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Friday, 4 January 2013

JUDGEMENT BY CAT ERNAKULAM IN PRE-20006 PENSIONERS CASE


                CENTRAL ADMINISTRATIVE TRIBUNAL
                           ERNAKULAM BENCH

                              O.A.No.747/11

                 Monday this the 23rd day of January 2012

C O R A M :

HON'BLE Dr.K.B.S.RAJAN, JUDICIAL MEMBER
HON'BLE Mr.K.GEORGE JOSEPH, ADMINISTRATIVE MEMBER

P.K.Bhargavan Pillai,
S/o.late K.Krishna Pillai,
Retd. Administrative Officer Grade I,
Indian Space Research Organisation.
Residing at Daiveekom, Manjapra PO,
Ernakulam - 683 581.                                          ...Applicant

(By Advocate Mr.M.R.Hariraj)

                                V e r s u s

1.    Union of India represented by the Secretary
      to Government of India,
      Ministry of Personnel, Public Grievances and Pensions,
      Department of Pension and Pensioners' Welfare,
      Lok Nayak Bhawan, New Delhi - 110 003.

2.    Pay and Accounts Officer,
      Central Pension Accounting Office,
      Trikoot - 2, Bhikaji Cama Place,
      New Delhi - 110 066.

3.    The Controller,
      Liquid Propulsion Systems Centre,
      Indian Space Research Organisation,
      Valiamala PO, Thiruvananthapuram - 659 547.

4.    Manager,
      State Bank of Travancore,
      Angamaly Branch, Kallookaran Towers,
      Angamaly - 683 572.                                 ...Respondents

(By Advocate Mr.Sunil Jacob Jose,SCGSC [R1-3])

      This application having been heard on 17th January 2012 this
Tribunal on 23rd January 2012 delivered the following :-

                               O R D E R

HON'BLE Dr.K.B.S.RAJAN, JUDICIAL MEMBER

      The applicant is a pre 2006 retiree and was earlier afforded pension

on the basis of order F No.38/27/08-P&PW(A) dated 1.9.2008 vide

Annexure A-1. As per the said order, pension would in no case be lower

than 50% of the minimum of the pay in the pay band plus grade pay

corresponding to the pre-revised pay scale from which the pensioner had

retired. The applicant, before his superannuation, was drawing his pay in

the scale of Rs.8,000 - 13,500, the corresponding revised pay being

Rs.15,600 - 39,100 plus grade pay of Rs 5,400/-. The extent of pension

he was drawing was Rs.10,500/- (being half of minimum pay of Rs 15,600

plus half of grade pay of Rs 5,400/-).  Arrears of pension on the basis of

the above calculation were also released to the applicant.      While so,

Revised Pension Order dated 27.1.2011 vide Annexure A-2 (one of the

impugned orders) was issued to the applicant whereby, his pension was

reduced to Rs 8,277/- w.e.f. 1.1.2006.     This led to issue of revision

authority dated 9.2.2011, vide Annexure A-3 (impugned herein). Faced

with such a drastic truncation of his pension, the applicant     moved a

representation dated 10.6.2011 vide Annexure A-4. In this representation,

he had stated that the pension under no circumstances shall be less than

half the minimum in the pay scale and the grade pay attached to the pay

scale for the post he was holding prior to his superannuation.        The

applicant thus requested for proper fixation in accordance with paras

4.1/4.2 of Annexure A-1 order. The respondents, however, continued to

pay the applicant the reduced pension of Rs.8277/- and in addition

recovery of Rs.2945/- had also been effected by the 4th respondent, as

could be seen from Annexure A-5 print out of the pension register. The

applicant has, therefore, moved this O.A seeking the following reliefs :-


       1.     To declare that the Central Civil Service (Pension)
       Amendment Rules, 2011 is discriminatory, arbitrary and ultra
       vires Article 14 and 16 of the Constitution of India to the
       extend it refuses to apply the liberalized principles of
       computing pension to pensioners who retired before 1.1.2006
       and that it is void to that extend.

       2.     To call for the records leading to issuance of Annexure
       A-2, Annexure A-3, O.M.No.38/37/08-P&PW (A) dated
       2.9.2008 and 10.12.2009 and to quash the same to the extend
       it refuses to apply the liberalized principles of computing
       pension to pensioners who retired before 1.1.2006.

       3.     To direct the respondents to compute the revised
       pension of the applicant at 50% of his emoluments or average
       emoluments, whichever is more beneficial to him, and to draw
       and disburse such revised pension to the applicant with all
       consequential benefits including arrears and arrears of
       pension and pensionary benefits with interest at the rate of
       12% per annum.

       4.     Alternatively, to direct the respondents to pay the
       applicant minimum basic pension of Rs.10500/- which is 50%
       of the minimum of the pay band plus grade pay corresponding
       to the pre-revised pay scale from which the applicant retired.

