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The State of Bihar and Ors. Vs. Sachindra Narayan and Ors. - (Supreme Court) (30 Jan 2019)

Legitimate expectation is not a wish or a desire or a hope, it cannot be claimed or demanded as a right



The present appeal is directed against an order passed by the High Court whereby the Writ Petition was allowed directing the Appellant to provide financial assistance for payment of the arrears as well as current pension to the employees of the Anugraha Narayan Sinha Institute of Social Studies. Question involved in present case is whether the financial burden of the Retirement Benefit Scheme canbe foisted upon the State.

It is true that in certain financial years as per documents on record, the amount of pension was specifically mentioned while granting grant to the Institute, but such amount is in discretion of the State and cannot be enforced by a writ of mandamus. There is no obligation on the State to disburse the grant towards the pension amount in terms of the Act or the Rules or even in terms of the resolution of the Board.

Sub-section (1) of Section 8 of the Anugraha Narayan Sinha Institute of Social Studies Act, 1964 mandates the State Government to contribute a sum of rupees two lacs in each financial year for the maintenance of the Institute, whereas, Sub-section (2) empowers the State Government to contribute from time to time, such additional sums as it may deem fit for special items of research or education work, publication, buildings and for proper maintenance and development of the Institute. Such payment for the special projects, is in discretion of the State Government in view of the object for which the grant is to be disbursed, but Sub-section (2) does not include disbursement of the amount of pension as the contribution is for limited purpose which is not recurring in nature.

The money contributed to the Institute by the State Government is one source of the fund of the Institute fund. Section 9(3) of the Act provides that the funds shall be applied towards meeting the expenses of the Institute including expenses incurred in exercise of its powers and discharge of its functions under the Act. Therefore, the retirement pension scheme, at best can be treated to be a part of obligation of utilization of funds of the Institute but such obligation to bear the amount of pension fund is not on State Government as it is not mandated either by Section 8 or Section 9 of the Act.

Legitimate expectation is one of the grounds of judicial review but unless a legal obligation exists, there cannot be any legitimate expectation. The legitimate expectation is not a wish or a desire or a hope, therefore, it cannot be claimed or demanded as a right. The payment of pension in the past will not confer an enforceable right in favour of the Institute or its employees.

Thus, the resolution of the Board of the Institute to implement a retirement benefit scheme from its own resources will not bind the State Government to pay the amount of pension to the employees of the Institute. The employees of such Institute cannot be treated at par with the employees of the State Government nor the State can be burdened with the responsibility to pay pension to the employees of the Institute. Consequently, the order of the Division Bench is not legally sustainable. The appeal is allowed.


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