Complaint filed on: 25.11.2015

Complaint Disposed on:11.01.2017

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, AT CHICKMAGALUR.

COMPLAINT NO.145/2015

DATED THIS THE 11^th DAY OF JANUARY 2017

:PRESENT:

HON’BLE SRI RAVISHANKAR, B.A.L, LL.B., - PRESIDENT

HON’BLE SMT B.U.GEETHA, M. COM., LL.B., -MEMBER

HON’BLE SMT H. MANJULA, B.A.L., LL.B., - MEMBER

COMPLAINANT:

1.     Sri. S.S.Marlaiah S/o Shivarudraiah

A/a 66 years,C/o Shivarudraiah

K.H.B.Colony, Lakshmipura,

Arasikere Taluk, Hassan District.

2.   Sri. B.N.Marulappa S/o R.Nijagunappa

        A/a 65 years, R/o Bittenahalli,

        Kanakatte, Kadur, Chikmagalur District.

(By Sri/Smt. K.M.Abdul Jabbar, Advocate)

V/s

OPPONENT:

The Regional Provident Fund Commission-II

Office of the Provident Fund Orgainzation,

Sub-Regional Office, Rathnagiri Road,

Chikmagalur Town.

(By Sri/Smt. Halekote A. Thejaswi, Advocate)

By Hon’ble President Sri. Ravishankar,

:O R D E R:

The complainants filed this complaint U/s 12 of the Consumer Protection Act 1986 against OP alleging deficiency in service in not calculating the pension payable to both complainants by giving two years weightage and also not paying the arrears of pension along with interest.  Hence, prays for direction against OP and to give annual relief as per the Paragraph 32 of the Employees Provident Fund Scheme 1995 along with arrears of pension and compensation for deficiency in service. 

2. The brief facts of the complaint is that:

The complainants are retired employees of Karnataka State Road Transport Corporation, Chikmagalur Division, Chikmagalur and they have rendered service more than 20 years without any interruption in the said KSRTC.  At the time of their employment, they become the members of the Family Pension Scheme 1971 and after introduction of the Employees Pension Scheme 1995 they were continued as a member of the said pension scheme under the pension scheme 1995 also.  Both of them after retirement are getting pension from the OP and they have given a representation through their Advocate on 20.10.2015 to OP to re-fix the pension by adding two years weightage as per 12(4) of the Employees Provident Fund Scheme 1995, but no steps were taken by OP so far and complainant have not received any reply from the OP even till today.

The complainants further alleges that due to non considering the representation dated:20.10.2015 the complainants have suffered financial loss.  The Employees pension scheme was introduced from 01/03/1971 to 15/11/1971 and the said scheme was introduced and coming effect from 16/11/1995.  Admittedly, the complainants are the members of the said pension scheme and they have rendered 20 years service.  Hence, they are eligible to get two years weightage as per the new pension scheme.  In spite of repeated requests, the OP has not provided two years weightage and not paid the arrears of pension as per the new scheme.  Hence, prays for direction to OP to settle the pension arrears along with re-fixation of the pension as per the new scheme and also prays for payment of compensation for deficiency in service.    

3.     After service of notice the OP appeared through his counsel and filed version and contended that the complainants have misrepresented the provisions of the scheme and filed this false complaint in order to gain personally.

The OP further contended that the Family Pension Scheme 1971 (old scheme) where the Employer used to contribute 1.16% and Employee used to contribute 1.16% of this salary.  The old scheme ceased to exist and Employees Pension Scheme 1995(hereinafter called new scheme) has come into force with effect from 16.11.1995.  All members of the Old Scheme were brought into the purview of New Scheme by calling them existing members and all the contributions made by Employer and Employee in the old scheme has been compensated commensurately by providing past service benefit by arriving multiplying the slab available in Para 12(3) by factor in Table B of New Scheme.  The benefit so arrived being added with Formula pension as defined in Para 12(2) of New Scheme.  The sum Total of both the benefits is being payable subject to minimum pension as per Para 12(3), 12(4) and 12(5) of New Scheme. 

The OP further contended that the intention of the legislature for providing a minimum pension was to protect the quantum of benefit of all those employees who were members of old pension scheme and later joined new pension scheme.  In the present case, the complainants have misinterpreted the rule provision by applying minimum pension to the past service benefit as defined above.  The misinterpretation has occurred as the past service benefit and minimum pension has been written in the same Para 12(3), 12(4) and 12(5) of New Scheme.

