Terminal Benefits and Family Pension Alone Do Not Bar Compassionate Appointment, But Financial Distress Must Be Proven – Supreme Court

Compassionate Appointment is Not a Right, But a Relief for Families in Distress - In a crucial ruling, the Supreme Court of India has held that compassionate appointment cannot be granted as a vested right but is meant to provide relief to families facing immediate financial hardship due to the death of an earning member. Setting aside an order of the Kerala High Court that had directed Canara Bank to appoint the son of a deceased employee, the Court ruled that while family pension and terminal benefits do not automatically disqualify an applicant, they must be considered in assessing financial distress.

"Compassionate appointment is not an alternate mode of public employment. It is an exception to general service rules, designed to address immediate financial difficulties when a family loses its breadwinner," the Bench of Justice C.T. Ravikumar and Justice Rajesh Bindal observed while partially modifying the relief granted to the claimant.

The dispute began when Ajithkumar G.K. applied for a clerical or sub-staff position at Canara Bank following the death of his father, a bank employee, in December 2001—just four months before his retirement. At the time of his application under the bank’s 1993 Compassionate Appointment Scheme, his mother was receiving a family pension of ₹4,637.92 per month, and the bank denied his request on two grounds:

First, it claimed that the family was not in financial distress since they had received a pension and terminal benefits. Second, it cited that Ajithkumar had crossed the upper age limit of 26 years, rendering him ineligible under the scheme.

Aggrieved, he approached the Kerala High Court, which ruled in his favor, directing the bank to reconsider his application. Despite this, the bank reaffirmed its rejection, prompting a fresh legal challenge. The High Court once again ruled in Ajithkumar’s favor, ordering his appointment and imposing a ₹5 lakh penalty on Canara Bank for delaying the decision. The bank then challenged the ruling before the Supreme Court.

"Compassionate Appointment is Not a Matter of Inheritance, But of Financial Necessity"
The Supreme Court took a firm view of the principle behind compassionate appointment, holding that it exists to alleviate immediate financial hardship, not as an employment guarantee.

"Compassionate appointment is a concession, not a right. It is granted to families in penury to prevent them from being left destitute after the sudden loss of an earning member," the Court observed.

It disagreed with the High Court’s conclusion that terminal benefits and family pension were irrelevant, stating that these factors must be considered while assessing the financial condition of the applicant’s family.

"It is difficult to accept the argument that terminal benefits should have no bearing on financial assessment. The very purpose of compassionate appointment is to provide for families that are unable to sustain themselves. If financial distress does not exist, there is no justification for such an appointment," the judgment stated.

"The Passage of Time Cannot Be a Sole Reason for Rejection"
The Court also addressed the two-decade delay in resolving the case, noting that Ajithkumar was not responsible for the prolonged litigation.

"The lapse of time cannot, in itself, be a reason to reject a claim. The delay in this case was due to legal proceedings, and the applicant should not be penalized for exercising his legal rights," the Bench held.

However, the Court clarified that this did not mean that the applicant was entitled to an appointment as a matter of course, as his eligibility and the financial status of his family had to be carefully assessed under the governing scheme.

"Courts Cannot Direct Appointment Without a Suitability Test"
A crucial aspect of the ruling was the Supreme Court’s criticism of the High Court’s direct order to appoint Ajithkumar without assessing whether he was qualified and suitable for the post.

"A court cannot bypass the requirement of a suitability test by directly ordering an appointment. Even if the claim for compassionate appointment is valid, the applicant must still meet the qualifications and undergo the necessary selection process," the Court emphasized.

It held that the High Court had overstepped its authority by compelling the bank to appoint Ajithkumar without subjecting him to due process.

While the Supreme Court set aside the High Court’s order for direct appointment, it recognized the prolonged legal battle and the legitimate expectation created by earlier rulings. Invoking Article 142 of the Constitution, the Court exercised its extraordinary powers to provide equitable relief.

Instead of ordering his appointment, it directed Canara Bank to pay Ajithkumar ₹2.5 lakh as full and final settlement within two months, in recognition of the hardships he had faced.

"The expectation created by judicial orders over the years cannot be ignored. While compassionate appointment is not possible, some relief must be granted," the Court observed in balancing legal principles with fairness.

"A Judgment That Reaffirms the Purpose of Compassionate Appointments"
This ruling provides much-needed clarity on the scope of compassionate appointments, reinforcing that:

•    Terminal benefits and family pension do not automatically bar an applicant, but they must be considered in assessing financial distress.
•    Courts cannot treat compassionate appointment as a form of alternative recruitment, as it is meant solely to address financial hardship.
•    The passage of time does not, by itself, defeat a claim, especially when the delay arises from prolonged litigation.
•    Judicial overreach in ordering direct appointments is impermissible, as eligibility and suitability must still be assessed under the governing rules.

With this decision, the Supreme Court has ensured that compassionate appointments remain a measure of relief for truly distressed families and not a parallel channel for employment.

"When the law is meant to provide relief, it must be applied with both fairness and wisdom. The fundamental principle remains: compassion, not entitlement," the Court concluded.

Date of Decision: 11 February 2025