Tara Vitasta Ganju JUDGMENT
Vibhu Bakhru, J.
1. The present Appeal has been filed by the Appellants impugning an order dated 05.09.2013 [hereinafter referred to as "Impugned Order"] passed by the learned Single Judge, whereby the Petition filed by the Petitioners/Appellants praying that they should be granted benefits of the Central Government Health Scheme, 1954 [hereinafter referred to as "CGH Scheme"], was dismissed by the learned Single Judge.
2. The Petitioners [10 in number] were the erstwhile employees of Respondent No. 2, the Central Silk Board [hereinafter referred to as "Respondent No. 2/CSB"] who have since retired. The Respondent No. 2/CSB is a statutory body under the administrative control of the Ministry of Textiles, Government of India/Respondent No. 1. Respondent No. 2/CSB was established in 1948 under the Central Silk Board Act, 1948 and their employees draw salary and their pensions from the consolidated fund of the Government of India.
3. A Coordinate Bench of this Court on 14.03.2014 admitted this Appeal. The Appeal was thereafter dismissed in default for non-prosecution on 26.09.2019 and subsequently, restored on 18.10.2023 and heard by this Court.
4. It is the case of the Appellants, that Respondent No. 2/CSB is a statutory body and its employees are employees of the Central Government. The fundamental rules of the Central Government being the Central Government Services Rules, Pension-cum-Gratuity Rules and other such rules apply to the employees of the Respondent No. 2/CSB. During their tenure with the Respondent No. 2/CSB, the Appellants are given the benefit of the CGH Scheme. However, post-retirement, the CGH Scheme and Rules do not apply to the Appellants, thus denying them medical benefits in their old age. The Appellants contend that denying them post-retiral medical benefits is illegal and unjustified and is violative of Articles 14 and 21 of the Constitution of India, 1950.
4.1. It was contended that Respondent No. 2/CSB functions under the administrative control of Respondent No. 1 and the pension of retired employees is as sanctioned from the consolidated fund of Government of India. Although, Respondent No. 2/CSB has adopted the Central Services (Medical Attendance) Rules, 1944 [hereinafter referred to as "CSMA Rules"] with the approval of Respondent No. 1, these rules do not apply to retired employees of Respondent No. 2/CSB. It is further contended that on more than one occasion, Respondent No. 3/Ministry of Health and Family Welfare had addressed communications to the Government requesting them to extend the insurance scheme called Central Government Employees and Pensioners Healthcare Insurance Scheme to the Appellants as well. However, on account of the fact that no approval has been received for the same, no benefits could be extended to the employees retired from Respondent No. 2/CSB.
5. It is contended by Respondent No. 2/CSB that they are principally in agreement for providing medical facilities and adopting CGH Scheme for their retired employees. In this regard, on 24.05.2006, Respondent No. 2/CSB had also sent its proposal to Respondent No. 1 to extend the CGH Scheme to its pensioners. However, since this proposal dated 24.05.2006 was rejected by Respondent No. 1 on 03.08.2006, Respondent No. 2/CSB are unable to extend the benefits to its retired employees.
5.1. Respondent Nos. 1, 3 and 4 have also filed their affidavits before this Court wherein it is stated that the CGH Scheme is available only in 25 cities in the country and the retired government employees not staying in those 25 cities are not entitled to CGH Scheme and instead get a fixed medical allowance to take care of their medical needs. It is further contended that although initially CGH Scheme intended to be only a scheme for employees in and around Delhi by extending coverage to various cities, the CGH Scheme facilities are already overextended. It was therefore, decided by the Central Government not to extend CGH Scheme to cover any new group of persons. It was contended by Respondent Nos. 1, 3 and 4 that in view of lack of resources, the same kind of healthcare and benefits cannot be extended to all Central Government employees and pensioners.
5.2. It is further contended by Respondent Nos. 1, 3 and 4 that the employees of autonomous statutory bodies are on a different footing as compared with the Central Government employees; thus, the question of Article 14 being violated does not arise at all, since it envisages equality amongst equals.
