10/4/2015
To
Chairman,
L I C of India,
Central Office,
“Yogakshema”,
Jeevan Beema Marg,
Mumbai-400021
Dear Sir,
Re: The effect of the Supreme Court
judgment dated 17/3/2015 read with Delhi High Court judgment dated
29/4/2013—Pension cannot be less than 50% of Pay
As per the above Supreme Court judgment,
the pension for a retired employee cannot be less than 50% of the minimum of
the Pay and Grade Pay in the Pay Band
corresponding to the pre-revised Pay.
Arising out of the above judgment, I
happened to make sample calculations taking the case of an Executive Director
of LIC who retired on 31/10/2002.Taking into account the method of calculation
for fixation of pension outlined in the L I C of India(Employees) Pension
Rules, 1995 as amended on 14/5/1999,my calculations revealed that for this
Officer, the Gross Basic Pension fixed
as per our Pension Rules worked out to less than 50% of (minimum Basic Pay plus
Fixed Personal Allowance) as per wage revision effected from 1/8/2002 .(Fixed
Personal Allowance also comes under the definition of “pay” under Rule 2
(o)(iii) to the extent it does not
exceed the last increment in the scale of pay; if any. This anomaly will
be evident from the following:
Gross Basic Pension Fixed as per existing
Pension Rules: Rs 16050
Gross Basic Pension required to be fixed as
per the above
SC
judgment:
Rs 16370
-------------Shortfall:
Rs 320
--------------
The difference may appear to be small, but
it may entail cumulative loss for an officer if his pension is not fixed
correctly and hence anomalous. I attach my calculations vide Table A.The
calculations may kindly be got verified by the Personnel dept for their
accuracy. May be it may not result in shortfall in the case of all pensioners
who have retired within 9 months of the effective date of wage revision, but I
am sure you will appreciate that all such cases will have to be reviewed and
anomalies will have to be rectified wherever shortfall in fixation is found-even
if the cases are few- and action taken for refixation of pension and payment of
arrears of difference due.
This review may have to be undertaken in
respect of all pensioners who would have retired within nine months from
1/8/1997, 1/8/2002 & 1/8/2007 and anomalies found if any may have to be
rectified to conform to the principle laid down as per the above Supreme Court
judgment. The number of cases falling under this category may not be large and
hence will not pose any administrative inconvenience for the Corporation.
In this context, I also attach the
following for your ready reference:
1.
Order of the Delhi High
Court dated 29/4/2013;
2.
An Office Memorandum dt
5/3/2015 by the Department of Pension and Pensioners Welfare;
3.
Copy of the Supreme Court
judgment dated 17/3/2015
4.
Order of the Supreme
Court under SLP© Nos 13280/2013 &
23055/2013
I hope the Corporation will be kind enough
to rectify this anomaly at the earliest.
Thanking you,
Yours faithfully,
C H Mahadevan
Executive Director (LIC)(Retd)
Dallas-Texas-USA
Encl: as above
Cc to Smt Usha Sangwan,Managing
Director,LIC of India,Mumbai for information and necessary action
Cc to Executive Director (Personnel), LIC
of India, Central Office Mumbai for information and necessary action.
Cc to Dr. Hasmukh Adhia, Secretary (Financial
Services), Government of India for information and necessary action, if any.
Cc to Shri N.
Srinivas Rao, Director (Pension Reforms, Insurance-II), and Government of India for information & necessary action,
if any.
1.
