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Citations: 2025 (4) KLR 101 : 2025 KER 27255
Court: High Court of Kerala (Division Bench)
Judges: Anil K. Narendran & Muralee Krishna S., JJ.
Case No: W.A. No. 976 of 2015; April 1, 2025

Service Law – Pension Eligibility – Distinction Between Resignation and Voluntary Retirement – Vijaya Bank (Employees) Pension Regulations, 1995, Clause 22 – 9th Bipartite Settlement Pension Scheme (Ext.P5)

Respondent, a bank employee with over 35 years of service, submitted a resignation letter citing ill health (Ext.P2) on April 30, 2010, effective May 31, 2010, which was accepted before the Pension Scheme circular (Ext.P5) was issued on September 7, 2010. Post-notification, respondent sought to treat his resignation as voluntary retirement to join the Pension Scheme, which was rejected by the Bank. Single Judge allowed the writ petition, directing pension benefits, holding that long service implied no intent to forfeit benefits. 

Held

The Division Bench reversed the decision, ruling that resignation forfeits pension eligibility under Clause 22 of the Pension Regulations, and the Pension Scheme’s terms cannot be extended beyond their explicit scope. Relying on Shree Lal Meena (2019) 4 SCC 479, the court distinguished resignation from voluntary retirement, finding the respondent ineligible as he resigned before the scheme’s notification. 

Appeal allowed; writ petition dismissed.

Against the Judgment dated 02.02.2015 in WPC No. 20291 of 2011 of High Court of Kerala 

Appellants: K. Anand (Sr.), Joseph Sebastian Parackal, Latha Krishnan, M.N. Radhakrishna MenonRespondent: B. Bipin, R. Reji, M.V. Thamban, Thara Thamban

Facts:

• V.T. Radhakrishnan joined Vijaya Bank on September 1, 1975. On April 30, 2010, he submitted a resignation letter (Ext.P2) citing ill health, requesting to be relieved from service effective May 31, 2010. The resignation was accepted on May 28, 2010 (Ext.P3), and he received all service benefits.
• On April 27, 2010, the 9th Bipartite Settlement was signed, introducing a Pension Scheme, which was circulated by the Bank via Ext.P5 on September 7, 2010. Employees in service before September 29, 1995, and continuing as of April 27, 2010, were eligible to opt into the scheme within 60 days.
• Radhakrishnan opted for the Pension Scheme on September 13, 2010, offering to refund his service benefits, but his request was rejected by the Bank on November 3, 2010 (Ext.P7). He then requested (Ext.P8, February 14, 2011) that his resignation be treated as voluntary retirement, which was also rejected (Ext.P11, May 25, 2011) after a court-directed hearing.
• Radhakrishnan filed a writ petition (W.P.(C) No. 20291 of 2011) under Article 226, seeking to quash the rejection orders and join the Pension Scheme. The Single Judge allowed the petition on February 2, 2015, directing the Bank to admit him to the scheme and disburse benefits from April 27, 2010, reasoning that no employee with 35 years of service would intend to forfeit benefits.
• The Bank appealed this decision under Section 5(i) of the Kerala High Court Act, 1958.

Issues:

1. Whether Radhakrishnan’s resignation (Ext.P2) could be treated as a request for voluntary retirement, entitling him to join the Pension Scheme under Ext.P5.
2. Whether the Single Judge erred in granting pension benefits despite the distinction between resignation and voluntary retirement under the Vijaya Bank (Employees) Pension Regulations, 1995, and the terms of Ext.P5.

Arguments:

• Appellants (Bank):
  • Resignation and voluntary retirement are distinct concepts. Radhakrishnan’s resignation (Ext.P2) was accepted before Ext.P5 was issued, and Clause 22 of the Pension Regulations, 1995, bars pension benefits for resigned employees.
  • Ext.P5 limits pension eligibility to employees under the Voluntary Retirement Scheme-2000 (Clause 6) and excludes others (Clause 7, though struck down by Karnataka HC, with legal questions left open by the Supreme Court).
  • Relied on Shree Lal Meena (2019) 4 SCC 479, where the Supreme Court distinguished resignation from voluntary retirement and denied pension benefits to resigned employees.
• Respondent (Radhakrishnan):
  • Due to mental illness and ill health, Ext.P2 was intended as a voluntary retirement request, not a resignation. The Bank’s rejection was arbitrary.
  • The Single Judge correctly interpreted his intent, given his 35+ years of service, and no interference was warranted.

