Option for Higher Pension (under the paragraphs of the Employees’ Pension Scheme,1995 for exempted establishment(s) as well as for un-exempted establishment(s) ) Article written by : S K Gupta, Advocate, Supreme Court , +91-11-2265485, Email:skpfdelhi@gmail.com Consequent to the Hon'ble Supreme Court judgment in the SLP No. 33032-33033/2015 (R.C. Gupta and others vs. Regional P.F. Commissioner and others), the Employees’ Provident Fund Organisation, and Delhi issued a circular No. Pension-I/12/33/EPS Amendment/96/Vol.II/34007 dated 23.03.2017, with approval of the Central Government, Ministry of Labour and Employment, to “allow members of EPS, 1995 the benefit of the actual salary in the Pension Fund exceeding wages limit of either Rs. 5000/- or Rs. 6500/- per month from the effective date respectively as per Hon’ble Supreme Court‘s Judgment in SLP No. 33032-33033/2015”. The aforesaid circular says that: “Thus a member contributing to the Provident Fund on the wages exceeding the statutory ceiling or who had contributed to the Provident Fund on the wages exceeding the Statutory ceiling cannot be debarred from exercising the option to contribute on such higher wages to the pension fund.” In the above circular, it has also been expressed that –“It has further been observed that a beneficial Scheme, ought not to be allowed to be defeated by reference to a cut-off date, particularly, in a situation where (as in the present case) the employer has deposited 12% of the actual salary and not 12% of the ceiling limit of Rs. 5000/- or Rs. 6500/-per month, as the case may be.” Thus, the circular dated 23.03.2017 of the EPFO is very clear and leaves no further controversy for payment of higher pension for exempted establishment or un-exempted establishment. However, the implementation of the aforesaid Circular is totally depending upon the concerned RPFC/APFC but, ultimately, the scenario does not bear the sense of a beneficial Scheme, ought not to be allowed to be defeated by reference to a cut-off date or so. In fact, the controversy for non-payment of higher pension got started with the issuance of the EPFO circular no. Pension/Misc.2005/65836 dated 22.11.2006 as the guidelines for regulating the higher pension cases under the said proviso to the paragraph 11(3) of the Employees’ Pension Scheme, 1995 which clearly says that pensionable salary will be limited to Fifteen Thousand per month only. If this paragraph 11(3) of the Pension Scheme,1995 is linked with the issue to paragraph 26 (6) of the EPF Scheme, 1952 which led the RPFC/APFC to put an embargo on all such cases, which finally went to the Supreme Court to pass orders in R.C. Gupta’s case on 04.10.2016. Now the RPFC /APFC have been putting embargos to deny accepting pension Fund ( Account No.10) on a higher basic wages ( more than Rs.15000.00) on the following grounds, especially with reference to the amendments made by the GSR 609(E) dated 22.08.2014 (w.e.f. 01.09.2014) - (i) The R C Gupta’s case is not applicable to exempted employees as their contributions kept by the trust of the exempted establishment vide H.Q. circular dated 31.05.2017. (ii) The proviso to the paragraph 11 (3) of the Scheme,1995 i.e. “ Provided that if at the option of the employer and employee, contribution paid on salary exceeding { rupees six thousand and five hundred /Rs.6500}per month from the date of commencement of this scheme or from the date salary exceeds { rupees six thousand and five hundred /Rs.6500} whichever is later, and 8.33 per cent share of the employers thereof is remitted into the pension fund, pensionable salary shall be based on such higher salary)”. The aforesaid portion of paragraph 11(3) of the Pension Scheme,1995 which was added by G.S.R 134 dated 28.02.1996 which was omitted by G.S.R 609(E) dated 22.08.2014. Hence, after this amendment, no option is available to post-notification retirees or to the present employees/existing members of the fund. (iii) Omitted proviso provides for a fresh option within 6 month for continuing the paying contribution on higher salary, are now governed by newly inserted paragraph 11 (4) of the Employees’ Pension Scheme, 1995 (inserted with effect from 01.09.2014). Since