# STATE OF PUNJAB AND ANR v. IQBAL SINGH

- **Citation:** [1976] 3 S.C.R. 360
- **Court:** Supreme Court of India
- **Decided:** 1976-02-12
- **Case number:** Civil Appeal No. 1203 of 1968
- **Bench:** A. C. Gupta, Jaswant Singh
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/state-of-punjab-and-anr-v-iqbal-singh-6739
- **Pages:** 5

## Headnote

B
f'iiujab ('ii·il Service Rules-r. 6.4-Retired Goverrunent servar1t-Pensio11
c
D
F
G
H
and death-cum-retiren1e111 gratuitv reduced by Govenunent on the ;::round that
service record not satisfactory-Pension, if a bounty paid by Go1'ernmentlf property under Arts 31(1) and 19(1)(/) of the Constifution-lf reasonable
oppr,rlunity of 1naking defence should be given before reducing the pension.
Constitution of l ndia-Art. 311 (2 )--Applicability of.
Purporting to act under r. 6.4 of the Puniab Civil Service Rules. the State
imposed a cut of 5 per cent on the pension and death-cun1-retirement gratuity
of the respondent, who \Vas a retired government servant, on the ground that
his service record was not satisfactory. The High Court allowed the respondent's
\vrit petition challenging the decision of the Governmellt.
Dismissing the appeal of the State,
HELD : The ground that superannuation pension is a bounty and is given
as an act of grace is not available to the appellant. In Deoki Nandan Prasad
v. The State of Bihm·, [197I] Supp. S.C.R. 634, it was held by this Court (1)
that pension is not a bounty payable, on the sweet will and pleasure of t~e
(jovernment and the right of a Government servant to receive it is property
under Art. 31 ( 1) of the Constitution, and so the State cannot withhold the
same by a mere executive order; and (2) the claim to pension is
property
under Art. 19(1) (f) of the Constitution and is not saved by .cl. (5) of Art.
19.
[362C-D]
(2) Though the impt1gned order imposing the cut in pension and gratuity
is not one of reduction in rank falling within the purview of Art. 311 (2),
yet there can be no doubt that it adversely affected the respondent and such
an order could not have been passed without giving him a reasoNable opportunity of making his defence.
[362G]
State of Punjab v. K. R. Erry & Sabha;:: Rai Mehta [19731 2 S.C.R. 405.
applied.
(3) M. \Tarc1.1hnachar '" The State of Mysore [1960} 1 S.C.R. 981, is inapplicable to this case because the point as to whether an opportunity to show
cause was to be afforded to a retired Government servant before applying the
cut in his pension in view of the principle.if natural justice of audi alteram
partem was never urged or gone into in that case, nor was the question whether
pension was a bounty or property arose in that case.
[364 D-E]

## Text

360
A
STATE OF PUNJAB AND ANR.
v.
IQBAL SINGH
February 12, 1976
[A. C. GUPTA AND JASWANT SINGH, JJ.]
B
f'iiujab ('ii·il Service Rules-r. 6.4-Retired Goverrunent servar1t-Pensio11
c
D
F
G
H
and death-cum-retiren1e111 gratuitv reduced by Govenunent on the ;::round that
service record not satisfactory-Pension, if a bounty paid by Go1'ernmentlf property under Arts 31(1) and 19(1)(/) of the Constifution-lf reasonable
oppr,rlunity of 1naking defence should be given before reducing the pension.
Constitution of l ndia-Art. 311 (2 )--Applicability of.
Purporting to act under r. 6.4 of the Puniab Civil Service Rules. the State
imposed a cut of 5 per cent on the pension and death-cun1-retirement gratuity
of the respondent, who \Vas a retired government servant, on the ground that
his service record was not satisfactory. The High Court allowed the respondent's
\vrit petition challenging the decision of the Governmellt.
Dismissing the appeal of the State,
HELD : The ground that superannuation pension is a bounty and is given
as an act of grace is not available to the appellant. In Deoki Nandan Prasad
v. The State of Bihm·, [197I] Supp. S.C.R. 634, it was held by this Court (1)
that pension is not a bounty payable, on the sweet will and pleasure of t~e
(jovernment and the right of a Government servant to receive it is property
under Art. 31 ( 1) of the Constitution, and so the State cannot withhold the
same by a mere executive order; and (2) the claim to pension is
property
under Art. 19(1) (f) of the Constitution and is not saved by .cl. (5) of Art.