Holding:

• The Division Bench allowed the appeal, reversing the Single Judge’s judgment.
• Radhakrishnan’s resignation on April 30, 2010 (effective May 31, 2010), preceded the notification of Ext.P5 on September 7, 2010. Per Clause 22 of the Pension Regulations, resignation forfeits pension eligibility.
• Following Shree Lal Meena, the court held that pension schemes are contributory and cannot be extended beyond their explicit terms. Radhakrishnan, having resigned before the scheme’s notification, was ineligible.
• The Single Judge’s reasoning—based on Radhakrishnan’s long service—was insufficient to override the legal distinction between resignation and voluntary retirement.

Decision:

• The writ appeal was allowed, the Single Judge’s judgment dated February 2, 2015, was set aside, and W.P.(C) No. 20291 of 2011 was dismissed.
• Radhakrishnan was not entitled to join the Pension Scheme or receive pension benefits.

Legal Principle:

• Resignation and voluntary retirement are distinct under pension regulations. Employees who resign before a pension scheme’s notification are ineligible for benefits unless explicitly covered by the scheme’s terms, as per Shree Lal Meena (2019) 4 SCC 479.

Disposition:

• Appeal allowed; writ petition dismissed. No costs mentioned.

Multiple Choice Questions (MCQs)

1. What was the primary relief sought by the respondent in W.P.(C)No.20291 of 2011?
   a) To be reinstated in the Bank’s service
   b) To join the Pension Scheme and receive pension benefits
   c) To receive a promotion with retrospective effect
   d) To cancel the 9th Bipartite Settlement
   Answer: b) To join the Pension Scheme and receive pension benefits
2. What was the respondent’s argument regarding the nature of his Ext.P2 resignation letter?
   a) It was a request for a salary increment
   b) It was intended as a request for voluntary retirement
   c) It was a demand for immediate termination
   d) It was a request for a transfer
   Answer: b) It was intended as a request for voluntary retirement
3. According to Clause 22 of the Vijaya Bank (Employees) Pension Regulations, 1995, what happens when an employee resigns?
   a) They are entitled to a partial pension
   b) Their entire past service is forfeited, disqualifying them from pensionary benefits
   c) They receive a lump sum payment
   d) They are automatically enrolled in the Pension Scheme
   Answer: b) Their entire past service is forfeited, disqualifying them from pensionary benefits
4. What was the reason provided by the respondent for submitting the Ext.P2 resignation letter?
   a) Financial difficulties
   b) Ill-health due to eyesight and hypertension
   c) Desire for a career change
   d) Family obligations
   Answer: b) Ill-health due to eyesight and hypertension
5. What was the outcome of the intra-court appeal filed by the appellants?
   a) The appeal was dismissed, upholding the Single Judge’s judgment
   b) The appeal was allowed, setting aside the Single Judge’s judgment
   c) The appeal was partially allowed with modifications
   d) The appeal was referred to a larger bench
   Answer: b) The appeal was allowed, setting aside the Single Judge’s judgment

Frequently Asked Questions (FAQs)

1. What was the main issue in the writ petition W.P.(C)No.20291 of 2011?
   The main issue was whether the respondent’s resignation (Ext.P2) should be treated as a request for voluntary retirement, entitling him to join the Pension Scheme under the 9th Bipartite Settlement dated 27.04.2010, and whether the Bank’s rejection of this request was arbitrary.
2. Why did the respondent claim that his resignation should be treated as voluntary retirement?
   The respondent argued that he used the word “resignation” in Ext.P2 due to his mental illness and ill-health (eyesight and hypertension issues), but his intention was to seek voluntary retirement. He contended that the Bank’s refusal to treat it as such was arbitrary and illegal.
3. What role did Clause 22 of the Vijaya Bank (Employees) Pension Regulations, 1995 play in the judgment?
   Clause 22 states that resignation results in the forfeiture of an employee’s entire past service, disqualifying them from pensionary benefits. The appellate court relied on this clause, along with the Supreme Court’s decision in Shree Lal Meena [(2019) 4 SCC 479], to hold that the respondent, having resigned, was not entitled to the Pension Scheme benefits.
4. What was the significance of the 9th Bipartite Settlement in this case?
   The 9th Bipartite Settlement, circulated via Ext.P5 on 07.09.2010, allowed employees who were in service before 29.09.1995 and continued until 27.04.2010 to opt for the Pension Scheme. The respondent sought to join this scheme, but his resignation prior to the circular’s issuance disqualified him.
5. Why was the Single Judge’s judgment set aside by the appellate court?
   The appellate court found that the Single Judge erred in allowing the writ petition, as the respondent’s resignation (accepted before the Ext.P5 circular) disqualified him from the Pension Scheme under Clause 22 of the Pension Regulations and the precedent set by Shree Lal Meena. The court held that resignation and voluntary retirement are distinct, and the respondent could not retroactively claim voluntary retirement.