6. The Learned Counsel appearing for the Appellants has averred that the Appellants, while they were in services were getting medical benefits under CSMA Rules, however, post-retirement, are getting only a few hundred rupees a month, as medical benefit. Relying on the judgments of the Supreme Court, it is contended that discrimination against retired employees like the Appellants by not extending the CGH Scheme is in clear violation of Articles 14 and 21 of the Constitution of India, 1950. Reliance in this regard has been placed on judgment of the Division Bench of the High Court of Madras in Union of India v. R. Rangarajan MANU/TN/0900/2008. In this case the Court held that denial of benefits contemplated under the CSMA Rules or CGH Scheme to retired employees on the ground that retired employees are residents of areas not covered by CGH Scheme is prima facie contrary to the spirit of Articles 14 and 21 of the Constitution of India and reasonable modalities are required to be implemented and worked out for the same.
6.1. Reliance was also placed on the judgment of Union of India v Shankar Lal Sharma MANU/HP/1246/2015 passed by a Division Bench of High Court of Himachal Pradesh at Shimla to contend that the State has a liability to reimburse the medical expenses of a retired Government employees and members of their family, even if they are residing in cities where the CGH Scheme is not available.
7. Learned Standing Counsel appearing on behalf of Respondent Nos. 1, 3, 4 and 5, on the other hand, has submitted that employees of autonomous bodies such as Respondent No. 2/CSB cannot claim parity with government employees. Reliance in this regard was placed on the judgments of the Supreme Court in State of Maharashtra v. Bhagwan MANU/SC/0025/2022 : 2022:INSC:29 : (2022) 4 SCC 193 and National Institute of Technical Teacher Training and Research v. Union of India MANU/PH/2064/2016.
7.1 In addition, learned Standing Counsel places reliance on the Office Memorandum no. No. S.14025/23/2013-MS.EHSS dated 29.09.2016 [hereinafter referred to as "O.M. of 29.09.2016] wherein it has been informed that respective administrative departments/Ministry may take their own decisions with respect to their respective employees. The relevant extract of the said Office Memorandum is set out below:
".....
3. In view, of the above, reimbursement of medical claims to pensioners under CS (MA) Rules, 1944 as directed by various CATS/Courts, need not be referred to the Ministry of Health and Family Welfare. The respective Administrative Department/Ministry may take their own decision in this regard.
4. Further, all Departments/Ministries are requested to intimate their employees proceeding for retirement regarding the above options for medical facilities available to the Central Government pensioners.
5. This issues with the approval of competent authority"
8. Learned Counsel appearing on behalf of Respondent No. 2/CSB has reiterated the contents of his affidavit filed before this Court and submits that in view of the post-retiral medical benefits being turned down by Respondent No. 1 by its letter dated 03.08.2006, Respondent No. 2/CSB requires specific approvals to extend CGH Scheme to the Appellants which is not forth coming.
9. Learned Counsel for the Appellants referred to judgment of a Division Bench of the Himachal Pradesh High Court in the Shankar Lal Sharma case to submit that in similar circumstances, directions were passed by the Court. In Shankar Lal Sharma case, the principal question involved pertained to the non-applicability of the CSMA Rules to retired employees of All India Radio, Shimla, which was one of the cities where the CGH Scheme was not applicable [hereinafter referred to as "non-CGHS areas"]. The Respondents/pensioners in that case had placed reliance on an office memorandum dated 05.06.1998 wherein it was stated that the Ministry has no objection to the extension of CSMA Rules to Central Government pensioners residing in non-CGHS areas, provided that the modalities for the same are administered by their respective Ministries/Departments. It was further stated that the pensioners who were Central/State government employees would be given a one-time option at their retirement for medical coverage under CGH Scheme or CSMA Rules. The Division Bench of the Himachal Pradesh High Court had while relying on this office memorandum held that since no decision had been taken for 17 years, the memorandum would have been bound to be accepted by Union of India. In these circumstances, it was directed that Respondent and similarly situated retired Central/State government employees residing in non-CGHS areas be given the option to avail medical benefits.
9.1. The R. Rangarajan case also dealt with availability of medical facilities with respect to reimbursement to a pensioner who had retired from the Department of Telecommunications, Ministry of Communications but resided in a non-CGHS area.
10. In the present case, however, the Appellants were employees of an autonomous organisation and not pensioners of Central/State government, who are residing in non-CGHS areas. In the context of such organisations, the Supreme Court in the State of Maharashtra case held that autonomous institutions, have their own administration and have no financial authority to impose monetary obligations such as employee benefits post-retirement, on the State or Central Government. The Supreme Court has further held that the employees of autonomous bodies cannot as a matter of right claim service benefits at par with government employees merely because Service Rules of government employees are adopted or because the institution is funded by the State or Central Government.
