Complaint filed on: 23.06.2016

Complaint Disposed on:27.02.2017

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, AT CHICKMAGALUR.

COMPLAINT NO.72/2016

DATED THIS THE 27^th DAY OF FEBRUARY 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:

Sri T.K.Sridharan S/o K.Govindan,

A/a 67 years, R/o Pookad Post,

Valikalalitham, Vuth Pooramba, Kannur.

(By Sri/Smt. G.Geetha Bai, Advocate)

V/s

OPPONENT:

The Regional Provident Fund Commissioner,

Sub-Regional Office,

Employees Provident Fund Orgainzation,

IV, Yashoram Chambers, Rathnagiri Road,

Chikmagalur Town.

(By Sri/Smt. Halekote A Thejasvi, 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 re-fixing the pension in accordance with para 12(4), (a) and (b) R/w para 10(2) of the Employees Pension Scheme, 1995 and also not paying the arrears of the pension. Hence, prays for direction against OP to re-fix the pension by providing 2 years weightage and also provide past service benefits along with compensation for deficiency in service.

2. The brief facts of the complaint is that:

The complainants is a retired employee, he was enrolled as a member to the provident pension scheme, 1952 formulated by central government U/s 6A of the Employees provident fund act of 1952. After becoming the member he was allotted membership and provided a code no.KN/4995 and the complainant was allotted a P.F A/c Code No.KN/4995/116 from Op. Such being the case, in the year 1971 the Government of India formulated Employees Family Pension Scheme, 1971 U/s 6A of the Employees Provident Fund ( Miscellaneous of the Provisions) Act of 1952, there afterwards on 01.03.1971 the Act came into force and complainant also continued as a member of the Employees Family Pension Scheme since 1973. The complainant has also contributed certain amount in his salary to the Employees Pension Fund as contemplated under para 9 of the said scheme.

In the year 1995 the Government of India has formulated the Employees Pension Scheme on 16.11.1995 U/s 6A of the said Act, Employees Pension Scheme came into force with effect from 01.04.1993. The complainant also opted the membership towards the said Pension Scheme of 1995 and contribution made towards the Employees Family Pension Scheme. Further the contributions made by complainant towards Family Pension Scheme, 1971, prior to coming into force the Employees Pension Scheme 1995 has been transferred to the Employees Pension Fund under para 3(4) of the Employees Pension Scheme 1995. Such being the case, after introduction of the said scheme the complainant retired from his service, the complainant has rendered more than 22 years service and after retaining 57 years he retired and Op had fixed the pension without considering the provisions of the Family Pension Scheme, 1995. According to service rendered by complainant, the complainant is entitled for pension which is statutorily required to be calculated as per para (a) & (b) of para 12(4) R/w para 10(2) of the Employees Pension Scheme, it is reads as follows:

Para 12(4):

In case of an employee who was a member of the ceased family pension 1971 and has attained the age of 48 years, but less than 53 years on the 16^th November 1995, the Superannuation/retirement pension shall be equal to the aggregate of-

1. Pension as determined under sub para (2) for the period of service rendered from the 16^th November 1995 or Rs.438/- p.m. whichever is more;
2. Past service benefit as provided in sub para (3) subject to a minimum of Rs.600/- p.m. provided the past service is 24 years. Provided further that if it is less than. 24 years the pension payable and the past service benefits taken together shall be proportionately less subject to the minimum of Rs.325/- per month.

Para 10(2):

Determination of Pensionable service: 

1. The pensionable service of the member shall be determined with reference to the contributions (received or receivable) on his behalf in the Employees’ Pension Fund.
2. In case of the member who superannuates on attaining the age of 58 years, and/or who has rendered 20 years pensionable service or more, his pensionable service shall be increased by adding a weightage of 2 years.

Hence, as admitted by Op, the complainant rendered past service of 22 years and therefore he is entitled to past service benefit in accordance with para 12(4)(b) of the Pension Scheme, 1995.

Complainant further alleged that the pensionable service contemplated under para 2(1) (xv) of the Employees Pension Scheme 1995 is the service rendered by the member for which contributions are received or receivable. The complainant has contributed to the Employees Pension Fund under Employees Family Pension Scheme, 1971 during the period of operation of that scheme and subsequently he has contributed to the Employees Pension Fund under Employees Pension Scheme, 1995. The contributions made towards the Employees Family pension Scheme, 1971 have been transferred to the Employees Pension Fund on the introduction of the Employees Pension Scheme, 1995. Thus, the complainant has contributed for a period of 30 years to the Pension Fund. Thus, their pensionable service as defined under para 2(1)(xv) is more than 20 years and therefore they are entitled for the weightage of 2 years service, as per para 10(2) of the Employees Pension Scheme, 1995. Therefore without considering the statutory provisions of the para 10(2) of the Employees Pension Scheme, 1995, Op wrongly calculated the pension of the complainant which amounts to deficiency in service and negligence in interpreting the provisions of law, which resulted in substantial financial loss of the complainant. Hence, complainant prays for direction against OP to re-fix the pension of the complainant in accordance with para 12(4)(a) and (b) R/w 10(2) of the Pension Scheme, 1995 along with arrears of the pension with interest and compensation for deficiency in service.

