7th CPC Pension Revision: Restoration of full pension of absorbee pensioners in view of the order dated 01.09.2016
7th CPC Pension Revision: Restoration of full pension of absorbee
pensioners in view of the order dated 01.09.2016 of Hon’ble Supreme
Court in Civil Appeal No. 6048/2010 and Civil Appeal No. 6371/2010.
F.No. 4/34/2002-P&PW(D).Vol.II
Government of India
Ministry of Personnel, Public Grievances & Pensions
Department of Pension & Pensioners Welfare
3rd Floor, Lok Nayak Bhavan,
Khan Market, New Delhi
Dated the 23rd June, 2017
OFFICE MEMORANDUM
Subject: Restoration of full pension of absorbee pensioners in view of
the order dated 01.09.2016 of Hon’ble Supreme Court in Civil Appeal No.
6048/2010 and Civil Appeal No. 6371/2010.
The undersigned is directed to say that in accordance with the
instructions which existed before 31.03.1995, a Government servant, on
absorption in a Public Sector Undertaking or an Autonomous Body, had the
option to draw pro-rata gratuity and a lump sum amount in lieu of
pension. The option regarding payment of lump sum amount in lieu of
monthly pension on absorption in a PSU or autonomous body was available
in terms of the instructions issued vide Department of Expenditure’s
O.M. No. 26(18)-E.V(B)/75 dated 08.04.1976, Department of Personnel
Training’s O.M. No. 28016/5/85-Estt.(C) dated 31.01.1986 and Department
of Pension & Pensioners’ Welfare’ O.M. No. 4(12)/85-P&PW dated
31.03.1987. This option was also available to Government employees on
absorption in PSUs/autonomous bodies of the State Governments and Joint
Sector undertakings in terms of this Department’s O.M. No.
4/43/88-P&PW(D) dated 16.10.1989. The terms and conditions for
absorption of Government employees consequent on conversion of a
Government Department into a PSU or autonomous body issued vide this
Department’s O.M. No. 4/18/87-P&PW(D) dated 5.7.1989 also provided
for a similar option of lump sum payment in lieu of monthly pension.
2. In accordance with Rule 37-A of the Central Civil Services (Pension)
Rules, 1972, incorporated vide Department of Expenditure’s Notification
No. 44(l)-E.V./71 dated 09.04.1973, on exercise of the above option, an
employee was entitled to a lump sum amount not exceeding the commuted
value of one-third of the pension and terminal benefit equal to twice
the aforesaid lump-sum amount, subject to the condition that the
Government servant surrendered his right of drawing two-thirds of his
pension.
3. The option to draw a lump sum amount in lieu of pension was withdrawn
vide this Department’s O.M. No. 4/42/91-P&PW(D) dated 31st March,
1995. Accordingly, the erstwhile Rule 37-A was omitted from the
CCS(Pension) Rules, 1972 vide Notification No. 4/42/91-P&PW(D) dated
25.06.1997.
4. In implementation of the Order dated 15.12.1995 of Hon’ble Supreme
Court in WP(C) No. 11855/85, instructions were issued vide this
Department’s O.M. No. 4/3/86-P&PW(D) dated 30.09.1996 for
restoration of one-third commuted portion of pension of Government
servants who had drawn lump sum payment on absorption in a
PSU/autonomous body. Further instructions were issued, from time to
time, for computation and revision of the one-third restored pension of
such absorbee pensioners and for payment of the attendant benefits like
dearness relief, etc. to such absorbee pensioners. Orders for revision
of the one-third restored pension w.e.f. 01.01.2006 of such absorbee
pensioners were issued vide this Department’s O.M. No 4/38/2008-
P&PW(D) dated 15/09/2008, O.M. No. 4/30/2010-P&PW(D) dated
11/07/2013. and O.M. No. 4/38/2008-P&PW(D) dated 04/08/2016. These
absorbee pensioners were, however, entitled to dearness relief and
age-related additional pension based on the notional full pension.
