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H.S.E.B And Others v. Azad Kaur .
Factual and Procedural Background
The respondent’s husband, an Upper Division Clerk in the Haryana State Electricity Board, died in harness on 14-11-1996. The respondent, already employed as a teacher before her husband’s death, was sanctioned family pension but was denied dearness allowance/relief (also referred to as ad hoc or interim relief) on the ground that she was gainfully employed. She successfully challenged this denial through a writ petition before the High Court, which directed payment of dearness relief on the family pension. The present civil appeal was filed by the Haryana State Electricity Board to contest that High Court decision.
Legal Issues Presented
- Whether a widow who was independently employed prior to the employee’s death can be denied dearness relief on family pension under the State’s 20-3-1980 circular and the principles laid down in Union of India v. G. Vasudevan Pillay.
Arguments of the Parties
Appellant's Arguments
- Relied on Union of India v. G. Vasudevan Pillay to contend that recipients of pension or family pension who are “employed/re-employed” may lawfully be denied dearness relief because their salary compensates for price-rise.
- Invoked a Government of Haryana Finance Department circular dated 20-3-1980 stating that payment of ad hoc relief on pension “shall remain suspended when a person in receipt of family pension/extraordinary pension is employed/re-employed.”
- Cited Haryana Civil Pensioners Assn. (Regd.) v. State of Haryana, which applied Vasudevan Pillay, to reinforce the proposition that re-employed pensioners or dependants can be denied dearness relief.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Union of India v. G. Vasudevan Pillay (1995) 2 SCC 32; (1995) 29 ATC 180 | Differential treatment between ordinary pensioners and those re-employed; denial of dearness relief permissible when a pensioner or dependant obtains employment on compassionate grounds or is re-employed. | Distinguished: The case concerns re-employment or compassionate employment after retirement/death; it does not cover a dependant who was already independently employed before the employee’s death. |
| Haryana Civil Pensioners Assn. (Regd.) v. State of Haryana (1995) 7 SLR 181 (P&H) (DB) | Applied Vasudevan Pillay to uphold denial of dearness relief to re-employed pensioners under Rule 55-A of the Central Services (Pension) Rules and corresponding State instructions. | Distinguished: Like Vasudevan Pillay, it dealt with re-employment/compassionate employment, not pre-existing independent employment of a family-pension recipient. |
| Swaran Kaur v. State of Punjab (1997) 1 RSJ 325 (P&H) (DB) | Held that a widow already in service on the date of her husband’s death, without any compassionate employment, is entitled to dearness allowance on family pension. | Approved and followed: Supported the conclusion that independent pre-existing employment does not justify withholding dearness relief. |
Court's Reasoning and Analysis
The Supreme Court examined the scope of the 20-3-1980 State circular and the ratio of Vasudevan Pillay. The underlying principle for withholding dearness relief is the presence of an additional financial cushion secured because of the employee’s death—namely, re-employment of the pensioner or compassionate employment of a dependant. The respondent’s teaching job was obtained independently and pre-dated her husband’s death; it was not compassionate employment. Consequently:
- The word “employed” in the 20-3-1980 circular must be confined to re-employment or compassionate employment linked to the deceased employee’s service.
- Denying dearness relief to a widow solely because she has a separate, pre-existing livelihood defeats the purpose of family pension, which is to cushion the family from financial hardship caused by the employee’s death.
- The High Court’s view aligns with Swaran Kaur; neither Vasudevan Pillay nor the Haryana Civil Pensioners case governs the present facts.
Holding and Implications
APPEAL DISMISSED WITH COSTS.
The Supreme Court upheld the High Court’s direction to grant dearness relief on the respondent’s family pension. The decision confirms that independent, pre-existing employment of a widow or dependant does not disentitle the family from dearness relief or ad hoc relief on family pension; only re-employment or compassionate employment linked to the death of the employee permits such denial. No new legal test was created, but the Court clarified the limited reach of previously cited precedents and State circulars.