3.     After service of notice, OP appeared through his counsel and filed the version and contended that the complainant is the member of Family Pension Fund/Employees Pension Scheme and the member is provided monthly pension from this office vide different PPO no.3506 respectively. The complainant has made a complaint regarding allowing 2 years weightage, payment of annual relief, minimum assured benefit in respect of past and present service, etc.,

The complainant has misinterpreted the provisions of scheme and filed the present complaint in order to gain wrongfully. The Family Pension Scheme 1971 (old scheme) where the employer used to contribute 1.16% and Employee used to contribute 1.16% of his 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 Employees 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 as arrived above being added with Formula 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 the 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.

4. 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 complainant has misinterpreted the rule provision.

5. The scheme provisions has been amended vide GSR No.431(E) dated 15^th June 2007 where it is clearly mentioned that this 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:

The provisions of para 12(4) of EPS-1995 is reproduced below:

Para 12(4):- In the case of an existing member and in respect of whom the date of commencement of pension is between the 16^th November 2000 and 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 service rendered from the 16^th November 1995 or Rs.438/- per month whichever is more.
2. Past service pension as provided in sub paragraph (3)

2. The aggregate of (a) and (b) calculated as above shall be subject to minimum of Rs.600/- per month, provided the eligible service is 24 years, provided further, if it is less than 24 years, the pension shall be proportionately less subject to the minimum of Rs.325/- per month.

6. Therefore, the present case, the complainant has no 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.

7. 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.

8. In the above para the contribution means, contribution payable under section 6 and 6A of Employees Provident Fund and miscellaneous provisions Act,1952 and has been fixed at 8 and 1/3^rd percent of basic wage and dearless allowances and retaining allowances. Therefore, definition of contribution cannot be stretched to include the old pension scheme.

9. The definition of pensionable service is distinct from the definition of past service which read 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.

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.

10. 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 read as follows:

11. 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 or who rendered 20 years pensionable service or more his pensionable service shall be increased by adding weightage of 2 years.

12. Hence, the complainant is not entitled for the claim as claimed in his complaint. The opponent further contends that the complainant has erred to read para 10(2) of new scheme in isolation with para mentioned above. When the pensionable service rendered on or after 16.11.1995 the benefit of adding 2 years weightage cannot be considered in this complaint. In the present case, complainant is seeking relief by adding services rendered in old scheme and new scheme together which they refer to be pensionable service. The assumption arrived by the complainant is totally contrary to the law and intention of the legislature. The pensionable service can only be referred to the service rendered in new pension scheme and the weightage of 2 years can be given only after putting 20 years of pensionable service. And the first eligible person who will be from 16.11.2015. Therefore, the assumption of the complainants in this regard is totally misunderstanding of new scheme provision.

13. The complainant has made above complaint regarding allowing 2 years weightage in terms of para 10(2) of Employees Pension Scheme. As per circular dated 26.11.2013 followed by corrigendum dated 05.12.2013 cited above the litigation needs to e 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.

14. As per the direction of Head office vide circular dated 26.11.2013 followed by corrigendum dated 05.12.2013 the eligibility of the member for allowing 2 years weightage is examined. It is found that the pensioner is not entitled for any benefits if the instructions therein are followed. However, the case is revised vide New PPO No.14043 under protest to reserving right of appeal before the Hon’ble Supreme Court in this behalf. The weightage arrears amount of Rs.22,540/- is disbursed in the month of July 2016.

15. It is submitted that payment of annual relief does not arise since no such relief is granted by Govt. of India.

16. As there is no Provision for release of interest on arrears in the scheme payment of interest does not arise.

        It is further submitted that the Employees Provident Fund Organization is a statutory body under the enactment of Parliament to extend the social security to working classes. Hence the Organization is always in the forefront in extending service without any deficiency. This organization is conducting Bhavishyanidhi Adalath (Nidhi-Apke-Nikat) on 10^th of every month to sort out the grievances of the members and conducting of Bhavishyanidhi Adalath (Nidhi-Apke-Nikat) is being published in all local/leading Newspapers. The complainant has not utilized the opportunity and prematurely approached the Hon’ble Forum.