10.1. The Supreme Court in the State of Maharashtra case has further held that normally, the Court should refrain from interfering with policy decisions, which have financial implications and grant of service benefits to employee should be left to the decision of the expert bodies. In these circumstances, the Supreme Court declined to extend pensionary benefits to the employees of the Water and Land Management Institute, an autonomous institute of the Irrigation and Flood Control Department inspite of the fact that the salary and allowances were being paid to the employees of this autonomous institute out of the State Treasury. Paragraphs 28 and 29 in this regard read as follows:
"28. As per the settled proposition of law, the Court should refrain from interfering with the policy decision, which might have a cascading effect and having financial implications. Whether to grant certain benefits to the employees or not should be left to the expert body and undertakings and the court cannot interfere lightly. Granting of certain benefits may result in a cascading effect having adverse financial consequences.
29. In the present case, Walmi being an autonomous body, registered under the Societies Registration Act, the employees of Walmi are governed by their own Service Rules and conditions, which specifically do not provide for any pensionary benefits; the Governing Council of Walmi has adopted the Maharashtra Civil Services Rules except the Pension Rules. Therefore, as such a conscious policy decision has been taken not to adopt the Pension Rules applicable to the State Government employees; that the State Government has taken such a policy decision in the year 2005 not to extend the pensionary benefits to the employees of the aided institutes, boards, corporations, etc.; and the proposal of the then Director of Walmi to extend the pensionary benefits to the employees of Walmi has been specifically turned down by the State Government. Considering the aforesaid facts and circumstances, the High Court is not justified in directing the State to extend the pensionary benefits to the employees of Walmi, which is an independent autonomous entity."
[Emphasis is Ours]
11. As discussed above, the Appellants are retired employees of a statutory body under the administrative control of Ministry of Textiles, Government of India. The Respondent No. 2/CSB employees draw their salary and their pensions from the consolidated fund of India.
12. Although, a proposal was mooted by the Respondent No. 2/CSB to extend the CGH Scheme to its pensioners, it was rejected by Respondent No. 1, by its letter dated 03.08.2006. The said letter is cryptic but it is apparent that it rejected the proposal to extend the medical benefits under the CGH Scheme to the retired employees of Respondent No. 2/CSB. The said letter reads as follows:
"No. 25012/20/2006-Silk
Govt. of India
Ministry of Textiles
Udyog Bhawan, New Delhi
Dated: August, 3, 2006
To
Member Secretary,
Central Silk Board,
Bangalore-560068.
Sir,
Subject: Proposal for medical facilities under CGHS to Retired Employees of Central Silk Board-reg.
I am directed to refer to your letter No. CSB/245/4/90/BS dt.24.5.06 on the subject mentioned above and to say that the marks has been examined under the C.G.H.S Eligibility conditions and as per the eligibility conditions office of Central Silk Board is not eligible to have the C.G.H.S facility.
Yours faithfully,
(P.L. VERMA)
Under Secretary to the Govt. of India"
13. Respondent Nos. 3 and 4 in their Affidavit filed before this Court have explained the reasons for this decision. It was contended that initially during 1970s and 1980s, CGH Scheme facilities were extended to autonomous/statutory bodies because a majority of their employees were employees on deputation from Central Government who were already availing CGH Scheme facilities in their parent departments. The present scenario, however, has completely changed. The autonomous institutions such as Respondent No. 2/CSB are competent to devise their own medical scheme to take care of their employees within their available resources and means, in consultation with their parental Ministries.
13.1. Respondent Nos. 3 and 4 have explained that Respondent No. 3/Ministry of Health and Family Welfare has been besieged with demands of employees from different parts of the country to extend coverage of the CGH Scheme. But due to severe resource constraints, it is not in a position to extend the CGH Scheme to employees/pensioners all over the country. It was in this backdrop that it was decided as a matter of policy to not extend the CGH Scheme to cover any new group of persons as it is already overstretched and such inclusions have large financial implications. The relevant extract of the Affidavit filed by Respondent Nos. 3 and 4 is below:
"8. That CGHS was constituted vide Ministry of Health's Office memorandum dated 1.5.1954. In accordance with the said O.M. CGHS facilities are available only to the Central Government servants who are paid their salary/pension from the Civil Estimates of the Central Government. Employees of other organizations receiving salary from other sources/grants provided by Central/State Government are not eligible to join CGHS as beneficiary. Since Central Silks Board is an autonomous body, its employees are not automatically eligible or entitled for CGHS membership. However, in the past decades, some autonomous/statutory bodies were extended CGHS facilities under CGHS in Delhi on a cost-to-cost basis. CGHS facilities were extended to the autonomous/statutory bodies during the decade of 70s and 80s because majority of their employees initially posted to such newly created autonomous/statutory bodies were sent on deputation from Central Government to support them in their initial years to make them functional. They were already availing CGHS facilities in their parent departments. Since, adequate facilities/proper medical scheme were not available with the newly created autonomous bodies, the CGHS facilities were extended to them to motivate the Central Government employees to join those new entities on deputation/absorption basis. Now in the present scenario the position has completely changed. They have now come of age and have developed their own rules and regulations to run their organizations efficiently. They enjoy functional area administrative autonomy and are competent to devise their own medical scheme to take care of their employees within their available resources/ways and means in consultation with their administrative Ministry. Copy of Ministry of Health's Office memorandum dated 1.5.1954, is annexed hereto as ANNEXURE A-1.
