The Delhi High Court has ruled that an employee of a statutory body that has adopted the Central Civil Service (Pension) Rules, 1972, who was initially engaged on a casual or contractual basis and is subsequently appointed to the same or another post in a substantive capacity without any interruption of duty, is entitled to the benefits under Rule 17 of the Central Civil Service (Pension) Rules, 1972, commonly known as the Old Pension Scheme (OPS).
The Court clarified that the applicability of Rule 17 is not defeated by the subsequent appointment being termed a ‘fresh appointment’ or ‘direct recruitment’ rather than “regularisation”. Such an employee must be given the option prescribed under Rule 17 to either retain the monetary benefits from their contractual service (such as Contributory Provident Fund contributions) or to refund/forgo such benefits and have the period of contractual service counted for the purpose of pension under the Old Pension Scheme.
The Division Bench comprising of the Chief Justice Devendra Kumar Upadhyaya and Justice Tejas Karia observed that while the Export Inspection Council is a statutory body and its employees are not Central Government employees, the Council had adopted the Central Civil Service (Pension) Rules, 1972 for its whole-time and regular employees through a notification dated 24 October 1981. This made the Rules, 1972, including Rule 17, fully applicable to the employees of the Council.
The Bench observed that the primary condition for invoking Rule 17 is that an initial engagement on contract must be followed by an appointment in a substantive capacity without any interruption of duty. The respondent-Council did not argue that there was any interruption in the appellants’ service; their contention was that the subsequent appointments were “fresh appointments” or “direct recruitment” and not “regularisation”.
Accordingly, the Bench clarified that Rule 17 does not require the subsequent appointment to be termed as ‘regularisation’, and an appointment in a ‘substantive capacity’ is sufficient. The respondent’s own admission that the appellants were given fresh appointments by way of direct recruitment was interpreted by the Bench as confirmation that these were indeed appointments in a substantive capacity, thereby attracting Rule 17.
Briefly, the appellants are employees, or their legal representatives, of the Export Inspection Council, which is a statutory body established under the Export (Quality Control and Inspection) Act, 1963. The appellants were initially engaged on a daily/casual basis between 1985 and 1992, subsequently granted contractual status, and were later appointed to substantive posts on various dates between 20 February 2007 and 6 January 2009.
The central dispute arose from the appellants’ claim for entitlement to pension benefits under the Central Civil Service (Pension) Rules, 1972, commonly known as the Old Pension Scheme (OPS), instead of the New Pension Scheme (NPS) which became effective from 1 January 2004. They contended that their initial contractual service should be counted for pensionary benefits as their subsequent appointments were without any interruption of duty, thereby bringing them under the purview of the OPS.
The respondent-Council, however, argued that the appellants were given fresh appointments, not a regularisation of service, and the appointment letters explicitly stipulated that they would be governed by the NPS, which they accepted without protest.
Appearances:
Advocate Parveen Kumar, for the Appellant
Advocates L.R. Khatana and Vijay Joshi, for the Respondent
