( 2025:HHC:23916 IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA CWP No. 10878/2025 Decided on: 23.07.2025 Himachal Pradesh Agriculture University Pensioner’s Sabha …Petitioner Versus Chaudhary Sarwan Kumar Himachal Pradesh Krishi Vishvavidyalaya & Anr. .…Respondents. ………………………………………………………………………………. Coram Ms. Justice Jyotsna Rewal Dua, Judge. Whether approved for reporting?1 Yes. For the petitioner: Mr. R.S. Gautam, Advocate. For the respondents: Mr. Prince Chauhan, Advocate, for respondent No.1. Mr. Rajat Choudhary, Assistant Advocate General, for respondent No.2. Jyotsna Rewal Dua , J Respondent cites financial constraints for not releasing retiral dues admissible to the members of petitioner society, therefore, the grievance of the petitioner. 2. Heard learned counsel for the parties & considered the case record. 3. The case. 3(i) Petitioner is a society registered on 07.06.2011 under the Himachal Pradesh Societies Registration Act, 2006. Its list of 1 Whether reporters of the local papers may be allowed to see the judgment? 2 ( 2025:HHC:23916 members has been placed on record at Annexure P-3. All the members of petitioner’s society are retired employees of respondent No.1-University. They have retired from Class-IV to Class-I posts on different dates ranging from 31.03.2023 to 31.08.2024 as per details given in Annexure P-3. Respondent No.1 did not release the leave encashment due and admissible to the members of the petitioner’s Society at the time of their superannuation, which led them to institute Himachal Pradesh Agriculture University Pensioner’s Sabha (Society) Palampur Vs. Chaudhary Sarwan Kumar Himachal Pradesh Krishi Vishvavidyalaya (CSKHPKVV) Palampur2. The said petition was disposed of with direction to the respondents to decide petitioner’s representations in light of precedents relied upon by it within eight weeks by passing a speaking order, in accordance with law. 3(ii) Pursuant to above, respondent No.1 passed a speaking order on 25.03.2025. In the said order, respondent No.1 did not deny petitioner’s claim of leave encashment and its liability to discharge the said claim. As per order dated 25.03.2025, respondent No.1 had released 50% of the total leave encashment to the individual members of the petitioner society by 25.10.2024. Remaining 50% leave encashment amount due to be paid to the petitioner has still not been paid. The order attributes the reason for non-payment of the 2 CWP No. 16403/2024 decided on 10.01.2025 3 ( 2025:HHC:23916 leave encashment to scarcity of funds. The order further records that respondent No.1 University is dependent upon the State Government for its financial requirements and at present additional funds have not been sanctioned by the State Government; Release of remaining leave encashment amount due towards the petitioner shall be considered as and when additional funds are released by the State government. Relevant portion of the order reads as under: - “…..AND WHEREAS, I have carefully gone through the Annexure P-5 and P-6 appended with the present writ petition and accordingly, the comments were sought from the Comptroller of the University being custodian of finances as per Section 31(1) of the H.P. Universities of Agriculture, Horticulture and Forestry Act, 1986 and clause 3.6(2) of the CSK HPKV Statute Statutes, 1988, who after due approval of the Vice-Chancellor, CSKHPKV, Palampur has exerted that overall liability on account of leave encashment w.e.f. February, 2023 to January 2025 onwards has been calculated to be Rs. 12.48 Crores in respect of 105 retirees of the University and since the University is fully dependent upon the State Govt. for its requirement of funds for salary, pension and retirement benefits, hence it is trying to liquidate the said liability in the phased manner due to paucity of funds and non-receipt of additional funds from the State Govt. for the purpose. AND WHEREAS, though the petitioners as mentioned in Annexure P-6 have been released only 50% Leave encashment on dated 25.10.2024 and that presently leave encashment to the retirees upto 28.02.2023 only has been paid in full and that the retirees from 31.03.2023 to 31.12.2023 have only been paid @ 50% of the total amount due subject to maximum of 7.5 Lakhs per individual. That the requirement of funds for payment of regular monthly salary and pension of CSK HPKV, Palampur is Rs. 150 Crores (Approximately) whereas, the Grant-in-Aid received for the same 4 ( 2025:HHC:23916 for the financial year 2024-2025 from the State Govt. was only 132.86 Crores; AND WHEREAS, that the State Govt. is being requested time to time for additional funds, however no additional funds have been sanctioned by the Govt. during the current financial year and that even in the sanctioned budget for the year 2025-26, there is no enhancement in the Grant-in-Aid and that releasing of leave encashment in full to the petitioners shall be considered as and when additional fund will be received from the Govt…..” 4. It is well settled that paucity of funds is no ground for not releasing the amount due and admissible to the employees, more so while considering the cases of release of terminal benefits to the retired employees. D.S. Nakara & Ors Vs. Union of India3 holds that ‘pension is a right, its payment does not depend upon the discretion of the Government but is governed by the rules and a Government servant coming within those rules is entitled to claim pension’. Relevant paras from the judgment reads as under :- “20. The antiquated notion of pension being a bounty a gratituous payment depending upon the sweet will or grace of the employer not claimable as a right and, therefore, no right to pension can be enforced through Court has been swept under the carpet by the decision of the Constitution Bench in Deoki Nandan Prasad v. State of Bihar and Ors.4 wherein this Court authoritatively ruled that pension is a right and the payment of it