       5.     To call for the records leading to recovery from pension
       of the applicant and quash the same.

       6.     To direct the respondents to refund the applicant any
       recovery already made from his pension.


2.     The respondents have contested the O.A. They have contended

that the Ministry of Personnel, Public Grievances and Pensions had given a

clarification vide O.M dated 3.10.2008 on fixation of pension/family pension

of the pre 2006 retirees vide Annexure R-2. According to the same, para

4.2 of the O.M dated 1.9.2008 has been modified to the extent that the

pension will be reduced pro-rata, where the pensioner had less than the

maximum required service for full pension as per rule 49 of the CCS

(Pension) Rules, 1972 as applicable on 1.1.2006 subject to a ceiling of

minimum of Rs.3500/- per month.         The Ministry had issued revised

guidelines vide Annexure R-3 stating that wherever the pension is

disbursed through public sector banks, the banks will pay and disburse the

pension and arrears in accordance with the ready reckoner and also the

additional pension to the old pensioners. A revised concordance table in

respect of pre 1996, pre 2006 and post 2006 pay scales/pay bands were

also provided to facilitate payment of revised pension in terms of para 4.2

of O.M dated 1.9.2008.       The responsibility to revise and disburse the

enhanced pension and arrears in terms of para 4.2 of the O.M dated

1.9.2008 was vested with the pension disbursing public sector banks

concerned. In so far as earlier payment of pension without truncation, the

respondents have stated that the 4th respondent bank might have

implemented the instructions contained in the O.M dated 1.9.2008 on its

own without looking into the subsequent clarifications issued by the

Department of Pension and Pensioners' Welfare with regard to the revision

of pension of pre 2006 pensioners. As uniformity had not been maintained

in calculation or disbursement of pension, the Department of Space vide

communication dated 31.3.2009 (Annexure R-4) and letter dated 6.1.2010

(Annexure R-5) requested its constituent centres to have speedy action for

payment of pension, arrears etc. to pre 2006 retirees by liaising with public

sector banks concerned. Accordingly, the 3rd respondent worked out the

revised entitlement to pension of the applicant which came to be Rs.8277/-

and the same was communicated to the 2nd respondent, namely, Central

Pension Accounting Office (CPAO), New Delhi, vide Annexure R-6 letter

dated 27.1.2011.



3.   The respondents have also stated in para 11 as under :-


     "11. As regards para 4.12 of the O.A., it is submitted that the
     Department of Pension and Pensioners' Welfare had issued a
     revised concordance table of the pre 1996, pre 2006 and post
     2006 pay scales/pay bands along with its OM dated
     14.10.2008    in  order to     facilitate payment of revised
     pension/family pension in terms of para 4.2 of the OM dated
     1.9.2008 (as clarified vide OM dated 3.10.2008) in all cases
     where fixation of pension under that provision is more
     beneficial. Note 1 appended below the said concordance table
     clearly provides that 'the revised pension of those who retired
     after completing maximum required qualifying service (ie.33
     years) before 1.1.2006 cannot be less than the pension
     indicated in column 8 above (ie. 50% of the sum of minimum of
     pay band and grade pay/scale corresponding to the scale of
     pay the pensioners held at the time of their retirement). The
     pension in col.8 above will be reduced pro-rata, where the
     pensioner had less than the maximum required qualifying
     service (ie. 33 years) for full pension as per Rule 49 of the
     CCS (Pension) Rules, 1972 as applicable on 1.1.2006 and in
     no case it will be less than 3500/- p.m. In case, the pension
     consolidated as per para 4.1 of above OM is higher than the
     pension calculated in the manner above, the same (higher
     pension) will be treated as basic pension'.      Obviously, the
     applicant who is a pre 2006 retiree, is ipso facto ineligible for
     revised pension at the rate of 50% of the minimum of the pay
     in the band plus grade pay corresponding to the pre revised
     pay scale from which he retired, since he doesn't have the
     maximum required qualifying service of 33 years for full
     pension as per Rule 49 of CCS (Pension) Rules, 1972. As
     such, the contentions of the applicant that his pension ought
     not be below 50% of the minimum of the pay in pay band plus
     grade pay corresponding to the pre revised pay scale from
     which he retired in view of the fact that the qualifying service
     for full pension had been reduced to 20 years instead of 33
     years and liberalized principles of pension cannot be refused
     to the past pensioners, etc., are not borne out of facts and the
     same may kindly be rejected by this Hon'ble Tribunal.

4.     The respondents have also reiterated that as per the Memorandum

issued by the Department of Pension and Pensioners' Welfare, fixation of

pension and payment of arrears in respect of pre 2006 retirees is a

responsibility of the pension disbursing authority including public sector

banks.



