See CBIC Circulation dated 15.05.2019

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