Central Administrative Tribunal - Ernakulam
P.K.Bhargavan Pillai vs Union Of India Represented By The ... on 23 January, 2012
CENTRAL ADMINISTRATIVE TRIBUNAL
ERNAKULAM BENCH
O.A.No.747/11
Monday this the 23rd day of January 2012
C O R A M :
HON'BLE Dr.K.B.S.RAJAN, JUDICIAL MEMBER
HON'BLE Mr.K.GEORGE JOSEPH, ADMINISTRATIVE MEMBER
P.K.Bhargavan Pillai,
S/o.late K.Krishna Pillai,
Retd. Administrative Officer Grade I,
Indian Space Research Organisation.
Residing at Daiveekom, Manjapra PO,
Ernakulam - 683 581. ...Applicant
(By Advocate Mr.M.R.Hariraj)
V e r s u s
1. Union of India represented by the Secretary
to Government of India,
Ministry of Personnel, Public Grievances and Pensions,
Department of Pension and Pensioners' Welfare,
Lok Nayak Bhawan, New Delhi - 110 003.
2. Pay and Accounts Officer,
Central Pension Accounting Office,
Trikoot - 2, Bhikaji Cama Place,
New Delhi - 110 066.
3. The Controller,
Liquid Propulsion Systems Centre,
Indian Space Research Organisation,
Valiamala PO, Thiruvananthapuram - 659 547.
4. Manager,
State Bank of Travancore,
Angamaly Branch, Kallookaran Towers,
Angamaly - 683 572. ...Respondents
(By Advocate Mr.Sunil Jacob Jose,SCGSC [R1-3])
This application having been heard on 17th January 2012 this
Tribunal on 23rd January 2012 delivered the following :-
O R D E R
HON'BLE Dr.K.B.S.RAJAN, JUDICIAL MEMBER The applicant is a pre 2006 retiree and was earlier afforded pension on the basis of order F No.38/27/08-P&PW(A) dated 1.9.2008 vide Annexure A-1. As per the said order, pension would in no case be lower than 50% of the minimum of the pay in the pay band plus grade pay corresponding to the pre-revised pay scale from which the pensioner had retired. The applicant, before his superannuation, was drawing his pay in the scale of Rs.8,000 - 13,500, the corresponding revised pay being Rs.15,600 - 39,100 plus grade pay of Rs 5,400/-. The extent of pension he was drawing was Rs.10,500/- (being half of minimum pay of Rs 15,600 plus half of grade pay of Rs 5,400/-). Arrears of pension on the basis of the above calculation were also released to the applicant. While so, Revised Pension Order dated 27.1.2011 vide Annexure A-2 (one of the impugned orders) was issued to the applicant whereby, his pension was reduced to Rs 8,277/- w.e.f. 1.1.2006. This led to issue of revision authority dated 9.2.2011, vide Annexure A-3 (impugned herein). Faced with such a drastic truncation of his pension, the applicant moved a representation dated 10.6.2011 vide Annexure A-4. In this representation, he had stated that the pension under no circumstances shall be less than half the minimum in the pay scale and the grade pay attached to the pay scale for the post he was holding prior to his superannuation. The applicant thus requested for proper fixation in accordance with paras 4.1/4.2 of Annexure A-1 order. The respondents, however, continued to pay the applicant the reduced pension of Rs.8277/- and in addition recovery of Rs.2945/- had also been effected by the 4th respondent, as could be seen from Annexure A-5 print out of the pension register. The applicant has, therefore, moved this O.A seeking the following reliefs :-
1. To declare that the Central Civil Service (Pension) Amendment Rules, 2011 is discriminatory, arbitrary and ultra vires Article 14 and 16 of the Constitution of India to the extend it refuses to apply the liberalized principles of computing pension to pensioners who retired before 1.1.2006 and that it is void to that extend.
2. To call for the records leading to issuance of Annexure A-2, Annexure A-3, O.M.No.38/37/08-P&PW (A) dated 2.9.2008 and 10.12.2009 and to quash the same to the extend it refuses to apply the liberalized principles of computing pension to pensioners who retired before 1.1.2006.
3. To direct the respondents to compute the revised pension of the applicant at 50% of his emoluments or average emoluments, whichever is more beneficial to him, and to draw and disburse such revised pension to the applicant with all consequential benefits including arrears and arrears of pension and pensionary benefits with interest at the rate of 12% per annum.
4. Alternatively, to direct the respondents to pay the applicant minimum basic pension of Rs.10500/- which is 50% of the minimum of the pay band plus grade pay corresponding to the pre-revised pay scale from which the applicant retired.