5.     Counsel for the applicant has submitted that the error committed by

the respondents in reducing the payment of pension has been fully

appreciated by the Tribunal.      In its full Full Bench judgment dated

1.11.2011 in O.A.No.0655 of 2010 and connected O.As the Tribunal has

dealt inextenso the extent of pension admissible to pre 2006 retirees. Para

2 onwards of the said order of the Full Bench reads as under :-


        "2.    Applicants, who are pre-2006 retirees, are claiming
        pension at par with post-2006 retirees based on the
        recommendations of the VI Central Pay Commission, which
        became effective from 1.1.2006. Considering that the issues
        involved have great ramifications and in the meanwhile Bombay
        Bench and Patna Bench of the Tribunal rendered judgment(s)
        against their cause., the matter was referred to the Full Bench
        vide order dated 29.04.2011. The grievance projected by the
        applicants in these OAs are that the employees, who retired
        prior to 1.1.2006 (specified date) and those who retried
        thereafter form one class of pensioners. The attempt to classify
        them into separate classes/groups for the purpose of
        pensionary benefits was not found on intelligible differentia,
        which has a rationale nexus with the object sought to be
        achieved.   To substantiate this argument reliance has been
        placed on the judgment of the Apex Court in the case of D.S.
        Nakara and others v. Union of India, (1983) 1 SCC 305 and
        Union of India v. S.P.S. Vains, (2008) 9 SCC 125. The further
        grievance raised by the applicants is that their notional pay
        fixation and consequent pension should not be lower than 50%
        of the sum of the minimum of the pay in the pay band and the
        grade pay thereon corresponding to scale of pay from which
        they had retired, as accepted by the Government vide
        resolution dated 29.08.2008 and the clarification issued by the

respondents    vide impugned       OM     dated    3.10.2008  and
14.10.2008 contrary to the Resolution dated 29.08.2008 and
OM dated 1.9.2008 in regard para 4.2, are illegal, arbitrary,
discriminatory, unreasonable and unjust, as according to the
applicants in the clarification/modification order dated 3.10.2008
respondents had added and deleted certain words, which
completely changed its meaning as per the recommendations
of the Commission as accepted by the Government. In other
words, the grievances raised by the applicants are that the
respondents have not revised pension of the pre-2006 retirees
even as per the modified parity/formula recommended by the
Pay Commission and adopted by the Government vide
resolution dated 29.08.2008. It may be stated that challenge
has been made only to the aforesaid issues though the
additional points raised by the applicants in OA-2087/2009 and
2101/2011 have not been pressed by the learned counsel for
the applicants.

3.     In order to decide the aforesaid issue, few relevant facts
may be noticed.      The Government of India constituted VI
Central Pay Commission (VI CPC) on 05.10.2006, inter alia, to
examine the principles which should govern the structure of
pension, death-cum-retirement gratuity, family pension and
other terminal or recurring benefits having financial implications
to the present and former Central Government employees
appointed before 1.1.2004. The report was submitted by the
Commission on 24.03.2008.         The Pay Commission made
separate recommendations for revision of pension of the past
pensioners and for determination of pension of those retiring
after implementation of its recommendations.          In regard to
determination of pension of those retiring after implementation
of its recommendations, the Commission recommended linkage
of full pension with 33 years of qualifying service should be
dispensed with.     Once an employee renders the minimum
pensionable service of 20 years, pension should be paid at 50%
of the average emoluments received during the past 10 months
or the pay last drawn, whichever is more beneficial to the
retiring employee. Simultaneously, the extant benefit of adding
years of qualifying service for purposes of computing
pension/related benefits should be withdrawn as it would no
longer be relevant. However, regarding revision of pension of
past pensioners the Commission made recommendations as
per para 5.1.47 of the report which recommendation of the
Commissioner was accepted by the Government with certain
modifications to which we will advert at a later stage. Thus, this
modified formula formed basis for revision of the pension of the
pre-2006 retirees, as adopted by resolution dated 29.08.2008,
which according to applicants has not even been followed by
the respondents in its true letter and spirit. Since the VI CPC
has made separate recommendations for pre-2006 retirees and

post-2006 retirees as such the Government issued two different
OMs based upon the recommendations of the Central Pay
Commission, i.e., one regarding revision of pension of past
pensioners and second regarding post-2006 retirees. It is in the
light of the aforesaid factual aspects the matter is required to be
examined."