9. That the CGHS was initially intended to be Delhi centric scheme and it was not envisaged to be an All India Scheme. However, the Scheme was subsequently expanded to other major cities in the country. In fact, the stretch of this scheme to cities over the years has put a heavy strain on the limited resources available with it. The Ministry of Health & Family Welfare is flooded with the demands from the Central Government servants and their associations from different parts of the country to extend CGHS coverage to those cities. But due to severe resource constraints, especially of qualified medical and paramedical professionals and also the financial and other logistic constraints, the Government is not in position to extend it to other parts of the country to provide the CGHS facilities to all its employees and pensioners across the country. In addition, with the rapid economic development and advancement in medical science and technology, the demand for quality health care has also increased tremendously and with the existing manpower and logistics it is becoming exceedingly difficult for the CGHS/department to manage even the current service.
10. It was in the backdrop of the above developments that as a policy matter, it has been decided by the Government of India to not to extend CGHS to cover any new group of persons. CGHS is already overstretched and any further pressure on this scheme will simply become unbearable and the scheme will collapse under the huge burden of expectations If Its beneficiaries which Include the Central Government Employees and Pensioners, Members of Parliament, Ex-Members of Parliament, Ex-Vice Presidents, Governors and Lt. Governors, sitting as well retired Judges of Supreme Court, retired Judges of High Courts, Freedom Fighters and employees of Certain Autonomous bodies. Statutory bodies etc. Inclusion of further groups also has financial Implications on account of creation of posts, provision of medical services in terms of medicines, specialized advices and related infrastructures etc. "
[Emphasis is Ours]
13.2. As stated above in paragraph 7.1, Respondent No. 1 has also relied on office memorandum dated 29.09.2016 regarding medical claims to pensioners being as within the scope of the respective administrative Departments or Ministries. It is, therefore, for the Appellants through Respondent No. 2/CSB to approach Respondent No. 3 for availing such benefits.
14. The Court cannot interfere with policy decisions taken by the Government merely because it feels that a different decision would have been more fair or wiser. The assessment and evaluation of policies fall outside the purview of judicial review, unless those policies contravene statutory or constitutional provisions or are deemed arbitrary. It is trite that, where the government possesses the competence to formulate policies, it can only be challenged when such policies are arbitrary. Therefore, the legitimacy of a public policy can only be contested if it transgresses specific legal frameworks. [See: State of M.P. v. Narmada Bachao Andolan MANU/SC/0599/2011 : 2011:INSC:379 : (2011) 7 SCC 639].
15. Thus, the decision to not extend the benefits of the CGH Scheme to the Appellants is a policy decision keeping in mind various factors including economic ones. Due to resource constraints including financial and logistical, the Respondents have been unable to extend benefits under the CGH Scheme to the Appellants. From an examination of the record, this does not appear to be arbitrary. Thus warrants no interference by this Court.
16. In so far as the contention that the differential treatment given by the Respondents to the Appellants falls foul of Article 14 of the Constitution is concerned, it is apposite to refer to the decision of the Supreme Court in State of Uttarakhand v. Sudhir Budakoti & Ors. MANU/SC/0434/2022 : 2022:INSC:401 : 2022 13 SCC 256. In that case it was held that a reasonable classification does not offend Article 14 of the Constitution of India. If benefit is extended to a class of persons, the same cannot be termed as arbitrary given the rational nexus with the object of excluding the benefits to a group of persons forming a class of their own. It is necessary to look into social, revenue and economic considerations and permissible parameters for extending such benefits. Since the role of the Court is restrictive, such decisions are best left to the authorities concerned. The Courts should be wary of entering into such an arena. The relevant extract of the said decision is set out below:
"Classification Test & Policy Decisions of the State:
14. A mere differential treatment on its own cannot be termed as an "anathema to Article 14 of the Constitution". When there is a reasonable basis for a classification adopted by taking note of the exigencies and diverse situations, the Court is not expected to insist on absolute equality by taking a rigid and pedantic view as against a pragmatic one.
