THE 20 % IMBROGLIO

There has been a lot of hair splitting over the 20% interim relief ordered by Supreme Court to be paid by LIC to the respondent-employees (pensioners) as per the impugned judgments of the three High Courts.

LIC seems to be deliberately interpreting the SC order dt 7/5/2015 to mean that they have to withdraw 20% of the amount deposited in the HC Registries and then pay the amounts to the concerned original petitioners.LIC has conveniently and erroneously presumed that the Supreme Court has accepted the amount deposited by it in the HC Registries ascorrect. LIC has not attached any importanceto the word "amount as per the impugned judgments" and also the statement, "As the matter relates to grant of enhancement of pension, it shall be listed between item Nos.1 to 5 in the hearing list" does not seem to carry an iota of significance for LIC. For LICthe interim relief payable appears to be the amount as determined by it according to its own convenient interpretation of the High Court judgments.

It is true that the final word on DR anomaly removal & 100% DR neutralization for pre-August 1997 retirees  and upgradation of pension for all retirees will emerge in the Supreme Court only after the Civil Appealsare disposed of by the Supreme Court.Recognising the  delay  that the legal process is subject to and also considering  the potential mortality risk that the beneficiary-pensioners are exposed to, the Supreme Court in its judicial wisdom has thought it fit to order an interim relief of 20 % of the amount that the respondent-pensioners would be presumably entitled to if the CAs are decided in their favour.

If we take the case of Chandigarh petitioners, the total amount of arrears they are entitled to is Rs 4.67 Cr without interest and Rs 7.7 crin including interest as at 30/4/2015.But LIC has only deposited Rs 33.7 lks.This works out to barely 7.2% of the due amount if interest is ignored and just 4.4% if interest is also taken into account. In effect the amount paid by LIC in the HC Registries is not sufficient to pay the   20% interim relief to the pensioner-petitioners.

The percentage will not be much different in the case of Jaipur petitioners; in fact the percentage may be still less as there are afew post-July 1997 retirees who are petitioners in Jaipur in respect of whom no deposits have been made.

Perhaps it would have been more appropriate if the Supreme Court had simply ordered LIC to pay 20% interim relief first to thebeneficiaries and then withdraw amount so paid from the High Court Registries in the normal course.

The SC has stated, "if any amount, that has been deposited before the High Courtpursuant to the order passed by this Court, 20% of the same shall be released in favourof the Life Insurance Corporation of India….".As Mr M Sreenivasa Murty had recalled some time ago, the payment in the Chandigarh HC Registry in May 2014 was not in obedience to any Supreme Court order, but only as per the undertaking by LIC's own counsel. Withdrawal of the amount from the said Registry cannot be a precondition for payment of interim relief.LIC can withdraw the entire amount from the Registry afterpaying the correct 20% interim relief to the Chandigarh petitioners. The Chandigarh HC has already been informed by the petitioners' counsel about the interim order passed by the Supreme Court on 7/5/2015.

In respect of Jaipur petitioners, LIC canwithdraw the entire amount deposited in the Jaipur HC Registry as the amount is less than 20% of the LIC's liability towards thepetitioners. In the meantime, LIC should pay the correct amount of interim relief to thesepetitioners (including the post-July 1997 retirees). But the crux of the matter is how to make LIC recognize the correct amount payable as per the Jaipur & Chandigarh HCjudgments. They are unlikely to pay the rightamount unless Supreme Court comes down heavily on them in the matter. This is where the challenge lies for our counsel in the Supreme Court to convince the Apex Courtabout the justness of our stand.

The easiest way to convince the Supreme Court on the pension anomaly is to highlight the fact of reduction in family pension as a result of the erroneous revision method adopted by LIC while making payments inhigh court registries.

Now we have to wait and see what moves LIC makes from 29/6/2015 onwards and what strategies the pensioners' case managers adopt in July 2015 after the Supreme Court reopens after the summer vacation.

As the date draws nearer to the date of thenext hearing viz 23/9/2015 at the Supreme Court, we need to move away to the morecrucial purpose of securing 100% ofupgradation benefits to 100% of eligiblepensioners coupled with payment of monthly upgraded pensions at the earliest. CaseManagers and Pensioners' Federations need to seriously consider whether we can identify a very eminent, high profile senior counsel of stature to appear before the Supreme Court Bench for the petitioners in the next hearing. The cost may be high and has to be collectively borne by over 40000 pensioners, but it will be definitely worth it.  We have a lot of merits in our cases alright, but what will make a difference is how powerfully they are driven home before the Supreme Court Bench. These are times for hard decisions which can brook no delay.

Greetings.

C H Mahadevan

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