After threadbare analysis of the entire issue, the Full Bench had
arrived at the following decision:-


"12. Now let us advert to last grievance raised by the
applicants viz. that even if the modified parity, as recommended
by the Pay Commission and accepted by the resolution dated
29.08.2008 is to be taken as criteria for determining pension of
pre-2006 retirees, still on account of subsequent clarification
issued to para 4.2 of the OM dated 1.9.2008 by the officers of
the respondents vide OM dated 3.10.2008 and             14.10.2008
criteria and principles for determining the pension has been
given a complete go-bye. Thus, these clarificatory OMs are
illegal, arbitrary, discriminatory, unreasonable, unjust and are
required to be quashed and set aside. At this stage, we wish to
mention that this issue was not raised and considered by the
Patna and Bombay Benches of the Tribunal, as such no finding
on this aspect was given. However, in paras 66 and 67 of the
judgment Patna Bench has given a direction that the
Government should examine this aspect of S-29 pay scales
retirees being able to retire at the maximum of the pay band 4
pay scale with the grade pay of Rs.10,000/- which would bring
their pension to Rs.38,500/-.        Suffice it to say that the
observation made by the Patna Bench was given without taking
into consideration the modified parity as recommended by the
Pay Commission and accepted by the Central Government vide
its resolution dated 29.08.2008, which formed the basis to grant
pension to pre-2006 retirees.


13.    In order to determine the issue, at this stage, it will be
useful to quote item No.12 of the Resolution No.38/37/08-
P&PW (A) dated 29.08.2008 whereby recommendations of the
VI CPC, as contained in para 5.1.47, was accepted with certain
modifications and thus reads :-

 S.No.              Recommendation                       Decision of
                                                         Government
         "All past pensioners should be allowed Accepted         with    the
         fitment benefit equal to 40% of the       modification that fixation
         pension excluding the effect of merger    of pension shall be based
         of 50% dearness allowance/dearness        on a multiplication factor
         relief  as   pension    (in  respect    ofof 1.86, i.e basic pension
         pensioners retiring on or after </2004)
         and    dearness    pension    (for  other +    Dearness     Pension
         pensioners) respectively. The increase    (wherever applicable) +
         will be allowed by subsuming the effect   dearness relief of 24% as
         of conversion of 50% of dearness          on 1.1.2006, instead of
         relief/dearness allowance as dearness     1.74
         pension/dearness pay. Consequently,
         dearness relief at the rate of 74% on
         pension     (excluding   the   effect   of
         merger) has been taken for the
         purposes of computing revised pension
         as on 1/1/2006. This is consistent with
         the fitment benefit being allowed in
         case of the existing employees. The
         fixation of pension will be subject to the
         provision that the revised pension, in
         no case, shall be lower than fifty
         percent of the sum of the minimum of
         the pay in the pay band and the grade
         pay thereon corresponding to the pre
         revised pay scale from which the
     12 pensioner had retired. (5.1.47)



Based on this resolution, respondents issued OM of even
number dated 1.9.2008. Para-4.2 whereof, which is relevant
for the purpose, reads as follows :

      "The fixation of pension will be subject to the provision
      that the revised pension, in no case, shall be lower than
      fifty percent of the minimum of the pay in the pay band
      plus the grade pay corresponding to the pre-revised pay
      scale from which the pensioner had retired. In the case of
      HAG+ and above scales, this will be fifty percent of the
      minimum of the revised pay scale."

14.   On the basis of the recommendations made by VI CPC,
which stood validly accepted by the Cabinet, it has been
argued that principle for determining the pension has been
completely altered under the garb of clarification. According to
the learned counsel for the applicants on the basis of the
aforesaid resolution/modified parity revised pension of the pre-
2006 pensioners shall not be less than 50% of the minimum of
the pay band + grade pay, corresponding to the pre-revised pay
scale from which the pensioner had retired.

15.    Applicants in para-11 of the Additional-Affidavit have
explained how the Note prepared by a junior functionary (at the
level of an Under Secretary) in the Department of Pension &
Pensioners Welfare in regard to para-4.2 of the OM dated
1.9.2008 has been given a go-by to the resolution dated
29.08.2008. The Note so prepared has been extracted in this
para, which thus reads :

       "Whether the pension calculated at 50% of the minimum
       pay in the pay band would be calculated (i) at the
       minimum of the pay in the pay band (irrespective of the
       pre-revised   scale    of  pay)   plus  the   grade   pay
       corresponding to the pre-revised pay scale, or (ii) at the
       minimum of pay pay in the pay band which an employee
       in the pre-revised scale of pay will be getting as per the
       fitment tables at Annex I of the CCS (Revised Pay)
       Rules, 2008 plus the grade pay corresponding to the pre-
       revised pay scales."

16.    It is pleaded that first the need for such a doubt
being raised is not clear as both the formulation of the CPC in
para 5.1.47 as well as in Government Resolution dated
29.8.2008 (Annexure A-7 of the OA) is clear that "the fixation
of pension will be subject to the provision that the revised
pension in no case, shall be lower than fifty percent of the sum
of the minimum of the pay in the pay band and the
grade pay thereon corresponding to the pre-revised pay scale
from which the pensioner had retired." (emphasis added).
The use of words `sum of', `and' and `thereon' leaves no doubt
that both the minimum of the pay in the pay band and the grade
pay have to correspond to the pre-revised pay scale.
Second, without bringing out merits or demerits of either
formulation, the lower functionary in DOP & PW incorporates
in the clarification against item 4.2 in the OM dated 1.9.2008,
the first option about "minimum of pay in the pay band
(irrespective of the pre-revised scale of pay)". What is worse
is that there is no application of mind even at the level of
Director and Secretary who merely sign the note and the
clarification is issued after obtaining finance concurrence and
approval of MOS (PP), without going back to the Cabinet for
such a modification.

