Grant of benefit of one notional increment (as due on 1st July) for the pensionary benefits to those employees who had retires on 30th of June before drawing the same
COURT CASE
TIME BOUND
F. No. 1453545/2021-Lstt (Pay-1)
Government of India
Ministry of Personnel, Public Grievances & Pensions
(Department of Personnel & Training)
Dated the 24June, 2021
OFFICE MEMORANDUM
Subject: Grant of benefit of one notional increment (as due on 1st July) for the pensionary benefits to those employees who had retires on 30th of June before drawing the same.
The undersigned is directed to refer to the subject cited above and to state that the issue of grant of notional increment and consequential pensionary benefits on the rationale of the Order dated 15.09.2017 passed by the Hon’ble High Court of Madras in WP 15732 of 2017 filed by Shri P. Ayyamperumal was examined and necessary instructions in this regard were issued vide this Department’s OM 19/2/2018-Estt (Pay-I) dated 03.02.2021. This OM is available at the link (https://documents.doptcirculars.nic.in/D2/D02est/19-2-201 8-Estt%20Pay-IMVLPO.PDF) or may be accessed from this Department’s website https://dopt.gov.in : Notifications : OMs and Orders : 13. Establishment : Pay Rules. :
2. Meanwhile, Ministry of Railways have brought to the knowledge of this Department , the Order dated 05.04.2021 passed by the Hon’ble Supreme Court of India in a case involving same subject matter {SLP(C) No. 4722/2021}. In the case under reference (OA No170/677/2019), Hon’ble CAT, Bangalore Bench, allowed grant of notional annual increment to an employee who superannuated from service on 30.06.2014. Ministry of Railways challenged this judgment in the Hon’ble High Court of Karnataka in WP No 146967 of 2020 (S-CAT), which was rejected by the High Court on 22.10.2020. Thereafter, Ministry of Railways filed a Special Leave Petition {SLP (C) No 4722/2021} against the Order dated 22.10.2020 of the Hon’ble High Court of Karnataka. Hon’ble Supreme Court heard the matter and issued the following directions in its Order dated 05.04.2021:
“Issue notice returnable after three weeks. In the meanwhile, there will be stay of operation of the order dated 18th December, 201 9 of the Central Administrative Tribunal, Bangalore Bench in Original Application No. 170/00677/2019, affirmed by the judgment and order impugned. The Petitioners shall, however, in the meanwhile without prejudice to the rights and contentions of parties pay retiral dues of the Respondent computed on the basis of the last pay drawn by him on the date of his retirement, that is, 30. 06.2014.”
Ministries /Departments are requested to take note of the contents of instructions issued vide this Department’s OM 19/2/2018-Estt (Pay-I) dated 03.02.2021 and the Order dated 05.04.2021 of the Hon’ble Supreme Court and defend the Court Cases similarly placed on behalf of Union of India including this Department, in consultation with this Department and other nodal Departments, if necessary, and keep the interest of this Department in view while on doing so.
(Sukhdeo Sah)
Under Secretary to the Government of India
Tel. No.23040489
To
All Ministries/Departments of Government of India.
COMMENTS
It is well settled by law as well as the provisions of FR26 regarding grant of annual increment that it falls within the ambit of benefits which are earned by duty while in service. Accordingly a govt. servant who rendered twelve complete calendar months service becomes entitled for the annual increment. As a general practice the benefit of annual increment is allowed from 1st of the subsequent month to a person while in service. But in case of a govt. servant who retires on superannuation after earning annual increment should be considered for the grant of notional increment for the purpose of pensionery benefits based on the concept that had he not retired from service he would have got the benefit of increment.Thus the verdicts given by various courts of this country in favor of pensioners who retired or to retire from service on superannuation on 30th June after earning annual increment were considered fit for the grant of notional increment for the purpose of pensionery benefits, since they may not be on duty on the 1st. Of subsequent month owing to their retirement on superannuation. On the similar footings the benefit of leave encashment is allowed. Hence, it is humble submission that the central govt.may be kind enough to look in to the matter judiciously & impart justice to the pensioners.