# Bank of India, Mumbai & Ors v. Sahajanand Rai & Anr

- **Citation:** (2024) 2 ILRA 653
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2024-02-05
- **Case number:** J. Special Appeal No. 1 of 2024
- **Bench:** Ashwani Kumar Mishra, Syed Qamar Hasan Rizvi
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/bank-of-india-mumbai-ors-v-sahajanand-rai-anr-51455
- **Pages:** 9

## Headnote

A. Service Law - Pensionary Benefits -
Bank
of
India
(Employees')
Pension
Regulations,
1995
-
Memorandum
of
Settlement, 2002 - Respondent, a Cashier-cumClerk, removed from service under Clause 6(b)
of the Settlement, 2002, claimed pensionary
benefits - Clause 6(b) allows superannuation
benefits (pension, provident fund, gratuity) to
employees removed for gross misconduct,
contrary to Regulation 22, which mandates
forfeiture of past service upon removal - Held,
Clause 6(b) of the Settlement, 2002, overrides
Regulation 22, entitling the respondent to
superannuation benefits, including pension, if
otherwise eligible with 10 years of qualifying
service - Supreme Court's ruling in *Bank of
Baroda*
followed,
affirming
that
denying
pension would render Clause 6(b) a fraud
settlement - Respondent entitled to pension and
leave encashment. (Paras 6, 7, 12, 15, 22, 27,
29, 30)

B. Service Law - Settlement, 2010 - Option
to Join Pension Scheme - Settlement, 2010,
extended an option to join the pension scheme
to employees who served before specified cutoff dates, retired, or died in service -
Respondent, removed under Clause 6(b) of the
Settlement, 2002, exercised option to join
pension scheme
- Bank's Circular dated
24.08.2010, excluding removed employees from
the pension option, challenged - Held, denying
the pension option to an employee entitled to
superannuation benefits under Clause 6(b) is
impermissible and arbitrary - Respondent,
treated at par with other employees entitled to
superannuation benefits, eligible to opt for
pension under Settlement, 2010. (Paras 9, 10,
17, 24, 26, 27)

C.
Service
Law
-
Interpretation
of
Settlements - Beneficent Construction -
Settlements of 2002 and 2010 are binding
agreements between the bank and employees,
intended to benefit employees - Narrow
interpretation excluding removed employees
from pension benefits under Settlement, 2010,
would contravene the intent of Clause 6(b) of
Settlement, 2002 - Held, settlements must be
liberally construed to ensure superannuation
benefits,
including
pension
and
leave
encashment,
are
extended
to
employees
removed under Clause 6(b), consistent with
*Bank of Baroda* - Bank's reliance on *UCO
Bank* distinguished as it predates Settlement,

## Text

2 All. Bank of India, Mumbai & Ors. Vs. Sahajanand Rai & Anr.
653
proceeding of the Case No. 426 of 2007
(State vs. Rashmi Srivstava & others),
arising out of Case Crime No. 137 of 2006,
under Sections 3/4/5/7/8/9 of the Act, P.S.
Sarojini Nagar, District Lucknow, pending
before Judicial Magistrate - III, Lucknow,
is hereby quashed.

33. Accordingly, the application is
allowed.
----------
(2024) 2 ILRA 653
APPELLATE JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 05.02.2024

BEFORE

THE HON'BLE ASHWANI KUMAR MISHRA, J.
THE HON'BLE SYED QAMAR HASAN RIZVI,
J.

Special Appeal No. 1 of 2024

Bank of India, Mumbai & Ors.
 ...Appellants
Versus
Sahajanand Rai & Anr. ...Respondents

Counsel for the Appellants:
Ms. Vatsala

Counsel for the Respondents:
A.S.G.I., Sri Sanjay Kumar Rai, Sri Vijay
Chandra, Sri Ashok Khare

A. Service Law - Pensionary Benefits -
Bank
of
India
(Employees')
Pension
Regulations,
1995
-
Memorandum
of
Settlement, 2002 - Respondent, a Cashier-cumClerk, removed from service under Clause 6(b)
of the Settlement, 2002, claimed pensionary
benefits - Clause 6(b) allows superannuation
benefits (pension, provident fund, gratuity) to
employees removed for gross misconduct,
contrary to Regulation 22, which mandates
forfeiture of past service upon removal - Held,
Clause 6(b) of the Settlement, 2002, overrides
Regulation 22, entitling the respondent to
superannuation benefits, including pension, if
otherwise eligible with 10 years of qualifying
service - Supreme Court's ruling in *Bank of
Baroda*
followed,
affirming
that
denying
pension would render Clause 6(b) a fraud
settlement - Respondent entitled to pension and
leave encashment. (Paras 6, 7, 12, 15, 22, 27,
29, 30)