does not depend upon the discretion of the Government but is governed by the rules and a Government servant coming within those rules is entitled to claim pension. It was further held that the grant of pension does not depend upon any one's discretion. It is only for the purpose of 3 (1983) 1 SCC 305 4 [1971] Supp. S.C.R. 634 5 ( 2025:HHC:23916 quantifying the amount having regard to service and other allied matters that it may be necessary for the authority to pass an order to that effect but the right to receive pension flows to the officer not because of any such order but by virtue of the rules. This view was reaffirmed in State of Punjab and Anr. v. Iqbal Singh.5 21……………… 22. In the course of transformation of society from feudal to welfare and as socialistic thinking acquired respectability, State obligation to provide security in old age, an escape from undeserved want was recognised and as a first step pension was treated not only as a reward for past service but with a view to helping the employee to avoid destitution in old age. The quid pro quo, was that when the employee was physically and mentally alert he rendered unto master the best, expecting him to look after him in the fall of life. A retirement system therefore exists solely for the purpose of providing benefits. In most of the plans of retirement benefits, everyone who qualifies for normal retirement receives the same amount, (see Retirement Systems for Public Employees by Bleakney, page 33.). 23-27………………… 28. Pension to civil employees of the Government and the defence personnel as administered in India appear to be a compensation for service rendered in the past. However, as held in Douge v. Board of Education6 a pension is closely akin to wages in that it consists of payment provided by an employer, is paid in consideration of past service and serves the purpose of helping the recipient meet the expenses of living. This appears to be the nearest to our approach to pension with the added qualification that it should ordinarily ensure freedom from undeserved want.” In North Delhi Municipal Corporation Vs. Dr. Ram Naresh Sharma & Ors.7 the Hon’ble Apex Court observed that the 5 (1976) 3 SCR 360 6 302 US 74 83 L. Ed. 57 7 (2021) 17 SCC 642 6 ( 2025:HHC:23916 State cannot be allowed to plead financial burden to deny salary for the legally serving doctors, otherwise it would violate their rights under Articles 14, 21 and 23 of the Constitution. In Punjab State Cooperative Agricultural Development Bank Limited Vs. Registrar Cooperative Societies and Ors.8 observed that non- availability of financial resources would not be a defence available to the appellant Bank in taking away the vested rights accrued to the employees that too when it is for their socio economic security. It is an assurance that in their old age, their periodical payment towards pension shall remain assured. The pension which is being paid to them is not a bounty and it is for the appellant to divert the resources from where the funds can be made available to fulfil the rights of the employees in protecting the vested rights accrued in their favour. Respondent No.1 has not denied its liability for paying leave encashment duly sanctioned in favour of members of petitioner’s Society. The liability is admitted. It is also not in dispute that the leave encashment has been computed and sanctioned separately for each of the members of petitioner’s society. The ground of financial crunch put-forth by the respondents cannot be accepted to deny the legitimate right of the petitioner to receive the entitled amount of leave encashment. Respondent No.1 is welfare organ of the State. Its retired employees have a right to get timely 8 (2022) 4 SCC 363 7 ( 2025:HHC:23916 payment of the leave encashment to live a dignified life post their superannuation. Members of petitioner society have earned this right because of their long service. The right accrued to them at the time of superannuation. The right of retired employee to timely receive terminal benefits is inherent concept of service jurisprudence and advances the right to live with dignity provided to them by Article 21 of the Constitution of India. Members of petitioner’s society did not retire abruptly or unexpectedly. Respondent No.1 was well aware of their dates of retirement. It was for the respondents to have made adequate arrangements & well in time to ensure timely discharge of its financial liabilities towards members of petitioner’s society at the time of their superannuation. Poor financial health/non-receipt of funds cannot be accepted as ground for denying payment of retiral benefits. Members of petitioner’s society retired from service long ago, its now almost two and half years since the senior most member of petitioner society superannuated. They are still awaiting complete payment of leave encashment. Even the impugned order was passed on 25.03.2025. Four more months have gone by, we are now approaching August 2025. There is still no sign from respondent No.1 University for making the payment due towards the members of petitioner society. Respondent No.1 has not even given any time frame for defraying its legal obligation. Members of petitioner society 8 ( 2025:HHC:23916 cannot be expected to wait for eternity for release of their remaining retiral benefits. 5. In view of above, impugned order dated 25.03.2025 (Annexure P-8) holding that release of remaining amount of leave encashment due to the members of petitioner’s Society shall be considered as and when additional funds are received, is quashed and set aside. Respondents are directed to release the admissible leave encashment due to the members of the petitioner’s Society within six weeks from today, failing which, the amount shall carry interest @5% per annum from the actual due date. Pending miscellaneous application(s), if any, shall also stand disposed of. Jyotsna Rewal Dua Judge 23rd July, 2025(rohit)