UNION OF INDIA Vs. SUDHA THEJUS

JUDGEMENT

(1.) The respondents in O. P. No. 11095 of 2000 are the appellants in the appeal. The petitioners were having deposits in the post office under the recurring deposit scheme. They opened their accounts on different dates prior to the amendment of R.9A of the Post Office Recurring Deposit Rules, 1981. As per the unamended Rules, the holder of an account could prematurely close the account after one year from the date of opening of the account provided that interest at the rate of Post Office Savings Account shall alone be payable on premature closure of the account. R.9A was amended by Notification dated 4.11.1999. By this amendment, the facility of premature closure was taken away. Therefore, the petitioners filed the Original Petition for the issuance of a direction to the respondents to allow the petitioners to have premature closure of the recurring deposits maintained by them with the third respondent as allowed in unamended R.9A of the Post Office Recurring Deposit Rules, 1981.

(2.) The respondents in the Original Petition filed a counter affidavit stating that it is the amended R.9A that is applicable to the deposits made by the petitioners. They also relied on a communication by the Ministry of Finance informing that the amended Rule will apply to Recurring Deposit Accounts which are already in existence on the date of Notification. They further relied on Ext. R2(b), wherein the petitioners have agreed that they would abide by the Rules framed by the Central Government from time to time. It is their further case that the petitioners have no vested right and that it is only a contractual right.

(3.) The learned single Judge has found that S.15 of the Government Savings Bank Act, under which the Recurring Deposit Rules are made does not give the Government the power to make Rules retrospectively. The amendment also does not say that the Rules have been made with retrospective effect. All amendments are presumed to be only of prospective operation. Retrospectivity has to be made explicit. The learned single Judge also found that the undertaking in the application form to abide by the Rules in force from time to time also will not help the Department since the Rules are not made retrospective. In view of the above reasoning, the learned single Judge allowed the Original Petition and held that the petitioners are entitled to have the benefit of the closure of the accounts prematurely on the basis of the unamended Rules which were applicable at the time when the deposit was made.