B. Service Law - Settlement, 2010 - Option
to Join Pension Scheme - Settlement, 2010,
extended an option to join the pension scheme
to employees who served before specified cutoff dates, retired, or died in service -
Respondent, removed under Clause 6(b) of the
Settlement, 2002, exercised option to join
pension scheme
- Bank's Circular dated
24.08.2010, excluding removed employees from
the pension option, challenged - Held, denying
the pension option to an employee entitled to
superannuation benefits under Clause 6(b) is
impermissible and arbitrary - Respondent,
treated at par with other employees entitled to
superannuation benefits, eligible to opt for
pension under Settlement, 2010. (Paras 9, 10,
17, 24, 26, 27)

C.
Service
Law
-
Interpretation
of
Settlements - Beneficent Construction -
Settlements of 2002 and 2010 are binding
agreements between the bank and employees,
intended to benefit employees - Narrow
interpretation excluding removed employees
from pension benefits under Settlement, 2010,
would contravene the intent of Clause 6(b) of
Settlement, 2002 - Held, settlements must be
liberally construed to ensure superannuation
benefits,
including
pension
and
leave
encashment,
are
extended
to
employees
removed under Clause 6(b), consistent with
*Bank of Baroda* - Bank's reliance on *UCO
Bank* distinguished as it predates Settlement,
2002. (Paras 17, 23, 27, 28, 29)

Special Appeal Dismissed - Respondent
Entitled
to
Pension
and
Leave
Encashment.

List of Cases Cited:

1. Bank of Baroda Vs S.K. Kool (Dead) through
Legal Representatives & anr., (2014) 2 SCC 715
654 INDIAN LAW REPORTS ALLAHABAD SERIES
2. UCO Bank & ors. Vs Sanwar Mal, (2004) 4
SCC 412

(Delivered by Hon'ble Ashwani Kumar
Mishra, J.)

1. This intra-court appeal arises out of
an order passed by the learned Single
Judge, dated 22nd March, 2023, in Writ-A
No. 53237 of 2014 whereby the writ
petition
has
been
allowed
and
the
respondent-petitioner is held entitled to
retiral benefits in light of Clause 6(b) of
Memorandum
of
Settlement,
dated
10.4.2002 (hereinafter referred to as
'Settlement, 2002'), notwithstanding a
contrary circular issued by the Bank.
Reliance is placed upon the judgment of the
Supreme Court in Bank of Baroda Vs. S.K.
Kool (Dead) through Legal Representatives
and another, (2014) 2 SCC 715, to allow
the claim of respondent-petitioner.

2. Facts admitted on record are that
the respondent-petitioner was employed as
Cashier-cum-Clerk in the appellant Bank of
India.
He
was
proceeded
with
departmentally on various charges and
ultimately an order of punishment came to
be passed against him on 19.9.2002,
directing his removal from the service in
terms of Clause 6(b) of the Settlement,
2002. This order of punishment was
unsuccessfully
challenged
by
the
respondent and ultimately his Special
Leave to Appeal (Civil) No. 30627 of
2010 got dismissed on 15.11.2010.

3. Pensionary benefits to the
employees of bank were governed by
the
provisions
of
Bank
of
India
(Employees')
Pension
Regulations,
1995
(hereinafter
referred
to
as
'Pension
Regulations,
1995').
Regulation
2(t)
of
the
Pension
Regulations of 1995 defined 'pension'
to include the basic pension and
additional
pension
referred
to
in
Chapter VI of the Pension Regulations,
1995. Pensioner meant an employee
eligible for pension under the Pension
Regulations, 1995. Qualifying service
has been defined under Regulation 2(w)
and
together
with
Regulation
14
provides it to mean a minimum of 10
years of service in the Bank on the date
of his retirement.