17.    The learned counsel has further argued that the resultant
injustice done to the pre-1-1-2006 pensioners had even been
recognized by MOS (F) and MOS (PP) in their letters to the
PM and MOS (F) respectively, copies of which are at
Annexures      A-11 (page 169) and A-12 (page 170) of the OA.
A formal proposal was also sent by DOP & PW to Department
of Expenditure seeking rectification but was not accepted

 by the latter.    It was also incorrectly mentioned that the
 earlier provision in para 4.2 of OM dated 1.9.2008 has been
 issued in pursuance of the approval of the Cabinet granted
 to the Report of the Sixth CPC and any change would entail
 substantial financial implications and this was done only
 with the approval of the Secretary (Expenditure) without putting
 up the note to MOS (F) who had himself supported the
 change. A copy of this Note dated 2.1.2009 is enclosed as
 Annexure 5.

 18.   As regards the grievance to OM dated 14.10.2008 based
 on the OM dated 1.9.2008 (as clarified by OM dated 3.10.2008)
 whereby a revised table (Annexure A-1) of the pre-2006
 pensioners pay scale/pay was finalized to facilitate payment of
 the revised pension/family pension, applicants have prepared a
 chart in respect of minimum of the pre-revised scales (modified
 parity) of S 29 along with 5 scales included in PB-4 works out
 as under and thus reads :

 Min of     Pay in the   Grade Pay       Revised      Pension 50%
   Pre      Pay Band                     Basic Pay      of (2+3)
 revised                                   (2+3)          Rs.
  scale                                     Rs.
        1             2             3               4             5
S-24

(14300)          37400           8700          46100          23050
S-25

(15100           39690           8700          48390          24195
S-26

(16400)          39690           8900          48590          24295
S-27

(16400)          39690           8900          48590          24295
S-28
(14300)          37400          10000          47400          23700
   S-29

(18400)          44700          10000          54700          27350

       The first 4 columns of the above table have been
 extracted from the pay fixation annexed with MOF OM of 30th
 August 2008 (referred to in para 4.5 (iii) above).     Revised
 pension of S 29 works out to Rs.27350 which has been
 reduced to Rs.23700 as per DOP OM of 3-10-2008 (para 4.8
 (B) below).

It was explained during arguments that pay in the Pay Band
indicated in column No.2 above table relates to the pay in the
revised pay scale corresponding to the minimum pay in the pre-
revised pay scale.

19.    On the basis of this chart it has been pleaded that as per
the impugned OM dated 14.10.2008 in the case of S-24 officers
the corresponding pay in the Pay Band against 14300/- is
shown as 37400. In addition, Grade Pay of Rs.8700/- was
given totaling Rs.46,100/-. Similarly, revisions concerning all
the other pay scales were accepted by the aforementioned OM
dated 14th October, 2008.       The illegality which has been
perpetrated in the present matter is apparent from the fact that
whereas an officer who was in the pre-revised scale S-24 and
receiving a pay of Rs.14,300/- would now receive Rs.37,400/-
plus grade pay of Rs.8700 and his             full pension would
accordingly be fixed at Rs.23050 (i.e. 50% of 37400 pay plus
grade pay Rs.8700) pursuant to the implementation of VI CPC
recommendations after 1.1.2006, whereas a person belonging
to the Applicant Association, who was drawing a pay of
Rs.18,400/- or even Rs.22,400/- (maximum of scale) in the pre-
revised S-29 scale will now be getting pension as only 23700/-
(i.e. 50% of pay of Rs.37,400/- plus grade pay of Rs.10000).
However, the misinterpreted revised basic pay of Rs.37400 has
caused a grave miscarriage of justice since those officers who
belong to a much higher grade have now been equated with
those who were working under them in a lower rank/grade. It is
further relevant to note that those officers belonging to S-29
who would retired after 1.1.2006 would, however, be placed in
the revised pay scale differently. For instance, a person who
was in the pre-revised pay scale of 18000-22400 (S29) at
Rs.18,400/- would now get Rs.44,700/- in addition to Grade
Pay of Rs.10,000/- i.e. the revised basic pay of Rs.61,850/-.
However, a person who retired only one day prior i.e. on 31st
December 2005, even if he had received pre-revised pay of
Rs.22400/- would now be placed in the revised pay of
Rs.37400/- only in addition to the Grade Pay of Rs.10,000.
Thus the illegality which has been committed in the present
matter also relates to equating the pre-revised pay scale of
Rs.18,400-22,400/-     with  the     pre-revised  pay   scale  of
Rs.14,300-18,300/-.

