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2025 Supreme(Online)(Mad) 24402
IN THE HIGH COURT OF JUDICATURE AT MADRAS
J.NISHA BANU, P.DHANABAL, JJ
The Regional Provident Fund Commissioner-I Employees Provident Fund Organization – Appellant
Versus
N.V.Krishnamoorthy – Respondent
W.A.Nos.871, 872, 873, 875, 876, 877, 878, 879 of 2024
For the Appellants/Petitioners: Mr.C.Kulanthaivel
For the Respondents: Mr.G.Sankaran, Senior counsel for Mr.S.Nedunchezian, Mr.T.Chezhian, Addl Govt.Pleader for R2.
The court affirmed that non-restoration of full pension after the commutation period is improper, emphasizing that pension schemes should be interpreted favorably towards employees as a matter of social welfare.
Headnote:(A) Employees' Provident Funds & Miscellaneous Provisions Act, 1952 - Section 17(1)(a) - Employees' Pension Scheme, 1995 - The appellants challenged the restoration of full pension after the commutation period of 100 months, which was previously denied by the PF organization. The court held that non-restoration of full pension after the commutation period is improper, reaffirming that the scheme should be interpreted in favor of employees as a welfare measure. (Paras 5, 18, 20)
Facts of the case:
Respondents were employed in an exempted establishment and opted for commutation of pension. They claimed restoration of full pension after the commutation period after their representations were denied by the PF organization.
Findings of Court:
The court confirmed the Single Judge's order to restore full pension after the commutation period and directed the appellants to pay all consequential benefits within eight weeks.
Issues: The main issues were whether the respondents were entitled to full pension restoration after 100 months and the interpretation of the pension scheme provisions.
Ratio Decidendi: The court found that the scheme does not prohibit restoration of full pension and is meant to prevent unjust enrichment of the PF organization. The interpretation of the pension scheme should be in favor of the employees as it is a welfare legislation.
Result: Writ Appeals dismissed.
| Table of Content |
|---|
| 1. employees opted for commutation of pension post-retirement. (Para 2 , 3) |
| 2. legal interpretation of pension restoration post-commutation. (Para 4 , 5) |
| 3. arguments regarding entitlement to full pension after commutation. (Para 6 , 7 , 11 , 13 , 14) |
| 4. recent amendments enabling restoration of full pension after 15 years. (Para 8 , 9 , 10) |
| 5. court's interpretation of pension scheme as welfare legislation. (Para 17 , 18 , 19) |
| 6. court confirms restoration of full pension after commutation period. (Para 20 , 21) |
JUDGMENT
Per J.NISHA BANU, J.
The Writ Appeals filed as against the common order passed by the learned Single Judge, dated 28.11.2019.
2. The case of the appellants-Provident Fund Department is that the respondents 1 and 3 to 9 were employed in Central Co-operative Bank Ltd., Kumbakonam, an exempted establishment under Section 17(1)(a) of the Employees' Provident Funds & Miscellaneous Provisions Act, 1952. The respondents were retired from their service in the years of 1999, 2002, 2005. After retirement, these respondents opted for 1/3rd commutation of pension under the Employees' Pension Scheme, 1995 , and agreed to receive the balance 2/3rd pension on monthly basis accordingly.
3. The respondents, after retirement sent representations to the appellant organisation, claiming their original pension after the period of 100 months, which includes their contributions which had been recovered from them. However, the organization denied the same vide order dated 02.01.2018, stating that there is no enabling provision for restoration of such Commuted pension, which lead to multiple writ petitions.
4. As per explanation 4 to para 13 of the scheme which were deleted vide order dated 26.09.2008, it has been reiterated that “ In cases of exercise of option for commutation under paragraph 12A, balance monthly pension payable after commutation shall be deemed to be the original monthly pension for the purpose of this paragraph.”
5. The learned Single Judge allowed the writ petition vide order dated 28.11.2019 and held as under:-
“21. This being the legal principles to be followed, this Court is of an opinion that, non restoration of full pension after the expiry of commutation period i.e., 100 months in this present case is improper and not in consonance with the very scheme of commutation itself.
22. Accordingly, the impugned orders passed by the Regional Provident Fund Commissioner-1, Employees Provident Fund Organization, in No.TN/ZO-CBE/PGHS/NIS/2018 dated 02.01.2018 is quashed and writ petitions stand allowed. The respondents are directed to restore the full pension on expiry of the 100 month period fixed for commutation and pay all other consequential and attendant benefits within a period of 12 weeks from the date of receipt of a copy of this order.”
Challenging the same the present Writ Appeal has been filed.
6. The learned counsel appearing for the appellant-Provident Fund Department contented that as per explanation 4 to para 13 of the scheme, only the balance pension after commutation is to be treated as “Original Pension”. The learned Judge erred in holding that after the deduction of the commuted amount for a period of 100 months from the date of received commuted amount, the petitioners are all entitled to claim full pension amount is not correct.
7. It is evident from the said provision in Para 12 (A), the emphasis is not on 100 months but on 100 times only and the same has been emphasized only for arithmetical calculation for the purposes of commuted value of 1/3rd pension to be paid as lump sum. Hence the learned Single Judge misconstrued the emphasis and the provision and granted the relief as prayed in the writ petition.
8. However, after the impugned orders passed in the writ petitions, the Ministry of Labour and Employment, Government of India, New Delhi issued a Notification No.G.S.R.132(E) dated 20.02.2020 by inserting Para 12B of Employees' Pension Scheme, 1995 , enabling the pensioners to get full/normal pe