4. Regulation 22 of the Pension
Regulations,
1995
provided
that
resignation or dismissal or removal or
termination of an employee from the
service
of
the
Bank
shall
entail
forfeiture of his entire past services and
consequently shall not qualify for
pensionary benefits. Regulation 2(y)
defined retirement to mean cessation
from Bank's service on (a) attaining the
age of superannuation specified in
Service Regulations or Settlements; (b)
voluntary retirement in accordance with
provisions contained in Regulation 29;
(c) on premature retirement by the Bank
before
attaining
the
age
of
superannuation specified in Service
Regulations or Settlement.

5. In terms of the provisions of
Pension
Regulations,
1995,
an
employee who is removed from service
would have his entire past service
forfeited under Pension Regulations,
1995
and
shall
not
qualify
for
pensionary benefits.

6. It transpires that the Settlement,
2002, entered into between the bank and its
employees however provided for a course
distinct from the scheme contemplated in
the Pension Regulations, 1995. Clause 6(b)
2 All. Bank of India, Mumbai & Ors. Vs. Sahajanand Rai & Anr.
655
of the Settlement, 2002, is relevant and is
reproduced hereinafter:-

"6. An employee found guilty of
gross misconduct may;
 (a).....................

(b) be removed from service with
superannuation benefits i.e. Pension and
/or Provident Fund and Gratuity as would
be due otherwise under the Rules or
Regulations prevailing at the relevant time
and without disqualification from future
employment, or."

7. Appellant was punished vide order
dated 19.9.2002 in terms of Clause 6(b) of
the Settlement, 2002, and, therefore,
notwithstanding his removal from service
the
respondent
became
entitled
to
superannuation benefits i.e. Pension and/or
Provident Fund and Gratuity as would
otherwise be due under the Rules or
Regulations prevailing at the relevant time
and without disqualification from future
employment.

8. At the time of removal of
respondent from service in terms of Clause
6(b) of the Settlement, 2002, there existed a
scheme of Contributory Provident Fund for
the employees of the Bank. An earlier
Memorandum of Settlement, dated 29th
October, 1993 was arrived at, as per which,
pension in lieu of Contributory Provident
Fund was introduced, in respect of the
employees who opted for the said pension
scheme.

9. A representation was made by the
united forum of Bank Unions for an option
to be extended to those employees who
were in the employment of Bank prior to
29th
September,
1995
in
case
of
Nationalized Banks and 26th March, 1996
in case of Associate Banks of State Bank of
India. The talks between management and
Union ultimately lead to a fresh settlement
notified on 27th April, 2010 (hereinafter
referred
to
as
'Settlement,
2010').
Settlement, 2010 gave another option to the
employees of Bank to join existing pension
scheme to the specified category of
employees. Clause 2 and 4 of the terms of
settlement are relevant and are reproduced
hereinafter:-

"(2) Another option for joining
the existing Pension Scheme shall be
extended to those employees who:-

(I) (a) were in the service of the
bank prior to 29 September 1995 in case of
Nationalized Banks/26 March 1996 in case
of Associate Banks of State Bank of India
and continue in the service of the bank on
the date of this Settlement;

(b) exercise an option in writing
within 60 days from the date of offer, to
become a member of the Pension Fund and

(c) authorise the Trust of the
Provident Fund of the bank to transfer the
entire contribution of the bank along with
interest accrued thereon to the credit of the
Pension Fund.

(II) (a) were in service of the
bank prior to 29th September 1995 in case
of Nationalized Banks/26th March 1996 in
case of Associate Banks of State Bank of
India and retired after that date and prior
to the date of this Settlement;

(b) exercise an option in writing
within 60 days from the date of offer to
become a member of the Pension Fund and

(c) refund within 30 days after
expiry of the said period of 60 days, the
entire amount of the banks contribution to
the Provident Fund and interest accrued
thereon received by the employee on
retirement together with his share in
contribution towards meeting 30% of
Rs.3115 crores which is estimated and
656 INDIAN LAW REPORTS ALLAHABAD SERIES
reckoned as the funding gap for those
eligible under Clause 2(II), 2(III) and 2(IV)
of this agreement. On an individual basis,
the payment over and above the bank's
contribution to Provident Fund and interest
thereon has been worked out at 56% of the
said amount of bank's contribution to
Provident Fund and interest thereon
received by the employee on retirement.