5. To call for the records leading to recovery from pension of the applicant and quash the same.
6. To direct the respondents to refund the applicant any recovery already made from his pension.
2. The respondents have contested the O.A. They have contended that the Ministry of Personnel, Public Grievances and Pensions had given a clarification vide O.M dated 3.10.2008 on fixation of pension/family pension of the pre 2006 retirees vide Annexure R-2. According to the same, para 4.2 of the O.M dated 1.9.2008 has been modified to the extent that the pension will be reduced pro-rata, where the pensioner had less than the maximum required service for full pension as per rule 49 of the CCS (Pension) Rules, 1972 as applicable on 1.1.2006 subject to a ceiling of minimum of Rs.3500/- per month. The Ministry had issued revised guidelines vide Annexure R-3 stating that wherever the pension is disbursed through public sector banks, the banks will pay and disburse the pension and arrears in accordance with the ready reckoner and also the additional pension to the old pensioners. A revised concordance table in respect of pre 1996, pre 2006 and post 2006 pay scales/pay bands were also provided to facilitate payment of revised pension in terms of para 4.2 of O.M dated 1.9.2008. The responsibility to revise and disburse the enhanced pension and arrears in terms of para 4.2 of the O.M dated 1.9.2008 was vested with the pension disbursing public sector banks concerned. In so far as earlier payment of pension without truncation, the respondents have stated that the 4th respondent bank might have implemented the instructions contained in the O.M dated 1.9.2008 on its own without looking into the subsequent clarifications issued by the Department of Pension and Pensioners' Welfare with regard to the revision of pension of pre 2006 pensioners. As uniformity had not been maintained in calculation or disbursement of pension, the Department of Space vide communication dated 31.3.2009 (Annexure R-4) and letter dated 6.1.2010 (Annexure R-5) requested its constituent centres to have speedy action for payment of pension, arrears etc. to pre 2006 retirees by liaising with public sector banks concerned. Accordingly, the 3rd respondent worked out the revised entitlement to pension of the applicant which came to be Rs.8277/-
and the same was communicated to the 2nd respondent, namely, Central Pension Accounting Office (CPAO), New Delhi, vide Annexure R-6 letter dated 27.1.2011.
3. The respondents have also stated in para 11 as under :-
"11. As regards para 4.12 of the O.A., it is submitted that the Department of Pension and Pensioners' Welfare had issued a revised concordance table of the pre 1996, pre 2006 and post 2006 pay scales/pay bands along with its OM dated 14.10.2008 in order to facilitate payment of revised pension/family pension in terms of para 4.2 of the OM dated 1.9.2008 (as clarified vide OM dated 3.10.2008) in all cases where fixation of pension under that provision is more beneficial. Note 1 appended below the said concordance table clearly provides that 'the revised pension of those who retired after completing maximum required qualifying service (ie.33 years) before 1.1.2006 cannot be less than the pension indicated in column 8 above (ie. 50% of the sum of minimum of pay band and grade pay/scale corresponding to the scale of pay the pensioners held at the time of their retirement). The pension in col.8 above will be reduced pro-rata, where the pensioner had less than the maximum required qualifying service (ie. 33 years) for full pension as per Rule 49 of the CCS (Pension) Rules, 1972 as applicable on 1.1.2006 and in no case it will be less than 3500/- p.m. In case, the pension consolidated as per para 4.1 of above OM is higher than the pension calculated in the manner above, the same (higher pension) will be treated as basic pension'. Obviously, the applicant who is a pre 2006 retiree, is ipso facto ineligible for revised pension at the rate of 50% of the minimum of the pay in the band plus grade pay corresponding to the pre revised pay scale from which he retired, since he doesn't have the maximum required qualifying service of 33 years for full pension as per Rule 49 of CCS (Pension) Rules, 1972. As such, the contentions of the applicant that his pension ought not be below 50% of the minimum of the pay in pay band plus grade pay corresponding to the pre revised pay scale from which he retired in view of the fact that the qualifying service for full pension had been reduced to 20 years instead of 33 years and liberalized principles of pension cannot be refused to the past pensioners, etc., are not borne out of facts and the same may kindly be rejected by this Hon'ble Tribunal.
4. The respondents have also reiterated that as per the Memorandum issued by the Department of Pension and Pensioners' Welfare, fixation of pension and payment of arrears in respect of pre 2006 retirees is a responsibility of the pension disbursing authority including public sector banks.