the Employee could not remit 1.16 % on exceeding salary of fifteen thousand as additional contribution so they are not entitled to get higher pension. The amendments of Pension Scheme,1995 ( w.e.f. 01.09.2014) are as under : (i) GSR 609 (E) dated 22.08.2014 (w.e.f. 01.09.2014) redrafting the entire paragraph 11 (4) including deleting the proviso providing a rider, (ii) Providing for a fresh option within 6 months, to continue EPS contribution on higher salary who already opted and paying contribution on higher salary. Provided that the aforesaid members/existing employees have to contribute at the rate of 1.16 per cent on salary exceeding fifteen thousand rupees as an additional contribution from and out of the contribution payable by such employees. With the above mentioned facts, let the constraints be examined due to which the benefits are being denied. In the initially notified EPS, 1995, there was proviso to paragraph 11 (3) providing optional higher benefits. It was inserted vide notification NO. GSR 134 dated 28.02.1996 w.e.f. 16.03.1996. No time limit was prescribed in that proviso for option for contribution on higher salary but due to ill publicity, options were not exercised by willing members or May be their calculation and comparison of benefits of pension and deposits in the P.F. Over a period of time, when return of P.F deposits became less beneficial, retiring or retired members found pension on higher salary more beneficial where their employers paid PF contribution on higher salary. Then they approached the concerned EPFO PF and sought some clarifications from the H.Q. In turn, EPFO H.Q. issued circular dated 22.11.2006 which linked such option with the permission of the PF authorities under paragraph 26 (6) of the E.P.F. Scheme, 1952. As evident, this paragraph was never revoked in general except some individual cases where the PF authorities used to grant permission. Despite this, PF contributions on higher salary was and is being accepted and PF accounts were prepared and annual accounts slips were being issued to individual members. In one case of a widow, the M.P. High Court accepted the option as deemed option where a PF member joined prior to 01.03.1971 did exercise option for Employees’ Family Pension Scheme, 1971 but continued to contribute EFPS contribution and died after certain period thereafter which made his widow entitled to family pension. Accordingly, revoking and linking para 28 (6) of the EPF Scheme, 1952 for higher contribution to EPS, 1995 was required to be interpreted and the circular dated 22.11.2006 was to be acted upon. It is worthwhile to mention that before the judgment of RC Gupta (supra) , the Hon’ble Supreme Court earlier dismissed various appeals SLP (C) No. 7074, 7075, 7076, 7107, 7108, 7224 of 2014 and 697 of 2016 filed by the Employees’ Provident Fund Organisaion , Delhi against Kerala High Court order in the case of 1135/2012 on 31.03.2016 and SLP (c) No. 19954/2015 against Kerala high Court orders in the WA No. 1362/2014. Thereafter, the Hon’ble the Supreme Court finally passed a detailed judgment on 04.10.2016 in the SLP (C) No. 10013-10014/2016 ( R C Gupta Vs. RPFC , EPFO and ors. 2017 LLR 86 ) arose out of order of DB of Himachal Pradesh High Court order in SLP (C) 33032-33033/2015 in which the DB reversed the order of the single Judge. Consequent to this judgment, the EPFO issued a circular dated 23.03.2017 with the approval of the Ministry of Labour & Employment with the intention to adhere and implement the RC Gupta Case (supra). A true copy of the aforesaid circular is annexed hereto for your perusal and identification. Subsequent to issue of the circular dated 23.03.2017, pension benefits were provided to the members of the fund for exempted establishment as well as for unexampled establishment. Further, the Rajasthan High Court in its DB judgment dated 05.01.2018 in the matter of Ajay Batra vs. RPFC and others (17276/2013) has allowed pension on higher/full salary as he was superannuated in 2016. This case has negated the contention of the EPFO that post 01.09.2014 retirees are not eligible for the benefit of the SC order in the case of R.C. Gupta(supra). In continuation