20.    In order to buttress the aforesaid submission applicants
have given specific instance of an officer in para-6 of the
Additional Affidavit who retired at a higher pay on 31.12.2005
getting a much higher pension at that time than another officer
who retired only 5 days later, i.e., on 5.1.2006 at a lower pay.
After implementing the VI CPC recommendations, as illegally
modified by the Department of Personnel, the result is that the
concerned person who retired on 31.12.2005 is getting far

lower pension than the person who retired 5 days later. A copy
of the said chart amplifying the above position has also been
reproduced, which is to the following effect :


    Name          Ashok         K.             R.K. Goel
                  Ghosh
  Department        Railways             Heavy Water Board
Scale of Pay       18400-500-           18400-500-22400
                   22400
Date           of 31.12.2005            05.01.2006   i.e.
Retirement                              only 5 days
Last      Pay     Rs.22900       (incl.        Rs.21400
Drawn             one     Stagnation
                  increment)
 Average       10 Rs.34350              Rs.31737.50       or
 months                                 31738
 Emoluments
 incl.  Dearness
 Pay
Original Pension Rs.17175              Rs.15869
fixed
Revised Pension       Rs.2587(i.e.      Rs.29435
Fixed   after  6th  Rs.22900x2.26)
CPC                         2
implementation

21.   Applicants have also explained as to how the disparity
has resulted on account of implementation/acceptance of
VI CPC recommendations by the Government vide resolution
dated 29.08.2008.      As can be seen from the clarificatory
order dated 30.08.2008 (Annexure A-6 at pages 139-147)
regarding pay scale of S-24 to S-29, the pay scales of the
V CPC of Rs.14300-18300 in respect of S-24 employees,
the VI CPC has placed them in Pay Band-3 and recommended
the Pay Band of Rs15,600-39100/- plus Grade Pay of Rs.7600
per month.     However, the Government has upgraded the
said S-24 category to Pay Band 4 and placed them in the pay
Band of Rs.37,400-67,000/- plus Grade Pay of Rs.8700/-
per month.      It is, therefore, absolutely clear that the
Government authorities have increased the pay of S-24
employees by far more than double. Further, it is very relevant
to note that the said impact would be not only on the retired
S-24 officers but also on the large base of serving employees.
Similarly, the same is the position with regard to S-25, S-26
and S-27 all of whom were recommended by the Sixth
Pay Commission to be in the pay band of Rs.15,600-39,100/-
but were placed by the Government in the pay band of
Rs.37,400-67,000/-. Similarly in the case of employees who

were placed in S-29 pay scale they were recommended
Pay Band of Rs.39,200-67000/- plus Grade Pay of Rs.9,000/-
per month by the VI CPC, whereas the Government has
revised pay structure to Rs.37,400-67000/- plus Grade Pay of
Rs.10,000/- per month. This has resulted in the anomaly which
is essentially to be rectified.

22.    It is submitted that the applicants are in the category
of retired employees and are a diminishing category.
In contrast, the serving employees of S-29 category are being
given the benefits of the recommendations of the VI CPC.
Further, as explained earlier, the benefits available in S-24
to S-27 grade are available not only to retired employees but
also to the large base of serving employees. The financial
effect of the same is many-many times that of the small
additional expenditure which will be incurred on account of the
benefits sought by the Applicants. Therefore, the argument
sought to be raised by the Union of India during the course of
hearing regarding the so-called financial impact has no factual
basis at all.

23.    Thus,    according    to the   applicants   the  aforesaid
disparity, which has been caused on account of granting
enhanced scales in S-24 to S-27 grade contrary to the
recommendations of the VI CPC and further reducing the
scales recommended by the Pay Commission in respect of
S-29 grade to be at par with the employees who were placed in
S-24 to S-27 grade is required to be set right. According to the
learned counsel of applicants even if the cut off date of
1.1.2006 for revision of the pay scale and grant of pensionary
benefits on the basis of VI CPC is to be upheld, even then the
applicants are entitled to relief based upon the Resolution
dated 29.08.2008 whereby the recommendations of the Pay
Commission was accepted and on account of disparity, which
has resulted in granting different pay scales, as recommended
by the VI CPC, which has caused prejudice to the applicants
and thus has to be set right.