5. Counsel for the applicant has submitted that the error committed by the respondents in reducing the payment of pension has been fully appreciated by the Tribunal. In its full Full Bench judgment dated 1.11.2011 in O.A.No.0655 of 2010 and connected O.As the Tribunal has dealt inextenso the extent of pension admissible to pre 2006 retirees. Para 2 onwards of the said order of the Full Bench reads as under :-
"2. Applicants, who are pre-2006 retirees, are claiming pension at par with post-2006 retirees based on the recommendations of the VI Central Pay Commission, which became effective from 1.1.2006. Considering that the issues involved have great ramifications and in the meanwhile Bombay Bench and Patna Bench of the Tribunal rendered judgment(s) against their cause., the matter was referred to the Full Bench vide order dated 29.04.2011. The grievance projected by the applicants in these OAs are that the employees, who retired prior to 1.1.2006 (specified date) and those who retried thereafter form one class of pensioners. The attempt to classify them into separate classes/groups for the purpose of pensionary benefits was not found on intelligible differentia, which has a rationale nexus with the object sought to be achieved. To substantiate this argument reliance has been placed on the judgment of the Apex Court in the case of D.S. Nakara and others v. Union of India, (1983) 1 SCC 305 and Union of India v. S.P.S. Vains, (2008) 9 SCC 125. The further grievance raised by the applicants is that their notional pay fixation and consequent pension should not be lower than 50% of the sum of the minimum of the pay in the pay band and the grade pay thereon corresponding to scale of pay from which they had retired, as accepted by the Government vide resolution dated 29.08.2008 and the clarification issued by the respondents vide impugned OM dated 3.10.2008 and 14.10.2008 contrary to the Resolution dated 29.08.2008 and OM dated 1.9.2008 in regard para 4.2, are illegal, arbitrary, discriminatory, unreasonable and unjust, as according to the applicants in the clarification/modification order dated 3.10.2008 respondents had added and deleted certain words, which completely changed its meaning as per the recommendations of the Commission as accepted by the Government. In other words, the grievances raised by the applicants are that the respondents have not revised pension of the pre-2006 retirees even as per the modified parity/formula recommended by the Pay Commission and adopted by the Government vide resolution dated 29.08.2008. It may be stated that challenge has been made only to the aforesaid issues though the additional points raised by the applicants in OA-2087/2009 and 2101/2011 have not been pressed by the learned counsel for the applicants.
3. In order to decide the aforesaid issue, few relevant facts may be noticed. The Government of India constituted VI Central Pay Commission (VI CPC) on 05.10.2006, inter alia, to examine the principles which should govern the structure of pension, death-cum-retirement gratuity, family pension and other terminal or recurring benefits having financial implications to the present and former Central Government employees appointed before 1.1.2004. The report was submitted by the Commission on 24.03.2008. The Pay Commission made separate recommendations for revision of pension of the past pensioners and for determination of pension of those retiring after implementation of its recommendations. In regard to determination of pension of those retiring after implementation of its recommendations, the Commission recommended linkage of full pension with 33 years of qualifying service should be dispensed with. Once an employee renders the minimum pensionable service of 20 years, pension should be paid at 50% of the average emoluments received during the past 10 months or the pay last drawn, whichever is more beneficial to the retiring employee. Simultaneously, the extant benefit of adding years of qualifying service for purposes of computing pension/related benefits should be withdrawn as it would no longer be relevant. However, regarding revision of pension of past pensioners the Commission made recommendations as per para 5.1.47 of the report which recommendation of the Commissioner was accepted by the Government with certain modifications to which we will advert at a later stage. Thus, this modified formula formed basis for revision of the pension of the pre-2006 retirees, as adopted by resolution dated 29.08.2008, which according to applicants has not even been followed by the respondents in its true letter and spirit. Since the VI CPC has made separate recommendations for pre-2006 retirees and post-2006 retirees as such the Government issued two different OMs based upon the recommendations of the Central Pay Commission, i.e., one regarding revision of pension of past pensioners and second regarding post-2006 retirees. It is in the light of the aforesaid factual aspects the matter is required to be examined."
After threadbare analysis of the entire issue, the Full Bench had arrived at the following decision:-
"12. Now let us advert to last grievance raised by the applicants viz. that even if the modified parity, as recommended by the Pay Commission and accepted by the resolution dated 29.08.2008 is to be taken as criteria for determining pension of pre-2006 retirees, still on account of subsequent clarification issued to para 4.2 of the OM dated 1.9.2008 by the officers of the respondents vide OM dated 3.10.2008 and 14.10.2008 criteria and principles for determining the pension has been given a complete go-bye. Thus, these clarificatory OMs are illegal, arbitrary, discriminatory, unreasonable, unjust and are required to be quashed and set aside. At this stage, we wish to mention that this issue was not raised and considered by the Patna and Bombay Benches of the Tribunal, as such no finding on this aspect was given. However, in paras 66 and 67 of the judgment Patna Bench has given a direction that the Government should examine this aspect of S-29 pay scales retirees being able to retire at the maximum of the pay band 4 pay scale with the grade pay of Rs.10,000/- which would bring their pension to Rs.38,500/-. Suffice it to say that the observation made by the Patna Bench was given without taking into consideration the modified parity as recommended by the Pay Commission and accepted by the Central Government vide its resolution dated 29.08.2008, which formed the basis to grant pension to pre-2006 retirees.