The OP further contended that the similar confusion has arrived at various parts of the country before various judicial and quasi judicial authorities.  Therefore, the scheme provision has been amended vide GSR No.431€ dated: 15^th June 2007 where it is clearly mentioned that his provision is deemed to have came into effect from the date from which Employees Pension Scheme 1995 came into force i.e. 16/11/1995 where it is clearly mentioned as follows:

Para 12(3) In the case of an existing member in respect of whom the date of commencement of pension is after the 16^th November 2005

1. Superannuation or early pension shall be equal to the aggregate of

1. Pension as determined under Sub-Paragraph(2) for the period of pensionable service rendered from the 16^th November 1995 or Rs.635/- per month whichever is more:
2. Past service pension shall be as given below

The past service pension payable on completion of 58 years of age on 16.11.1995

        The amount under column (2) or (3) above, as the case may be, shall be multiplied by the factor given in Table “B” corresponding to the period between the 16^th Novmeber 1995 and the date of exit to arrive at the past service pension payable.

(ii) The aggregate of (a) and (b) calculated as above shall be subject to a minimum of Rs.800/- per month, provided the eligible service is 24 years.  Provided further, if it is less than 24 years, the pension as computed above shall be reduced proportionately subject to a minimum of Rs.450/- per month.

        Therefore in the present case, the complainant have not locus standi for demanding the pension payable by applying minimum pension to past service benefit, and hence the complainant is not entitled for any benefit as claimed.  In this connection it is pertinent to reproduce the provisions of Section 7 of EPF & MP Act, 1952 which reads as follows:

Section 7. Modification of Scheme: (1) The Central Government may, by notification in the official Gazette add to, [amend or vary, either prospectively or retrospectively, the scheme, the [pension] scheme or the insurance scheme, as the case may be.]

(2) Every notification issued under sub section (1) shall be laid, as soon as may be after it is issued, before each house of parliament while it is in session, for a total period of thirty days, which may be comprised in one session or in two or more successive sessions and if, before the expiry of the session immediately following the session or the successive sessions aforesaid, both houses agree in making any modification in the notification, or both houses agree that the notification should not be issued, the notification shall thereafter have effect only in such modified form or be of no effect as the case may be; so, however, that any such modification or annulment shall be without prejudice to the validity of anything previously done under that notification.]

As per Para 35 of EPS, the Central Government is competent to issue directions with regard to resolving any difficulty in the disbursement of  pension and other benefits and implementations of the Scheme, Provisions of Para 35 of EPS is reproduced below:

Para 35 Power to issue directions: The Central Government may issue, such directions as may be deemed just and proper by it for resolving any difficulty in the disbursement of pension and other benefits or for resolving any difficulty in implementation of this Scheme.

           As per Para 41 of Employee Pension scheme, only the Central Government is competent to issue any clarification regarding the EPS (New Scheme) which reads as follows:

Para 41. Interpretation: Where any doubt arises with regard to the interpretation of the provisions of this Scheme, it shall be referred to the Central Government who shall decide the same.

There was certain confusions regarding whether the minimum pension will be applicable only to the past service benefits (i.e. Pension arrived as per Table B)

Or

 The minimum will be applicable to the aggregate of pension arrived for past service and service under the New Scheme.

As only the Government of India is a competent Authority to issue any clarification/interpretation, therefore the matter was referred to the Government. The Government of India vide its letter dated 10.05.1999 has issued authoritative clarifications stating that the minimum  pension will be applicable to the aggregate of pension arrived for the past service and the service under New Scheme.

Despite issuance of authoritative clarification /interpretation of the scheme, various Courts viz. District Consumer Forum. State Commission, National Commission & High Courts has continued to misunderstand the provision of the Scheme, therefore the authoritative clarification s/Interpretation issued by Government of India in accordance with Para (41) of the New Scheme has been incorporated as integral part of the new Scheme by way of substitution by Gazette Notification by G.S.R. 431€, dated: 15^th June 2007 (deemed to have come into force from the date from the Employees’ Pension Scheme, 1995 came into force i.e. 16^th November 1995.

The present clarification/interpretation has incorporated by above said Gazette notification cannot be referred as amendment.  By this clarification / interpretation only the existing provision of the New Scheme has been clarified without changing any of the benefit amounts payable to the any of the member in the form of pension.  Moreover in the said Gazette Notification Dt: 15^th June 2007 it has been clarified that it will be applicable from 16.11.1995 as if it is a part of the New Scheme i.e. since its inception.  Therefore, the claim of the complainant that his benefits have been reduced is totally misplaced.

The OP further contended that Para 2(xv) of New Scheme is read as below:

Pensionable service means the service rendered by the member for which contributions have been received or are receivable and in the above para the contribution means, contribution payable under section 6 & 6A of Employees Provident Funds and miscellaneous provisions Act, 1952 and has been fixed @ Eight and one third percent of basic wage and dearness allowances and retaining allowances.  Therefore, definition of contribution cannot be stretched to include the old pension scheme.

