GOVERNMENT OF HIMACHAL PRADESH

FINANCE (REGULATIONS) DEPARTMENT

-01
No. Fin(C)B(15)-11/2022-Loose dated Shit-Ma-2 k*5 April, 2023

OFFICE MEMORANDUM

Subject Regarding CWP No. 7359 of 2021-titled as Amita Gupta Vs.

State of Himachal Pradesh & Ors.

The undersigned is directed to forward herewith a copy of

judgment dated 01.12.2022 passed by the Hon'ble High Court of
Himachal Pradesh in CWP No. 7359 of 2021-titled as Amite Gupta Vs.
State of Himachal Pradesh & Ors. It is advised that the said judgment
may be kept in view and the relevant cases, as and when received, may
be examined and settled accordingly.
2. These instructions may please be brought to the notice of the
all concerned.
By Order

Akshay Sood
Secretary (Finance) to the
Government of Himachal Pradesh

To
All the Administrative Secretaries to the
Government of Himachal Pradesh.

Endst. No. Fin(C) B(15)-11/2022-Loose dated Shimla-2 5 April, 2023

Copy forwarded to:

1. The Ld. Addl. Advocate General, State of HP with the request to
bring the same into the notice of Ld. Advocate General, State of HP
w.r.L the above mentioned judgment.
2. AU the Heads of Departments in Himachal Pradesh.

c
(Rajender Sharma)
Joint Secretary (Finance) to the
Government of Himachal Pradesh
Miro'
 DIRECTORATE OF ELE EDUCATION
HIMACHAL PRADESH, LALPANI, SHIMLA-171001.

Enst. No.EDN-H(ELE)B-6/99-2010-Vol-VI-113(Fin), Dated: May 2023.

Copy to information and strict compliance to:-
1. The Joint Controller, (F&AS), Dte. of Elementary Education, HP Shimla-1.
2. The District Attorney, Directorate of Elementary Education, HP Shimla-1
3. All the Deputy Director Elementary Education, Himachal Pradesh with the
remarks to intimate all the BEEOs' working under their jurisdiction.
4. All the Branch Officer, Directorate of Elementary Eduation, HP Shimla-1.
5. The Assistant Controller, (F&AS), Dte. of Elem. Education, HP Shimla-1.
6. All the Branch Supdt. Directorate of Elementary Education, HP Shimla-1.
7. The Private Secretary, Director Elementary Education, HP Shimla-01.
8. The Section Officer, (F&AS), Dte. of Elementary Education, HP Shimla-1.
The Nodal Officer IT Cell (internal) with the direction to upload the same on
departmental website.
10. The Private Assistant, Joint Director (Admn.) Elem. Edu., HP Shimla-1.
11. Guard file.

(Dr. Bhuwan Sharma)HPAS,

Joint Director (Admn.),
Directorate of Elem. Edu.,
HP Shimla-171001.
IN THE HIGH COURT OF HIMACHAL PR ‘DESII AT SHIMLA
C.W.P. No. 7359 of 2021

Reserved on : 22.11.2022

Date of decision :01.12.2022

Amita Gupta titt

Versus

State of Himachal Pradesh and others espondents

Coram : The Hon'ble Mr. Justice A.A. Sa0cichief Justice

The Hon'bie Ms. Jyotsbe Rewal Dua, Judge

\`-)
Whether approved for reporti Yes

For the Petitioner: rawan

.. Dogra. Senior Advocate,
wethsplr. Pradeep K. Gupta and Mr.
7(---7./ '\, .. japak Sharma. Advocates.

For the Res\poiOntsi Ms. Ritta Goswami, Additional

\--......:-/ Advocate General.

tSnaiè,aI Dua, Judge

Actual monetary benefits admittedly due to the

er towards revised leave encashment. on account of re-

fixation of her pay in higher pay-scale from a retrospective date

after her superannuation, are not being released by the

respondents. Hence, the writ petition

Whether reporters of Local Papers may be allowed to see the judgment ? Yes

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2. Facts

2(i) On attaining age of superannuation. the petitioner

retired from service on 30.09.2020 from the post of S n

Architect.

