The Court further clarified that for an act to be termed "grave misconduct" under the CCS (Pension) Rules, there must be an element of moral turpitude, fraud, or a significant breach of duty that causes loss to the state. In this case, there was no pecuniary (financial) loss to the government.

Transparency is Vital: The Court emphasized that because the petitioner maintained transparency at all times regarding his relationship, there was no mala fide (bad faith) intention to obtain benefits through misrepresentation.
Context Matters: The Court observed that the petitioner’s efforts were directed toward providing security for the woman he had lived with for decades and their children. Labeling this as "lack of integrity" was deemed "misconceived."
Proportionality of Penalty: Withholding half of a person's life-long savings (pension) for a clerical entry regarding a well-known domestic relationship was found to be excessive and legally unsustainable.

Setting aside the CAT's order and the Disciplinary Authority's penalty, the Delhi High Court declared that Birendra Singh Kunwar is entitled to his full monthly pension and gratuity.

The Court directed the Government to:

Release the withheld pension and gratuity amounts effective from August 1, 2012.
Pay interest at the rate of 6% per annum on all delayed payments.
Consider the petitioner’s plea to include the names of Ms. Manihal Devi and her children in the Pension Payment Order (PPO) for the purposes of family pension and CGHS (Central Government Health Scheme) facilities.

The respondents have been given eight weeks to comply with these directions.