of R C Gupta (supra) , the Hon’ble Kerala High Court in the WP(C ) No. 13120 of 2015 vide judgment dated 12.10.2018 has decided based on R C Gupta case (supra) and the Hon’ble Kerala High Court has set aside notification No.GSR 609 vide judgment dated 12.10.2018 Further , the Hon’ble Rajasthan High Court in the matter of Sh. Vinod Kumar Sharma and Ors. Vs.Chairman , Central Board of Trust and Ors. S.B. Civil Writs No. 17616 of 2017 was also decided based on RC Gupta case (supra) , the Hon’ble High Court categorically pronounced in paragraph 25 that “ it is submitted that proviso to Clause 11(3) of the Pension Scheme was deleted vide notification dated 22.08.2014 w.e.f. 01.09.2014 and thereafter the benefit of proviso cannot be extended to any employee after 01.09.2014 if he had not exercised the option earlier. In the opinion of the this court , such a notification will not apply in view of the judgment passed by the Supreme Court in the case of RC Gupta & Ors.(supra). It is also noted that the Division Bench of High Court of Kerala vide its judgment dated 12.10.2018 has also set aside the Employees’ Pension Amendment Scheme,2014 issued vide notification dated 22.08.2014 whereby the aforesaid proviso was deleted……………………………………In view thereof, the benefit of this judgment would also be applicable to the existing employees who are yet to retire”. Therefore , keeping in view of the above judgments , it is well established principle of law that the PF contribution ( Account No.01) of the exempted employees is kept in the exempted PF Trust, granted by the appropriate Government. These exempted PF trusts always remain under the direct control of the concerned Regional Provident Fund Commissioner / Assistant Provident Fund Commissioner as per guide-lines issued in paragraph 27-AA of the Employees’ Provident Fund Scheme, 1952, then there cannot be any question of doubt that the PF contribution of the exempted employees is not under their control. Moreover, the employer, even of the exempted establishment is under obligation by law under paragraph 3 of the EPS, 1995 to segregate a part of his contribution payable under section 6 (read with paragraph 29 of the EPF Scheme, 1952) @ 8.33% of the pay and transfer it to the Pension Fund ( Account No.10). The exempted PF trust of the establishment, who is under obligation to transfer PF Contribution , kept in account no.1 , to the pension fund if it is asked /directed by the EPFO. There is no issue/dispute regarding Provident Fund for which exemption had been granted by the appropriate government whereas these were Un-exempted for EPS (Pension Fund) but the benefit as accorded by the Apex Court is being erroneously and unlawfully denied for Pension revision by treating such establishments as Exempted establishment. Therefore , the arguments of the EPFO in view of the R C Gupta (supra) that the pension benefit is only applicable to un-exempted establishment and that too before retirees of September’2014 is not tenable in view of the RC Gupta case(supra) and Kerala High Court’s judgment. The aforesaid portion of paragraph 11(3) of the Pension Scheme,1995 which was added by G.S.R 134 dated 28.02.1996, is omitted by G.S.R 609(E) dated 22.08.2014. Hence, after this amendment, no option is available to post-notification retirees or to the present employees/existing members of the fund. Most of the request for higher pension as per paragraph 11(3) of the Pension Scheme,1995 is being rejected by the EPFO because the aforesaid option for higher pension was not exercised on or before 01.12.2004. This action of the EPFO was challenged before the Hon’ble Kerala High Court and the Kerala High Court in the writ Petition No. WP (C) No. 6643 and 9929 of 2007. The Court held that paragraph 11(3) of the Scheme,1995, added with effect from 16.12.1996 was retrospective in operation, applicable from the date of commencement of the Scheme,1995. The cut-off date pronounced by the EPFO was unsustainable. The Hon’ble Court found that the employee and employer may give joint option at any time as per paragraph 11(3) of the Scheme,1995. Subsequently, WA No.568 of 2012 was also filed which was dismissed and that too, SLP was also