2(ii) The Finance Department issued

14.11.2014 to the effect that the Government had

the process of granting two tier pay scale in revi ed pay

structure by granting the corresponding rs1 structure to

the category of Architects in the Public Works Department On

short PWD) as per the scheckit 4RpOded to the Himachal

Pradesh Civil Services (R Rules 2009 with immediate

effect. Keeping in /G-- ./decision taken in the Finance

Department;i*teilda\tect411.2014, a further decision was taken

by the Finthe.D ,partment on 21.09.2020 (Annexure P-1) to

o tier pay scale in respect of the Architects of P.W.D.

al basis w.e.f. 27.08.2009 (without grant of arrears) and

C\,
olta-RiCtual basis w.e.f. 14.11.2014.
,
.s
oar In furtherance of the decision taken on 21.09.2020,

the respondent PWD issued a notification on 15.12.2020

(Annexure P-2) releasing the two tier pay scale to the petitioner.

She was found eligible for the pay scale of Rs. 37400-

67000+8600 Grade Pay with initial start of Rs. 46,000/- after 14

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 3

years of service. Petitioner was held entitled to this pay scale on

notional basis w.e.f. 01.01.2013 and on actual basis w.e.f.

14.11.2014. Consequent upon recommendations of the screen' g_

committee dated 15.12.2020. the petitioner's pay was refixe i Qi

the higher pay scale of Rs. 37400-67000+8600 Grade Pa after
„2
completion of 14 years regular service vide Ann

31.12.2020. Pay of the petitioner was fixed on notional basis for

the period 01.01.2013 to 13.11.2014 and con)ctual basis from

)
14.11.2014 onwards.

2(iv) Pursuant to re-fixation tif.. petitioner's pay, revised

sanction was accorded in our for payment of leave

encashment of 300 days of)xmattlized earned leave. The order in

this regard(rat pail/ by the respondent department on

(
10.02.2021 '(4knnex9ie P-4). The amount of leave encashment

aVeadSaj to the petitioner at the time of her retirement was Rs.

/-. The amount of revised leave encashment in light of

fT'Atti n of her pay. post retirement was worked out at Rs.

4;78530/-. The balance leave encashment amount due to the

petitioner was thus Rs. 85,010/-. This amount, however, was not

released to the petitioner by the State Treasury for the following

reasons/objection(s) dated 20.01.2021 contained in Annexure

P-5

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 4

(1) The amount seems wrong in sanction order

(2) Kindly follow instructions No Fin(C)A(3)-1/2008. dated 13Th

August. 2013.

2(v) Regarding payment of balance leave encashment

)
the petitioner. the matter was followed up by the Chief Architect/

HP PWD (respondent No. 3). On 07.04.2021, he w t1:1

\
Engineer-in-Chief HP PWD (respondent No. 2)

payment of balance leave encashment amount to the petitioner in

view of revision of her pay scale post.'ec tIrnent. In his

)
communication at Annexure P-7 dated 07.042021, he was of the

view that pay of the petitioner was\kxed on actual basis w.e.f.

14.11.2014 and she had been\ e arrears on that basis after

her superannuation,i
bence 6alance leave encashment amount

ought to bejSaidAo *-5equest was accordingly made to issue

necessary C1Okcati9h in the matter. Some correspondence was

on the subject between the respondents. Finally on

1 (Annexure P-11), respondent No. 2 turned down the

No the petitioner for balance payment of revised leave

n6athment with following observations :-

"To
The Chief Architect.
HP. PWD, Nigam Vihar Shimla-2,

Subject: Regarding payment of Leave Encashment.

Sir.

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 am to refer to your office letter No. PW-Arch-Misc-2021-
1250 dated 25.08.2021 on the subject cited above

In this connection, it is intimated that the subject cited

matter has been re-examined in this office and it has been found t \s,
as per clarification conveyed vide Special Secretary (Finance)
Govt. of Himachal Pradesh. Notification No. Fin (C)A(3)-1/2008
13.08.2013, the benefit of leave encashment is not a part of retirem
benefit and the same is regulated under separate set6/'Rules
CCS (Leave) Rules. 1972 as such instructions issued by the kance>
(Pension) Department vide 0.M. dated 12.03.2 be
applied in such case. Moreover, in terms of rule 39(2 CS
(Leave) Rules, 1972, the leave encashment sQ11 be pa in one
lump sum as one time settlement.
The applicant may be informed acco

Encl.. As above fitOrsle fully.

Sd/-
(Er Dare Singh Dehal).
Engineer-in-Chief,
(' Himachal Pradesh, PWD,
Shimla-2"

2(vi). The abov\decision f the respondents not to pay

revised (balance) leetv encashment amount has led the

•
petitioner tconitifute the-pfesent writ petition for grant of following

substantive el..hers•:-/ /
_-
writ or direction or order in the nature of mandamus and/or any
r appropriate writ quashing Annexure P-11 :
. Directions or orders to respondents to pay Rs. 85,010/- with interest
N towards difference in leave encashment on account of pay drawn
,/ at Rs. 58.440/- on 30.09.2020...

