Legal Review and Analysis of Ashok Kumar Dabas Dead Thr LRs vs Delhi Transport Corporation 2025 INSC 1404
Case Synopsis
Ashok Kumar Dabas (Dead) Thr. LRs vs. Delhi Transport Corporation, 2025 INSC 1404
Synopsis: The Supreme Court delineated a strict boundary between resignation and voluntary retirement, holding that resignation under Rule 26 of the CCS (Pension) Rules leads to forfeiture of past service and disqualification for pension, regardless of service length. However, it concurrently upheld the statutory right to gratuity under the Payment of Gratuity Act, which remains payable even upon resignation.
1. Heading of the Judgment
Case Name: Ashok Kumar Dabas (Dead) Through Legal Heirs vs. Delhi Transport Corporation
Citation: 2025 INSC 1404
Court: Supreme Court of India
Judges: Justice Rajesh Bindal and Justice Manmohan
Date of Judgment: 9th December 2025
2. Related Laws and Sections
Central Civil Services (Pension) Rules, 1972:
Rule 26: Forfeiture of service on resignation.
Rule 36: Grant of retiring pension.
Rule 48: Retirement on completion of 30 years' qualifying service.
Rule 48-A: Retirement on completion of 20 years' qualifying service.Payment of Gratuity Act, 1972:
Section 4: Payment of gratuity upon termination after five years of continuous service, including on resignation.Relevant Precedents Cited:
BSES Yamuna Power Limited v. Ghanshyam Chand Sharma & Anr., (2020) 3 SCC 346.
Reserve Bank of India v. Cecil Dennis Solomon, (2004) 9 SCC 461.
Shashikala Devi v. Central Bank of India, (2014) 16 SCC 260.
3. Basic Judgment Details
A. Facts of the Case:
Ashok Kumar Dabas (the deceased employee) was appointed as a Conductor with the Delhi Transport Corporation (DTC) in 1985 and had opted for the pension scheme.
He submitted his resignation on 07.08.2014 citing family circumstances, which was accepted by DTC on 19.09.2014. His subsequent request to withdraw the resignation was rejected.
Upon seeking his retiral benefits, DTC vide order dated 23.10.2015 informed him that he was entitled only to the Provident Fund and no other benefit (pension, gratuity, leave encashment) as he had resigned.
The deceased employee challenged this before the Central Administrative Tribunal (CAT) and later the Delhi High Court, both of which dismissed his claim. His legal heirs then appealed to the Supreme Court.
B. Issues Before the Supreme Court:
Whether an employee who resigns after rendering more than 20 years of service is entitled to pension under the CCS (Pension) Rules, 1972?
Whether such an employee is entitled to gratuity under the Payment of Gratuity Act, 1972?
Whether the employee is entitled to payment for encashment of earned leave?
C. Ratio Decidendi (Court's Reasoning):
The Supreme Court partly allowed the appeal, granting relief for gratuity and leave encashment but denying pension.
On Pension (Claim Denied):
The Court applied Rule 26(1) of the CCS (Pension) Rules, 1972, which unequivocally states that resignation entails forfeiture of past service, unless withdrawn in public interest.
It distinguished between "resignation" and "voluntary retirement." The employee had voluntarily resigned; he did not apply for retirement under Rules 48 or 48-A. The Court refused to re-classify a resignation as voluntary retirement, as doing so would render Rule 26 nugatory.
The Court relied on its earlier judgment in BSES Yamuna Power Limited, which had clarified this distinction and overruled the liberal approach suggested in earlier cases like Cecil Dennis Solomon. The length of service (over 20 years) was held irrelevant once the mode of exit was resignation.On Gratuity (Claim Allowed):
The Court applied Section 4 of the Payment of Gratuity Act, 1972, which mandates payment of gratuity to an employee on termination after five years of continuous service, explicitly including termination due to "resignation."
Since DTC could not establish that it was exempt from the Act's provisions, the forfeiture rule under the Pension Rules could not override the statutory entitlement under the Gratuity Act. Hence, the legal heirs were entitled to gratuity.On Leave Encashment (Claim Allowed):
The respondent-DTC fairly conceded that the amount for encashment of earned leave was payable, and the Court accordingly directed its payment.
4. Core Principle of the Judgment
The Irreconcilable Distinction: Resignation Versus Voluntary Retirement and the Primacy of Specific Statutes
The Supreme Court addressed the critical issue of whether a long-serving employee who resigns can claim pensionary benefits intended for those who retire voluntarily. The core legal principle reaffirmed is the strict interpretation of service rules based on the specific nature of the employee's exit.
Main Issue & Analysis:
The central conflict was between a sympathetic interpretation of a long-serving employee's intent and a strict, literal interpretation of service regulations. The appellants argued that the employee's "notice for resignation" should be construed as a request for voluntary retirement to avoid the harsh consequence of forfeiting pension earned over decades.
The Supreme Court, however, provided a clear and structured analysis:
The Primacy of the Chosen Exit Route: The Court held that the employee's action—submitting a letter titled "resignation"—determines the applicable legal consequences. The CCS (Pension) Rules create two distinct pathways with different outcomes:
Pathway 1 (Voluntary Retirement under Rules 48/48-A): Available after 20/30 years of service. Leads to a "retiring pension."
Pathway 2 (Resignation under Rule 26): Can be tendered at any time. Leads to "forfeiture of past service" for pension purposes.
The employee opted for Pathway 2. The Court refused to allow a post-hoc re-categorization, emphasizing that such a practice would obliterate the deliberate legal distinction created by the rules and undermine contractual and statutory certainty.Overruling Sympathetic Precedents: The judgment firmly aligns with the precedent in BSES Yamuna Power Limited, which had corrected the earlier, more employee-friendly interpretations in cases like Cecil Dennis Solomon. This establishes a consistent, rule-based approach over discretionary, equity-based ones in matters of service jurisprudence.
Statutory Entitlement Trumps Service Rules for Gratuity: The Court made a crucial separation of benefits. While pension is governed solely by the CCS (Pension) Rules, gratuity is governed by a standalone statute—the Payment of Gratuity Act, 1972. The Act’s provision (Section 4) is unambiguous: gratuity is payable on resignation after five years. The forfeiture clause in Rule 26 of the Pension Rules does not apply to this separate statutory right. This highlights the principle that a specific statutory right cannot be negated by general service rules.
5. Final Outcome
The Supreme Court modified the orders of the Tribunal and the High Court. It directed DTC to:
Pay Gratuity to the legal heirs with 6% interest from the date of resignation.
Release leave encashment dues.
Deny the claim for pension, upholding the forfeiture under Rule 26.
6. (MCQs) Based on the Judgment
Question 1: In Ashok Kumar Dabas vs. DTC, why did the Supreme Court deny the claim for pension to an employee who had served for over 20 years?
a) Because the employee was terminated for misconduct.
b) Because the employee had voluntarily resigned, and Rule 26 of the CCS (Pension) Rules mandates forfeiture of past service upon resignation.
c) Because the Delhi Transport Corporation does not have a pension scheme.
d) Because the employee had not completed the mandatory 30-year service period.
Question 2: Despite denying pension, the Supreme Court allowed the payment of gratuity to the legal heirs of the deceased employee. What was the legal basis for this decision?
a) The compassionate grounds of the employee's family.
b) A directive from the Central Administrative Tribunal.
c) The provisions of Section 4 of the Payment of Gratuity Act, 1972, which expressly includes "resignation" as a qualifying event for gratuity payment after five years of service.
d) A specific clause in the Delhi Transport Corporation's service regulations that overrides the Pension Rules.
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