INTRODUCTION
Today, I will talk about the case
of Union of India & Another v. Abhiram Verma, Civil Appeal
No. 1027 of 2020, wherein the Hon’ble Supreme Court discussed the difference
between ‘voluntary resignation’ and ‘voluntary retirement’.
DICTIONARY MEANING
Before adverting any further, let us peruse the dictionary
meaning of these terms. Black’s Law Dictionary, Eighth Edition, defines ‘resignation’
as “the act or an instance of surrendering or relinquishing an office,
right or claim” and “a formal notification of relinquishing an
office or position.” Whereas ‘retirement’ has been defined as “voluntary
termination of one’s own employment or career, especially upon reaching a
certain age.”
IMPORTANT TAKEAWAYS
When I started reading this case, I was amazed that
there could be so many differences between similar sounding terms such as
resignation and retirement. And after reading this case-law, I find myself to
be intellectually enriched. Following are the important takeaways from the
judgment that I will discuss now: -
a. Resignation can be tendered at any time but premature/voluntary
retirement stems from statutory provisions and it is confined to that.
b. In case of resigning, no prior permission or
notice is mandated, but in case of voluntary retirement, permission of the
employer is imperative.
c. Pension is not a matter of charity. It is a
creature of the statute and what has been excluded in it cannot be included by
implication.
d. Pension Rules do not apply retrospectively
unless so expressly provided for.
e. Resignation has the effect of termination
whereas voluntary retirement has different effects depending upon the concerned
Rules governing the subject-matter.
f. Pension has many purposes and objectives. Such
purposes and objectives must be taken into account while looking into the
question that whether the termination of service is in actuality a resignation
or does it fall within the four corners of retirement as defined in the
concerned laws.
g. If in fact an employee has resigned, then later
on, he cannot contend that what he meant was voluntary retirement. One cannot
be allowed to breathe hot and cold at the same time.
OBSERVATIONS BY THE COURT
Now, in order to understand the difference between
‘voluntary resignation’ and ‘voluntary retirement’ in a better manner, let us
sift through the pertinent observations by the Supreme Court.
Firstly, the Court noted that “there is a
distinction between “resignation” and “voluntary retirement”. A person can
resign at any time during his service, however, an officer cannot ask for
premature/voluntary retirement unless he fulfils the eligibility criteria.”
Secondly, the Court cited the case of Senior
Divisional Manager, LIC v. Shree Lal Meena, (2019) 4 SCC 479, wherein
it was explained that: -
“In service jurisprudence, the expressions
“superannuation”, “voluntary retirement”, “compulsory retirement” and
“resignation” convey different connotations. Voluntary retirement and
resignation involve voluntary acts on the part of the employee to leave
service. Though both involve voluntary acts, they operate differently. One of
the basic distinctions is that in case of resignation it can be tendered at any
time, but in the case of voluntary retirement, it can only be sought for after
rendering prescribed period of qualifying service. Other fundamental
distinction is that in case of the former, normally retiral benefits are denied
but in case of the latter, the same is not denied. In case of the former,
permission or notice is not mandated, while in case of the latter, permission
of the employer concerned is a requisite condition. Though resignation is a
bilateral concept, and becomes effective on acceptance by the competent
authority, yet the general rule can be displaced by express provisions to the
contrary….”
Thirdly, the Court also clarified that “resignation
has the effect of termination of an employee. Voluntary retirement though has
the effect of termination of an employee, yet it has different consequences. In
the former case, the ex-employee could not be entitled to pension, whereas in
case of voluntary retirement, the latter one, the employee would be entitled to
pension depending upon the terms postulated in the regulations or rules or the
scheme.”
Fourthly, the Court also cited the case of Sheelkumar
Jain v. New India Assurance Co. Ltd., (2011) 12 SCC 197, wherein it was
laid down that “the court will have to construe the statutory provisions
in each case to find out whether the termination of service of an employee was
a termination by way of resignation or a termination by way of voluntary
retirement and while construing the statutory provisions, the court will have
to keep in mind the purposes of the statutory provisions.”
Fifthly, the Court also opined that a man ought
not to have been deprived of pensionary benefits “merely because he
styled his termination of service as “resignation” or because there was no
provision to retire voluntarily at that time. The commendable objective of the
Pension Rules is to extend benefits to a class of people to tide over the
crisis and vicissitudes of old age, and if there are some inconsistencies
between the statutory provisions and the avowed objective of the statute so as
to discriminate between the beneficiaries within the class, the end of justice
obligates us to palliate the differences between the two and reconcile them as
far as possible.”
Sixthly, according to the Court, though Pension Schemes
are delegated beneficial legislations, yet their beneficial construction or
interpretation “cannot run contrary to the express terms of the
provisions.” Such “issue cannot be dealt with on a charity
principle. When the legislature, in its wisdom, brings forth certain beneficial
provisions in the form of Pension Regulations from a particular date and on
particular terms and conditions, aspects which are excluded cannot be included
in it by implication.”
Seventhly, the Court also observed that in cases
where an employee had resigned at a point of time when the concerned Pension
Rules did not exist and later on, when such Pension Rules got framed, the said
employee cannot claim Pension as a matter of right unless the concerned Pension
Rules expressly provide for its retrospective applicability.
And lastly, the Court also said that once ‘resignation’
has been tendered by an employee, he must suffer the consequences and later on,
he cannot be permitted to take ‘U’ turn by contending that what he really
wanted was ‘premature retirement’ and not ‘resignation’.
ENDING REMARKS
Those were the observations by the Court. I hope
that the difference between ‘voluntary resignation’ and ‘voluntary retirement’
is clear by now.
If a person gives resignation,he is not entitled for service benefits and if a person takes VRS ,he is entitled for benefits according to CSR,
ReplyDelete.
Kindly make it clear that in case of VRS,he or she can take medical leaves and c-leaves. Thanks
Am i eligible for all benifits for voluntary retirement scheme with 12 years of services and age 57 female
DeleteWhat can be my medical leave not availed in last 12 years
ReplyDelete