Resignation cannot be deemed voluntary retirement; employee’s widow entitled only to gratuity

Case Name: Rajasthan State Road Transport Corporation Ltd. & Ors. v. Smt. Mohani Devi & Anr.

Citation: Civil Appeal No. 2236 of 2020 (Arising out of SLP (C) No. 5650 of 2019)

Date of Judgment: 15 April 2020

Bench: Justice R. Banumathi and Justice A.S. Bopanna

Held: The Supreme Court held that an employee who tenders resignation cannot subsequently claim to have voluntarily retired, particularly when the resignation was accepted and acted upon. The right to seek voluntary retirement under Rule 50 of the Rajasthan Civil Services (Pension) Rules, 1996 arises only upon the employer’s acceptance; there is no concept of deemed acceptance. Where disciplinary proceedings were pending and punishment had been imposed, the employer was justified in declining to act on the voluntary retirement request. The High Court erred in treating the resignation as voluntary retirement and directing payment of retiral benefits.

Summary: The respondent’s husband, a conductor with the Rajasthan State Road Transport Corporation since 1979, sought voluntary retirement in July 2005 citing ill health. No order was passed, and after facing disciplinary proceedings and penalty in September 2005, he resigned in May 2006. His resignation was accepted, and all benefits applicable to a resigned employee were paid. After his death in 2011, his widow filed a writ petition claiming that his resignation should be construed as voluntary retirement. The Single Judge and Division Bench of the Rajasthan High Court allowed her plea, directing the Corporation to treat him as voluntarily retired. On appeal, the Supreme Court ruled that since the employee had pending disciplinary proceedings and later consciously resigned, no indefeasible right to voluntary retirement accrued. Having accepted the resignation benefits, neither he nor his widow could claim pensionary relief.

Decision: Appeal allowed. The judgments of the Single Judge and Division Bench were set aside. The Court, however, directed the Corporation to pay gratuity under Section 4(1)(b) of the Payment of Gratuity Act, 1972 since resignation after five years of service still entitles an employee to gratuity if not already paid, within four weeks.