dismissed. As result of the aforesaid legal position, a joint application as per paragraph 11(3) of the Pension Scheme,1995, if it is moved the employer and employee, cannot be rejected by the Regional Provident Fund Commissioner / Assistant PF Commissioner. The Central Government further amended the Pension Scheme with effect from 01.09.2014 by which the Employees’ Pension ( Amendment) Scheme,2014 brought into force by Notification No.GSR 609 dated 22.08.2014 and in this amended provision , cut-off date was also inserted by adding paragraph 11(4) which was available to the employees upto August’2015. Benefit of the aforesaid amendment , large no. of employees could not be opted higher pension or availed this option as enumerated under paragraph 11(4) of the Pension Scheme,1995. However , this notification No.GSR 609 was set-aside by the Hon’ble Kerala High Court in the WP(C ) No. 13120 of 2015 vide judgment dated 12.10.2018. The Hon’ble Kerala High Court in this judgment in paragraph 38 has rightly observed that due to various amendments , the EPFO has created different class of pensioners which is as under : (i) Employees who have exercised option under the proviso to paragraph 11(3) of the 1995 Scheme and continuing in service as on 1.9.2014; (ii) Employees who have not exercised their option under the proviso to paragraph 11(3) of the 1995 Scheme, and continuing in service as on 1.9.2014; (iii) Employees who have retired prior to 1.9.2014 without exercising an option under paragraph 11(3) of the 1995 Scheme; (iv) Employees who have retired prior to 1.9.2014 after exercising the option under paragraph 11(3) of 1995 Scheme. The rationale in so classifying the employees covered by the Pension Scheme on the basis of the above date is not forthcoming. The object sought to be achieved is stated to be prevention of depletion of the Pension Fund, which cannot be accepted as a justification to support the classification. Inasmuch as the statutory scheme is to make the Pension Fund ensure to the benefit of the homogeneous class of the totality of employees covered by the Provident Fund, a further classification of the said class by formulating a Scheme is ultra vires the power available to the Central Government under Sections 5 and 7 of the EPF Act. Therefore, it has to be held that, the impugned amendments are arbitrary, ultra vires the EPF Act and unsustainable”. Recently , the EPFO/Union of India has filed the SLP in the Supreme Court in this month of March’2019 against the Kerala High Court’s judgment dated 12.10.2018 in the writ petition No. 13120 of 2015 along with the application for condoning the delay. This SLP No. 9610 of 2019 was listed on 01.04.2019 before the Hon’ble Supreme Court of India , in respect of the dispute of higher pension in respect of those employees, who retired after the September’2014. The Hon’ble Supreme Court has dismissed the SLP on 01.04.2019. Therefore , the judgment of the Hon’ble Kerala High Court will be applicable across the country as per the Article 141 of the Indian Constitution . CONCLUSION HENCE, in my considered opinion that existing employees of the exempted establishment and/or un-exempted establishment and/or retired employees ( either retired before September’2014 or retired after September’2014) are entitled higher pension as per the paragraph of the Employees’ Pension Scheme,1995 and now , the concerned RPFC/APFC cannot deny to grant higher pension based on the notification No. GSR 609 dated 22.08.2014 which was set aside by the Hon’ble Kerala High Court . Therefore , such existing employees and/or retired employees may of exempted establishment and/or un-exempted establishment may approach to their respective Employees’ Provident Fund Organisation for getting higher pension and the EPFO is bound to grant higher pension to their members of the Fund. For seeking expert legal opinion , the employees / organisation /establishment may contact at my email: skpfdelhi@gmail.com replicas de relojes S K Gupta , Advocate , Supreme Court. Do not miss fake watches UK perfect fake watches on the reliable website!Official AAA replica watches UK are selling at a low price. You can find quality fake watches here.
