The Jharkhand High Court, in State of Jharkhand v. Joy Kumar Mahto (since deceased), has reiterated the principle that an employee who voluntarily opts for the Employees’ Provident Fund (EPF) scheme, accepts all terminal benefits thereunder, and remains silent for a prolonged period cannot subsequently claim pensionary benefits from the State. Emphasising the doctrines of estoppel, waiver, and acquiescence, the Division Bench held that such conduct disentitles the employee from asserting a later and inconsistent claim for State pension, even though pension is recognised as a constitutional right subject to lawful conditions and the employee’s own conduct.
Background Facts
- The employee, Joy Kumar Mahto, was originally appointed as a Chowkidar in the Food Supply & Commerce Department of the then undivided State of Bihar. He served about 6 years before being deputed to Bihar State Food & Civil Supplies Corporation (BSFC) in 1973.
- While at BSFC, he voluntarily switched to the EPF scheme under the Employees’ Provident Funds & Miscellaneous Provisions Act, 1952 and regularly contributed to EPF.
- Upon retirement (31 Jul 1991), he accepted all terminal benefits from BSFC — including EPF accumulations (approx. ₹11,580) and gratuity — without objection.
- No pension was claimed at retirement. Instead, he remained silent for ~16 years before filing a writ petition in 2007 seeking pensionary benefits from the State.
Legal Proceedings
- The Single Judge originally allowed his pension claim in 2013, directing the State to pay pension with interest from the date of superannuation, on grounds that pension is a vested constitutional right and there was no formal service transfer record to BSFC.
- The State of Bihar appealed under Letters Patent, challenging denial of pension.
Issues Before the Division Bench
The High Court framed two main issues:
- Whether acceptance of EPF and other terminal benefits precluded a later claim to State pension.
- Whether the long delay (16+ years) in filing the petition, combined with the employee’s conduct, barred the pension claim under principles of estoppel and waiver.
Key Legal Principles Applied
✔️ Estoppel and Waiver
- The bench held that once an employee voluntarily switches to EPF, accepts all terminal benefits and remains silent for years, he is estopped from turning around later to claim pension against the State.
- The employee’s conduct demonstrated acceptance of BSFC terms, making pension rules of the State inapplicable after the switch.
✔️ Pension as a Right (Qualified)
- The Court acknowledged that pension is a constitutional right under Articles 19(1)(f) and 300-A (right to property), referring to Supreme Court precedents.
- However, this right can be qualified by conduct, delay, and acceptance of alternative benefits like EPF.
✔️ Conduct & Delay Matter
- A delay of ~16 years post-retirement to assert pension rights, especially after accepting EPF benefits, contributed to the finding of waiver and barred revival of pension claim.
- The doctrine of estoppel was applied because the petitioner adopted a position inconsistent with his later claim.
✔️ Distinguishing Other Cases
- The Court rejected comparison with other employees who may have secured proportionate pensions (e.g., Sonalal Poddar) because:
- Mahto had only 6 years of pre-deputation service — less than pension eligibility minimum;
- Poddar had longer qualifying service, making that case factually distinguishable.
Final Decision
- The Division Bench allowed the State’s appeal, quashed the Single Judge’s pension award, and dismissed the writ petition.
- The employee (and subsequently his widow, Savitri Devi, after his death) was held not entitled to State pension due to estoppel and waiver arising from conduct and acceptance of EPF/terminal benefits.
Practical Takeaways
- Voluntarily opting for EPF and accepting terminal benefits may preclude future claims for State pension, especially if there is prolonged delay without contemporaneous protest.
- Estoppel can be invoked where employee’s conduct is inconsistent with later claims, overriding absence of formal transfer documents.
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Employees with mixed service (government + corporation) must take prompt action and clarify service status early to preserve pension claims.