(III)
The
family
of
those
employees who were in the service of the
bank prior to 29th September 1995 in case
of Nationalized Banks/26th March 1996 in
case of Associate Banks of State Bank of
India retired after that date and died will
be eligible for family pension, provided-

(a) the family of the deceased
employee exercises option in writing within
60 days of the offer to become a member of
the Pension Fund and

(b) refund within 30 days after
expiry of the said period of 60 days, the
entire amount of the bank's contribution to
the Provident Fund and interest accrued
thereon received by the deceased employee
on retirement together with his share in
contribution towards meeting 30% of
Rs.3115 crores which is estimated and
reckoned as the funding gap for those eligible
under Clause 2(II), 2 (III) and 2(IV) of this
agreement. On an individual basis, the
payment
over
and
above
the
bank's
contribution to Provident Fund and interest
thereon has been worked out at 56% of the
said amount of bank's contribution to
Provident Fund and interest thereon received
by the employee on retirement.

(IV) The family of those employees
who were in the service of the bank prior to
29th September 1995 in case of Nationalized
Banks / 26th March 1996 in case of Associate
Banks of State Bank of India, but have died
while in service of the bank after that date
will be eligible for family pension, provided -

(a) the family of the deceased
employee exercises an option in writing
within 60 days of the offer to become a
member of the Pension Fund and

(b) refund within 30 days after
expiry of the said period of 60 days
mentioned above, the entire amount of the
bank's contribution to the Provident Fund
and interest accrued thereon received upon
death of the employee together with his share
in contribution towards meeting 30% of
Rs.3115 crores which is estimated and
reckoned as the funding gap for those eligible
under Clause 2(II), 2(III) and 2(IV) of this
agreement On an individual basis, the
payment
over
and
above
the
bank's
contribution to Provident Fund and interest
thereon has been worked out at 56% of the
said amount of bank's contribution to
Provident Fund and interest thereon received
on death of the employee."

10. The petitioner invoked the
provisions of the Settlement, 2010 and
submitted an option to receive pension vide
his letter dated 1.10.2010. He also claimed
benefit of leave encashment. Such claim of
the respondent-petitioner came to be rejected
by the Bank of India vide its order dated
13.10.2010. Clause 3 of the Circular, dated
24.8.2010, has been relied upon by the
Bank for rejection of the claim of
respondent,
which
is
reproduced
hereinafter:-

"3. It also may be noted that the
employees who have ceased to be in the
service of Bank on account of Resignation /
Voluntarily retired under officer's Service
Regulation 19/ Incapacitation / on medical
grounds/any other type of cessation on
account of penalty proceedings are not
eligible to opt for joining the Pension
Scheme. Also existing Pension optees
2 All. Bank of India, Mumbai & Ors. Vs. Sahajanand Rai & Anr.
657
cannot revoke their option from Pension to
CPF"

11. Aggrieved by the rejection of his
claim to opt for pension scheme the
respondent filed Writ Petition No. 53237 of
2014. Orders passed by the authority
rejecting
petitioner's
claim
dated
13.10.2010, as affirmed by the Regional
Deputy Manager on 11.8.2014, were
challenged. Para 3 of the Circular, dated
24.8.2010 also was put to challenge. A
prayer was made to direct the Bank to
release pension from 20th September, 2002
alongwith arrears within time to be
specified by this Court.

12. A question arose as to whether
pensionary benefits would be admissible to
an employee of the Bank, who has put in
10 years qualifying service, if an order of
removal has been passed against him in
terms of Clause 6(b) of the Settlement,
2002. This was because Regulation 22 of
the Pension Regulations, 1995 clearly disentitled an employee from pension whereas
Clause
6(b)
protected
superannuation
benefits i.e. Pension and/or Provident Fund.
The issue was specifically examined in
para 13 to 17 of the judgment of the Supreme
Court in Bank of Baroda (supra). The Court
examined the intent of the Bipartite
Settlement and emphatically held that if
Regulation 22 of the Pension Regulation,
1995, providing for forfeiture of service is to
prevail then Clause 6(b) of the Settlement,
2002 would clearly be a fraud settlement.
Para 13 to 17 of the judgment in Bank of
Baroda (supra) are reproduced hereinafter:

"13.
Regulation
22
of
the
Regulations, which is relied on to deny the
claim of the employee reads as follows:

"22. Forfeiture of service.-(1)
Resignation or dismissal or removal or
termination of an employee from the service
of the Bank shall entail for forfeiture of his
entire past service and consequently shall not
qualify for pensionary benefits."