13. In order to determine the issue, at this stage, it will be useful to quote item No.12 of the Resolution No.38/37/08- P&PW (A) dated 29.08.2008 whereby recommendations of the VI CPC, as contained in para 5.1.47, was accepted with certain modifications and thus reads :-
S.No. Recommendation Decision of
Government
"All past pensioners should be allowed Accepted with the
fitment benefit equal to 40% of the modification that fixation
pension excluding the effect of merger of pension shall be based
of 50% dearness allowance/dearness on a multiplication factor
relief as pension (in respect ofof 1.86, i.e basic pension
pensioners retiring on or after </2004)
and dearness pension (for other + Dearness Pension
pensioners) respectively. The increase (wherever applicable) +
will be allowed by subsuming the effect dearness relief of 24% as of conversion of 50% of dearness on 1.1.2006, instead of relief/dearness allowance as dearness 1.74 pension/dearness pay. Consequently, dearness relief at the rate of 74% on pension (excluding the effect of merger) has been taken for the purposes of computing revised pension as on 1/1/2006. This is consistent with the fitment benefit being allowed in case of the existing employees. The fixation of pension will be subject to the provision that the revised pension, in no case, shall be lower than fifty percent of the sum of the minimum of the pay in the pay band and the grade pay thereon corresponding to the pre revised pay scale from which the 12 pensioner had retired. (5.1.47) Based on this resolution, respondents issued OM of even number dated 1.9.2008. Para-4.2 whereof, which is relevant for the purpose, reads as follows :
"The fixation of pension will be subject to the provision that the revised pension, in no case, shall be lower than fifty percent of the minimum of the pay in the pay band plus the grade pay corresponding to the pre-revised pay scale from which the pensioner had retired. In the case of HAG+ and above scales, this will be fifty percent of the minimum of the revised pay scale."
14. On the basis of the recommendations made by VI CPC, which stood validly accepted by the Cabinet, it has been argued that principle for determining the pension has been completely altered under the garb of clarification. According to the learned counsel for the applicants on the basis of the aforesaid resolution/modified parity revised pension of the pre- 2006 pensioners shall not be less than 50% of the minimum of the pay band + grade pay, corresponding to the pre-revised pay scale from which the pensioner had retired.
15. Applicants in para-11 of the Additional-Affidavit have explained how the Note prepared by a junior functionary (at the level of an Under Secretary) in the Department of Pension & Pensioners Welfare in regard to para-4.2 of the OM dated 1.9.2008 has been given a go-by to the resolution dated 29.08.2008. The Note so prepared has been extracted in this para, which thus reads :
"Whether the pension calculated at 50% of the minimum pay in the pay band would be calculated (i) at the minimum of the pay in the pay band (irrespective of the pre-revised scale of pay) plus the grade pay corresponding to the pre-revised pay scale, or (ii) at the minimum of pay pay in the pay band which an employee in the pre-revised scale of pay will be getting as per the fitment tables at Annex I of the CCS (Revised Pay) Rules, 2008 plus the grade pay corresponding to the pre- revised pay scales."
16. It is pleaded that first the need for such a doubt being raised is not clear as both the formulation of the CPC in para 5.1.47 as well as in Government Resolution dated 29.8.2008 (Annexure A-7 of the OA) is clear that "the fixation of pension will be subject to the provision that the revised pension in no case, shall be lower than fifty percent of the sum of the minimum of the pay in the pay band and the grade pay thereon corresponding to the pre-revised pay scale from which the pensioner had retired." (emphasis added). The use of words `sum of', `and' and `thereon' leaves no doubt that both the minimum of the pay in the pay band and the grade pay have to correspond to the pre-revised pay scale. Second, without bringing out merits or demerits of either formulation, the lower functionary in DOP & PW incorporates in the clarification against item 4.2 in the OM dated 1.9.2008, the first option about "minimum of pay in the pay band (irrespective of the pre-revised scale of pay)". What is worse is that there is no application of mind even at the level of Director and Secretary who merely sign the note and the clarification is issued after obtaining finance concurrence and approval of MOS (PP), without going back to the Cabinet for such a modification.
17. The learned counsel has further argued that the resultant injustice done to the pre-1-1-2006 pensioners had even been recognized by MOS (F) and MOS (PP) in their letters to the PM and MOS (F) respectively, copies of which are at Annexures A-11 (page 169) and A-12 (page 170) of the OA. A formal proposal was also sent by DOP & PW to Department of Expenditure seeking rectification but was not accepted by the latter. It was also incorrectly mentioned that the earlier provision in para 4.2 of OM dated 1.9.2008 has been issued in pursuance of the approval of the Cabinet granted to the Report of the Sixth CPC and any change would entail substantial financial implications and this was done only with the approval of the Secretary (Expenditure) without putting up the note to MOS (F) who had himself supported the change. A copy of this Note dated 2.1.2009 is enclosed as Annexure 5.
18. As regards the grievance to OM dated 14.10.2008 based on the OM dated 1.9.2008 (as clarified by OM dated 3.10.2008) whereby a revised table (Annexure A-1) of the pre-2006 pensioners pay scale/pay was finalized to facilitate payment of the revised pension/family pension, applicants have prepared a chart in respect of minimum of the pre-revised scales (modified parity) of S 29 along with 5 scales included in PB-4 works out as under and thus reads :
Min of Pay in the Grade Pay Revised Pension 50% Pre Pay Band Basic Pay of (2+3) revised (2+3) Rs.
scale Rs.
