F.No.4/34/2002-P&PW(D).Vol.II
Government of India
Ministry of
Personnel, Public Grievances & Pensions
Department of Pension
& Pensioners Welfare
3rd Floor, Lok Nayak Bhavan,
Khan Market, New Delhi
Dated : 23rd June, 2017
Office Memorandum
Subject: Restoration of full pension of
absorbee pensioners in view of the order dated 01.09.2016 of Hon’ble Supreme
Court in Civil Appeal No. 6048/2010 and Civil Appeal No. 6371/2010.
The undersigned is directed to say that
in accordance with the instructions which existed before 31.03.1995, a
Government servant, on absorption in a Public Sector Undertaking or an
Autonomous Body, had the option to draw pro-rata gratuity and a lump sum amount
in lieu of pension. The option regarding payment of lump sum amount in lieu of
monthly pension on absorption in a PSU or autonomous body was available in terms
of the instructions issued vide Department of Expenditure’s O.M.
No.26(18)-E.V(B)/75 dated 08.04.1976, Department of Personnel & Training’s
O.M. No.28016/5/85-Estt.(C) dated 31.01.1986 and Department of Pension &
Pensioners’ Welfare’ O.M. No.4(12)/85-P&PW dated 31.03.1987. This option
was also available to Government employees on absorption in PSUs/autonomous
bodies of the State Governments and Joint Sector undertakings in terms of this
Department’s O.M. No.4/43/88-P&PW(D) dated 16.10.1989. The terms and
conditions for absorption of Government employees consequent on conversion of a
Government Department into a PSU or autonomous body issued vide this
Department’s O.M. No.4/18/87-P&PW(D) dated 5.7.1989 also provided for a
similar option of lump sum payment in lieu of monthly pension.
2. In accordance with Rule 37-A of the
Central Civil Services (Pension) Rules, 1972, incorporated vide Department of
Expenditure’s Notification No.44(1)-E.V./71 dated 09.04.1973, on exercise of
the above option, an employee was entitled to a lump sum amount not exceeding
the commuted value of one-third of the pension and terminal benefit equal to
twice the aforesaid lump-sum amount, subject to the condition that the
Government servant surrendered his right of drawing two-thirds of his pension.
3. The option to draw a lump sum amount
in lieu of pension was withdrawn vide this Department’s O.M. No.
4/42/91-P&PW(D) dated 31st March, 1995. Accordingly, the erstwhile Rule
37-A was omitted from the CCS(Pension) Rules, 1972 vide Notification No.
4/42/91-P&PW(D) dated 25.06.1997.
4. In implementation of the Order dated
15.12.1995 of Hon’ble Supreme Court in WP(C) No. 11855/85, instructions were
issued vide this Department’s O.M. No. 4/3/86-P&PW(D) dated 30.09.1996 for
restoration of one-third commuted portion of pension of Government servants who
had drawn lump sum payment on absorption in a PSU/autonomous body. Further
instructions were issued, from time to time, for computation and revision of
the one-third restored pension of such absorbee pensioners and for payment of
the attendant benefits like dearness relief, etc. to such absorbee pensioners.
Orders for revision of the one-third restored pension w.e.f. 01.01.2006 of such
absorbee pensioners were issued vide this Department’s O.M. No4/38/2008-
P&PW(D) dated 15/09/2008, O.M. No.4/30/2010-P&PW(D) dated 11/07/2013
and O.M. No.4/38/2008-P&PW(D) dated 04/08/2016. These absorbee pensioners
were, however, entitled to dearness relief and age-related additional pension
based on the notional full pension.
5. Hon’ble High Court of Judicature of
Madras, in its judgement dated 02-082007 in Writ Petition No.22207/2002 filed
by one Sh. K. Ganesan, an officer in the office of Controller General of
Accounts, held that surrendering of the right for drawal of 2/3rd of Pension
after its commutation, as provided under Rule 37-A (b), was repugnant to
Section 12 of the Pensions Act, 1871 and that the petitioner was lawfully
entitled for the restoration of his pension after the expiry of the period of
commutation of 2/3rd Hon’ble High Court, accordingly, directed restoration of
2/3rd pension and payment of arrears accordingly.
6. An SLP (Civil) No.4054/2008
(converted into Civil Appeal No. 6048/2010) was filed by the Union of India
challenging the aforesaid order dated 02-08-2007 of Hon’ble High Court of
Judicature of Madras. In its order dated 1.9.2016, Hon’ble Supreme Court found
no justification to interfere with the order dated 02.08.2007 of Hon’ble High
Court directing restoration of 2/3rd pension in respect of the respondent (Shri
K. Ganesan), after the expiry of the requisite period of commutation. The Civil
Appeal No. 6048/2010 was accordingly dismissed by Hon’ble Supreme Court. In the
said judgement dated 1.9.2016, similar direction was passed by Hon’ble Supreme
Court in the Civil Appeal No. 6371/2010 for restoration of 2/3rd pension in
respect of the petitioners, Shri K.L. Dhall, an absorbed employee of Ministry
of Civil Aviation and member pensioners of Welfare Association of Central
Government Officers, CAD Absorbed in PSU.
7. Review Petitions No. 465/2017 and
No. 472/2017 were filed by Union of India in the Supreme Court against the
aforesaid order dated 1.9.2016. Instructions were separately issued to the
office of Controller General of Accounts and the Ministry of Civil Aviation
vide OM No.4/34/2002-P&PW(D).Vol.II dated 21-122016 and OM No.
4/34/2002-P&PW(D).Vol.II dated 21-12-2016 respectively, for implementation
of the orders of Hon’ble Supreme Court in respect of the petitioner/respondent
pensioners in the aforesaid Civil Appeals, subject to the final outcome of the
Review Petitions. The aforesaid Review Petitions No. 465/2017 and 472/2017 have
been dismissed by Hon’ble Supreme Court on 22.03.2017.
8. The matter has been examined in
consultation with the Department of Legal Affairs and the Ministry of Finance
(Department of Expenditure). It has been decided to extend the benefit of order
dated 02-08-2007 of the Hon’ble Madras High Court and the Order dated
01-09-2016 of the Hon’ble Supreme Court to all similarly placed absorbee
pensioners. Accordingly, all such absorbee petitioners who had taken 100%
lump-sum amount in lieu of pension on absorption in PSUs/Autonomous Bodies in
accordance with the then existing Rule 37-A and in whose case 1/3 pension had
been restored after 15 years, may be allowed restoration of full pension after
expiry of commutation period of 15 years from the date of payment of 100%
lump-sum amount.
9. The absorbee pensioners whose full
pension is restored in terms of the above instructions would also be entitled
to revision of their pension in accordance with the instructions issued from
time to time in implementation of the recommendations of the Pay Commissions,
including the 7th Central Pay Commission.
10. In their application to the persons
belonging to the Indian Audit and Accounts Department, these orders issue in
consultation with the Comptroller and Auditor General of India.
11. Ministry of Agriculture etc. are
requested to bring the contents of these Orders to the notice of Controller of
Accounts/Pay & Accounts Officers and Attached & subordinate Offices
under them on a top priority basis and for taking necessary action for
implementation of the above instructions. All pension disbursing offices are
also advised to prominently display these orders on their notice boards for the
benefit of pensioners.
12. This issues with the approval of
Ministry of Finance (Department of Expenditure) vide their ID Note No.1 (11)/EV/2017
dated 26-05-2017 and dated 13-6-2017.
13. Hindi version will follow.
sd/-
(Harjit Singh)
Director