Option for Higher Pension
(under the paragraphs of the Employees’ Pension Scheme,1995 for exempted establishment(s) as well as for un-exempted establishment(s) )
Article written by : S K Gupta, Advocate, Supreme Court ,
+91-11-2265485, Email:skpfdelhi@gmail.com
Consequent to the Hon'ble Supreme Court judgment in the SLP No. 33032-33033/2015 (R.C. Gupta and others vs. Regional P.F. Commissioner and others), the Employees’ Provident Fund Organisation, and Delhi issued a circular No. Pension-I/12/33/EPS Amendment/96/Vol.II/34007 dated 23.03.2017, with approval of the Central Government, Ministry of Labour and Employment, to “allow members of EPS, 1995 the benefit of the actual salary in the Pension Fund exceeding wages limit of either Rs. 5000/- or Rs. 6500/- per month from the effective date respectively as per Hon’ble Supreme Court‘s Judgment in SLP No. 33032-33033/2015”. The aforesaid circular says that:
“Thus a member contributing to the Provident Fund on the wages exceeding the statutory ceiling or who had contributed to the Provident Fund on the wages exceeding the Statutory ceiling cannot be debarred from exercising the option to contribute on such higher wages to the pension fund.”
In the above circular, it has also been expressed that –“It has further been observed that a beneficial Scheme, ought not to be allowed to be defeated by reference to a cut-off date, particularly, in a situation where (as in the present case) the employer has deposited 12% of the actual salary and not 12% of the ceiling limit of Rs. 5000/- or Rs. 6500/-per month, as the case may be.”
Thus, the circular dated 23.03.2017 of the EPFO is very clear and leaves no further controversy for payment of higher pension for exempted establishment or un-exempted establishment. However, the implementation of the aforesaid
Circular is totally depending upon the concerned RPFC/APFC but, ultimately, the scenario does not bear the sense of a beneficial Scheme, ought not to be allowed to be defeated by reference to a cut-off date or so.
In fact, the controversy for non-payment of higher pension got started with the issuance of the EPFO circular no. Pension/Misc.2005/65836 dated 22.11.2006 as the guidelines for regulating the higher pension cases under the said proviso to the paragraph 11(3) of the Employees’ Pension Scheme, 1995 which clearly says that pensionable salary will be limited to Fifteen Thousand per month only. If this paragraph 11(3) of the Pension Scheme,1995 is linked with the issue to paragraph 26 (6) of the EPF Scheme, 1952 which led the RPFC/APFC to put an embargo on all such cases, which finally went to the Supreme Court to pass orders in R.C. Gupta’s case on 04.10.2016.
Now the RPFC /APFC have been putting embargos to deny accepting pension Fund ( Account No.10) on a higher basic wages ( more than Rs.15000.00) on the following grounds, especially with reference to the amendments made by the GSR 609(E) dated 22.08.2014 (w.e.f. 01.09.2014) -
(i) The R C Gupta’s case is not applicable to exempted employees as their contributions kept by the trust of the exempted establishment vide H.Q. circular dated 31.05.2017.
(ii) The proviso to the paragraph 11 (3) of the Scheme,1995 i.e. “ Provided that if at the option of the employer and employee, contribution paid on salary exceeding { rupees six thousand and five hundred /Rs.6500}per month from the date of commencement of this scheme or from the date salary exceeds { rupees six thousand and five hundred /Rs.6500} whichever is later, and 8.33 per cent share of the employers thereof is remitted into the pension fund, pensionable salary shall be based on such higher salary)”. The aforesaid portion of paragraph 11(3) of the Pension Scheme,1995 which was added by G.S.R 134 dated
28.02.1996 which was omitted by G.S.R 609(E) dated 22.08.2014. Hence, after this amendment, no option is available to post-notification retirees or to the present employees/existing members of the fund.