3. Contentions:-

We have heard learned Senior Counsel for the petitioner

as well as learned Additional Advocate General for the

respondents

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 6

The Chief Architect (respondent No.3) in his

correspondence with the other respondents had vouched for the

entitlement of petitioner to the difference in leave encashrrp „

<)
amount on account of revision of her pay scale after retirern nt . /

However, in the common reply filed by all the respondents, the

\
impugned action of denying the revised leave encaithe

petitioner has been defended. The respondents in th ir reply

\ e basis of a
have justified denying the claim of the petitioneron

notification of Finance Department dated 13.08.2013 and the

Central Civil Services (Leave) Rules, 1_02. Whereas contention

raised for the petitioner is that it /petitioner's right to have the

, otherwise permissible to her in terms

leave encashment whictOsX

of re-fixation of her Pay -Ordered after her retirement. It has further

(
been submitted that the interpretation given by the respondents to

the CCS (Leave) Rules for denying the revised leave encashment

etitioner is incorrect. That the notification issued by the

ilineipce: Department on 13.08.2013 cannot deprive the petitioner

f right to claim due and admissible leave encashment.

4. Observations:-

The stand taken by the respondents to deny the revised

leave encashment to the petitioner defies even common sense

logic. We observe so on following counts :-

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 4(i) It is not in dispute that on attaining the age of

superannuation, the petitioner retired on 30.09.2020 as Senior

Architect from the State PVVD. About a week before

retirement i.e. 21.09.2020. the Government had decided to a or//

1

two tier pay scale structure to the category of petitiotiès. Thi.

‘
revised pay structure was ordered to be paid on al basis

w.e.f. 27.08.2009 and on actual basis w.e.f. 14.11.2014. Thus the

approval to release two tier pay structure to the category of the

petitioner had been accorded by the—Stite even before

petitioner's superannuation. (

4(ii) As per State Governme t'd cision dated 21.09.2020, the

screening committee recorr ''' ded releasing two tier pay scale
)men

in favour of the petifronAr,,The recommendation of the screening

committee was accepted by the State on 15.12.2020. Order was

atordiiiigly passed on 31.12.2020 re-fixing petitioner's pay in the

)31 .r\ a y scale. On completion of 14 years regular service as on

/

Q6-1-.01\2013. petitioner's pay in the revised scale was fixed on

otional basis for the period 01.01.2013 to 13.11.2014. Her pay

was fixed in the revised scale on actual basis w.e.f. 14.11.2014.

4(iii) Pursuant to re-fixation of petitioner's pay. the leave

encashment due and admissible to her was worked out at Rs.

14.78.530/-. Revised sanction of leave encashment was

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accordingly granted. Since she had already been paid leave

encashment amount of Rs. 13.93.520/- on the basis of her old

pay scale, hence the balance amount due to her was worked
)
at Rs. 85.010/-. This amount was admittedly due to the petiti er/
in light of upward revision of petitioner's pay-scale car\r. d ()LIS

after her retirement. /\ .

4(iv) For denying the payment of revised leave encas ment to

the petitioner. the respondents have taken'snetter of a notification

issued by the Finance Department on 13.0&.2o1/3 as well as Rule

39 of the CCS (Leave) rules, 1972.j.0e Office Memorandum

dated 131h August, 2013 issu e Finance Department is as•

under
(S\L
Other/MEMORANDUM
1
(
SubjeCounting of notional pay for pensionary benefits in
respect of Government employees who are allowed
promotion/financial up-gradation etc. on notional
basis as a result of Government decisions or Court
orders — clarification regarding leave encashment of
un-utilized earned leave.

The undersigned is directed to refer to Finance Department

No. Fin (Pen) A (3) -12/2010 dated 12''' March. 2013 vide which
it has been decided by the State Government that in cases where
pay of the Government employees are fixed on notional basis due to
promotions/financial up gradations etc. as a result of Government
decisions or due to final Court orders, the notional pay so fixed shall
be taken into account for calculation of pensionary benefits under
Rule-33 and Rule-34 of the CCS (Pension) Rules. 1972.

