The Bench comprising Justice Sanjay Karol and Justice Nongmeikapam Kotiswar Singh allowed the appeal filed by the dependant of an employee of New India Assurance Company Limited and set aside the judgment of the Nagpur Bench of the Bombay High Court which had upheld the rejection of the compassionate appointment claim.
The employee, Ramnarayan Madankar, submitted an application for voluntary retirement on medical grounds on 22 July 2015. At that time he was below the age of fifty‑five years. He attached a certificate issued by a Civil Surgeon declaring him permanently incapacitated for service. The Scheme for Compassionate Appointment in Public Sector General Insurance Companies provides that a dependent is eligible for appointment when the employee retires on medical grounds due to incapacitation before attaining the age of fifty‑five years, provided the incapacitation is certified by a duly constituted Medical Board.
According to the record, the employee repeatedly reminded the employer to process his application before he crossed the age threshold on 10 December 2015. The company, however, did not inform him that a Medical Board certificate was required until 3 February 2016, after he had already turned fifty‑five. Upon receiving the communication, the employee obtained the Medical Board certificate within seven days. Nevertheless, the employer rejected the son’s claim for compassionate appointment on the ground that the employee had retired after attaining the age of fifty‑five years.
The Bombay High Court affirmed the rejection, holding that the Medical Board certificate had been obtained only after the employee crossed the age limit and therefore the condition precedent for compassionate appointment was not satisfied.
The Supreme Court examined the scheme’s purpose and the employer’s duty to administer it fairly. The Bench observed that once the employee had applied for voluntary retirement on medical grounds before attaining fifty‑five years and supported the application with a government medical certificate, the respondent‑company was required to scrutinise the application with reasonable promptitude. If the Civil Surgeon’s certificate was deemed insufficient, the company had to inform the employee of the deficiency before the age threshold expired. It could not remain silent until the employee crossed fifty‑five years and then rely on the consequence of its own delayed action to defeat the claim.
The Court emphasized that allowing the employer to benefit from its own delay would permit it to “control eligibility through delayed processing” and would defeat the beneficial intent of the compassionate appointment scheme. The Bench relied on the settled principle that no person should be permitted to take undue and unfair advantage of his own wrong to gain a favourable interpretation of law, citing Kusheshwar Prasad Singh v. State of Bihar, wherein it was held that a wrongdoer ought not to be permitted to make a profit out of his own wrong.
Applying that principle, the Supreme Court concluded that the basis for rejection – the alleged retirement after the age of fifty‑five – was unsustainable because the delay in informing the employee about the Medical Board requirement was attributable to the employer. Consequently, the denial of compassionate appointment could not be upheld. The claim, which had remained pending since 2016, was therefore allowed.
The judgment, authored by Justice Kotiswar Singh, directed New India Assurance Company Limited to grant compassionate appointment to the son of the employee. The Bench made clear that the employer’s procedural lapse cannot be used to circumvent the substantive entitlement created by the scheme, reinforcing the obligation of public sector entities to act diligently and in good faith when processing benefits intended for employees and their dependents.