1 2 3 4 5
S-24
(14300) 37400 8700 46100 23050
S-25
(15100 39690 8700 48390 24195
S-26
(16400) 39690 8900 48590 24295
S-27
(16400) 39690 8900 48590 24295
S-28
(14300) 37400 10000 47400 23700
S-29
(18400) 44700 10000 54700 27350
The first 4 columns of the above table have been extracted from the pay fixation annexed with MOF OM of 30th August 2008 (referred to in para 4.5 (iii) above). Revised pension of S 29 works out to Rs.27350 which has been reduced to Rs.23700 as per DOP OM of 3-10-2008 (para 4.8 (B) below).
It was explained during arguments that pay in the Pay Band indicated in column No.2 above table relates to the pay in the revised pay scale corresponding to the minimum pay in the pre- revised pay scale.
19. On the basis of this chart it has been pleaded that as per the impugned OM dated 14.10.2008 in the case of S-24 officers the corresponding pay in the Pay Band against 14300/- is shown as 37400. In addition, Grade Pay of Rs.8700/- was given totaling Rs.46,100/-. Similarly, revisions concerning all the other pay scales were accepted by the aforementioned OM dated 14th October, 2008. The illegality which has been perpetrated in the present matter is apparent from the fact that whereas an officer who was in the pre-revised scale S-24 and receiving a pay of Rs.14,300/- would now receive Rs.37,400/- plus grade pay of Rs.8700 and his full pension would accordingly be fixed at Rs.23050 (i.e. 50% of 37400 pay plus grade pay Rs.8700) pursuant to the implementation of VI CPC recommendations after 1.1.2006, whereas a person belonging to the Applicant Association, who was drawing a pay of Rs.18,400/- or even Rs.22,400/- (maximum of scale) in the pre- revised S-29 scale will now be getting pension as only 23700/- (i.e. 50% of pay of Rs.37,400/- plus grade pay of Rs.10000). However, the misinterpreted revised basic pay of Rs.37400 has caused a grave miscarriage of justice since those officers who belong to a much higher grade have now been equated with those who were working under them in a lower rank/grade. It is further relevant to note that those officers belonging to S-29 who would retired after 1.1.2006 would, however, be placed in the revised pay scale differently. For instance, a person who was in the pre-revised pay scale of 18000-22400 (S29) at Rs.18,400/- would now get Rs.44,700/- in addition to Grade Pay of Rs.10,000/- i.e. the revised basic pay of Rs.61,850/-. However, a person who retired only one day prior i.e. on 31st December 2005, even if he had received pre-revised pay of Rs.22400/- would now be placed in the revised pay of Rs.37400/- only in addition to the Grade Pay of Rs.10,000. Thus the illegality which has been committed in the present matter also relates to equating the pre-revised pay scale of Rs.18,400-22,400/- with the pre-revised pay scale of Rs.14,300-18,300/-.
20. In order to buttress the aforesaid submission applicants have given specific instance of an officer in para-6 of the Additional Affidavit who retired at a higher pay on 31.12.2005 getting a much higher pension at that time than another officer who retired only 5 days later, i.e., on 5.1.2006 at a lower pay. After implementing the VI CPC recommendations, as illegally modified by the Department of Personnel, the result is that the concerned person who retired on 31.12.2005 is getting far lower pension than the person who retired 5 days later. A copy of the said chart amplifying the above position has also been reproduced, which is to the following effect :
Name Ashok K. R.K. Goel
Ghosh
Department Railways Heavy Water Board
Scale of Pay 18400-500- 18400-500-22400
22400
Date of 31.12.2005 05.01.2006 i.e.
Retirement only 5 days
Last Pay Rs.22900 (incl. Rs.21400
Drawn one Stagnation
increment)
Average 10 Rs.34350 Rs.31737.50 or
months 31738
Emoluments
incl. Dearness
Pay
Original Pension Rs.17175 Rs.15869
fixed
Revised Pension Rs.2587(i.e. Rs.29435
Fixed after 6th Rs.22900x2.26)
CPC 2
implementation
21. Applicants have also explained as to how the disparity has resulted on account of implementation/acceptance of VI CPC recommendations by the Government vide resolution dated 29.08.2008. As can be seen from the clarificatory order dated 30.08.2008 (Annexure A-6 at pages 139-147) regarding pay scale of S-24 to S-29, the pay scales of the V CPC of Rs.14300-18300 in respect of S-24 employees, the VI CPC has placed them in Pay Band-3 and recommended the Pay Band of Rs15,600-39100/- plus Grade Pay of Rs.7600 per month. However, the Government has upgraded the said S-24 category to Pay Band 4 and placed them in the pay Band of Rs.37,400-67,000/- plus Grade Pay of Rs.8700/- per month. It is, therefore, absolutely clear that the Government authorities have increased the pay of S-24 employees by far more than double. Further, it is very relevant to note that the said impact would be not only on the retired S-24 officers but also on the large base of serving employees. Similarly, the same is the position with regard to S-25, S-26 and S-27 all of whom were recommended by the Sixth Pay Commission to be in the pay band of Rs.15,600-39,100/- but were placed by the Government in the pay band of Rs.37,400-67,000/-. Similarly in the case of employees who were placed in S-29 pay scale they were recommended Pay Band of Rs.39,200-67000/- plus Grade Pay of Rs.9,000/- per month by the VI CPC, whereas the Government has revised pay structure to Rs.37,400-67000/- plus Grade Pay of Rs.10,000/- per month. This has resulted in the anomaly which is essentially to be rectified.