(iii) Omitted proviso provides for a fresh option within 6 month for continuing the paying contribution on higher salary, are now governed by newly inserted paragraph 11 (4) of the Employees’ Pension Scheme, 1995 (inserted with effect from 01.09.2014). Since the Employee could not remit 1.16 % on exceeding salary of fifteen thousand as additional contribution so they are not entitled to get higher pension.
The amendments of Pension Scheme,1995 ( w.e.f. 01.09.2014) are as under :
(i) GSR 609 (E) dated 22.08.2014 (w.e.f. 01.09.2014) redrafting the entire paragraph 11 (4) including deleting the proviso providing a rider,
(ii) Providing for a fresh option within 6 months, to continue EPS contribution on higher salary who already opted and paying contribution on higher salary. Provided that the aforesaid members/existing employees have to contribute at the rate of 1.16 per cent on salary exceeding fifteen thousand rupees as an additional contribution from and out of the contribution payable by such employees.
With the above mentioned facts, let the constraints be examined due to which the benefits are being denied.
In the initially notified EPS, 1995, there was proviso to paragraph 11 (3) providing optional higher benefits. It was inserted vide notification NO. GSR 134 dated 28.02.1996 w.e.f. 16.03.1996. No time limit was prescribed in that proviso for option for contribution on higher salary but due to ill publicity, options were not exercised by willing members or
May be their calculation and comparison of benefits of pension and deposits in the P.F. Over a period of time, when return of P.F deposits became less beneficial, retiring or retired members found pension on higher salary more beneficial where their employers paid PF contribution on higher salary. Then they approached the concerned EPFO PF and sought some clarifications from the H.Q. In turn, EPFO H.Q. issued circular dated 22.11.2006 which linked such option with the permission of the PF authorities under paragraph 26 (6) of the E.P.F. Scheme, 1952. As evident, this paragraph was never revoked in general except some individual cases where the PF authorities used to grant permission. Despite this, PF contributions on higher salary was and is being accepted and PF accounts were prepared and annual accounts slips were being issued to individual members. In one case of a widow, the M.P. High Court accepted the option as deemed option where a PF member joined prior to 01.03.1971 did
exercise option for Employees’ Family Pension Scheme, 1971 but continued to contribute EFPS contribution and died after certain period thereafter which made his widow entitled to family pension. Accordingly, revoking and linking para 28 (6) of the EPF Scheme, 1952 for higher contribution to EPS, 1995 was required to be interpreted and the circular dated 22.11.2006 was to be acted upon.
It is worthwhile to mention that before the judgment of RC Gupta (supra) , the Hon’ble Supreme Court earlier dismissed various appeals SLP (C) No. 7074, 7075, 7076, 7107, 7108, 7224 of 2014 and 697 of 2016 filed by the Employees’ Provident Fund Organisaion , Delhi against Kerala High Court order in the case of 1135/2012 on 31.03.2016 and SLP (c) No. 19954/2015 against Kerala high Court orders in the WA No. 1362/2014. Thereafter, the Hon’ble the Supreme Court finally passed a detailed judgment on 04.10.2016 in the SLP (C) No. 10013-10014/2016 ( R C Gupta Vs. RPFC , EPFO and ors. 2017 LLR 86 ) arose out of order of DB of Himachal Pradesh High Court order in SLP (C) 33032-33033/2015 in which the DB reversed the order of the single Judge.
Consequent to this judgment, the EPFO issued a circular dated 23.03.2017 with the approval of the Ministry of Labour & Employment with the intention to adhere and implement the RC Gupta Case (supra). A true copy of the aforesaid circular is annexed hereto for your perusal and identification. Subsequent to issue of the circular dated 23.03.2017, pension benefits were provided to the members of the fund for exempted establishment as well as for unexampled establishment.