        It is submitted that Employees Pension Scheme is not a Government pension rather it is a contributory pension scheme. Any extra benefit being ordered by the Hon’ble Forum to a particular applicant is impacting the health of pension fund and thereby having the effect of reducing the entitlement of other pensioners.

        In view of above, it is respectfully submitted to the Hon’ble Forum that there is no deficiency on the part of respondent and hence the payment of cost and compensation and interest to the complainant does not arise. It is also respectfully submitted to the Hon’ble Forum to dismiss the case.

Hence, there is no deficiency on the part of this Op and prays for dismissal of the complaints.

17.The complainant in his respective complaint has filed affidavit and marked his pension particulars as Ex.P.1. Op also filed affidavit and marked no documents.

18.   Heard the arguments:

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

1. Whether there is deficiency in service on the part of OP.
2. Whether complainant entitled for any relief & what Order?

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

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

: R E A S O N S :

POINT NOs. 1 & 2:

21. The case of the complainant is that he is retired employee of Vignyan Industries Ltd, Tarikere and during his employment has became member to the Employees Provident fund scheme 1952, there afterwards he continued as a member to the new act introduced by Government of India Employees Pension Scheme 1971, even thereafter they continued as a member of the Employees Provident fund 1995 which came into effect from 01.04.1993 and he has contributed certain amount from the salary towards the pension fund of the employee, now he is retired and getting pension from Op, but alleges that Op had not properly interpreted the provisions of the Family Pension Scheme 1995 and has not provided 2 years weightage to the complainant and also alleges that Op had not provided past service benefits as per 12(4) (a) and (b) R/w 10(2) of the Employees Pension Scheme. Hence, prays for direction against Op to provide 2 years weightage along with past service benefits as prayed above.

22. On contrary Op had taken contention that the complainant has misinterpreted provisions of the scheme and filed the present complaint for personal gain and complainant is not entitled to get any claim as claimed in the complaint. The pension to the complainant is already re-fixed as per the new scheme. When the pensionable service rendered on or after 16.11.1995 the benefit of adding 2 years weightage cannot be considered in this complaint. In the present complaint the complainant is seeking relief by adding service rendered in old scheme and new scheme together which they refer to be pensionable service. The assumption arrived by complainant is contrary to the law and intension of the legislature. The pensionable service can only be referred to the service rendered in the new pension scheme and weightage of 2 years can be given only after putting 20 years of pensionable service, and the first eligible person who will be eligible for this benefit will be from 16.11.2015. Therefore, the complainant was already retired from his service. Therefore he is not entitled to get 2 years weightage as claimed by complainant.

23. Op had filed affidavit and sworn that each of the complainant has received pension as per the circular given by head office dated 26.11.2013 followed by corrigendum dated 05.12.2013 and eligible members are provided 2 years weightage as per the circular. The Op in his affidavit has categorically mentioned complaint eligibility.

Hence, there is no deficiency in service on the part of this Op.

24. 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 eligibility of the member for allowing 2 years weightage is examined. It is found that the pensioners are not entitled for any benefits if the instructions therein are followed.

16. It is submitted that payment of annual relief does not arise since no such relief is granted by Govt. of India.

25. As there is no Provision for release of interest on arrears in the scheme payment of interest does not arise.

26. It is further submitted that the Employees Provident Fund Organization is a statutory body under the enactment of Parliament to extend the social security to working classes. Hence the Organization is always in the forefront in extending service without any deficiency. This organization is conducting Bhavishyanidhi Adalath (Nidhi-Apke-Nikat) on 10^th of every month to sort out the grievances of the members and conducting of Bhavishyanidhi Adalath (Nidhi-Apke-Nikat) is being published in all local/leading Newspapers. The complainant has not utilized the opportunity and prematurely approached the Hon’ble Forum.

27. It is submitted that Employees Pension Scheme is not a Government pension rather it is a contributory pension scheme. Any extra benefit being ordered by the Hon’ble Forum to a particular applicant is impacting the health of pension fund and thereby having the effect of reducing the entitlement of other pensioners and.

28. On observation of the pension worksheet produced by Op, we are of the opinion that the Op have provided all arrears and pension by providing 2 years weightage to the complainant under protest only, the advocate for complainant has furnished number of authorities decided by the Hon’ble National Commission, State Commission and Hon’ble Supreme Court of India.

