TaxTMI 
TaxTMI 
1984 (9) TMI 295
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....; relevant facts which have given rise to this controversy. Prior to the coming into force of the Constitution of India on January 26, 1950, Hyderabad was an Indian State within the meaning of that term as defined in section 311(1) of the Government of India Act, 1935, and its Ruler within the meaning of that term as defined in the said section 311(1) was the Nizam. The Appellant in Civil Appeal No. 2627 of 1977, Ahmed Hussain Khan, joined the service of the Public Work Department of the erstwhile Indian State of Hyderabad in the year 1945 and retired on April 5, 1972, as Chief Engineer, Electricity (operation), Andhra Pradesh State Electricity Board. At the time of his retirement he was drawing a salary of Rs. 1,980 per month. By a Government Order, namely, G.O. MS No. 664, Public Works (E) Department, dated June 22, 1973, this Appellant's pension after deducting the pension equivalent of death-cum-retirement gratuity was fixed at Rs. 801.96 per month on the basis that the maximum amount of pension admissible under Rule 299(1)(b) of the Hyderabad Civil ....
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....e Appellant in each of these two Appeals from The date he became eligible for pension, that is, from the date on which he retired from Government service, on the basis that the maximum pension admissible under the said Rule 299(1)(b) of the Hyderabad Civil Services Rules was Rs. 1,000 per month and not Rs. 857.15 per month. The learned Single Judge also directed the State of Andhra Pradesh to pay the costs of both these writ petitions. The appeals filed by the State of Andhra Pradesh against the said judgment and orders of the learned Single Judge, being Writ Appeals Nos. 835 of 1974 and 920 of 1974, were allowed, with no order as to costs, by a Division Bench of the Andhra Pradesh High Court by a common judgment holding that a letter No. S/8/73-SR(S) dated April 28, 1973, from the Joint Secretary to the Government of India, Cabinet Secretariat, Department of Personnel and A.R., to the Secretary to the Government of Andhra Pradesh, Finance Department, was in the nature of a previous approval given by the Central Government within the meaning of the proviso to sub-sectio....
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....yderabad currency, namely, Osmania Sikka, and that the letters "O.S." which denominated Osmania Sikka in short were omitted from the said Rule 299(1)(b) by an inadvertent printing error. (2) In any event, under the Hyderabad Currency Demonetization (Consequential and Miscellaneous Provisions) Act, 1953, the said sum of Rs. 1,000 was to be construed as its equivalent amount in the Government of India currency and, therefore, according to the standard rate of exchange the equivalent of Rs. 1,000 in Osmania Sikka was Rs. 857.15 in Government of India currency. (3) The said letter dated April 21, 1973, from the Joint Secretary to the Government of India to the Secretary to the Government of Andhra Pradesh, Finance Department, constituted the prior approval of the Central Government within the meaning of the proviso to sub-sec(ion (7) of section 115 of the States Reorganization Act, 1956, to the amendment made in the said clause (b) of Rule 299(1). (4) The Appellant in each of these two Appeals had received without ....
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....ned by the Hyderabad Civil Service Regulations, herein after for the sake of brevity referred to as "the Regulations". The Regulations were promulgated in obedience to the Nizam's Firman dated 25th Ramzan, 1337 H. corresponding to 18th Amardad, 1328 F. They were amended from time to time. Regulation 1 of the Regulations stated that the Regulations were intended to define the conditions under which salaries, leave, pension and other allowances were earned by service in the Civil Departments and the manner in which they were calculated. Regulation 6 provided as follows: "6. An officer's claim to pay and allowances is regulated by the rules in force at the time in respect of which the pay and allowances are earned; to leave by the rules in force at the time the leave is applied for and granted and to pension by the rules in force at the time when the officer retires." (Emphasis supplied) Civil Service in the erstwhile Indian State of Hyderabad was of two kinds, namely, Superior service and Inferior service. Clause (a) o....
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....ndstill Agreement was entered into in November 1947 by the Nizam with the Dominion of India, ensuring virtual accession of the erstwhile Indian State of Hyderabad to the Dominion of India in respect of defence, external affairs and communications. By a Firman dated November 23, 1949, the Nizam declared and directed that the Constitution of India shortly to be adopted by the Constituent Assembly of India should be the Constitution for the erstwhile Indian State of Hyderabad as for the other parts of India, and would be enforced as such and that the provisions of the Constitution of India would, as from the date of its commencement, supersede and abrogate all other constitutional provisions inconsistent therewith which were then in force in the erstwhile Indian State of Hyderabad. By the said Firman, the Nizam further declared that the said decision taken by him would be subject to ratification by the people of the State whose will as expressed through the Constituent Assembly of that State would finally determine the nature of the relationship between the erstwhile India....
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....Clauses Act was substituted by a new clause which provided as follows: "(22) 'rupee' means a rupee in I.G. Currency and fractional denominations of a rupee shall be construed accordingly." The definitions contained in section 2 of the Hyderabad General Clauses Act apply for the interpretation of the terms defined thereby when occurring in any "Hyderabad law" which expression includes Regulations made by the Nizam and would thus include the Hyderabad Civil Service Regulations. In view of the provisions of the Demonetization Act, the maximum pension admissible under clause (b) of Regulation 313 would be Rs. 857.15 being the equivalent in I.G. Currency of O.S. Rs. 1,000. Had the matter rested there, neither of the Appellants would have any case because under Regulation 6 reproduced earlier, a Government servant's claim to pension was to be regulated by the rules in force at the time the officer retired and the pension that each of them would then have got would be on the basis that the maximum pension admissible under clause ....