From a plain reading of the
aforesaid Regulation, it is evident that
removal of an employee shall entail forfeiture
of his entire past service and consequently
such an employee shall not qualify for
pensionary benefits. If we accept this
submission, no employee removed from
service in any event would be entitled for
pensionary benefits. But the fact of the matter
is that the Bipartite Settlement provides for
removal from service with pensionary
benefits "as would be due otherwise under
the rules or regulations prevailing at the
relevant time". The consequence of this
construction would be that the words quoted
above shall become a dead letter. Such a
construction has to be avoided.

14. The Regulations do not entitle
every employee to pensionary benefits. Its
application and eligibility is provided under
Chapter II of the Regulations whereas
Chapter IV deals with qualifying service. An
employee who has rendered a minimum of
ten years of service and fulfils other
conditions only can qualify for pension in
terms of Regulation 14 of the Regulations.
Therefore, the expression "as would be due
otherwise"
would
mean
only
such
employees who are eligible and have put in
minimum number of years of service to
qualify for pension. However, such of the
employees who are not eligible and have
not put in required number of years of
qualifying service shall not be entitled to
the
superannuation
benefits
though
removed from service in terms of Clause
6(b) of the Bipartite Settlement. Clause 6(b)
came to be inserted as one of the
punishments on account of the Bipartite
Settlement. It provides for payment of
658 INDIAN LAW REPORTS ALLAHABAD SERIES
superannuation benefits as would be due
otherwise.

15. The Bipartite Settlement tends
to provide a punishment which gives
superannuation benefits otherwise due. The
construction canvassed by the employer
shall give nothing to the employees in any
event. Will it not be a fraud Bipartite
Settlement? Obviously it would be. From
the conspectus of what we have observed
we have no doubt that such of the
employees who are otherwise eligible for
superannuation benefit are removed from
service in terms of Clause 6(b) of the
Bipartite Settlement shall be entitled to
superannuation benefits. This is the only
construction which would harmonise the
two provisions. It is well-settled rule of
construction that in case of apparent
conflict between the two provisions, they
should be so interpreted that the effect is
given to both. Hence, we are of the opinion
that such of the employees who are
otherwise
entitled
to
superannuation
benefits under the Regulations if visited
with the penalty of removal from service
with superannuation benefits shall be
entitled for those benefits and such of the
employees though visited with the same
penalty
but
are
not
eligible
for
superannuation
benefits
under
the
Regulations shall not be entitled to that.

16. Accordingly, we hold that the
employee's
heirs
are
entitled
to
superannuation benefits. The entire amount
that the respondent is found entitled to
along with interest @ 6% per annum
should be disbursed within 6 weeks from
the date of receipt/communication of this
order.

17. In the result, we do not find
any merit in this appeal and it is dismissed
accordingly with costs of Rs 50,000
(Rupees fifty thousand) to be paid by the
appellant to Respondent 1 along with other
dues and within the time stipulated above."

13. In view of the law laid down by
the Supreme Court in Bank of Baroda
(supra), the superannuation benefits in the
form of Contributory Provident Fund have
been
paid
to
the
respondent.
A
supplementary affidavit has been filed by
the Senior Manager of the Bank clearly
acknowledging the payment made to
respondent of contributory pension scheme.

14. From the facts brought on
record it is, therefore, admitted to the
appellant Bank that in terms of Clause 6(b)
of the Settlement, 2002, as interpreted by
the Supreme Court in Bank of Baroda
(supra) the respondent was entitled to
superannuation benefits and such benefits
in terms of the earlier scheme i.e.
contributory provident fund was actually
paid to the respondent.

15. The short question that then
arises in the facts of the case is as to
whether the option extended in the
Settlement, 2010, to opt for pension would
be available to the respondent, or not?

16. Ms. Vatsala appearing for the
Bank submits that the Settlement, 2010,
restricts the benefit of scheme only to
retired employees or to those who have
voluntarily retired from service. The option
to be exercised for pension was not
available to an employee of the Bank who
had been removed from service. Clause 3
of the Circular of the Bank is also relied
upon, as per which, the benefit to opt for
pension would only be available to those
who have retired and not to those who have
been terminated or removed from service
by way of punishment.
2 All. Bank of India, Mumbai & Ors. Vs. Sahajanand Rai & Anr.
659
17. Sri Ashok Khare, learned
Senior Counsel, per contra, submits that
Cause 6(b) of the Settlement, 2002, clearly
extends superannuation benefits also to an
employee who has been removed from
service. It is, therefore, submitted that the
status of a removed employee would be at
par with any other retired employee who is
entitled to superannuation benefits. It is
urged that there is no cogent reason to
exclude an employee from the benefit of
the Settlement of 2010 who has been
removed from service under Clause 6(b) of
the Settlement, 2002, when superannuation
benefits have otherwise been extended to
him under the Settlement.