Further, the Rajasthan High Court in its DB judgment dated 05.01.2018 in the matter of Ajay Batra vs. RPFC and others (17276/2013) has allowed pension on higher/full salary as he was superannuated in 2016. This case has negated the contention of the EPFO that post 01.09.2014 retirees are not eligible for the benefit of the SC order in the case of R.C. Gupta(supra). In continuation of R C Gupta (supra) , the Hon’ble Kerala High Court in the WP(C ) No. 13120 of 2015 vide judgment dated 12.10.2018 has decided based on R C Gupta case (supra) and the Hon’ble Kerala High Court has set aside notification No.GSR 609 vide judgment dated 12.10.2018
Further , the Hon’ble Rajasthan High Court in the matter of Sh. Vinod Kumar Sharma and Ors. Vs.Chairman , Central Board of Trust and Ors. S.B. Civil Writs No. 17616 of 2017 was also decided based on RC Gupta case (supra) , the Hon’ble High Court categorically pronounced in paragraph 25 that “ it is submitted that proviso to Clause 11(3) of the Pension Scheme was deleted vide notification dated 22.08.2014 w.e.f. 01.09.2014 and thereafter the benefit of proviso cannot be extended to any employee after 01.09.2014 if he had not exercised the option earlier. In the opinion of the this court , such a notification will not apply in view of the judgment passed by the Supreme Court in the case of RC Gupta & Ors.(supra). It is also noted that the Division Bench of High Court of Kerala vide its judgment dated 12.10.2018 has also set aside the Employees’ Pension Amendment Scheme,2014 issued vide notification dated 22.08.2014 whereby the aforesaid proviso was deleted……………………………………In view thereof, the benefit of this judgment would also be applicable to the existing employees who are yet to retire”.
Therefore , keeping in view of the above judgments , it is well established principle of law that the PF contribution ( Account No.01) of the exempted employees is kept in the exempted PF Trust, granted by the appropriate Government. These exempted PF trusts always remain under the direct control of the concerned Regional Provident Fund Commissioner / Assistant Provident Fund Commissioner as per guide-lines issued in paragraph 27-AA of the Employees’ Provident Fund Scheme, 1952, then there cannot be any question of doubt that the PF contribution of the exempted employees is not under their control. Moreover, the employer, even of the exempted establishment is under obligation by law under paragraph 3 of the EPS, 1995 to segregate a part of his contribution payable under section 6 (read with paragraph 29 of the EPF Scheme, 1952) @ 8.33% of the pay and transfer it to the Pension Fund ( Account No.10). The exempted PF trust of the establishment, who is under obligation to transfer PF Contribution , kept in account no.1 , to the pension fund if it is asked /directed by the EPFO. There is no issue/dispute regarding Provident Fund for which exemption had been granted by the appropriate government whereas these were Un-exempted for EPS (Pension Fund) but the benefit as accorded by the Apex Court is being erroneously and unlawfully denied for Pension revision by treating such establishments as Exempted establishment. Therefore , the arguments of the EPFO in view of the R C Gupta (supra) that the pension benefit is only applicable to un-exempted establishment and that too before retirees of September’2014 is not tenable in view of the RC Gupta case(supra) and Kerala High Court’s judgment.
The aforesaid portion of paragraph 11(3) of the Pension Scheme,1995 which was added by G.S.R 134 dated 28.02.1996, is omitted by G.S.R 609(E) dated 22.08.2014. Hence, after this amendment, no option is available to post-notification retirees or to the present employees/existing members of the fund. Most of the request for higher pension as per paragraph 11(3) of the Pension Scheme,1995 is being rejected by the EPFO because the aforesaid option for higher pension was not exercised on or before 01.12.2004. This action of the EPFO was challenged before the Hon’ble Kerala High Court and the Kerala High Court in the writ Petition No. WP (C) No. 6643 and 9929 of 2007. The Court held that paragraph 11(3) of the Scheme,1995, added with effect from 16.12.1996 was retrospective in operation, applicable from the date of commencement of the Scheme,1995. The cut-off date pronounced by the EPFO was unsustainable. The Hon’ble Court found that the employee and employer may give joint option at any time as per paragraph 11(3) of the Scheme,1995. Subsequently, WA No.568 of 2012 was also filed which was dismissed and that too, SLP was also dismissed. As result of the aforesaid legal position, a joint application as per paragraph 11(3) of the Pension Scheme,1995, if it is moved the employer and employee, cannot be rejected by the Regional Provident Fund Commissioner / Assistant PF Commissioner.
