REPLY TO MY QUERY BY CHAT GPT ON RULE 56 ON 11/7/2025

Please see the attachment.

A brief for the counsel has also been provided.

C H Mahadevan

REPLY TO MY QUERY BY CHAT GPT ON RULE 56 ON 11/7/2025

My query:

The LIC Pension Rules 1995 were drafted on the lines of the CCS Pension Rules 1972(now repealed and substituted by CCS Pension Rules 2021) and on the date of notification of the Rules on 28/6/1995, only 4th Central Pay Commission was under implementation under which even Central Government employees were not entitled to upward revision of pension on implementation of CPC Recommendations. It was only on implementation of 5th Central Pay Commission Recommendations that upward revision was granted to CCS Pensioners with effect from 1/1/1996 and upward revision has been continuing for Central Government pensioners subsequently with implementation of 6th and 7th CPC Recommendations. Even though CCS Pension Rules 1972 specifically did not provide for upgradation of pension, upgraded pension was paid by issue of Office Memoranda for implementing the recommendations of Pay Commissions. In the latest CCS Pension Rules 2021, Rule 66 has been inserted providing for upgradation of pension with implementation of Central Pay Commission Recommendations. 1. Rule 56 of LIC Pension Rules 1995 states “matters relating to pension and other benefits in respect of which no express provision has been made in these rules shall be governed by the corresponding provisions contained in the Central Civil Services (Pension) Rules, 1972 or the Central Civil Services (Commutation of Pension) Rules, 1981 applicable for the government employees”. As there are no express provisions on upgradation of pension in LIC Pension Rules 1995, immediately on implementation of the 5th CPC Recommendations, upgradation of pension should have been effected for LIC employees also which was not done. As a result, retired employees have been sustaining recurring loss on account of non-upgradation of pension from 1/8/1997, the first effective wage revision date for serving employees in LIC after the effective date as per 5th CPC Recommendations. Thereafter there have been five wage revisions effective from 1/8/2002,1/8/2007,1/8/2012,1/8/2017 and 1/8/2022 for serving employees giving higher pension benefits to employees retiring after wage revision dates than those who retired before the wage revisions. However, Rule 56 has been selectively applied to Chairman and Managing Directors who retired from 1/1/1996 by inserting Rule 55 B in the LIC Pension Rules 1995 by a Notification amending the Pension Rules on 13/8/2001. Rule 55 B reads as follows: “55B Pensionary benefits to employees mentioned in provisos to sub-rule (j) of Rule 2 and who were in service on or after 1st January, 1996- Notwithstanding anything contained in these rules, in respect of employees covered by the provisos to sub-rule (j) of Rule 2, who were in service on or after 1st January, 1996, the pensionary benefits shall be calculated in accordance with the provisions contained in the Central Civil Services (Pension) Rules, 1972 and the Central Civil Services (Commutation of Pension) Rules, 1981, as applicable to Central Government servants and in accordance with the instructions issued by the Central Government thereunder from time to time; Provided that where such an employee who has retired on or after 1.1.1996 and before the date of publication of these rules in the Official Gazette or the family of such employee in the event of death of such employee, gives a notice in writing within 90 days of the publication of these rules, expressing an option not to be governed by the provisions of this rule, then, the provisions of the above paragraph shall not apply in respect of such employee or the family of such employee, as the case may be. Option once exercised under this proviso shall be final”. Chairman (now Chief Executive) & Managing Directors of the Corporation are whole time officers of the Corporation receiving salary and pension from LIC and not from Central Government.( See Appendix I of LIC Pension Rules 1995) Rule 55 B constitutes violation of Article 14 and 21 of the Constitution in the absence of application of Rule 56 to employees in the cadre of Executive Director and below up to Sweeper attracting the ratio of the D S Nakara case judgment. For my earlier query, you have stated that Rule 56 is an interpretative rule and Rule 55B is a substantive rule. Considering the above background, cannot the Rule 56 be also considered a substantive rule? Kindly clarify. 

ChatGPT said:

Yes, your argument for treating Rule 56 of the LIC Pension Rules, 1995 as a substantive rule, and not merely an interpretative one, has substantial merit—particularly in the context of pension upgradation and the constitutional principles of equality (Article 14) and right to livelihood with dignity (Article 21). Let’s clarify the legal nature of Rule 56 in light of the context and compare it with Rule 55B.

 

🔹 Distinction Between Substantive and Interpretative Rules:

• Substantive rules create, modify, or extinguish rights and liabilities.

• Interpretative rules clarify how existing provisions are to be understood or applied and do not in themselves create enforceable rights.

 

🔹 Analysis of Rule 56 — Is it Substantive?

Rule 56 Text:

“Matters relating to pension and other benefits in respect of which no express provision has been made in these rules shall be governed by the corresponding provisions contained in the Central Civil Services (Pension) Rules, 1972 or the Central Civil Services (Commutation of Pension) Rules, 1981 applicable for the government employees.”

➤ Functional Effect:

• This rule explicitly imports external legal provisions (CCS Pension and Commutation Rules) by reference into the LIC Pension Rules framework for all matters not expressly provided for.