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.... which does not exceed Rs. 40 per mensem". Under clause (48) of Rule 7, 'Superior service' is defined as meaning "any kind of service which is not inferior vide Rule 7(26)". Rule 299 of the Rules Provides for the pension and gratuity for superior service. Clause (a) or Rule 299 deals with a case where the qualifying service is less than ten years. Clause (b) deals with a case where the qualifying service is of ten years or more. The relevant provisions of Rule 299 are as follows: "299. The pension and gratuity for superior service is regulated as follows: X X X (b) After qualifying service of 10 years or more, the amount of the pension will be calculated according to the following rule; the average salary should be multiplied by the period of qualifying service, and the product divided by 60; the result will be the amount of pension admissible. The maximum pension ordinarily admissible will be Rs. 1,000 a month. In applying the above rule qualifying service of 25 years or above, whatever its length may be, will....
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....t have to be paid to persons residing outside the Hyderabad State, and that in special cases it might be fixed in Government of India Currency subject to the condition that the maximum of O.S. Rs. 1,000 per mensem fixed in clause (b) of Regulation 313 was not exceeded under any circumstances. The not to Regulation 308 stated that a pension transferred to India might be converted from the current coin of the Hyderabad State to Indian Government currency under the principle laid down in the said Regulation. In the Rules, we do not find any provision corresponding to Regulation 308. If there is any doubt (assuming that there can be any), it is most easily resolved by referring to the Preface to the Eighth Edition of the Hyderabad Civil Services Rules Manual, which for the first time published the Rules in a book form. In paragraph 3 of the said Preface, the Secretary to Government, Finance Department, Hyderabad, has expressly stated: "The figures for amounts of rupees and annas mentioned in the rules are all in Indian Government Currency". There can thus be no scope ....
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.... 299 and that the Rules promulgated by the Rajpramukh under the proviso so Article 309 of the Constitution of India cannot be amended or altered merely by issuing an erratum and that the said Assistant Secretary to the Government of Andhra Pradesh was not entitled to amend any such rule unless the sanction of the Governor of Andhra Pradesh had been obtained thereto. The said writ petition was thereupon allowed. A Letters Patent Appeal filed against the said judgment, being Writ Appeal No. 568 of 1970 State of Andhra Pradesh v. Daulat Rai and others, was dismissed on September 24, 1970, by a Division Bench of the said High Court which also rejected an application for certificate to appeal to this Court and a petition for special leave to appeal against the said judgment was dismissed by this Court. The question whether in clause (b) of Rule 299 the sum of Rs. 1,000 is mentioned in Government of India Currency or in O.S. Currency has thus been finally decided and it is not open to the Respondent to reagitate this question. This point was also not taken by the Respondent i....
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....p; "(3) As soon as may be after the appointed day, the Central Government shall by general or special order, deter mine the successor State to which every person referred to in sub-section (2) shall be finally allotted for service and the date with effect from which such allotment shall take effect or be deemed to have taken effect. "(4) Every person who is finally allotted under the provisions of sub-section (3) to a successor State, shall if he is not already serving therein be made available for serving in that successor State from such date as may be agreed upon between the Governments concerned, and in default of such agreement as may be determined by the Central Government. "(7) Nothing in this section shall be deemed to effect after the appointed day the operation of the provisions of Chapter I of Part XIV of the Constitution in relation to the determination of the conditions of service of persons serving in connection with the affairs of the Union or any State; Provided that the conditions of service....
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....ted that there was an omission to convert the maximum limit of pension of O.S. Rs. 1,000 into I.G. Currency but in practice, how ever, the figure was treated as O.S. Rs. 1,000 and all pensions sanctioned before November 1, 1956, were restricted to Rs. 857.15 being the equivalent in I.G. Currency of O.S. Rs. 1,000. Incidentally, there is nothing on the record to bear out this statement. The issue of the said erratum and the judgment the Andhra Pradesh High Court striking it down were then recited in the said letter. It was then stated that the Government held the view that as no one was paid more than Rs. 857.15 in I.G. Currency prior to November 1, 1956, the condition of service that the maximum pension admissible should be Rs. 1,000 in I.G. Currency did not exist and that it came into being only by virtue of the judgment delivered by the Andhra Pradesh High Court In 1970, that is, in the said writ petition filed by Daulat Rai and two others, and that it was, therefore, felt by the State Government that what it had done was not a variation in the conditions of service of any ....
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....he said section 115 and, therefore, did not give any approval to the said amendment. To equate the not giving of approval with a prior approval satisfying the requirements of the proviso to sub-section (7) of section 115 appears to us to be a contradiction in terms as also to say that a letter written on April 28, 1973, was a prior approval given to an amendment which was made more than two years earlier on February 3, 1971. The Statement made in the said letter dated March 13, 1973 that by the said amendment the conditions of service were not being varied was incorrect because by the said amendment the maximum pension of Rs 1,000 per month in I.G. Currency was being reduced to the equivalent in that currency of O.S. Rs. 1,000 per month, namely, to Rs. 857.15 per month and that too with retrospective effect from the date of the coming into force of the rules, namely, October 1, 1954. For such an amendment the previous approval of the Central Government was required by the proviso to sub-section (7) of section 115. Such approval was not given and the amendment made by the said....