Pre-Regularisation Contract Service Counts for Pension Benefits | SC

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contractual service counted for pension

Case Details: S.D. Jayaprakash vs. Union of India - [2025] 181 taxmann.com 182 (SC)

Judiciary and Counsel Details

  • Pamidighantam Sri Narasimha & Joymalya Bagchi, JJ.
  • Gaurav Dhingra, AOR for the Petitioner.
  • K. M. Nataraj, A.S.G., Vatsal Joshi, Sharath Nambiar, Ms Indira Bhakar, Vinayak Sharma, Anuj Srinivas Udupa, Chitransh Sharma, Ms Satvika Thakur, Yogya Rajpurohit, Aayush Saklani, Ms Nikita Capoor, Mohd. Akhil, Raghav Sharma, Prashant Rawat, Kritagya Kait, Advs. & Dr N. Visakamurthy, AOR for the Respondent.

Facts of the Case

In the instant case, the appellants were engaged as Data Entry Operators under the Plan Scheme titled ‘Rationalisation of Data Processing Facilities’ on a temporary and contractual basis between 1996 and 1999. Subsequently, the appellants were regularised with prospective effect.

The appellants filed an application before the Central Administrative Tribunal seeking protection of pay and grant of seniority, service benefits and pension by counting their period of contractual service. The Tribunal allowed the application and directed protection of pay as well as counting of the contractual period towards pensionary benefits.

Aggrieved by the Tribunal’s order, the respondents filed a writ petition before the High Court, which was partly allowed. The High Court set aside the directions relating to counting of the contractual period for seniority, service benefits and pension on the ground that the initial appointments were contractual in nature and not made through the Staff Selection Commission.

Supreme Court Held

The Supreme Court observed that, in view of the clear language of rule 17 and its interpretation in State of H.P. v. Sheela Devi, the contractual service rendered by the appellants prior to their regularisation in 2015 was required to be counted towards their pensionary benefits in accordance with the mechanism prescribed under rule 17.

Accordingly, the Supreme Court directed the respondent Union of India to take immediate steps to indicate the mode and manner in which the appellants could exercise the option provided under rule 17, and to notify the amounts payable by the appellants in the event they opted for grant of pension under the Rules.

List of Cases Reviewed

  • Order of the High Court of Karnataka W.P. No. 4712/2016, dated 23.03.2021 (para 10) partly set aside
  • State of H.P. v. Sheela Devi 2023 SCC OnLine SC 1272 (para 9) followed

List of Cases Referred to

  • State of H.P. v. Sheela Devi 2023 SCC OnLine SC 1272 (para 2).

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Author: Taxmann

Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.

The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:

  • The statutory material is obtained only from the authorized and reliable sources
  • All the latest developments in the judicial and legislative fields are covered
  • Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
  • Every content published by Taxmann is complete, accurate and lucid
  • All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
  • The golden rules of grammar, style and consistency are thoroughly followed
  • Font and size that's easy to read and remain consistent across all imprint and digital publications are applied