19.
[362C-D]
(2) Though the impt1gned order imposing the cut in pension and gratuity
is not one of reduction in rank falling within the purview of Art. 311 (2),
yet there can be no doubt that it adversely affected the respondent and such
an order could not have been passed without giving him a reasoNable opportunity of making his defence.
[362G]
State of Punjab v. K. R. Erry & Sabha;:: Rai Mehta [19731 2 S.C.R. 405.
applied.
(3) M. \Tarc1.1hnachar '" The State of Mysore [1960} 1 S.C.R. 981, is inapplicable to this case because the point as to whether an opportunity to show
cause was to be afforded to a retired Government servant before applying the
cut in his pension in view of the principle.if natural justice of audi alteram
partem was never urged or gone into in that case, nor was the question whether
pension was a bounty or property arose in that case.
[364 D-E]
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1203 of 1968.
From the order dated the 4-4-1967 of the Punjab and Haryana
High Court in L.P.A. No. 104 of 1967.
0. P, Sharma, for the appellant.
H. K. Puri and M. C. Dhingra, for the respondent.
The Jndgment of the Court was delivered by
JASWANT SINGH, J.-This appeal by certificate of fitness
granted
by the Punjab and Haryana High Court is directed against the judgment dated April 4, 1967 of a Division Bench of that Court passed
in Letters Patent Appeal No. 104 of 1967 whereby the judgment and
order dated December 19, 1966 of N arula, J. (as he then was)
in
Civil Writ Petition No. 298 of 1966 was affirmed.
\
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PUNJAB v. IQBAL SINGH (Jaswant Singh, J.)
3 ti l
It appears that the respondent joined the
Punjab
Education
Department (Class II) Service by direct recruitment as senior lecturer
in 1933.
He was promoted to Punjab Education Service
(Class
I) on October 1, 1949.
He was given the selection grade
with
effect from February 15, 1956 and in due course rose to the position
of Director of Public Instruction-cum-Secretary to the Government
of Punjab, Education Department.
He proceeded on leave preparatory to retirement on March 18, 1958, on attaining the age of superannuation. In June, 1961, he received a copy of letter No. 5137Ed-I-60/9269 dated May 2, 1961 addressed by the
Secretary to
Government, Punjab, Education Department, to the Director of Public Instruction, Punjab, Chandigarh, conveying the sanction of
the
Governor of Punjab to the grant to him i.e. the respondent of super·
annuation pension and death-cum-retirement gratuity of Rs. 417.02 np.
per menscm and Rs. 17,030.25 np in lump sum respectively
under rules 5.27 and 6.13 of the Punjab Civil Service Rules, Vol. II
read with para 9(1) (a) of the New Pension Rules, 1951. It was
stated in the aforesaid letter that personal file of the respondent had
been examined with reference to rule 6.4 of the Punjab Civil Service
Rules, Vol. II and Government were satisfied that his service record
was not satisfactory and a cut of 10% had accordingly been made in
the amount of pension and death-cum-retirement gratuity admissible
to him.
On January, 28, 1962, the respondent submitted representa·
tions to the Chief Minister and Governor of Punjab against the aforesaid decisivn of the Government to apply 10% cut in his pension and
death-cum-retirement gratuity but the same proved abortive.
After
the establishment of the Board set up to examine and remove the
grievances in the matters of promotion and fixation of pension etc.
of the Gazetted Officers of the Government, the respondent addressed
a representation to the said Board on September 14, 1964, against
the aforesaid decision of the Government to apply a cut of 10% in
his pension and gratuity.
On November 1. 1965, the
respondent
received a copy of letter No. EDI-4(64)-65/22436 dated October 21,
1965, addressed_ by the Education Commissioner and Secretary
to
Government, Punjab, Education Department, to the Director of Public
Instruction, Punjab, intimating that in supersession of the aforesaid
letter dated May 2. 1961 of the Punjab Government, it had been
decided to grant to the respondent a superannuation
pension and
death-cum-retirement gratuity of Rs. 440.18 np per mensem and Rs.