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 9

2. The references are being received in this Department from

various quarters seeking clarification as to whether the pay fixed on
notional basis shall be counted for leave encashment or not. It is
clarified that since the benefit of leave encashment is not a part of
retirement benefit and the same is regulated under separate ,set .)
Rules i.e. CCS (Leave) Rules. 1972 as such instructions issue
the Finance (pension) Department vide O.M. dated 12. 13' she
not be applied in such cases. Moreover, in terms o )(2 )`o
the CCS (Leave) Rules. 1972. the leave ences shàIJbe
/
payable in one lump sum as one time settlement \
3. These orders may be brought to the notice>,f all concerned."

4(iv)(a) Leave encashment becomes pAyable at the time of

retirement and is calculated in ac,Qordance with Rule 39(2) (b) of

CCS (Leave) Rules, 1972. .61:of this Rule relevant to the

context runs as under :-

"39.. Leave/Cash payment in lieu of leave beyond the date of

retireryient. compulsory retirement or quitting of service
(1) 149 leave shall be granted to a Government servant beyond-
(6) theilikie of his retirement, or
he date of his final cessation of duties. or
((c)' th ate on which he retires by giving notice to Government or he
tired by Government by giving him notice or pay and allowances
; in lieu of such notice. in accordance with the termsand conditions of
.his service. or
(d) the date of his resignation from service.

(2)(a) Where a Government servant retires on attaining the normal

age prescribed for retirement under the terms and conditions
governing his service. the authority competent to grant leave shall.
suo motu. issue an order granting cash equivalent of leave salary for
both earned leave and half pay leave, if any. at the credit of the

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 Government servant on the date of his retirement subject to a
maximum of 300 days:
(b) The cash equivalent of leave salary under Clause (a) shall be
calculated as follows and shall be payable in one lumpsum as a one-
time settlement.—

(1) Cash NumbeKd days o

equivalent Pay admissible on the date arned>
for earned of retirement plus lea \ t,,,N lredIt
leave Dearness Allowance subj ct to the total
admissible on that date of earned leave and
'half pay leave not
30 -t 300 days
(ii) Cash Half pay leave salary--\1\1 er of days of
payment in admissible on the date' of ,. flair pay leave at
lieu of half retirement plus Dearness.- - ,redit subject to the
pay leave Allowance admissible - ow total of earned
component that date leave and half pay
x leave at credit not
exceeding 300 days

NOTE.— The overalL, limit ncashment of leave including both

earned leave anrtheilfpa jpoi'ie shall not exceed 300 days.
(c) To pake.. up\. the shot/fall in earned leave, no commutation of half
--j
pay leave shall. \ e-pennissible.
(3) The authority/competent to grant leave may withhold whole or part
of cash equivalent of earned leave in the case of a Government
servant who retires from service on attaining the age of retirement
while ,-Under suspension or while disciplinary or criminal proceedings
\\ae pending against him, if in the view of such authority there is a
(
plossibility of some money becoming recoverable from him on
/conclusion of the proceedings against him on conclusion of the
proceedings. he will become eligible to the amount so withheld after
adjustment of Government dues, if any .. "

Leave encashment is the amount of money paid to

an employee on account of his unutilized paid leaves standing to

his credit at the time of his retirement. Rule 39 of CCS (Leave)

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 Rules. 1972 provides calculating the leave encashment inter-al/a

on the pay and dearness allowance admissible on the date of

retirement. Leave encashment is thus paid at the time/of

retirement. Its computation depends inter-alia upon the availa i i

of earned leave to the credit of the employee as well as pay an

dearness allowance etc. admissible to him at th e o'f.,fiis

retirement. While interpreting provision of the Rajasth n Non

Government Educational Institutions Act 1989. Hon'ble Apex

Court in (2005) 10 SCC 346 State of Rajasthan and another

Versus Senior Higher Secondary School, Lachhmangarh and

others. held 'leave encashiTie nothing but salary for the

unavailed leave to the;irklit.ni/the employee'. The decision was

reiterated and followepy the Apex Court in Civil Appeal No.

6953 of 2022 ‘(Jagdish Prasad Saini and others versus State of

Rajast4 and others). decided on 26.09.2022.