22. It is submitted that the applicants are in the category of retired employees and are a diminishing category. In contrast, the serving employees of S-29 category are being given the benefits of the recommendations of the VI CPC. Further, as explained earlier, the benefits available in S-24 to S-27 grade are available not only to retired employees but also to the large base of serving employees. The financial effect of the same is many-many times that of the small additional expenditure which will be incurred on account of the benefits sought by the Applicants. Therefore, the argument sought to be raised by the Union of India during the course of hearing regarding the so-called financial impact has no factual basis at all.
23. Thus, according to the applicants the aforesaid disparity, which has been caused on account of granting enhanced scales in S-24 to S-27 grade contrary to the recommendations of the VI CPC and further reducing the scales recommended by the Pay Commission in respect of S-29 grade to be at par with the employees who were placed in S-24 to S-27 grade is required to be set right. According to the learned counsel of applicants even if the cut off date of 1.1.2006 for revision of the pay scale and grant of pensionary benefits on the basis of VI CPC is to be upheld, even then the applicants are entitled to relief based upon the Resolution dated 29.08.2008 whereby the recommendations of the Pay Commission was accepted and on account of disparity, which has resulted in granting different pay scales, as recommended by the VI CPC, which has caused prejudice to the applicants and thus has to be set right.
24. The stand taken by the respondents is that the recommendations of the VI CPC, as accepted by the Government vide Resolution dated 29.08.2008 and further clarification issued by the respondents is in consonance with the recommendations so accepted. It is stated that there may be a slight change in the word used in the clarification issued by the Government subsequently but has the same meaning as in the latter part of para 5.1.47 of the report of the VI CPC as accepted by Government. The phrase "minimum of the pay in the Pay Band" has been used and this phrase carries the same meaning i.e., the pay from which a pay band starts. It is stated that the clarification on OM dated 3.10.2008 was issued after due exercise in Department of Pension and Pensioners Welfare and Ministry of Finance and with the approval of the Hon'ble Minister of State. It is further stated that VI CPC has not made any recommendation for complete parity between the pre-1996 and post-1-1-1996 pensioners. Therefore, question of allowing complete parity between pre- 1996 and post 1.1.1996 pensioners would not arise. It is stated that the OM dated 1.9.2008 has been further clarified on 3.10.2008 that pension calculated at 50% of the minimum of the pay in the pay band plus grade pay would be calculated at the minimum of the pay in the pay band (irrespective of the pre- revised sale of pay) plus the grade pay corresponding to the pre-revised pay scale.
25. In order to decide the matter in controversy, at this stage, it will be useful to extract the relevant portions of para 5.1.47 of the VI CPC recommendation, as accepted by the Resolution dated 29.08.2008, para 4.2 of the OM dated 1.9.2008 and subsequent changes made in the garb of clarification dated 3.10.2008, which thus read :
Resolution Para 4.2 of OM OM DOP&PW OM No. No.38/37/8-P&PW DOP&PW OM No. No.38/37/8-P&PW(A) (A) dated No.38/37/8-P&PW dated 3.10.2008 29.08.2008-Para (A) dated 1.09.2008 5.1.47 (page 154- (page 38 of OA)
155) The fixation as The fixation as per The Pension per above will be above will be Calculated at 50% of subject to the subject to the the [sum of the] provision "that provision "that the minimum of the pay the revised revised pension, in in the pay band [and pension, in no no case, shall be the grade pay case, shall be lower than 50% of thereon lower than 50% of the(sum of the) corresponding to the the sum of the minimum of the pay pre-revised pay minimum of the in the pay band scale] plus grade pay in the pay plus (and) the pay would be band and the grade pay (thereon) calculated (i) at the grade pay corresponding to minimum of the pay thereon the prerevised pay in the pay band corresponding to scale from which (irrespective of the the prerevised the pensioner had pre-revised scale of pay scale form retired. pay plus) the grade which the pay corresponding pensioner had to the pre-revised retired. pay scale. For example, if a pensioner had retired in the pre-
revised scale of pay
of Rs.18400-22400,
the corresponding
pay band being
Rs.37400-67000 and
the corresponding
grade pay being
Rs.10000 p.m., his
minimum guaranteed
pension would be
50% of
Rs.37400+Rs.10000
(i.e. Rs.23700)
Strike out are Strike out are
deletions and deletions and
bold letter bold letters
addition addition.