The Central Government further amended the Pension Scheme with effect from 01.09.2014 by which the Employees’ Pension ( Amendment) Scheme,2014 brought into force by Notification No.GSR 609 dated 22.08.2014 and in this amended provision , cut-off date was also inserted by adding paragraph 11(4) which was available to the employees upto August’2015. Benefit of the aforesaid amendment , large no. of employees could not be opted higher pension or availed this option as enumerated under paragraph 11(4) of the Pension Scheme,1995. However , this notification No.GSR 609 was set-aside by the Hon’ble Kerala High Court in the WP(C ) No. 13120 of 2015 vide judgment dated 12.10.2018. The Hon’ble Kerala High Court in this judgment in paragraph 38 has rightly observed that due to various amendments , the EPFO has created different class of pensioners which is as under :
(i) Employees who have exercised option under the proviso to paragraph 11(3) of the 1995 Scheme and continuing in service as on 1.9.2014;
(ii) Employees who have not exercised their option under the proviso to paragraph 11(3) of the 1995 Scheme, and continuing in service as on 1.9.2014;
(iii) Employees who have retired prior to 1.9.2014 without exercising an option under paragraph 11(3) of the 1995 Scheme;
(iv) Employees who have retired prior to 1.9.2014 after exercising the option under paragraph 11(3) of 1995 Scheme.
The rationale in so classifying the employees covered by the Pension Scheme on the basis of the above date is not forthcoming. The object sought to be achieved is stated to be prevention of depletion of the Pension Fund, which cannot be accepted as a justification to support the classification. Inasmuch as the statutory scheme is to make the Pension Fund ensure to the benefit of the homogeneous class of the totality of employees covered by the Provident Fund, a further classification of the said class by formulating a Scheme is ultra vires the power available to the Central Government under Sections 5 and 7 of the EPF Act. Therefore, it has to be held that, the impugned amendments are arbitrary, ultra vires the EPF Act and unsustainable”.
Recently , the EPFO/Union of India has filed the SLP in the Supreme Court in this month of March’2019 against the Kerala High Court’s judgment dated 12.10.2018 in the writ petition No. 13120 of 2015 along with the application for condoning the delay. This SLP No. 9610 of 2019 was listed on 01.04.2019 before the Hon’ble Supreme Court of India , in respect of the dispute of higher pension in respect of those employees, who retired after the September’2014. The Hon’ble Supreme Court has dismissed the SLP on 01.04.2019. Therefore , the judgment of the Hon’ble Kerala High Court will be applicable across the country as per the Article 141 of the Indian Constitution .
CONCLUSION
HENCE, in my considered opinion that existing employees of the exempted establishment and/or un-exempted establishment and/or retired employees ( either retired before September’2014 or retired after September’2014) are entitled higher pension as per the paragraph of the Employees’ Pension Scheme,1995 and now , the concerned RPFC/APFC cannot deny to grant higher pension based on the notification No. GSR 609 dated 22.08.2014 which was set aside by the Hon’ble Kerala High Court . Therefore , such existing employees and/or retired employees may of exempted establishment and/or un-exempted establishment may approach to their respective Employees’ Provident Fund Organisation for getting higher pension and the EPFO is bound to grant higher pension to their members of the Fund.
For seeking expert legal opinion , the employees / organisation /establishment may contact at my email: skpfdelhi@gmail.com
replicas de relojes
S K Gupta , Advocate , Supreme Court.