40 Respondents' argument that under Rule 39(2)(b) of

' \\9CSLeave)
1 Rules 1972. the leave encashment is payable only
.
'. one lump sum as one time settlement and, therefore, revised

leave encashment cannot be paid to the petitioner, is clearly

misconceived and based upon misinterpretation of applicable

Rules. The office memorandum issued by the Finance

Department on 13.08.2013 to the extent it pertains to leave

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 12

encashment is not in consonance with law and Rules. Amount of

leave encashment by necessary implication becomes payable in

one lump sum at the time of retirement. However, Rule 39(2)

cannot be interpreted to mean that Government servants

have been paid leave encashment in one lump sum at the' me

2 /
retirement cannot be paid more leave encashment a o 'fFtti if

there is any increase in their pay/dearness Allowance e c., post

retirement. Here is a case where pay of the petitioner was re-

fixed in higher pay scale after her retirement. The pay re-fixation

order and the notification on the basis of which pay was re-fixed
\ \
clearly provided that petitioner to be granted notional benefit

of re-fixation of pay upto a`particular date and actual monetary

benefits were to bejeleased to her w.e.f. 14.10.2014. The

petitioner as granted actual monetary benefit from a

retrospective date (w.e.f. 14.10.2014) after her superannuation on

30.09.2020. The actual monetary benefits (arrears) on the basis

., .
- \df49Vised pay fixation order had already been released in favour

N. f ili4 petitioner. She was definitely entitled to the revised leave

encashment worked out on the basis of her re-fixed pay structure.

Though in this case the petitioner after her

superannuation was granted actual monetary benefits on account

of re-fixation of her pay. however, even if she had not been

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granted the actual monetary benefits or had received only

notional benefits, still the fact remains that her pay had been re-

fixed after her retirement. Under Rule 39 of the CCS (Leav

Rules 1972. it is the pay and dearness allowance 'admissib

the petitioner at the time of her retirement that are to be 4 n mt

consideration for computing her leave encashmen In'asèhe

pay and dearness allowance admissible to the petition at the

time of retirement had undergone chainge- post her date of

\
retirement, then definitely the leave encashment amount was

required to be re-worked out and to be/paid accordingly. It will

;N\\
also be beneficial to refer to a clanfitation issued under G.I.D.P.

& A.R., O.M. No. P 14g2.8)1:1/81-Estt (L). dated the 81h March.

1982. This clarification was issued as number of references were

received in tl-T Elept/of Per. & A.R.. as to whether any increase in

D DA sanctioned by the Government with retrospective effect

admissible to those Government servants, who had

aire‘ady been paid leave salary in one lumpsum as one-time

effle-ment at the time of their retirement. Whether the words

"payable in one lump sum as one time settlement occurring in

the Rules should or need not be taken to mean that if any

increase in DA/installment of ADA is allowed after the final

settlement, but with retrospective effect, it should be denied to the

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 15

retirement/quitting service, then the difference between the leave salary

already paid and leave salary payable according to the new rates will be
admissible to the Government servant concerned, notwithstanding the fact
that one-time settlement had already been made prior to the date of issue of
orders regarding the increase in DA/ADA. etc.
(G.I., D.P.& A.R.. 0.M. No. P. 14028/11/81-Estt. (L). dated the 8' March. 1982

Thus, once the revised DA/ADA is to be ken in

consideration for revising the payable leave en

time of retirement, then certainly revised pay. of an e ee re-

fixed from a retrospective date prior to his retireme t is also to be

s
taken into consideration for revising leave ,ekcathment.

5. Conclusion
-)
Viewing from a ni0e, "the stand taken by the

respondents in denying paymei) f revised leave encashment to

\
\
the petitioner cannot' be Countenanced. For all the aforesaid

reasons, the petition is therefore. allowed. Respondents are

directed to implement the Office Order dated 10.02.2021

77:\
(A extire 'P-4). The balance amount of leave encashment due to
\
thej3e,titioner in terms of office order dated 10.02.2021 be paid to

er Within a period of four weeks from today. The petitioner shall

\.%
also be entitled to costs of Rs. 25,000/- to be paid to her by the

respondents alongwith the due balance leave encashment

amount within the aforesaid period. We also clarify that in case

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 16

this amount is not paid within a period of four weeks. the same

shall also carry interest @ 5% per annum from the due date.

The writ petition stands disposed off in the aforesaid

terms, so also the pending applications, if any. \\/

Having come across several cases whererse

leave encashment amount due to the employees is d nied

on the analogy of stand adopted by the responders in th instant

case, we direct the office of learned Adyopate General to bring

this judgment to the notice of the State Finance-oepartment for its

onward circulation to all the concerned departments to avoid

unnecessary litigation on the‘'sjecti

( A.A. Sayed )
Chief Justice

(7\
Is December, 2022 (K) ( Jyotsna Rewal Dua )
Judge
f N
)

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