26. As can be seen from the relevant portion of the resolution dated 29.8.2008 based upon the recommendations made by the VI CPC in paragraph 5.1.47, it is clear that the revised pension of the pre-2006 retirees should not be less than 50% of the sum of the minimum of the pay in the Pay Band and the grade pay thereon corresponding to the pre-revised pay scale held by the pensioner at the time of retirement. However, as per the OM dated 3.10.2008 revised pension at 50% of the sum of the minimum of the pay in the pay band and the grade pay thereon, corresponding to pre-revised scale from which the pensioner had retired has been given a go-by by deleting the words "sum of the" "and grade pay thereon corresponding to the pre-revised pay scale" and adding "irrespective of the pre- revised scale of pay plus" implying that the revised pension is to be fixed at 50% of the minimum of the pay, which has substantially changed the modified parity/formula adopted by the Central Government pursuant to the recommendations made by the VI CPC and has thus caused great prejudice to the applicants. According to us, such a course was not available to the functionary of the Government in the garb of clarification thereby altering the recommendations given by the VI CPC, as accepted by the Central Government. According to us, deletion of the words "sum of the" "and grade pay thereon corresponding to the pre-revised scale" "and addition of the words "irrespective of the pre-revised scale of pay plus", as introduced by the respondents in the garb of clarification vide OM dated 3.10.2008 amounts to carrying out amendment to the resolution dated 29.08.2008 based upon para 4.1.47 of the recommendations of the VI CPC as also the OM dated 1.9.2008 issued by the Central Government pursuant to the aforesaid resolution, which has been accepted by the Cabinet. Thus, such a course was not permissible for the functionary of the Government in the garb of clarification, that too, at their own level without referring the matter to the Cabinet.
27. We also wish to add that the Pay Commissions are concerned with the revision of the pre-revised `pay scales' and also that in terms of Rule 34 of the CCS (Pension) Rules, 1972 the pension of retirees has to be fixed on the basis of the average emoluments drawn by them at the time of retirement. Thus, the pre-revised scale from which a person has retired and the emoluments which he was drawing at the time immediately preceding his retirement are a relevant consideration for the purpose of computing revised pension and cannot be ignored. As such, it was not permissible for the respondents to ignore the pre-revised scale of pay for the purpose of computing revised pension as per the modified parity in the garb of issuing the clarifications, thereby altering the modified parity/formula, which was accepted by the Central Government vide its resolution dated 29.08.2008.
28. The above view is also fortified by paras 137.15, 137.20 and 137.21 of the V CPC recommendations, as reproduced below, leading to modified parity, which were also accepted by the VI CPC and accepted by the Central Government and thus read:
"Immediate relief to pensioners 137.15 While the work relating to revision of pension of pre 1.1.1986 retires by notional fixation of their pay shall have to be undertaken by the pension sanctioning authorities to be completed in a time-bound manner, we suggest that the pensioners should be provided some relief immediately on implementation of our recommendations. The pension disbursing authorities may be authorized to consolidate the pension by adding (a) basic pension; (b) personal pension, wherever admissible; (c) dearness relief as on 1.1.1996 on basic pension only; (d) Interim Relief (I and II) and (e) 20% of basic pension. The consolidated pension shall be not less than 50% of the minimum pay, as revised by the Fifth CPC, of the post held by the pensioner at the time of retirement. This may be stepped up by the pension disbursing authorities, wherever feasible, to the level of 50% of the minimum pay of the post held by the pensioner at the time of retirement. (emphasis supplied) xxx xxx xxx xxx xxx Modified parity conceded 137.20 We have given our careful consideration to the suggestions. While we do not find any merit in the suggestion to revise the pension of past retirees with reference to maximum pay of the post held at the time of retirement, as revised by the Fifth CPC, there is force in the argument that the revised pension should be not less than that admissible on the minimum pay of the post held by the retiree at the time of retirement, as revised by the Fifth CPC. We have no hesitation in conceding the argument advanced by pensioners that they should receive a pension at least based on the minimum pay of the post as revised by Fifth Pay Commission in the same way as an employee normally gets the minimum revised pay of the post he holds. We recommend acceptance of this principle, which is based on reasonable considerations. (emphasis supplied).
