The court of appeal disagreed with the claim of Gurkhas that the ministry of defence unlawfully discriminated against them on the grounds of age and race.
Nepalese Gurkha veterans, who had served the British Army and retired before 1997, today lost the latest round of their court battle with the ministry of defence to claim the same pensions as their British comrades.
The court of appeal disagreed with the claim of Gurkhas that the ministry of defence unlawfully discriminated against them on the grounds of age and race.
They had appealed following a judgment in the high court in January which ruled the ministry had not acted unlawfully and rejected all the grounds of challenge.
In a test case which would affect 25,000 veterans, the retired Gurkhas were seeking equal pension payments with soldiers who retired after a July 1, 1997 cut-off date, when the Gurkha headquarters was moved from Hong Kong to Britain.
They are paid a third of the pension that Gurkha veterans who retired after 1997 receive.
Those who retired after 1997 receive the same amount as their British colleagues, while serving Gurkhas earned pension equality in 2007.
The ministry of defence argued the pension cut-off date was "justified and proportionate".
But Retired Major Tikendra Dal Dewan, chairman of the Gurkha welfare Society said, "We are very disappointed with the court's judgment and will be conferring with our legal team over the coming days to discuss taking our case to the European courts."
"We maintain that there is a cost benefit to the UK in resolving this issue, let alone the moral obligation of ensuring a respectable quality of life for these elderly Gurkhas and their families, all of whom have given great and devoted service to the UK's armed forces."
Gurkhas, who are recruited from Nepal, have been part of the British army for almost 200 years.
Last year, all retired Gurkhas won the right to live in the UK, following a high-profile campaign championed by actress Joanna Lumley.
The ministry of defence said over the course of a retirement "these Gurkha soldiers will receive at least the same amount of pension as their British counterparts".
About 2,00,000 Gurkhas fought for Britain in World War I and World War II and more than 45,000 have died in British uniform.
Around 3,500 now serve in the British Army, including in Afghanistan.
Gurkhas have won 13 Victoria Crosses, the top military award for valour and they are highly respected for their valour.
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