Transfer of Property Act (TPA)
TPA Pensions and Stipends Section 6g
Pensions and Stipends under Section 6(g): Non-Transferability, the Pensions Act, 1871, and the Point at Which the Protection Ends
A pension is deferred remuneration for service already rendered, paid so that the pensioner may live after he has stopped working. The Supreme Court has said plainly that it is a right and not a bounty. Yet a right of this kind cannot be sold, and section 6(g) says so, reinforced by two sections of the Pensions Act, 1871 and by the exemptions in the Code of Civil Procedure. The pension flows from the Government to the pensioner along a protected channel, and the law closes every branch that leads anywhere else — until the money reaches his hands, at which point it becomes his like any other money.
Figure 1: The protected channel, the branch the law shuts, the statutory exception, and the point at which protection ends
1. The Clause and Its Statutory Companions
Section 6(g), TPA 'Stipends allowed to military, naval, air-force, and civil pensioners of the Government and political pensions cannot be transferred.' |
Provision | What it adds |
|---|---|
Section 11, Pensions Act, 1871 | No pension granted or continued by Government on political considerations, or on account of past services or present infirmities or as a compassionate allowance, shall be liable to seizure, attachment or sequestration by process of any court at the instance of a creditor, for any demand against the pensioner |
Section 12, Pensions Act, 1871 | All assignments, agreements, orders, sales and securities of every kind made by the person entitled to any such pension, in respect of any money not payable at the time, shall be null and void |
Section 60, Code of Civil Procedure, 1908 | Stipends and gratuities allowed to pensioners of the Government, or of a local authority, or of any other employer, are exempt from attachment in execution of a decree |
Provident Funds Act, 1925 and the Payment of Gratuity Act, 1972 | Provident fund amounts and gratuity carry their own statutory protection against assignment and attachment, on the same reasoning |
2. What the Clause Covers
- Stipends of pensioners of the Government — military, naval, air force and civil. The common feature is a grant by the Government in respect of past service.
- Political pensions — allowances granted on political considerations, historically to former rulers, their families and dependants.
- Family pension, where it is granted by the Government to the family of a deceased servant, rests on the same footing: it is granted for the personal support of the recipient.
- What it does not cover is a pension payable by a private employer or a private trust. The clause speaks of pensioners of the Government and of political pensions; a contractual pension from a private source is an ordinary entitlement once it accrues, subject to the terms that create it.
3. A Pension Is Property, and Yet It Is Not Marketable
The two propositions sit together and are worth stating carefully, because they look contradictory.
The constitutional characterisation In Deoki Nandan Prasad v. State of Bihar, (1971) 2 SCC 330 and again in D.S. Nakara v. Union of India, (1983) 1 SCC 305, the Supreme Court held that pension is not a bounty payable at the sweet will and pleasure of the Government, but a right earned by past service — a measure of socio-economic justice, and property of which the pensioner cannot be deprived save by authority of law. That characterisation determines the pensioner's position against the Government: the pension cannot be withheld or reduced arbitrarily. Section 6(g) determines his position against a purchaser or a creditor: the right, though property, is not in the market. The two rules protect the same person from different directions. |
4. What the Protection Prevents
The attempted transaction | Effect |
|---|---|
A pensioner assigns his future pension to a money-lender | Void under section 6(g), and null and void under section 12 of the Pensions Act |
A pensioner executes a charge or security over his pension | Ineffective — section 12 strikes at securities of every kind in respect of money not payable at the time |
A creditor attaches the pension in execution of a decree | Barred by section 11 of the Pensions Act and by section 60 of the Code of Civil Procedure |
A pensioner commutes part of his pension for a lump sum, where the rules allow it | Permissible — this is not a transfer to a stranger, but the same entitlement taken in a different form, under the statutory scheme |
A pensioner spends, lends or gives away the money after it has been paid to him | Perfectly good — the protection is spent once the payment has been made |
A pensioner directs the treasury to pay the pension to another as his agent | A mandate for collection is not an assignment; but a direction that in substance transfers the entitlement would fall foul of the clause |
5. Where the Protection Ends
The single limit on the clause is the moment of payment. Once the pension has been paid into the hands of the pensioner, it ceases to be a pension and becomes ordinary money. He may spend it, lend it, give it away, invest it, or charge it as security, and his creditors may reach it like any other asset. The statutory protection attaches to the entitlement, not to the rupees once received.
6. Why the Law Protects It
- It is maintenance in another form. The pension is granted so that the pensioner may support himself when he can no longer earn; permitting sale would defeat the object at the first moment of need.
- The pensioner is vulnerable. An elderly person with a certain monthly income and an urgent present need is precisely the person a discounting creditor would seek out.
- It matches the exemption from attachment. What creditors may not seize, the pensioner ought not to be able to give away in advance; otherwise the exemption would survive only until the first loan.
- The State's purpose in granting it would be frustrated. A pension assigned away leaves the State paying money that never reaches the person it was intended to support.
Retention aid Government to pensioner, and nowhere else. Section 6(g) closes the transfer, section 12 of the Pensions Act voids the assignment or charge, section 11 and section 60 of the Code close attachment. The only opening is the statutory one — commutation — and the only exit is payment into his own hands. |
7. Related Topics and Provisions
- Transfer of the Salary of a Public Officer, Section 6(f) — the companion clause protecting present remuneration
- Right to Future Maintenance, Section 6(dd) — the same personal-support policy in private law
- Sections 11 and 12, Pensions Act, 1871 — attachment and assignment of pensions
- Section 60, Code of Civil Procedure, 1908 — stipends and gratuities exempt from attachment
- Deoki Nandan Prasad v. State of Bihar, (1971) 2 SCC 330 and D.S. Nakara v. Union of India, (1983) 1 SCC 305 — pension as a right, not a bounty
- What May Be Transferred, Section 6 — the general rule and the other exceptions