Principle enunciated 137.21 The Commission has decided to enunciate a principle for the future revision of pensions to the effect that complete parity should normally be conceded up to the date of last pay revision and modified parity (with pension equated at least to the minimum of the revised pay scale) be accepted at the time of each fresh pay revision. This guiding principle which we have accepted would assure that past pensioners will obtain complete parity between the pre-'86 and post-'86 pensioners but there will be only a modified parity between the pre-'96 and post-'96 pensioners. The enunciation of the principle would imply that at the time of the next pay revision say, in the year 2006, complete parity should be given to past pensioners as between pre-1996 and post-1996 and modified parity be given between the pre-2006 and post-2006 pensioners." (emphasis supplied)
29. From the above extracted portion it is clear that the principle of modified parity, as recommended by the V CPC and accepted by the VI CPC and accepted by the Central Government provides that revised pension in no case shall be lower than 50% of the sum of the minimum of the pay in the pay band and grade pay corresponding to revised pay scale from which the pensioner had retried. According to us, as already stated above, in the garb of clarification, respondents interpreted minimum of pay in the pay band as minimum of the pay band. This interpretation is apparently erroneous, for the reasons :
a) if the interpretation of the Government is accepted it would mean that pre-2006 retirees in S-29 grade retired in December, 2005 will get his pension fixed at Rs.23700/- and anther officer who retired in January 2006 at the minimum of the pay will get his pension fixed at Rs.27350/-. This hits the very principle of the modified parity, which was never intended by the Pay Commission or by the Central Government;
b) The Central Government improved upon many pay scales recommended by the VI CPC. The pay scale in S-29 category was improved from Rs.39200-67000/- plus Grade Pay of Rs.9,000/- with minimum pay of Rs.43280/- to Rs.37,400-
67000/- with grade pay of Rs.10,000/- with minimum pay of Rs.44,700/- (page 142 of the paper-book). If the interpretation of the Department of Pension is accepted, this will result in reduction of pension by Rs.4,00/- per month. The Central Government did not intend to reduce the pension of pre-2006 retirees while improving the pay scale of S-29 grade;
c) If the erroneous interpretation of the Department of Pension is accepted, it would mean that a Director level officer retiring after putting in merely 2 years of service in their pay band (S-24) would draw more pension than a S-29 grade officer retiring before 1.1.2006 and that no S-29 grade officer, whether existing or holding post in future will be fixed at minimum of the pay band, i.e., Rs.37,400/-. Therefore, fixation of pay at Rs.37,400/- by terming it as minimum of the pay in the pay band is erroneous and ill conceived; and
d) That even the Minister of State for Finance and Minister of State (PP) taking note of the resultant injustice done to the pre-11.2006 pensioners (pages 169-170) had sent formal proposal to the Department of Expenditure seeking rectification but the said proposal was turned down by the officer of the Department of Expenditure on the ground of financial implications. Once the Central Government has accepted the principle of modified parity, the benefit cannot be denied on the ground of financial constraints and cannot be said to be a valid reason.
30. In view of what has been stated above, we are of the view that the clarificatory OM dated 3.10.2008 and further OM dated 14.10.2008 (which is also based upon clarificatory OM dated 3.10.2008) and OM dated 11.02.2009, whereby representation was rejected by common order, are required to be quashed and set aside, which we accordingly do. Respondents are directed to re-fix the pension of all pre-2006 retirees w.e.f. 1.1.2006, based on the resolution dated 29.08.2008 and in the light of our observations made above. Let the respondents re-fix the pension and pay the arrears thereof within a period of 3 months from the date of receipt of a copy of this order. OAs are allowed in the aforesaid terms, with no order as to interest and costs."
6. The Full Bench had set aside the orders dated 3.10.2008 and 11.2.2009 (Annexure R-2 and Annexure R-11). Thus the stipulation that the pension will be reduced pro-rata as contained in para 4.2 of OM dated 3.10.2008 which was the basis of fixation of pension at the reduced rate by the respondents stands already quashed. Order dated 11.2.2009 (Annexure R-11) which only reiterated the clarification contained in OM dated 3.10.2008 and earlier OM dated 1.9.2008 having also been quashed by the Full Bench, in the case of the applicant his entitlement remains intact at Rs.10500/- and the reduction communicated and executed vide Annexure A-2 and Annexure A-3 has thus become erroneous as the basis for such reduction itself is no longer available. In view of the above, this application is allowed to the following extent :-
(a) It is declared that the applicant is entitled to 50% of his minimum pay in the scale of pay of Rs.15600 and 50% of the grade pay attached to it as pension.
(b) Consequently, it is declared that Annexure A-2 and Annexure A-3 being erroneous are liable to be quashed and set aside. It is accordingly ordered.
7. Respondents, especially, respondent No.2 shall forthwith authorize respondent No.4 to reschedule the pension as earlier available to the applicant (ie. Rs.10500/- p.m). Any recovery that has been effected in the wake of issue of Annexure A-2 and Annexure A-3 orders shall be refunded to the applicant.
8. The applicant has claimed interest at the rate of 12% per annum. As the mistake committed by the respondents is not in the character of deliberate misinterpretation of the rule, showing indulgence no interest is directed to be paid by the respondents.
9. The applicant has also challenged the Amendment Rules, 2011 to the Central Civil Service (Pension) Rules. Though counsel for the applicant advanced his argument focusing upon the aforesaid relief, we are of the considered view that in view of the quashing and setting aside of Annexure A-2 and Annexure A-3 orders, no orders may be necessary to be passed in connection with the prayer at 8 (1).
10. The time limit calendered for passing of necessary orders by the respondent No.2 is one month from the date of communication of this order. The time limit scheduled for restoring the pension at Rs.10500/- is within two weeks from the date of receipt of the authority from respondent No.2 by respondent No.5. And time limit fixed for payment of arrears of pension and also refund of recovery already made is four weeks from the date of receipt of the communication from the respondent No.2 by respondent No.5 restoring the pension.
11. Under the above circumstances, there shall be no order as to costs.
(Dated this the 23rd day of January 2012)
K.GEORGE JOSEPH Dr.K.B.S.RAJAN
ADMINISTRATIVE MEMBER JUDICIAL MEMBER
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