The SBI employee is entitled for pension after completion of 15 years of service; SC.

Supreme Court of India

Justice Arun Mishra, Justice M R Shah and Justice B R Gavai

The SC {ASSISTANT GENERAL MANAGER, STATE BANK OF INDIA & ORS. v. RADHEY SHYAM PANDEY} holds that the   employees   who completed 15 years of service or more as on cut­off date were entitled to proportionate pension under SBI VRS to be computed as per SBI Pension Fund Rules. It was held that the benefits be extended to all such similar employees retired under VRS on completion of 15 years of service without requiring them to rush to the court. However, considering the facts and circumstances, it was held that it would not be appropriate to burden the bank with interest. It was also held that order be complied with and arrears be paid within three months, failing which amount to carry interest at the rate of 6 per cent per annum from the date of this order.

It was further held that the principal aim of the socialist State as envisaged in the Preamble is to eliminate inequality. The basic framework of socialism is to provide security in the fall of life to the working people and especially provides security from the cradle to the grave when employees have rendered service in heydays of life, they cannot be destituted   in   old   age,   by taking action   in  an   arbitrary manner and for omission to complete obligation assured one. Further held that though there cannot be estoppel against the law but when a bank had the power to amend it, it cannot take shelter of its own inaction and SBI ought to have followed the pursuit of other banks and was required to act in a similar fair manner having accepted the scheme.

Further held that SBI accepted the scheme, it was incumbent upon it to bring the rules in consonance with the similar VRS scheme as was done by other banks. The SBI accepted the scheme on 27.12.2000 without any ifs and buts. Thus, the anomaly was the outcome of the bank's inaction to propose and make amendment of rules. In such a scenario, the action of SBI is violative of Articles 14, 16 and 21 of the Constitution. The situation created by itself is not going to benefit the bank to lend support to arbitrary   action.   The bank   was   bound   to   extend   the   benefits   by amending the rules, if necessary, to salvage the situation for itself. Breach of law has been committed by the SBI itself, its action is arbitrary and it cannot be permitted to take advantage of its own wrong - held by the SC.

In the present case, the question involved is whether the respondent ­employees are entitled to pension on completion of 15 years of service as per the State Bank of India Voluntary Retirement Scheme (for short, “the VRS framed in 2000”), when the SBI has not done suitable amendment in its rules to incorporate that scheme.