Dear Sury, 

I am Attaching here the transcript of what I have put down as my impressions. They are entirely my own impressions and do not purport to be that of the Association I am a member of.Thanks



Dear Sury,

You asked for my impressions on the Delhi H C  Judgement. I shall try and capture a few points here. They are more or less the same as those I mentioned in the Meeting Yesterday. I shall put them down here, again , for the benefit of those who weren't there in the Gen Body Meeting Yesterday:

1.  There is a Pre-amble to the judgement which itself runs into pages, for good reasons. They have to  convince the reader of the points that were under reference to them from SC, and on which they would adjudicate. It is pretty clear from their narration that they were fully seized of their Brief from SC which included the background of Jaipur, Chandigarh and Delhi HCs and their judgements favouring the Petitioners on grounds of Discrimination as far as the DR principle to Pre-97 Retirees.  After  going over the whole background of the point upto where the SC thought of Remanding the case to the Delhi HC itself, mainly because , while giving a favourable judgement  on grounds of Discrimination in DR , the Delhi HC had not addressed the issue of the Constituional Validity of Rule 3(A) of the Pension Rules though it had been specifically raised as a Prayer in the Petition filed by our Federation way-back in 2006.. So with a lot of clarity as to their job on hand the Delhi HC  captures in essence the two aspects  of Prayers from Petitioners they need to listen to and adjudicate upon.
It says in Page 8 of the Judgement,  "In view of the aforesaid discussion, the issue which survives for consideration, and has to be answered, relates to the VALIDITY of Rule 3(A) which is restricted to employees who have Retired or died on or after 1st day of Aug 1997. This, as noticed below, is not the Primary issue. The core issue is the Prayer of the Retired Employees/Assns that all Retirees prior to Aug 1997 should be given full Neutralization and up gradation on Basic Pension with effect from 1st Aug 1997, ensuring Uniform Pension for all Retired Employees, irrespective of the Date of Retirement. In other words, the Retired Employees seek enforcement of the precept of 'One Rank One Pension', by judicial verdict contrary to the Rule position."
In analysing the point reg up gradation demand, the judgement mainly discusses D S Nakara case which was about discrimination in the principle involved in computing basic Pension for a set of Retirees as against a later group retiring after a cut off date. Quoting another SC judgement on another case it says, ".....merger of Dearness allowance into pay would amount to a new Retirement Benefit, whereas D S Nakara's case the ratio and mandate was limited to upward Revision of an existing Benefit. The challenge made by the Retired Employees had failed to distinguish between the in- force Pension Scheme and the Revised Pay Scale. When there is a Revision of Pay, it applies to existing Employees or in some cases even to Retired Employees, when given a retrospective effect. However, this does not mean that the Pension should be Revised on the basis of the new or upgraded emoluments. Unless there is a change in emoluments as defined in the Pension scheme the basic  pension payable would continue to remain as per the pay drawn by the employees immediately before his Retirement."
In yet another averment of the SC in connection with the D S Nakara Case it says, "the SC was certainly conscious and aware that employees retiring from broadly comparable posts at different times were receiving different amounts of Pension. These differences were due to the difference in emoluments drawn by the Retirees at the time of Retirement and also on account of merger of the Dearness Allowance with basic pay or due to interim Relief  granted from time to time. This was not struck down in the case of D S Nakara. In fact , it was never made the subject matter of  challenge."
"thus, D S Nakara's case had held that the Formula computing Pension by taking average of last 10 months' emoluments would be applied universally. It did not lay down that quantum of emoluments drawn during the last 10 months for each employee must be taken as uniform.  The emoluments have to be calculated according to the pay-scales applicable at the time of Retirement."
"The Pension rules do not Postulate increase in Pension pay outs for retired employees upon wage Revision. The Pension Rules to offset the adverse impact of inflation provide for Dearness relief based on price index. This cannot be faulted and struck down as violating Art 14. Thus, courts have recognised that amount of Pension for Retirees from the same post  can be different."
