Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2024 Supreme(Cal) 1105

IN THE HIGH COURT AT CALCUTTA
RAI CHATTOPADHYAY, J.
Ajoy Kumar Rej & Ors. – Petitioners
Versus
Union of India & Anr. – Respondents
WPA 7763 of 2017 with CAN 1 of 2022
Decided On : 31-07-2024

Advocates Appeared:
For the Petitioners: Ms. Reshmi Hossain, Mr. M. Hossain, Ms. M. Brahmachari, Ms. M. Biswas.
For the Respondents: Mr. Kumar Joyti Tewari, Mr. Lakshmi Kumar Gupta, Ld. Senior Adv., Mr. D. N. Ray, Mr. Bhaskar Mukherjee, Mr. Debdeeta Dutta.

IMPORTANT POINT
The court established that once an employee opts for the CPF scheme, that choice is irrevocable, barring any future claims for pension benefits under the Pension Scheme.

Headnote:
Pension - Writ Petition - Central Civil Services (Pension) Rules 1972, Notification dated 1st May 1987 - The court interpreted the provisions regarding automatic switch to the Pension Scheme for employees who did not opt for the CPF scheme, concluding that the petitioners had consciously opted for CPF and were thus not entitled to pension benefits.
Fact of the Case:
The petitioners, retired employees, challenged the refusal of the Indian Institute of Management to grant them pension benefits, claiming they automatically switched to the Pension Scheme as they did not exercise an option to remain in the CPF scheme by the deadline.
Finding of the Court:
The court found that the petitioners had submitted options to remain in the CPF scheme, thus barring them from claiming benefits under the Pension Scheme. The court emphasized the binding nature of the option exercised and the notification provisions.
Issues: Whether the petitioners, having not opted for the CPF scheme by the deadline, were entitled to automatic inclusion in the Pension Scheme as per the notification dated 1st May 1987.
Ratio Decidendi: The court held that the option exercised by the petitioners to remain in the CPF scheme was final and binding, and they could not later claim benefits under the Pension Scheme.
Result: The writ petition is dismissed.

JUDGMENT :

(Rai Chattopadhyay, J.) :

1) This writ petition is to challenge the inaction on the part of respondents No. 4 and 5/the Indian Institute of Management at Joka, Calcutta, to allow the writ petitioners the benefit of changeover to the Pension Scheme with effect from 1st May, 1987. The writ petitioners have prayed for a writ of mandamus to be issued upon the said respondents treating the petitioners having been changed over to the Pension Scheme with effect from 1st May 1997; also that a writ of mandamus be issued commanding them to forebear from treating the petitioners as that the Contributory Provident Fund Scheme (in short CPF) members.

2) Let the factual background of the case be narrated in a nutshell.

3) A total of 58 petitioners have filed the present case. All of them have been employees of the respondents No. 4 and 5 and retired on various dates since after 2017. The Central Government Rules and the Central Civil Services (Pension) Rules 1972, govern the service conditions of the writ petitioners. In case of the petitioners, a revision in service conditions was affected pursuant to the 4th Central Pay Commission recommendations, with effect from 1st January, 1986, vide the notifications dated 19th September, 1986 and 14th March, 1987. In the process a further memorandum was issued on 14th April, 1987 to modify the provisions of the Central Civil Services (Pension) Rules, to incorporate appropriate provision in terms of the recommendation of the Pay Commission that all Contributory Provident Fund beneficiaries (CPF beneficiaries) in service on 1st January, 1986 should be deemed to have come over to the pension scheme on that date unless they specifically put out to continue under the CPF scheme. The amended rule as above was implemented by dint of an office memorandum dated 1st May, 1987.

4) An option was to be exercised by the employees declaring their desire to continue under the CPF scheme, if so, within 30th September, 1987 and in a prescribed form. The said memorandum has specified that all employees shall be continue to be treated under the Pension Scheme, unless they specifically seek to remain a member of the CPF scheme within the prescribed deadline.

5) Similar provision was made for the persons who were in service on 1st January, 1986 but have since retired and received the retirement benefit under the CPF scheme. It has been provided that those persons would also have an option to get their retirement benefit calculated under the Pension Scheme upon their refunding to the government the contribution of the government to the CPF and interest thereon at the time of settlement of CPF account and subject to exercise of such option latest by 30th September, 1987.

6) The writ petitioners have contended that since they decided to change over to the Pension Scheme, which was automatic unless an option to remain with the CPF scheme was exercised, they did not submit the option form before the said cut off date that is, 30th September, 1987. Thus, they say, that according to the amended Rules, they would have to be considered to have 1st changed over to the Pension Scheme with effect from January 1986. The respondent No. 5 issued a notification on 24th August, 1987 whereby it informed adoption of the modified Pension Rules as above and implementation thereof for the employees of the said Institution. The Board of Directors of the respondent Institution in its meeting dated 18th January, 1989, decided to extend the date of exercise of such option. Be that as it may, the petitioners have stated that they have never exercised any option to remain members of the CPF scheme. As such in terms of the modified Rules, the respondent authorities should have to allow them benefits treating them to be the members of the Pension Scheme. The writ petitioners have challenged the alleged inaction on part of the respondent Institution in due compliance with the said amended Rules, in case of the writ petitioners. The petition