24.    The stand taken by the respondents is that the
recommendations of the VI CPC, as accepted by the
Government vide Resolution dated 29.08.2008 and further
clarification issued by the respondents is in consonance with
the recommendations so accepted. It is stated that there may
be a slight change in the word used in the clarification issued
by the Government subsequently but has the same meaning as
in the latter part of para 5.1.47 of the report of the VI CPC as
accepted by Government. The phrase "minimum of the pay in
the Pay Band" has been used and this phrase carries the same
meaning i.e., the pay from which a pay band starts. It is stated

   that the clarification on OM dated 3.10.2008 was issued
   after due exercise in Department of Pension and Pensioners
   Welfare and Ministry of Finance and with the approval of the
   Hon'ble Minister of State.       It is further stated that VI CPC
   has not made any recommendation for complete parity
   between      the   pre-1996    and     post-1-1-1996   pensioners.
   Therefore, question of allowing complete parity between pre-
   1996 and post 1.1.1996 pensioners would not arise. It is stated
   that the OM dated 1.9.2008 has been further clarified on
   3.10.2008 that pension calculated at 50% of the minimum of
   the pay in the pay band plus grade pay would be calculated at
   the minimum of the pay in the pay band (irrespective of the pre-
   revised sale of pay) plus the grade pay corresponding to the
   pre-revised pay scale.


   25.     In order to decide the matter in controversy, at this stage,
   it will be useful to extract the relevant portions of para 5.1.47 of
   the VI CPC recommendation, as accepted by the Resolution
   dated 29.08.2008, para 4.2 of the OM dated 1.9.2008 and
   subsequent changes made in the garb of clarification dated
   3.10.2008, which thus read :




Resolution            Para   4.2    of   OM OM DOP&PW OM No.
No.38/37/8-P&PW DOP&PW OM No. No.38/37/8-P&PW(A)
(A)            dated No.38/37/8-P&PW          dated 3.10.2008
29.08.2008-Para       (A) dated 1.09.2008
5.1.47 (page 154- (page 38 of OA)
155)

The fixation as The fixation as per The                 Pension
per above will be above       will   be Calculated at 50% of
subject   to   the subject      to   the the    [sum    of   the]
provision    "that provision "that the minimum of the pay
the       revised revised pension, in in the pay band [and
pension,   in   no no case, shall be the          grade      pay
case,   shall   be  lower than 50% of    thereon
lower than 50% of   the(sum     of  the) corresponding to the
the sum of the      minimum of the pay   pre-revised         pay
minimum of the      in the pay band      scale]    plus    grade
pay in the pay      plus    (and)    the pay       would      be
band    and    the  grade pay (thereon)  calculated (i) at the
grade          pay  corresponding     to minimum of the pay
thereon             the prerevised pay   in    the   pay   band
corresponding to    scale from which     (irrespective of the
the     prerevised  the pensioner had    pre-revised scale of
pay scale form      retired.             pay plus) the grade
which          the                       pay     corresponding
pensioner      had                       to    the  pre-revised
retired.                                 pay     scale.      For
                                         example,        if    a
                                         pensioner           had
                                         retired in the pre-
                                         revised scale of pay
                                         of    Rs.18400-22400,
                                         the     corresponding
                                         pay     band      being
                                         Rs.37400-67000 and
                                         the     corresponding
                                         grade     pay     being
                                         Rs.10000 p.m., his
                                         minimum guaranteed
                                         pension would be
                                         50%                  of
                                         Rs.37400+Rs.10000
                                         (i.e. Rs.23700)
                   Strike out are        Strike    out    are
                   deletions     and     deletions        and
                   bold        letter    bold          letters
                   addition              addition.

   26.   As can be seen from the relevant portion of the resolution
   dated 29.8.2008 based upon the recommendations made by
   the VI CPC in paragraph 5.1.47, it is clear that the revised
   pension of the pre-2006 retirees should not be less than 50% of
   the sum of the minimum of the pay in the Pay Band and the
   grade pay thereon corresponding to the pre-revised pay scale
   held by the pensioner at the time of retirement. However, as

per the OM dated 3.10.2008 revised pension at 50% of the sum
of the minimum of the pay in the pay band and the grade pay
thereon, corresponding to pre-revised scale from which the
pensioner had retired has been given a go-by by deleting the
words "sum of the" "and grade pay thereon corresponding to
the pre-revised pay scale" and adding "irrespective of the pre-
revised scale of pay plus" implying that the revised pension is
to be fixed at 50% of the minimum of the pay, which has
substantially changed the modified parity/formula adopted by
the Central Government pursuant to the recommendations
made by the VI CPC and has thus caused great prejudice to
the applicants.    According to us, such a course was not
available to the functionary of the Government in the garb of
clarification thereby altering the recommendations given by the
VI CPC, as accepted by the Central Government. According to
us, deletion of the words "sum of the" "and grade pay thereon
corresponding to the pre-revised scale" "and addition of the
words "irrespective of the pre-revised scale of pay plus", as
introduced by the respondents in the garb of clarification vide
OM dated 3.10.2008 amounts to carrying out amendment to the
resolution dated 29.08.2008 based upon para 4.1.47 of the
recommendations of the VI CPC as also the OM dated
1.9.2008 issued by the Central Government pursuant to the
aforesaid resolution, which has been accepted by the Cabinet.
Thus, such a course was not permissible for the functionary of
the Government in the garb of clarification, that too, at their own
level without referring the matter to the Cabinet.

