The Jharkhand High Court has overturned a Single Judge order that had granted pension benefits to a retired employee of the Bihar State Food and Civil Supplies Corporation, holding that once an employee opts for the Employees’ Provident Fund (EPF) scheme and accepts terminal benefits, a later pension claim cannot be revived after long delay.
The Division Bench allowed the appeal filed by the State of Bihar, bringing an end to a dispute that began more than three decades after the employee’s retirement.
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Background of the Case
The case arose from the service history of a deceased employee who was initially appointed as a Class-IV Chowkidar in the Food Supply and Commerce Department of the erstwhile Bihar Government in May 1967.
In October 1973, he was sent on deputation to the Bihar State Food and Civil Supplies Corporation (BSFC), where he continued to serve until his superannuation on 31 July 1991 from a depot at Dumka. During his tenure with the corporation, he was covered under the Employees’ Provident Fund scheme and regularly contributed to it.
After retirement, he received all terminal benefits, including EPF dues. However, in 2007 - nearly 16 years later - he approached the High Court seeking pension on the ground that no formal option had been taken from him at the time of deputation to the corporation.
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A Single Judge accepted this plea in 2013 and directed the State of Bihar to grant pension with 6% interest from August 1991. Challenging this order, the State filed a Letters Patent Appeal.
The State of Bihar argued that the employee had consciously accepted the EPF scheme, opened an EPF account, contributed to it throughout service, and withdrew the amount after retirement. According to the State, this amounted to a clear choice against the pension scheme.
It was also pointed out that the employee had rendered only about six years of service under the State Government before deputation, falling short of the minimum qualifying service required for pension.
On the other hand, the employee’s widow, who was substituted as legal heir after his death during the appeal, argued that pension is a constitutional right and cannot be denied merely because of deputation to a corporation, especially when no written consent was taken.
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Court’s Observations
The Division Bench examined the service records, including the service book and supplementary affidavits, which showed that the employee had shifted to the EPF scheme and received all retirement benefits without protest.
While acknowledging settled law that pension is not a bounty but a right, the court drew a clear distinction between entitlement and choice.
“The right to pension depends upon the applicable service rules and the option exercised by the employee,” the bench observed, noting that once an employee accepts an alternative statutory scheme like EPF, the pension rules of the State Government cease to apply.
The judges also took note of the long silence maintained by the employee. “After accepting EPF benefits and remaining silent for more than 16 years, the claim for pension cannot be reopened,” the court remarked, holding that the principle of estoppel squarely applied.
The Bench found that the Single Judge had focused only on the absence of a formal handover order while ignoring crucial facts such as acceptance of EPF benefits, conduct of the employee, and extraordinary delay.
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Final Decision
Allowing the appeal, the Jharkhand High Court set aside the Single Judge’s 2013 judgment and dismissed the original writ petition.
The court held that the employee, having opted for and benefited from the EPF scheme, was not entitled to claim pension under State Government rules after retirement. With this, the long-pending pension dispute stood conclusively closed.
Case Title: State of Bihar vs. Savitri Devi & Others
Case No.: L.P.A. No. 236 of 2014
Case Type: Letters Patent Appeal (Service / Pension Matter)
Decision Date: 06 November 2025