5. Hon’ble High Court of Judicature of Madras, in its judgement dated
02-08-2007 in Writ Petition no. 22207/2002 filed by one Sh. K. Ganesan,
an officer in the office of Controller General of Accounts, held that
surrendering of the right for drawal of 2/3rd of Pension after its
commutation, as provided under Rule 37-A (b), was repugnant to Section
12 of the Pensions Act, 1871 and that the petitioner was lawfully
entitled for the restoration of his pension after the expiry of the
period of commutation of 2/3rd pension. Hon’ble High Court, accordingly,
directed restoration of 2/3rd pension and payment of arrears
accordingly.
6. An SLP(Civil) No. 4054/2008 (converted into Civil Appeal No.
6048/2010) was filed by the Union of India challenging the aforesaid
order dated 02-08-2007 of Hon’ble High Court of Judicature of Madras. In
its order dated 1.9.2016, Hon’ble Supreme Court found no justification
to interfere with the order dated 02.08.2007 of Hon’ble High Court
directing restoration of 2/3rd pension in respect of the respondent
(Shri K. Ganesan), after the expiry of the requisite period of
commutation. The Civil Appeal No. 6048/2010 was accordingly dismissed by
Hon’ble Supreme Court. In the said judgement dated 1.9.2016, similar
direction was passed by Hon’ble Supreme Court in the Civil Appeal No.
6371/2010 for restoration of 2/3rd pension in respect of the
petitioners, Shri K.L. Dhall, an absorbed employee of Ministry of Civil
Aviation and member pensioners of Welfare Association of Central
Government Officers, CAD Absorbed in PSU.
7. Review Petitions No. 465/2017 and No. 472/2017 were filed by Union of
India in the Supreme Court against the aforesaid order dated 1.9.2016.
Instructions were separately issued to the office of Controller General
of Accounts and the Ministry of Civil Aviation vide OM
No.4/34/2002-P&PW(D).Vol.ll dated 21-12-2016 and OM No.
4/34/2002-P&PW(D).Vol.II dated 21-12-2016 respectively, for
implementation of the orders of Hon’ble Supreme Court in respect of the
petitioner/respondent pensioners in the aforesaid Civil Appeals, subject
to the final outcome of the Review Petitions. The aforesaid Review
Petitions No. 465/2017 and No. 472/2017 have been dismissed by Hon’ble
Supreme Court on 22.03.2017.
8. The matter has been examined in consultation with the Department of
Legal Affairs and the Ministry of Finance (Department of Expenditure).
It has been decided to extend the benefit of order dated 02-08-2007 of
the Hon’ble Madras High Court and the Order dated 01-09-2016 of the
Hon’ble Supreme Court to all similarly placed absorbee pensioners.
Accordingly, all such absorbee petitioners who had taken 100% lump-sum
amount in lieu of pension on absorption in PSUs/Autonomous Bodies in
accordance with the then existing Rule 37-A and in whose case 1/3
pension had been restored after 15 years, may be allowed restoration of
full pension after expiry of commutation period of 15 years from the
date of payment of 100% lump-sum amount.
9. The absorbee pensioners whose full pension is restored in terms of
the above instructions would also be entitled to revision of their
pension in accordance with the instructions issued from time to time in
implementation of the recommendations of the Pay Commissions, including
the 7th Central Pay Commission.
10. In their application to the persons belonging to the Indian Audit
and Accounts Department, these orders issue in consultation with the
Comptroller and Auditor General of India.
11. Ministry of Agriculture etc. are requested to bring the contents of
these Orders to the notice of Controller of Accounts/Pay & Accounts
Officers and Attached subordinate Offices under them on a top priority
basis and for taking necessary action for implementation of the above
instructions. All pension disbursing offices are also advised to
prominently display these orders on their notice boards for the benefit
of pensioners.
12 This issues with the approval of Ministry of Finance (Department of
Expenditure) vide their ID Note No.1(11)/EV/2017 dated 26-05-2017 and
dated 13-6-2017.
13. Hindi version will follow.
Sd/-
(Harjit Singh)
Director
Source: Pensioners Portal
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