Read Time: 08 minutes

Synopsis

The Supreme Court on Monday said that an employee can't be denied a pension just because there were some wrong deductions on the part of the employer.

A bench of Justices Abhay S Oka and Rajesh Bindal said that an employee can't be deprived of his due without a conscious abandonment of the right to receive a pension by him.

The apex court dismissed an appeal filed by the Calcutta State Transport Corporation and others against the high court's division bench decision of March 5, 2021.

The division bench had upheld the single bench's order directing the employer to release the pension of one Ashit Chakraborty and others.

Chakraborty was appointed as a conductor with the Corporation in 1981. At that time there was no pension scheme in force, only Contributory Provident Fund Scheme was applicable. 

In 1991, in exercise of powers conferred under Section 45 of the Road Transport Corporation Act, 1950, the Corporation, with the previous sanction of the State Government, framed the Calcutta State Transport Corporation Employees’ Service (Death cum Retirement Benefits) Regulations, 1990. The Regulations came into force with retrospective effect from April 1, 1984.

The 1990 Regulations mandated that in order to get the benefit of the said scheme, existing employees of the Corporation will have to submit a written option within six months from the date of publication of the 1990 Regulations expressing their willingness to switch over to the said pension scheme instead of maintaining their status as CPF holder.

The 1990 Regulations also provided that it shall be optional to the existing employees, however, it shall be binding upon the new entrants on and after the date of Notification of the 1990 Regulations. 

Chakraborty, who opted for a pension scheme, took voluntary retirement in 2017. He was paid the sum towards CPF contribution and gratuity without any pension, forcing him to approach the high court with a writ petition.

In its appeal before the top court, the Corporation contended that there were regular deductions from the salary of the employee towards the provident fund. The statements were being sent to him. However, he never objected to it. He raised the issue only after his retirement. In such circumstances, he should not be allowed to avail the benefit of the pension scheme. 

In his response, the employee submitted that he had made his option for availing the pension scheme. Thereafter, it was the duty of the employer to have properly calculated his salary and made the deductions under different heads. In case any error was committed by the Corporation, he should not be made to suffer on that account. Whatever amount was paid to him on his retirement, he accepted it considering that the same may be due on his retirement. He did not know that the Corporation will not pay his pension to him.

Agreeing to the employee's submission, the bench said, "Merely because there were some wrong deductions from his salary and he was treated as a member of the CPF Scheme, cannot be permitted to be raised as a ground to defeat his rightful claim."

The court rejected the argument that there are a number of similarly situated employees who will also stake their claims, saying this will not deter it from granting the relief to the employee, which is legitimately due to him. 

"Rather this argument shows that the Corporation was at fault in implementing the 1990 Regulations in the cases of a number of employees though these were notified on 4.1.1991 and were given retrospective effect from 1.4.1984. Technical objections are sought to be raised, which are not tenable. For any fault on the part of the Corporation, the employees cannot be made to suffer," the bench said.

Case Title: Calcutta State Transport Corporation vs. Ashit Chakraborty & Ors.