18. Learned Senior Counsel submits
that if the Settlement of 2010 is interpreted
in the manner suggested by the appellant
then an employee removed under Clause
6(b)
would
be
dis-entitled
to
superannuation
benefits
like
Pension/Provide Fund which are otherwise
protected under the Settlement of 2002. Sri
Khare, therefore, submits that the judgment
of learned Single Judge suffers from no
infirmity in law and the instant special
appeal lacks merit.

19. We have heard learned counsel
for the parties and have perused the
provisions of the Pension Regulation, 1995;
Settlement, 2002 as well as Settlement,
2010. Circular issued by the Bank on
24.8.2010 interpreting the Settlement of
2010 has also been perused by us.

20. It is undisputed that respondent
was removed from service under Clause
6(b) of the Settlement, 2002. Clause 6(b)
clearly provides that an employee found
guilty of gross misconduct may be removed
from service with superannuation benefits
i.e. Pension and/or Provident Fund and
Gratuity as would be due otherwise under
the Rules or Regulations prevailing at the
relevant time and without disqualification
from future employment. Clause 6(b) is
unique, inasmuch as, it empowers the
employer to remove an employee without
natural consequences of it allowed as per
service jurisprudence i.e. forfeiture of past
service. But for the Settlement, 2002, the
Pension Regulations, 1995 would have
applied and consequently on account of
removal from service the respondent would
have been denied superannuation benefits.
However, in view of Clause 6(b) of the
Settlement, 2002, the respondent has been
held entitled to superannuation benefits.
Such superannuation benefit in the form of
contributory provident fund alone was
payable since the respondent had not opted
for pension, etc. In the event he had opted
for pension earlier he would have been
entitled to it. The entitlement of respondent
to superannuation benefits is thus admitted
to the Bank.

21. It is in this context that we are to
examine as to whether the right created in a
bank employee to opt for pension could be
denied to an employee who has been
removed from service under clause 6(b) of
the Settlement of 2002?

22. In Bank of Baroda (supra), the
Supreme Court has clearly held that the
employees who are otherwise eligible for
superannuation benefit, if are removed
from service in terms of Clause 6(b) of the
Settlement of 2002, shall be entitled to
superannuation benefits.

23. We have perused the Pension
Regulations, 1995, which contemplates
payment of pension to an employee who
has retired from service. Retirement has
been defined under Regulation 2(y) of the
660 INDIAN LAW REPORTS ALLAHABAD SERIES
Pension
Regulations,
1995
to
mean
cessation from Bank's service on attaining
the age of superannuation specified in
Service Regulations or Settlements; on
voluntary retirement in accordance with
provisions contained in Regulation 29 of
the Regulation; on premature retirement by
the Bank before attaining the age of
superannuation.
Under
the
Pension
Regulations, 1995, no pension is payable to
an employee, who is removed from service.
The right to receive pension to an employee
removed from service flows from the
Settlement of 2002. The Settlement of 2002
will have an overriding effect, inasmuch as,
the settlement mandatorily binds the
employer
and
employee
alike.
The
settlement of 2002 cannot be read in a
manner so as to deny its benefit to an
employee
contrary
to
the
express
stipulations made therein.

24. Once the Settlement of 2002
allows superannuation benefits in the form
of Pension and/or Provident Fund and
Gratuity to an employee removed from
service under Clause 6(b), it would not be
open for the employer to contend that
option to opt for pension can be denied to
someone who is otherwise entitled to
superannuation benefits.

25. The Settlement of 2010 extends
option to opt for pension scheme to the
employees; (i) who were in employment on
the cut-off date and were in service of the
bank on the date of settlement; (ii) were in
service of the bank on the cut-off date and
retired after that date and prior to the date
of settlement; (iii) to employees who were
in service of the bank on the cut-off date
and retired after that date and died would
be
entitled
to
family
pension;
(iv)
employees in employment of Bank on the
cut-off date but have died while in service
of the Bank after that date are also entitled
to family pension.