In Pages 54 & 55 the judgement goes on to state further- -"The Prayer is for Revalorisation  of basic pension by merging dearness Relief paid upto  index of 1740 points into basic pension or by notional increase in emoluments. The Prayer would require re-writing  the Pension Rules including the defenition of 'average emoluments' and rule 35,37, &38 relating to computation of the amt of pension , Dearness Relief, and re-calculation of average emoluments for the period of 10 months."
"In case we accept  the contention of the Retired Employees/associations, whenever there is a Revision of Pay, after a period of every 5 years, all retired employees would be entitled to  revalorisation of basic pension on the basis of enhanced  pay-scales, notwithstanding the fact that they have retired prior to enhancement of pay-scales. For reasons stated, this challenge & submission predicted on Article 14 is to be rejected."
Having thus demolished our demand for up -gradation on the principle of Art 14, the judgement goes on to test it against the principle of Art 21 of the constitution. The Art 21 embodies the Right to adequate means of livelihood. The Demand for up-gradation can be considered under Art 21 only if the" amount being drawn is shown as grossly inadequate, unconscionable or an apparent case of arbitrariness and irrationality resulting in violation of Art 14 can be made out. violation of Art 21 is not made out with reference to the aforesaid Tables. Pensions between 13000/- and 21000/- a month do not violate Art 21 so as to affect right to life. The challenge is not that the amount being paid as Pension is meager and piteous, but that the pension paid is less than what is paid to others. The Argument would have to be tested under Art 14 and not under Art 21."
Further the judgement points out that the Pension Scheme was voluntary  and those opting for it knew that the in-service employees would get Revision every 5 years and that those Retiring later would get sizably more Pension based on the definition  of basic pension as described in the Pension Rules.
"In order to offset the inflationary effect, and fall in the value of money, the Pension Rules had postulated Dearness Relief stipulated as per the scale or formula in Appendixiv The Purpose and object of rule 37 read with Appendix iv is to grant Dearness Relief on account of Inflation and rise in prices. Dearness Relief neutralised the inflationary effect to ensure that the pension is adequate and fair"
My own impression is that the demand for up-gradation has been  exhaustively dealt with in the judgement  though it certainly was no demand for OR OP from our side, as seen in the judgement. The judgement does recognize that earlier retirees in the same position draw considerably less than the same level retirees  later on. But that is not to be seen as offending Art 14 or right to equal treatment.  The time point of retirement is significant and our demand for 'some ' up-gradation like what the retirees of Central Govt  employees get , was interpreted as OROP and all arguments against giving it ,have been robustly built up. To me it looks like there is no getting up from this devastating blow, to once again appeal to SC on up-gradation. We could at best say we were not asking for wholesale change in Pension Rules, and what we intended was only a percentage rise , that too , based on notional application of the merger principle.

2. As far as the pronouncement in the judgement on 3(A)  of Pension Rules is concerned , I would read it as a  total success in that the constitutional validity of it has been questioned and  that it offends Art 14 has been upheld.  The Problem comes thereafter. The Court has perhaps not fully grappled with the concept of percentage neutralisation that is embodied as part of the different percentage points against each level of Basic pension, and before and after 1st Aug 1997. With the result they start out stipulating percentage points to different categories without quite realising that the discrimination talked about is the neutralisation of Dearness Relief percentage, to each category referred to. They seem to have got mixed up in seeing higher and lower percentage points in their absolute form and sense, instead of the neutralisation percentage they represent.  This has resulted in there being no co-relation between the way the Arrears on such neutralisation was calculated and Interim Relief  granted to the Pre-97 Retirees by the SC. This could be a good point for Appeal if we decided to go for one.The Pension Rules are involved, and it becomes policy making and perhaps the Courts here went beyond their Brief.

I do not want to proffer views on deeper aspects now, as the Highest Brain-Trust of the Federation will sit on the future measures to be followed based on their discussions and combined analysis.

D.Krishnan.(Vice President)

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