15. Such a discrimination would not be termed as arbitrary as the object of the classification itself is meant for providing benefits to an identified group of persons who form a class of their own. When the differentiation is clearly distinguishable with adequate demarcation duly identified, the object of Article 14 gets satisfied. Social, revenue and economic considerations are certainly permissible parameters in classifying a particular group. Thus, a valid classification is nothing but a valid discrimination. That being the position, there can never be an injury to the concept of equality enshrined under the Constitution, not being an inflexible doctrine.
......
17. The question as to whether a classification is reasonable or not is to be answered on the touchstone of a reasonable, common man's approach, keeping in mind the avowed object behind it. If the right to equality is to be termed as a genus, a right to non-discrimination becomes a specie. When two identified groups are not equal, certainly they cannot be treated as a homogeneous group. A reasonable classification thus certainly would not injure the equality enshrined under Article 14 when there exists an intelligible differentia between two groups having a rational relation to the object. Therefore, an interference would only be called for on the court being convinced that the classification causes inequality among similarly placed persons. The role of the court being restrictive, generally, the task is best left to the concerned authorities. When a classification is made on the recommendation made by a body of experts constituted for the purpose, courts will have to be more wary of entering into the said arena as its interference would amount to substituting its views, a process which is best avoided."
[Emphasis is Ours]
17. It is settled law that Courts ought not to encroach upon the domain of the legislature or the executive and issue directions which impose financial burden on the State. The learned Single Judge has in this regard while declining to give directions to the Respondents, held as below:
"3. In a Utopian society everyone must get equal benefits, however, in this real world each autonomous organization has to run as per the finances which are available and sanctioned to it. Courts have repeatedly held that decisions of the administrative authorities with respect to finances should not ordinarily be interfered with by the Courts because organizations know best how to use their available finances. In this regard, the Supreme Court in the case of Indian Drugs and Pharmaceuticals Ltd. vs. Workman, Indian Drugs and Pharmaceuticals Ltd. MANU/SC/4993/2006 : 2006:INSC:859 : (2007) 1 SCC 408 has held that Courts should not give directions for fixing of a particular pay-scale or for creation of sanctioned posts or for regularization of employees and so on, because the same will put financial burden on the employers which the Courts cannot impose. The relevant paragraphs of this judgment are as under:-
"16. We are afraid that the Labour Court and the High Court have passed their orders on the basis of emotions and sympathies, but cases in court have to be decided on legal principles and not on the basis of emotions and sympathies.
18. In State of M.P. v. Yogesh Chandra Dubey this Court held that a post must be created and/or sanctioned before filling it up. If an employee is not appointed against a sanctioned post he is not entitled to any scale of pay. In our opinion, the ratio of the aforesaid decision squarely applies to the facts of the present case also.
37. Creation and abolition of posts and regularisation are purely executive functions vide P.U. Joshi v. Accountant General. Hence, the court cannot create a post where none exists. Also, we cannot issue any direction to absorb the respondents or continue them in service, or pay them salaries of regular employees, as these are purely executive functions. This Court cannot arrogate to itself the powers of the executive or legislature. There is broad separation of powers under the Constitution, and the judiciary, to, must know its limits.
40. The Courts must, therefore, exercise judicial restraint, and not encroach into the executive or legislative domain. Orders for creation of posts, appointment on these posts, regularisation. fixing pay scales, continuation in service, promotions, etc. are all executive or legislative functions, and it is highly improver for Judges to step into this sphere, except in a rare and exceptional cases. The relevant case-law. and philosophy of judicial restraint has been-Md down by the Madras High Court in great detail in Rama Muthuramalingam v. Dy. Supdt. Of Police and we fully agree with the views expressed therein."(underlining added)"
[Emphasis is Ours]
18. In view of the aforegoing discussions, we find no infirmity with the view taken by the learned Single Judge in the Impugned Order. The Appeal is accordingly dismissed.
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