29. Further with respect to the payment of pension by providing 2 years weightage In the Revision petition Nos.4221 to 4231/2014 between Regional Provident Fund Commission V/s C. Raghavendrachar & Others reported in CPJ III 2015 (3)(NC). In this Revision Petition the Hon’ble National commission has categorically and elaborately discussed the matter with respect to the fixation of the pension as per the new scheme. The Hon’ble National commission has appreciated that:

      The learned counsel for the petitioner has drawn our attention to the para 12 (3) and (4) of the scheme, which read as under:

(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 the 16^th November, 1995.

The amount under column (2) or column (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 November, 1995 and the date of exit to arrive at past service pension payable. 

2.  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. 

       (4) In the case of an existing member and in respect of whom the date of commencement of pension is between the 16^th November, 2000 and the 16, November,2005,

      (i)  Superannuation or early pension shall be equal to the aggregate of-

1. Pension as determined under Sub-paragraph (2) for the period of service rendered from the 16^th November,1995 or Rs.438 per month whichever is more;

2. Past service pension is provided in Sub-paragraph (3).

2. The aggregate of (a) and (b) calculated as above shall be subject to a minimum of Rs.600 per month, provided the eligible service is 24 years:

Provided further, if it is less than 24 years the pension shall be proportionately less subject to the minimum of Rs.325 per month.”

30. The contention of the learned Counsel is that since they are also required to give pension for the past service, it would amount to giving double benefit to the employee in case weightage of two years in computing the pensionable service is also given to them.  We, however, find no merit in this contention.  In terms of the Sub-para (2) of para 12, the pension is to be calculated by multiplying the pensionable salary with pensionable service and dividing it by 70. Since the pensionable service would be calculated in terms of para 10, the weightage of two years would have to be given to the complainants for the purpose of calculating the pension in terms of Sub-para (2) of para 12.  The provisions of the Scheme being such, we are unable to take a contrary view of the matter.  Even otherwise if two interpretations of the provisions of the Scheme are possible, we must necessarily lean in favour of the interpretation which is favorable to a pensioner, though, in the case before us we are quite clear that para 10 of the Scheme is not capable of more than one interpretations.  

31. Sub-para (3) of para 12 which deals with the case of the employees who exit after 16.11.2005 provides for payment of superannuation or early pension which is to be calculated in terms of Clause i (a) of the said Sub-paragraph and past service pension which is to be calculated as per table given in the said Paragraph.  The aforesaid table deals only with those cases where the past service pension is payable on completion of 50 years of age on 16.11.1995.  None of the complainants before us had completed 50 years of age on 16.11.1995.

       Sub-para (4) of para 12 of the 1995 Scheme deals with the case of those employees in respect of whom the date of commencement of pension is between the 16.11.2000 and 16.11.2005.  In their case also pension has to be determined in terms of Sub-para (2) of para 12 and their past service pension has to be determined in terms of Sub-paragraph (3).  As noted earlier, the table given in Sub-para (3) of para 12 refers to those cases where past service pension became payable on completion of 50 years of age on 16.11.1995.  Therefore, reliance upon the aforesaid Sub-paragraphs is misplaced.”

32. In view of the aforesaid decision on the subject taking a view that in such cases, the employees are entitled to benefit of two years weightage, the revision petitions are liable to be dismissed.  The said petitions are dismissed accordingly. No order as to costs.

33. Thus order passed by this forum in the earlier complaints were over ruled by the said decision given by Hon’ble National Commission. Following the principles laid down in the above said citation.  The complainant also continued as a member to the new scheme and paid contributions. As such he is entitled to get the relief as per the order passed in above case by Hon’ble National Commission.  The complainant is entitled to benefit of 2 years weightage and Op is liable to re-fix the pension to the complainant accordingly.  As per the version and affidavit of the Op, we noticed that they have paid arrears of the pension to the complainant and same is admitted by complainant, as such the complainant is not entitled to get any arrears from Op as because Op had already paid arrears as per the order of the higher authority of the Op office. As such for the above said reasons we answer point No.1 and 2 in affirmative and proceed to pass the following:   

:ORDER:

1. The Complaint filed by complainant is partly allowed.

   2. OP is directed to provide 2 years weightage and re-fix the pension to the complainant and also directed to pay litigation expenses of Rs.1,000/- to the complainant within one month from the date of receipt of this order. Failing which 9% interest will be charged till realization.

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

 (Dictated to the Stenographer transcribed typed by her, transcript corrected by me and then pronounced in Open Court on this the 27^th day of February 2017).

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

    Member                     Member                  President

ANNEXURES

Documents produced on behalf of the complainant:

Ex. P1               -           Pension particulars of complainant.

Documents produced on behalf of the Op:

NIL

Dated:27.02.2017                         President 

                                          District Consumer Forum,

                                                  Chikmagalur.            

RMA