MY TAKE ON THE POST OF MR S R SRINIVASAN ON APPLICABILITY OF DR PROVISIONS

MY TAKE ON THE POST OF MR S R SRINIVASAN ON APPLICABILITY OF DR PROVISIONS

As Mr S R Srinivasan has requested me also to revisit the issue on the points raised by him, I thought I should make my thoughts clear on the points raised by him and in that process share my thoughts with the pensioner friends visiting the blog.

LIC pension Rules 1995 are sacrosanct till they are amended by LIC/GOI or till they are struck down by the courts.

As regards the DHC judgment, LIC has implemented the judgment according to its own interpretation of the judgment and has not amended the LIC Pension Rules 1995 despite the fact that they have not challenged the judgment. Perhaps LIC  is waiting for the disposal of the SLPs pending in the Supreme Court, so that any amendments that may be needed after the  final verdict may be done at a  time.

On the points of the DHC judgment raised by Mr Srinivasan,my comments are as follows:

1.     It is not ordered by DHC that pre-August 1997 retirees are entitled to DR at 100% neutralisation as is allowed to post 8/1997 retirees. If the DHC had felt so,it could have ordered that the DR formula should have been equalised with the DA formula for serving employees as prevailing for post-August 1997 retirees. Not only was it not done, but the prayer for upgradation was also rejected ;

2.     The amendment to Appendix IV ordered by DHC is not as per Para 3 A, but taking the 0.23% as the bench mark minimum rate .This was arbitrary considering that the relativity of the DR rate to the AICPI was disturbed .The rate of 0.23% for pre-April 1993 period  of retirement is not the same as 0.23% for the post-April 1993-pre-August 1997  and post August 1997 -pre August 2002 retirement periods. Applying this rate of 0.23% for the various retirement periods as the bench mark minimum distorts the DR formula creating further anomaly. The simplest way in which the DHC could have provided relief to pre-August 1997 retirees in the absence of upgradation  was to order equalisation of DR rates for retirees identical with the DA rates for serving employees in the tapering formula following the principle adopted from 1/8/1997 onwards.

3.     Rule 3A does not violate the ratio of D S Nakara judgment and has not been struck down by DHC. Appendix IV only violates the ratio of the D S Nakara judgment to the extent that the parity between retirees and serving employees in the matter of DR/DA rate on Basic Pension/Basic Salary was not maintained in the rates published in Appendix IV in the light of Para 3A in the Notification dated 22/6/2000.I feel that it was wrong at the first instance to have pleaded that Para 3A  was unconstitutional  because Para 3A was what rendered  the DR rates under Para 1 to 3  of Appendix IV unconstitutional. Para 3A was in fact setting a benchmark for determining the rate of DR employees retiring from 1/8/1997 to 31/7/2002 and future periods of wage revisions..

4.     Rule 3 A does not violate Article 14 of the Constitution but Paras 1 to 3 of Appendix IV do when read with para 3A.We should not challenge Para 3A,as,if Para 3A is invalidated, there will be a vacuum for retirees of the period from 1/8/1997 to 31/7/2002 and any alternative formula may not help pre-August 1997 retirees but may rather act to the detriment of the Group 3 retirees  with a possible scaling down of the DR formula to fall in line with the pattern followed for pre-August 1997 retirees. Fortunately, such a thing did not happen so far.

Para 3B may be an extension of Para 3A, but it only enables the Corporation to determine the rate of DR for retirees of each period of retirement after wage revision from 1/8/2002 till the effective date of next wage revision. It does not confer the right of upgradation of pension.

There is definitely a strong legal case for upgradation of pension and we are not able to get the benefit as the hearing in SC got repeatedly got adjourned. There are very strong grounds included in our SLPs and the various rejoinders to the counter affidavits of LIC as well as in the synopses lastly submitted to the Supreme Court.

It is very important that we should argue for upgradation of pension on strong grounds through our counsels. If we focus on wrong and weak grounds, we may run the run the risk of losing a winnable case.

The most basic ground in our favour was the fact that LIC decided in its Board Resolution dated 24/11/2001 which in my opinion is  clearly for upgradation of pension to revise the pension as at 1/8/1997 and apply the rate of DR at 0.23% on such revised pension. But LIC, while sending its recommendations to the MoF, although it factored revision of pension on 1/8/1997 on merger of DR with Basic Pension, left out the weightage of 11.25% recommended by the Board. The decision on the Board Resolution is still pending with the GOI.

Rule 55B is another discriminatory rule where under the same Pension Rules two separate classes of pensioners exist with different benefits without any justifiable and intelligible criteria and a valid specific object to be achieved. I can write about the distinctive grounds emerging from Rule 55 B, but it will take another long paragraph which I feel is not necessary now. Suffice it to say that Rule 55 B gives us a golden opportunity of establishing the applicability of the ratio of D S Nakara case judgment very convincingly before the Apex Court.

I have no doubt that all the case managers will marshal their strong grounds effectively in the hearing in the Supreme Court due to take place next month.

Let us hope for good days to arrive for LIC Pensioners.

C H Mahadevan