26. Clause 4 extended the benefit of
pension to those who voluntarily retired
under special scheme provided they had
worked for 15 years. This clause apparently
will not apply in the case of the respondentpetitioner since his period of working is
less than 15 years and he has otherwise not
retired voluntarily. Clause 2(ii) of the
Settlement, 2010, however, would be
applicable in the present case as the
respondent had completed the requisite
qualifying service and became entitled to
superannuation
benefits
in
terms
of
Settlement of 2002. The Settlement of 2010
is
otherwise
a
beneficent
provision
introduced for the advancement of the
cause of employees of the Bank and its
provisions will have to be liberally
construed. The option to opt for Pension
Regulations under the Settlement of 2010 is
seen to have been extended to all category
of employees who are otherwise entitled to
superannuation benefits. Denial of the
option to the respondent to opt for pension
virtually eliminates him from the category
of
persons
who
are
entitled
to
superannuation benefits. This would be
impermissible and arbitrary.

27. Once Clause 6(b) of the
Settlement of 2002 allows superannuation
benefits to an employee removed from
service he will have to be treated at par
with any other employee of the Bank who
is entitled to superannuation benefits. Any
other construction would clearly go against
the express terms and intent of the
settlement arrived at between the Bank and
its employees. Such construction would
also go contrary to the spirit of the rights
recognized in an employee removed from
service under Clause 6(b) of the Settlement
2 All. Bhagwan Singh Vs. State of U.P. & Ors.
661
of 2002 by the Supreme Court in Bank of
Baroda (supra).

28. Ms. Vatsala has placed reliance
upon a judgment of the Supreme Court in
UCO Bank and others Vs. Sanwar Mal,
(2004) 4 SCC 412. This judgment although
interpreted Regulation 22 but had not taken
note of the settlement of 2002 which
subsequently came to be arrived at between
the employees and the Bank. Clause 6(b) of
2002 Settlement, with which we are
concerned, did not fall for consideration in
UCO Bank (supra). The ratio of law laid
down by the Supreme Court in UCO Bank
(supra) relying upon Clause 22 of the
Pension Regulations, 1995, would thus not
have
any
relevance
in
the
present
controversy.

29. Having examined the respective
submissions advanced at the bar, we are of
the considered view that the superannuation
benefits including pension, etc., made
admissible to an employee removed from
service under Clause 6(b) of the Settlement
of 2002 ought not to be interpreted in a
narrow sense. It ought to be given a
construction consisting with the nature of
settlement i.e. beneficent for the employee.
Any
narrow
construction
would
not
subserve the objective of the Settlement of
2002. We, therefore, find ourselves to be in
agreement with the view expressed by the
learned Single Judge in extending offer to
the respondent to opt for pension upon
terms indicated in the Settlement of 2002.
The appeal filed by the Bank, accordingly,
fails.

30. We are inclined to take similar
view in the matter of leave encashment also
as under the applicable regulations and
circular of the Bank leave encashment is
admissible to an employee who is entitled
to superannuation benefits and pension.
Once we hold that the respondent is entitled
to opt for pension under the Settlement of
2010, and has otherwise been extended
superannuation benefits in the form of
Contributory Provident Fund, there would
be no good ground to deny the benefit of
leave encashment to the respondent. No
applicable provision of law is shown which
dis-entitles the respondent to payment of
leave encashment notwithstanding the
Settlement of 2002.

31.

For
the
reasons
and
discussions held above, this appeal fails
and is, consequently, dismissed. Costs
made easy.
----------
(2024) 2 ILRA 661
APPELLATE JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 08.02.2024

BEFORE

THE HON'BLE ASHWANI KUMAR MISHRA, J.
THE HON'BLE SYED QAMAR HASAN RIZVI,
J.

Special Appeal Defective No. 57 of 2024

Bhagwan Singh ...Appellant
Versus
State of U.P. & Ors. ...Respondents

Counsel for the Appellant:
Sri Akash Khare

Counsel for the Respondents:
C.S.C.

A. Service Law - Seasonal Collection Peon
- Denial of Engagement - Appellant, a
Seasonal
Collection
Peon,
challenged
the
dismissal of his writ petition seeking restoration
of
services
and
payment
of
salary
-
Respondents allegedly overlooked his seniority
(serial no. 187) and engaged juniors based on a