18,927.50 np in lump sum respectively under rules 5.27 and 6.13
of the Punjab Civil Service Rules, Vol. II read with para 9(i) (a)
of. the New Peru;ion Rules, 1951. In para 3 of the letter, it was
reiterated that a cut of 5 % had been made in the pension admissible
to the respondent as his service record which had been examined with
reference to rule 6.4 of the Punjab Civil Service Rules, Vol. II had not
been. satisfactory.
Aggrieved by ~his communieation, the respondent
filed m th~ Pun1ab and Haryana High Court at Chandigarh a petition
un~c.r Art1cle.s 226 and 227 of the Constitution, being Civil
Writ
Petition No. 298 of 1966, challenging the aforesaid decision o{ the
Punjab Government which was, as already stated, allowed by Narula,
J. (as he then was) by his judgment and order dated December 19
1966, following the Fnll Bench Judgment of his Court dated Octobe;
A
B
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F
G
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A
B
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362
SUPREME COURT REPORTS
[1976] 3 S.C.R.
25, 1966, in Civil Writ Petition No. 504 of 1954 entitled Shri K. R.
Erry, Retired Superintending Engineer, 45, Cecil Hotel, Simla
v.
The State of Punjab(').
Dissatisfied with this judgment and order,
the appellants preferred a Letters Patent Appeal, being L. P. A. No.
104 of 1967 which did not meet with success.
Thereupon the appellants applied for a certificate under Article 133 of the Constitution
which was granted to them.
This is how the matter is before ns.
Although in the grounds of appeal, it has been urged by the appellants that the Full Bench decision of the High Court of Punjab
and Haryana in K. R. Erry's( 1) case (supra) is not in accordance
with law as superannuation pension is a bonnty and is given only as
an act of grace, that ground is no longer available to the appellants
in view of the decision of this Court in Deokinandan Prasad v. The
State of Bihar & Ors. (2) where it was held that pension is not
a
bounty payable on the sweet will and pleasure of the
Government
and the right of a Government servant to receive it is property under
Article 31 ( 1) of the Constitution and the State cannot withhold the
same by a mere executive order. It was further held in that case that
the claim to pension was also property under Article 19 ( l) • ( f) of
the Constitution and was not saved by clause ( 5) thereof.
The
learned counsel appearing for the appellants has, however, made a
feeble attempt to urge that no opportunity to show cause was require<!'
to be given to the respondent before passing the order jmposing the
cut in his superannuation pension and death-cum-retire,\P,Mt gratuity
under clanses (a) and (b) of rule 6.4 of the· I'tibjall "Civil Service
Rules (Pension Rules), as the order W11s'1/lff1administrative order and
the case did not fall within· th&ripurview of Article 311 (2) of the
Constitution. It has-·bll<ln· further contended by learned counsel for
the appellants that ·U: was
the
judgment of this
Court in M.
Narasimachar v. •The State of Mysore(•), and not the judgment in
State of Punjab v. The K. R. Erry & Sobhag Rai Mehta( 4 ) which governed the present case.
We regret we are unable to accede to these
contentions.
Though the impugned order imposing cut in pension and gratuity
is not one of reduction in rank falling .within the purview of Article 311
(2) yet there can be no doubt that it adversely affected the respondent
and such an order could not have been passed without giving him a
reasonable opportunity of making his defence.
Reference in this
connection may be made with advantage to the decision of this Court
in K. R. Erry & Sobhag Rai Mehta's case (supra) where after an
exhaustive review of the case law bearing on
the
point,
it was
observed at page 413 as follows :-
"Where a body or authority is judicfa.I or where it has
to determine a matter involviffg rights judicially because of
express or implied provision, the principle of natural justice
audi alteram partem applies. See : Province of Bombay v.
Kusaldas S. Advani & Ors. [1950 S.C.R. 621 (725), and
Board of High School & Intermediate
Education,
U.P.
(I) I.L.R. (1917) Punjab & Haryana 278.