The OP further alleged that the definition of pensionable service is distinct from the definition of past service which reads as follows:

Para 2(xii) Past Service means the period of service rendered by an existing member from the date of joining Employees Family Pension Fund till the 15^th November 1995 and it is amply clear that pensionable service starts from 16.11.1995 only and not prior to that since service prior to 16.11.1995 denotes past service.   Therefore, it is amply clear that contributions at eight and one third percent can be received or receivable only from 16.11.1995 i.e. from the date on which the new pension scheme has came into effect but not from 1971 i.e. when the old pension scheme was started.  Therefore, the pensionable service means service rendered on or after 16.11.1995.  This fact has also been reiterated in Para 10(1) of New Pension Scheme which reads as follows:

Determination of pensionable service:

1. The pensionable service of the member shall be determined with reference to the contribution (received or receivable) on behalf in the employees pension fund.

2. In the case of the member who superannuates on attaining age of 58 years, and who rendered 20 years pensionable service or more his pensionable service shall be increased by adding weightage of two years.

Hence, the complainants are not entitled to claim as claimed in the complaint.

The complainants have made the above complaint regarding two years weightage in terms of Para 10(2) of the Employees Pension Scheme as per the circular dated:26.112013 followed by corrigendum dated:05.12.2013 the litigation needs to be pursued only in respect of the following cases on the subject namely

1. All early pension cases.
2. Superannuation pension cases where date of commencement of pension is on and after 24.07.2009.

The OP further contended that as per the direction of Head office vide circular dated:26.11.2013 followed by corrigendum dated:05.12.2013 the pension of the complainants have been revised allowing two years weightage and arrears released along with monthly pension for the month of March-2015.  Weightage arrears of Rs.6,714/- was released in respect of complainant Sri.S.S.Raralaiah (PPO No.6123) and Rs.5,161/- in respect of complainant Sri. B.N.Marulappa (PPO No.7826) respectively.  Hence, there is no any deficiency in service on the part of OP and they have settled the matter of the complainants as per the pension scheme.  Hence, prays for dismissal of the complaint.        

4.     The complainants filed affidavit and marked the documents as Ex.P1 to P4.  The OP also filed affidavit and no documents marked.

5.     Heard the arguments:

6.     In the proceedings, the following points do arise for our consideration and decision:

1. Whether there is deficiency in service on the part of OPs.

2.  Whether complainant entitled for any relief & what Order?

7.     Our findings on the above points are as follows:-

1. Point No.1: Negative..  
2. Point No.2: As per Order below. 

: R E A S O N S :

POINT NOs. 1 & 2:

8.     The case of the complainant is that they are retired KSRTC Employees and rendered 20 years service at the same Department.  At the time of service they become members to the Family Pension Scheme of 1971.  Thereafter after introduction of the Employees Pension Scheme of 1995 they continued to be the members of the said scheme and after retirement they are getting the pensions.  But the OP has not considered two years weightage as per the family pension scheme of 1995.  Hence, alleges deficiency in service and prays for direction against OP to provide two years weightage along with payment of arrears of the pension along with compensation for deficiency in service.

9.     On contrary, the OP has taken a contention that as per the direction of Head Office of circular dated:26.11.2013 followed by corrigendum dated:05.12.2013 the pension of the complainants have been revised by adding two years weightage and arrears also released along with monthly pension for the month of March-2015.  The weightage arrears of Rs.6,714/- was released in respect of complainant Sri. S.S.Maralaiah (PPO No.6123) and Rs.5,161/- in respect of complainant Sri. B.N.Marulappa (PPO No.7826) respectively.  Hence, they have provided the relief as per the family pension Scheme 1995.  Hence, there is no any deficiency in service and prays for dismissal of the complaint.

10.   During the course of trial, the Advocate for complainant also agreed that the OP has settled the matter and further submitted that the OP would have settled the matter before the complainants approached this Forum.  Since they have made a representation on 20.10.2015, the Ops have neglected to revise the pension of the complainants.  The Ops have settled the matter only after filing of this complaint and the complainants have constrained to file this complaint in order to receive their own pension.  Hence, prays for payment of compensation for deficiency in service.  We found there is no any abnormal delay in settling the claim of the complainants from OP.  They have received a circular from Head Office on 05.12.2013 and they have given a two years weightage from March 2015 itself and the arrears of the pension also paid to the complainants.  As such we found there is no deficiency in service on the part of OP.  As such for the above said reasons, we answer the above points as under and proceed to pass the following:-

: O R D E R :

1. The complaint filed by the complainants is Dismissed.  No order as to costs.

2. Send free copies of this order to both the parties.

(Dictated to the Stenographer transcribed typed by him, transcript corrected by me and then pronounced in Open Court on this the 11^th day of January 2017).

(B.U.GEETHA)           (H. MANJULA)      (RAVISHANKAR)

     Member                     Member                 President

ANNEXURES

Documents produced on behalf of the complainant:

Ex. P1               -           Office copy of the legal notice Dt:20.10.15

Ex.P2                -           Postal receipt

Ex.P3                -           Photo Copy of the pension payment order

Documents produced on behalf of the OPs:

NIL

Dated:11.01.2017                         President 

                                      District Consumer Forum,

                                                  Chikmagalur.