Featured image for Supreme Court Judgment dated 10-02-2020 in case of petitioner name State of U.P. & Ors. vs Virendra Kumar & Ors.
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UP Avas Evam Vikas Parishad Pension Dispute: Supreme Court Ruling on Service Conditions

The case of State of U.P. & Ors. v. Virendra Kumar & Ors. deals with the pensionary rights of employees of the Uttar Pradesh Avas Evam Vikas Parishad (UPAVP) and the extent of the State Government’s authority to regulate service conditions. The Supreme Court examined whether the employees of UPAVP were entitled to pension and other benefits at par with State Government employees and whether the State Government had jurisdiction to issue directions regarding service conditions. This ruling has a significant impact on public sector employees and the interpretation of service regulations.

Background of the Case

UPAVP, a statutory housing board established under the Uttar Pradesh Avas Evam Vikas Parishad Adhiniyam, 1965, initially provided its employees with a Contributory Provident Fund (CPF) scheme. In 1997, the Parishad sought to implement a pension scheme similar to that of State Government employees. While the State Government gave an in-principle approval, it clarified that no financial assistance would be provided. The pension regulations were subsequently framed in 2009.

However, in 2015, the State Government issued directives limiting pension benefits, leading to a dispute among employees who argued that they were entitled to full pension benefits as per the 2009 regulations. The Allahabad High Court ruled in favor of the employees, prompting the State of U.P. and UPAVP to challenge the decision before the Supreme Court.

Legal Issues Involved

  • Whether the State Government had jurisdiction to regulate the service conditions of UPAVP employees.
  • Whether the pension regulations framed by UPAVP in 2009 were valid and binding.
  • Whether UPAVP employees were entitled to pension benefits at par with State Government employees.
  • Whether the exclusion of UPAVP employees from the 6th Pay Commission recommendations was justified.

Petitioners’ Arguments

The State of U.P. and UPAVP, represented by their legal counsel, argued:

  • The service conditions of UPAVP employees did not constitute a function of the Board under Section 15 of the 1965 Act.
  • The State Government had the authority to issue directions under Section 92 of the Act, and its decisions were binding on UPAVP.
  • The financial burden of granting pensionary benefits similar to State Government employees would be unsustainable for the Board.
  • The High Court erred in striking down the State Government’s directives without considering their financial implications.

Respondents’ Arguments

The employees of UPAVP contended:

  • UPAVP had already framed regulations in 2009 granting pension benefits, which were valid and enforceable.
  • The State Government could not override statutory regulations through executive orders.
  • Employees who had served for decades should not be deprived of pension benefits merely because of subsequent policy changes.
  • The exclusion of UPAVP employees from the 6th Pay Commission recommendations was discriminatory.

Supreme Court’s Analysis

The Supreme Court analyzed the relevant provisions of the 1965 Act and previous judicial precedents. Key observations included:

  • The State Government has the authority to issue policy directions under Section 92, but such directions cannot override statutory regulations.
  • UPAVP employees’ service conditions are not explicitly covered under Section 15 of the Act, but the power to frame regulations under Section 95(1)(f) includes pensionary benefits.
  • The 2009 regulations were legally framed and could not be nullified by executive orders issued in 2015.
  • The financial impact of pension benefits should be considered, but employees’ legitimate expectations based on existing regulations must also be respected.

Final Judgment

The Supreme Court ruled:

  • UPAVP employees are entitled to pension benefits as per the 2009 regulations.
  • The State Government’s 2015 directives restricting pension benefits were quashed.
  • All retired employees eligible under the 2009 regulations must be granted pension benefits within three months.
  • Interest at 9% per annum must be paid on delayed pension payments.

Impact of the Judgment

This ruling has significant implications for public sector employees and service regulations:

  • It reaffirms that statutory regulations cannot be overridden by executive orders.
  • It ensures that employees’ pension rights are protected despite changes in government policy.
  • It clarifies the limits of State Government control over statutory bodies.
  • It sets a precedent for similar cases involving public sector pension disputes.

By upholding the pension rights of UPAVP employees, the Supreme Court reinforced the principle that statutory benefits cannot be arbitrarily withdrawn, ensuring justice for retired employees.


Petitioner Name: State of U.P. & Ors..
Respondent Name: Virendra Kumar & Ors..
Judgment By: Justice Ashok Bhushan, Justice M.R. Shah.
Place Of Incident: Uttar Pradesh.
Judgment Date: 10-02-2020.

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