(3) [1960] I S.C.R. 981 : A.I.R. 1960 S.C. 247.
(2) [1971] Supp. S.C.R. 634.
(4) [1973] 2 S.C.R. 405.
'
PUNJAB v. lQBAL JilNGH (Jaswant Singh, J.)
J63
Allahabad v. Ghanshyam Das Gupta & Ors. (1962) Suppl.
A
(3) S.C.R. 36.]
With the profiteration of administrative
decisions in the welfare state it is now further recognised by
Courts both in England and in this country, (especially after
the decision of House of Lords in Ridge v. Baldwin (1964)
A.C. 40 that where a body or authority is characteristically
administrative the principle of natural justice is also liable
to be invoked
if the decision of that body or authority
B
affects, individual rights or interests, and liaving regard to
the particular situation it would be unfair for the body or
authority not to have allowed a reasonable opportunity to
be heard. See : State of Orissa v. Dr. (Miss) Binapani Dei
& Ors. (1967) 2 S.C.R. 625 and In re H. K. (An Infant)
[1967] 2 Q.B.D. 617. In the former case it was observed
as follows :-
C
"An order by the State to the prejudice of a person in
derogation of his vested rights may be made only in accordance with the basic rules of jUstice and £airplay.
The
deciding authority, it is true, is not in the position of a Judge
called upon to decide an action between. contesting parties,
and strict compliance with the forms of judicial procedure
may not be insisted upon. He is however under a duty to
give the person against whom an enquiry is held an opportunity to set up his version or defence and an opportunity
to correct or to controvert any evidence in the possession of
the authority which is sought fo be relied upon to his prejudice.
For that purpose the person against
whom an
enquiry is held must be informed of the case he is cal!ecl
upon to meet and the evidence in support thereof.
The
rule that a party to whose prejudice an order is intended to
be passed is entitled to a hearing applied alike to judicial
tribunals and bodies of persons invested with authority to
adjudicate upon matters involving civil consequences.
It
[)
E
is one of the funi(amental rules of our constitutional set up
that every citizen is protected against exercise of arbitrary
authority by the State or its officers.
Duty to act judicially
would therefore arise from the very nature of the function
intended to be performed.
It need not be shown
to be
super-added. If there is power to decide and determine to
F
the prejudice of a person, duty to act judici_ally is i!Ilpl_icit in
the exercise of such power.
If the essentials of 1usllce be
ignored
and an order
to the prejudice
of a person is
made, the order is a nullity.
That is a basic concept of the
rule of law and importance thereof transcends the significance of a decision in any particular case."
These observations were made with reference to an authority
which could be described as characteristically administrative. At page
630 it was observed :
"It is true that the order is administrative in character,
but even an administrative
order
which
involves
civil
G
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364
SUPREME COURT REPORTS
[1976) 3 S.C.R.
A
consequences as already stated, must be made consistently
with the rules of natural justice after informing the first res-
'
pondent of the case of the State, the evidenve in support
thereof and after giving an opportunity to the first respondent of being heard and meeting or explaining the evidence."
"This case and the English case in re H.K. (An Infant) were speciB
fically referred to with approval in a decision of the constitutional
bench of this Court in A. K. Kraipak & Ors. etc. v. Union oj
•
India & Ors. [1970] 1 S.C.R. 457".
The decision of this Court in M. Narasimachar's case (supra) on
which strong reliance has been placed on behalf of the appelbnts is of
no assistance to them as the point as to whether an opportunity to
C
show cause was to be afforded to a Government servant before applying a cut in his pension in view of the principle of natural justice
embodied in the well known maxim audi alteram partem was never
~
urged or gone into in that case.
Furthermore as pointed out
by
Palekar, J. while speaking for the Court in K. R. Erry & Sobhag Rai
Mehta's case (supra) the question whether pension is a bounty or
property did not arise in the former case.
The present case is, in our
D
opinion, fully covered by the judgment of this Court in K. R. Erry &
Sobhag Rai Mehta's case (supra).
For the foregoing reasons we are of the view that the impugned
judgments do not suffer from any illegality and were rightly rendered.
In the result the appeal fails aud is hereby dismissed with costs.
P.B.R.
Appeal dismissed.
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