Denying Pension Solely On Ground Of Employees’ Origin In Societies Amounts To Unjust Discrimination: Supreme Court Grants Relief To Absorbed Employees Of MPSEB

The Supreme Court granted relief to employees of Madhya Pradesh State Electricity Board observing that denying pension to the employees solely on the ground of their origin in the societies amounts to unjust discrimination.

The Court held thus in a batch of Civil Appeals filed against the Judgment of the Madhya Pradesh High Court’s Full Bench, Jabalpur in a bunch of Writ Appeals.

The two-Judge Bench of Justice Vikram Nath and Justice Prasanna B. Varale observed, “It would be wholly unjust to deny pension benefits to the absorbed employees when they are performing the same duties and discharging the same responsibilities as other MPSEB employees. Further in the judgment in the case of BKS, relief has already been granted partially. Thus, there cannot be two classes of employees in the same organisation. One set with pension and the other without pension. In such circumstances, denying them the benefit of pension solely on the ground of their origin in the societies would amount to unjust discrimination.”

Senior Advocates N.K. Mody and S K Gangele represented the Appellant while Senior Advocate G. Umapathy represented the Respondents.

Facts of the Case

The MP High Court’s Full Bench had answered two questions referred to it and held that the Judgment of the Division Bench holding that the employees of the Society were entitled to pension, did not lay down the correct law and further that the employees were not entitled to the benefit of pension as claimed by them but would be governed by the terms of absorption which provided that pension and gratuity would be admissible as per the rules and regulations of the Society. This was under challenge before the Apex Court.

The only issue which was relevant for adjudication in the Appeals was with regard to the admissibility of pension to the employees of the Societies who were absorbed with the MPSEB (Madhya Pradesh State Electricity Board) and if the answer to the same is yes, then what would be the length of service to be counted i.e., whether the service rendered in the Society would also be counted for determining the qualifying period for calculation of pension or only the service rendered after absorption in the MPSEB would be counted.

Reasoning

The Supreme Court after hearing the contentions of the counsel, noted, “… full functional integration carries with it the rights and benefits attached to the new service. However, it is pertinent to note that the benefits and relaxations given by the above judgments have already been implemented and the State had accepted the legal position of extending the benefits from the date of absorption.”

The Court held that all the absorbed employees would be entitled to pension in the peculiar facts and circumstances of the case.

“The remaining question is whether qualifying period for pension should be calculated from the date of their joining in the Society or from the date of absorption into the MPSEB. The entitlement for pension is governed by the Madhya Pradesh Civil Services (Pension) Rules and the relevant provision is Rule 3(p)”, it said.

The Court further noted that Rule 12(2) provides that qualifying service begins from the date the employee assumes charge of the post to which they are first appointed, whether on a substantive, officiating, or temporary basis, in the services of the State Government.

“Rule 13(1) lays down that the service of a government servant shall not qualify unless his duties and pay are regulated by the Government. … In view of the above, while the appellants are held entitled to pension from the MPSEB, the period of service rendered in the Society prior to absorption cannot be counted. This is for the reason that such service was not under the State Government, and was not governed by its rules”, it also observed.

The Court, therefore, concluded that the Appellants would be eligible for pension from the date of their absorption into MPSEB, from which point they became employees governed by State Rules.

“… the appellants shall be paid pension by the MPSEB, with effect from their respective dates of absorption. Impugned orders stand modified as above. The respondents to implement the above directions within a period of four months from today and pay all the arrears of pension within the same time”, it directed.

Accordingly, the Apex Court allowed the Appeals to an extent and modified the impugned Orders.

Cause Title- Vijay Kumar Joshi v. Akash Tripathi & Ors. (Neutral Citation: 2025 INSC 670)

Appearance:

Appellant: Senior Advocates N.K. Mody, S K Gangele, AORs Praveen Swarup, Prashant Bhushan, Satish Kumar, Arup Banerjee, Devvrat, Advocates Ishita M. Puranik, Suresh Kumar Bhan, Jigisha Agarwal, Diwakar Shukla, Prabuddha Singh Gour, Karan Gupta, Nityanand Mahato, Alice Raj, Priya Sharma, Prathvi Raj Chauhan, Barnali Basak, Monica Goel, Saket Gautam, Devesh Kumar Agnihotri, Ajeet Kumar Singh, Priya Mishra, and Aditya Kumar Dubey.

Respondents: Senior Advocate G. Umapathy, DAG V.V.V. Pattabhiram, GA Aditya Vaibhav Singh, AORs Rohit K. Singh, Amalpushp Shroti, Mrinal Gopal Elker, Siddharth, Advocates Pritam Bishwas, Chhavi Khandelwal, and Harshit Manwani.

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