Order
1. The husband of the respondent was working as an Upper Division Clerk in the Haryana State Electricity Board. He died on 14-11-1996 while in service. The respondent was working as a teacher prior to the date of the death of her husband. After her husband's death, she claimed family pension to which the respondent and her family were entitled. The respondent was granted the family pension but was not given dearness allowance/relief and interim relief on the ground that the respondent was working as a teacher. The denial of dearness relief was challenged by the respondent in a writ petition filed before the High Court. The High Court granted her dearness relief on family pension. Hence, the appellant Haryana State Electricity Board has filed this appeal.
2. The appellants have placed reliance on a decision of this Court in Union of India v. G. Vasudevan Pillay (1995) 2 SCC 32, (1995) 29 ATC 180. The decision in that case dealt with ex-servicemen who had been re-employed. The Court said that pensioners who have got re-employment can be treated differently from other pensioners; and in the case of re-employed pensioners, it would be permissible in law to deny dearness relief on pension inasmuch as the salary to be paid to them on re-employment takes care of erosion in the value of money because of a rise in prices. The Court also observed that the denial of dearness relief on family pension on a fresh employment being granted to the dependant/widow of an ex-serviceman will also be sustained.
3. This decision, therefore, deals with cases where (i) the pensioner himself gets re-employment, or (ii) the widow or a dependant of the pensioner such as a son, gets fresh employment on compassionate grounds. It does not deal with any case where one of the recipients of the family pension is also independently employed elsewhere.
4. The other decision which was relied upon by the appellants is a decision of the Punjab & Haryana High Court in the case of Haryana Civil Pensioners Assn. (Regd.) v. State of Haryana (1995) 7 SLR 181 (P&H) (DB) where also the High Court followed the decision of this Court in Union of India v. G. Vasudevan Pillay (1995) 2 SCC 32, (1995) 29 ATC 180. The High Court dealt with Rule 55-A of the Central Services (Pension) Rules and the instructions issued by the Central Government as well as by the Government of Haryana under which a pensioner was not liable to dearness allowance on pension during the period of his re-employment. The Court said that the person who was re-employed after retirement and who had got the pay of the re-employed post together with dearness relief, can be denied the dearness relief on his pension. The same observations were made in respect of the employment of a dependant on compassionate grounds. This case also, therefore, has not dealt with a situation where one of the recipients of the family pension is independently employed even prior to the death of the employee.
5. It is not the case of the appellant that the respondent secured employment on compassionate grounds as a teacher after the death of her husband. In fact, we fail to see how she could have secured any employment on compassionate grounds in a totally different service.
6. The appellants have relied upon a letter dated 20-3-1980 from the Secretary to the Government, Finance Department, Government of Haryana circulated to all the Heads of the Departments under which it is clarified that the payment of ad hoc relief on pension shall remain suspended when a person in receipt of family pension/extraordinary pension is employed/re-employed. The appellants contend that whenever a recipient of a family pension is employed, the ad hoc relief on pension shall not be granted. In our view, this is not a correct interpretation of the letter of 20-3-1980. As the ratio of the judgment of this Court in Union of India v. G. Vasudevan Pillay (1995) 2 SCC 32, (1995) 29 ATC 180 shows, the principle on which ad hoc relief is withheld, is that if a recipient of a family pension has received an additional benefit in the form of either re-employment or an employment on compassionate grounds on account of the death of the employee, the need to provide another cushion in the form of ad hoc relief is not there. The word “employed” used in the letter of 20-3-1980 in that context can only refer to the kind of employment which is secured by the widow or a family member on account of or in the context of the death of the employee in respect of whom family pension is being paid. It can have no reference to any independent employment or any other independent source of livelihood which the family members may possess. The mere fact that the widow is independently employed as a teacher elsewhere even prior to the death of her husband, cannot deprive the family of the benefit of the ad hoc relief on family pension.
7. Our attention is drawn to a decision of the Division Bench of the Punjab & Haryana High Court in the case of Swaran Kaur v. State of Punjab (1997) 1 RSJ 325 (P&H) (DB) where the High Court, after ascertaining that the petitioner therein had not secured any job on compassionate grounds on account of the death of her husband, nor had any family member done so, held that dearness allowance on family pension could not be withheld. It said that the fact that the widow was in service at the time when her husband died would not deprive her of dearness allowance on family pension when the employment was not on compassionate grounds. We, therefore, agree with the reasoning and conclusion reached by the High Court in the impugned judgment.
8. The civil appeal is, therefore, dismissed with costs.
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