20 May 2025 Legal Updates

'ONE RANK ONE PENSION MUST IN CONSTITUTIONAL OFFICE': SUPREME COURT EXPLAINS PRINCIPLES ON RETIRED HC JUDGES' PENSION

(a) Case Title: 

• In Re: Refixation of Pension Considering Service Period in District Judiciary and High Court 

(b) Court: 

• Supreme Court of India 

(c) Date of Decision: 

• 19 May 2025 

(d) Bench:

• Chief Justice B.R. Gavai , Justice Augustine George Masih, Justice K. Vinod Chandran 

KEY ISSUES

• Whether service as a District Judge should be counted for calculating pension of High Court Judges.
• Whether a gap between retirement as a District Judge and appointment as a High Court Judge affects pension entitlement. 
• Whether Judges who joined the State Judiciary after National Pension Scheme (NPS) (2004) are entitled to pension under the High Court Judges Act, 1954. 
• Whether retired Additional Judges of High Courts are entitled to full pension. 
• Whether family pension and gratuity should be denied to widows/family members of Additional Judges. 
• Whether Judges appointed after NPS are entitled to Provident Fund benefits under the HCJ Act. 

SUPREME COURT’S RULINGS:

1. One Rank One Pension for High Court Judges:

• All retired High Court Judges (including Additional Judges) must receive uniform pension:  Rs. 15,00,000/-  per annum for retired Chief Justices and Rs. 13,50,000/- per annum for other retired Judges. 

2. Service as District Judge Must Be Counted: 

• Previous service in District Judiciary must be included for pension calculation. 

3. No Penalty for Break-in Service:

• Any gap between retirement as District Judge and appointment as High Court Judge does not reduce pension entitlement. 

4. NPS-Appointed Judges Entitled to HCJ Act Benefits: 

• Judges who joined State Judiciary after NPS (2004) are still entitled to pension under HCJ Act.  Their NPS contributions must be refunded with interest, while State contributions remain with the government. 

5. Family Pension & Gratuity for Additional Judges’ Families: 

• Widows/family members of Additional Judges cannot be denied family pension or gratuity. Gratuity must be calculated by adding 10 years to the Judge’s actual service. 

6. Provident Fund and Other Benefits

• All retired Judges are entitled to Provident Fund, leave encashment, and commutation benefits under the HCJ Act. 

7. Legal Principles Established:

• Article 14 (Equality): No discrimination in pension based on source of appointment (Bar or District Judiciary). 
• Constitutional Status of Judges: High Court Judges form a single class; post-retirement benefits must be uniform. 
• Independence of Judiciary: Financial security for Judges (active & retired) is crucial for judicial independence. 

ALL TRADEMARK DISPUTES AREN'T OUTSIDE ARBITRATION; IN PERSONAM ISSUES RELATING TO LICENSE AGREEMENT ARBITRABLE: SUPREME COURT

(a) Case Title:

• K. Mangayarkarasi & Anr. v. N.J. Sundaresan & Anr. 

(b) Court:

• Supreme Court of India 

(c) Date of Decision:

• May 9, 2025 

(d) Bench:

• J.B. Pardiwala and R. Mahadevan, JJ. 

FACTS

The petitioners (original plaintiffs) filed a suit in the Commercial Court, Coimbatore, seeking a permanent injunction to restrain the defendants from using the trademark "Sri Angannan Briyani Hotel" and claiming damages.  The defendants applied under Section 8 of the Arbitration and Conciliation Act, 1996, arguing that the dispute should be referred to arbitration as the Deed of Assignment of Trade Marks contained an arbitration clause. 

The Commercial Court and the Madras High Court both ruled in favor of arbitration, dismissing the petitioners' objections. 

KEY LEGAL ISSUES: 

1. Arbitrability of Trademarks Disputes

• The Supreme Court clarified that not all trademark disputes are non-arbitrable. Disputes arising from contractual agreements (like assignment deeds) are arbitrable if they involve rights in personam (private rights between parties) rather than rights in rem (public rights, e.g., trademark registration). 

2. Fraud Allegations and Arbitration: 

• The petitioners alleged that the assignment deeds were fraudulent. However, the Court held that mere allegations of fraud do not oust arbitration unless the fraud permeates the entire contract or has implications in the public domain. 

3. Jurisdiction of Civil Courts vs. Arbitral Tribunals: 

• Once a valid arbitration agreement exists, civil courts must refer parties to arbitration unless prima facie no arbitration agreement exists (Section 8). The Court reiterated that arbitral tribunals have the competence to rule on their own jurisdiction (Section 16), including objections to the validity of the arbitration agreement. 

Supreme Court's Decision:

The Court upheld the High Court's order, dismissing the Special Leave Petition.  It ruled that the dispute was arbitrable as it arose from contractual assignment deeds and involved private rights, not sovereign functions (like trademark registration).  The allegations of fraud were inter partes (between private parties) and did not affect public interest, making them arbitrable. 

KEY TAKEAWAYS

1. Arbitrability Depends on Nature of Dispute: 

• Contractual disputes (rights in personam) are generally arbitrable.  Disputes involving sovereign functions or public rights (rights in rem) are non-arbitrable. 

2. Fraud Allegations: 

• Only serious fraud affecting public interest can nullify arbitration agreements. 

3. Judicial Approach:

• Courts must enforce arbitration agreements unless the agreement is prima facie invalid.  Arbitral tribunals have the first authority to decide on their jurisdiction (Kompetenz-Kompetenz principle).