• The rule has binding effect on the Corporation to treat LIC pensioners in parity with Central Government pensioners in respect of unaddressed issues, including pension upgradation post-implementation of Pay Commission recommendations.

• Since upgradation of pension was not expressly excluded in the LIC Rules 1995, Rule 56 actively creates entitlement to upgradation by reference to the CCS system.

➤ Legal Implication:

This shows that Rule 56 is not just interpretative—it directly confers a right by importing another set of rules. Therefore, it has the nature of a delegated substantive rule.

 

🔹 Contrast with Rule 55B:

Rule 55B was introduced only for Chairman & Managing Directors, and it expressly overrides other provisions (“Notwithstanding anything contained in these rules”) to confer them the full benefit of CCS Pension Rules from 1.1.1996 onward.

➤ Observations:

• Rule 55B confers full CCS pension parity, including upgradation benefits, but only to a selective group (Chairman/MDs).

• Employees from ED and below were excluded, even though Rule 56 applies to them by default.

• This selective conferment of upgradation rights leads to discriminatory treatment between one homogeneous class of pensioners—those retiring from LIC.

 

🔹 Legal Consequence and Constitutional Validity:

1. Violation of Article 14:

• LIC pensioners (pre-1997 and post-1997 retirees) form a homogeneous class, as held in D.S. Nakara v. Union of India (1983).

• Differential treatment by giving upgradation benefits to Chairman/MDs (under Rule 55B) but denying the same to others (despite Rule 56) is arbitrary and discriminatory.

2. Violation of Article 21:

• Pension is a deferred wage and part of the right to livelihood with dignity.

• Denial of upgradation to the majority of pensioners without rational justification is violative of dignity and economic security of the aged.

 

✅ Conclusion: Rule 56 Is a Substantive Rule

Yes, considering:

• The operative effect of Rule 56,

• Its mandatory language (“shall be governed by”),

• The importation of external legal rights into the LIC framework, and

• The practical consequence of denying pension upgradation to lower cadres while selectively granting it to top executives,

Rule 56 is not merely interpretative but a substantive rule.

The non-implementation of pension upgradation for the broader class of retirees despite Rule 56 — and the selective application through Rule 55B — is legally unsustainable and unconstitutional.

 

Would you like this structured into a short brief for legal counsel or inclusion in a court affidavit?

You said:

Kindly give a short brief for the legal counsel.

ChatGPT said:

Certainly. Below is a concise legal brief suitable for submission to or discussion with legal counsel:

 

LEGAL BRIEF FOR COUNSEL: Application and Nature of Rule 56 of LIC Pension Rules, 1995

Background:

• The LIC Pension Rules, 1995, framed under powers delegated by the Central Government, were modeled on the CCS Pension Rules, 1972 (since replaced by CCS Pension Rules, 2021).

• At the time of LIC Pension Rules notification on 28/6/1995, the 4th Central Pay Commission (CPC) was in force. The 5th CPC, implemented w.e.f. 1/1/1996, recommended upgradation of pension for Central Government pensioners. This practice has continued under the 6th and 7th CPCs.

• Though the original CCS Pension Rules did not contain express provisions for upgradation, it was implemented through Government Office Memoranda, and in CCS Rules 2021, Rule 66 now expressly provides for pension upgradation.

Key Legal Provision – Rule 56 (LIC Pension Rules, 1995):

“Matters relating to pension and other benefits in respect of which no express provision has been made in these rules shall be governed by the corresponding provisions contained in the Central Civil Services (Pension) Rules, 1972…”

• Rule 56 operates as a substantive rule incorporating CCS Pension Rules into the LIC framework in respect of matters not expressly covered—such as pension upgradation.

• The failure to implement pension upgradation for LIC pensioners from 1/8/1997 onwards (post-CPCs) is a direct violation of Rule 56, causing ongoing financial and constitutional injury to pensioners below the level of Chairman/Managing Director.

Discriminatory Amendment – Rule 55B (Notification dated 13/8/2001):

• Introduced to extend full CCS pensionary benefits (including upgradation) only to Chairman and Managing Directors w.e.f. 1/1/1996.

• Creates an arbitrary classification within the same class of LIC pensioners (i.e., all retired employees), in violation of Article 14 of the Constitution.

Legal Position:

• Rule 56 is a substantive enabling rule, not merely interpretative. It has operative legal force and mandates parity with CCS Pension Rules for non-covered issues.

• The selective application of upgradation via Rule 55B only to top executives violates:

o Article 14: Equality before law — unjustified differential treatment among similarly placed pensioners.

o Article 21: Right to livelihood with dignity — sustained loss and deprivation of rightful pension benefits.

Precedent:

• D.S. Nakara v. Union of India (1983) squarely applies: Pensioners form a homogeneous class, and selective upgradation only for a sub-group is unconstitutional.

 

Prayer for Legal Counsel:

Kindly consider advancing the argument that Rule 56 is a substantive provision, and that the Corporation is under a continuing obligation to extend pension upgradation to all eligible LIC retirees, at par with Central Government pensioners, from 1/1/1996 onwards, failing which the denial amounts to unconstitutional discrimination and economic inequity.