An Employee Who Retired On 31st of a Month Not Entitled To Increment Which Would Have Fallen Due On 1st of Next Month: Himachal Pradesh HC

An Employee Who Retired On 31st of a Month Not Entitled To Increment Which Would Have Fallen Due On 1st of Next Month: Himachal Pradesh HC

The Himachal Pradesh High Court has ruled that an employee, who has retired on the 31st of a month, is not eligible to claim the benefit of an increment which became due on the 1st of the next month, because on that day, his status would be of a pensioner and not that of an employee. The Court passed the order while hearing a writ petition filed by a Senior Hydro-geologist in the Department of Industries (Geological wing) who had retired on 31 March, 2003.

The Petitioner relied on the settled legal position by the Apex Court that the increment which falls due on the day immediately following the day of retirement, has to be granted to the employee on the ground that he had completed 12 months of service on the date of his retirement.

A Division Bench of Justices Tarlok Singh Chauhan and Jyotsna Rewal Dua held, "The date of increment falls due on the first day of the succeeding month after the retirement. Petitioner retired on the basic pay drawn by him on 31 March 2003 i.e. his date of retirement. His pension has to be determined accordingly. Petitioner had become a pensioner on 1 April, 2003. He cannot be held entitled to any increment which may fall due post his retirement. He is entitled only to those increments which fall due to him during the period of his service."

Therefore, the Petitioner had contended that the law in this regard is settled by the Supreme Court and must be applied in this case. The State Counsel, while relying on the orders passed by the High Courts of Madhya Pradesh and Andhra Pradesh, had argued that a writ petition claiming next annual increment due immediately after retirement cannot be allowed, keeping in view the Fundamental Rules governing service conditions of the petitioner.

A special leave petition preferred against this judgment was dismissed in limine by the Supreme Court in 2018. The Division Bench however refused to apply this principle, while clarifying that an order refusing Special Leave to Appeal, whether by a speaking order or by a non-speaking one, will not attract the doctrine of merger. The Court referred to the Fundamental Rules (FR) that govern all general conditions of service of employees. It noted that in terms of FR 56(a), the day when the government employee retires has to be treated as his last working day.

Further, FR 17(1) provides that an officer shall begin to draw pay and allowances attached to the post w.e.f. the date when he assumes duties of that post and shall cease to draw them as soon as he ceases to discharge those duties. The Court was of the opinion that the petitioner was not on duty on 1 April, 2003, and increment can be drawn only when an employee is on duty. "The increment in terms of FR 24 & 26 did not become due during the period of service of the petitioner. Therefore, increment on 1 April, 2003 cannot be sanctioned in favour of petitioner on the ground that he had completed twelve months of continuous service."