27.    We also wish to add that the Pay Commissions are
concerned with the revision of the pre-revised `pay scales' and
also that in terms of Rule 34 of the CCS (Pension) Rules, 1972
the pension of retirees has to be fixed on the basis of the
average emoluments drawn by them at the time of retirement.
Thus, the pre-revised scale from which a person has retired
and the emoluments which he was drawing at the time
immediately     preceding    his   retirement  are    a    relevant
consideration for the purpose of computing revised pension and
cannot be ignored. As such, it was not permissible for the
respondents to ignore the pre-revised scale of pay for the
purpose of computing revised pension as per the modified
parity in the garb of issuing the clarifications, thereby altering
the modified parity/formula, which was accepted by the Central
Government vide its resolution dated 29.08.2008.

28.    The above view is also fortified by paras 137.15, 137.20
and 137.21 of the V CPC recommendations, as reproduced
below, leading to modified parity, which were also accepted by
the VI CPC and accepted by the Central Government and thus
read:

"Immediate relief to pensioners

137.15       While the work relating to revision of pension of pre
1.1.1986 retires by notional fixation of their pay shall have to be
undertaken by the pension sanctioning authorities to be
completed in a time-bound manner, we suggest that the
pensioners should be provided some relief immediately on
implementation of our recommendations.              The pension
disbursing authorities may be authorized to consolidate the
pension by adding (a) basic pension; (b) personal pension,
wherever admissible; (c) dearness relief as on 1.1.1996 on
basic pension only; (d) Interim Relief (I and II) and (e) 20% of
basic pension. The consolidated pension shall be not less than
50% of the minimum pay, as revised by the Fifth CPC, of the
post held by the pensioner at the time of retirement. This may
be stepped up by the pension disbursing authorities, wherever
feasible, to the level of 50% of the minimum pay of the post
held by the pensioner at the time of retirement. (emphasis
supplied)

xxx   xxx    xxx   xxx   xxx

Modified parity conceded

137.20       We have given our careful consideration to the
suggestions. While we do not find any merit in the suggestion
to revise the pension of past retirees with reference to
maximum pay of the post held at the time of retirement, as
revised by the Fifth CPC, there is force in the argument that the
revised pension should be not less than that admissible on the
minimum pay of the post held by the retiree at the time of
retirement, as revised by the Fifth CPC. We have no hesitation
in conceding the argument advanced by pensioners that they
should receive a pension at least based on the minimum pay of
the post as revised by Fifth Pay Commission in the same way
as an employee normally gets the minimum revised pay of the
post he holds. We recommend acceptance of this principle,
which is based on reasonable considerations.             (emphasis
supplied).

Principle enunciated

137.21       The Commission has decided to enunciate a
principle for the future revision of pensions to the effect that
complete parity should normally be conceded up to the date of
last pay revision and modified parity (with pension equated at
least to the minimum of the revised pay scale) be accepted at
the time of each fresh pay revision.       This guiding principle
which we have accepted would assure that past pensioners will
obtain complete parity between the pre-'86 and post-'86

pensioners but there will be only a modified parity between the
pre-'96 and post-'96 pensioners.       The enunciation of the
principle would imply that at the time of the next pay revision
say, in the year 2006, complete parity should be given to past
pensioners as between pre-1996 and post-1996 and modified
parity be given between the pre-2006 and post-2006
pensioners." (emphasis supplied)

29.    From the above extracted portion it is clear that the
principle of modified parity, as recommended by the V CPC and
accepted by the VI CPC and accepted by the Central
Government provides that revised pension in no case shall be
lower than 50% of the sum of the minimum of the pay in the
pay band and grade pay corresponding to revised pay scale
from which the pensioner had retried.      According to us, as
already stated above, in the garb of clarification, respondents
interpreted minimum of pay in the pay band as minimum of the
pay band. This interpretation is apparently erroneous, for the
reasons :

a)     if the interpretation of the Government is accepted it
would mean that pre-2006 retirees in S-29 grade retired in
December, 2005 will get his pension fixed at Rs.23700/- and
anther officer who retired in January 2006 at the minimum of
the pay will get his pension fixed at Rs.27350/-. This hits the
very principle of the modified parity, which was never intended
by the Pay Commission or by the Central Government;

b)     The Central Government improved upon many pay
scales recommended by the VI CPC. The pay scale in S-29
category was improved from Rs.39200-67000/- plus Grade Pay
of Rs.9,000/- with minimum pay of Rs.43280/- to Rs.37,400-
67000/- with grade pay of Rs.10,000/- with minimum pay of
Rs.44,700/- (page 142 of the paper-book). If the interpretation
of the Department of Pension is accepted, this will result in
reduction of pension by Rs.4,00/- per month.       The Central
Government did not intend to reduce the pension of pre-2006
retirees while improving the pay scale of S-29 grade;

c)     If the erroneous interpretation of the Department of
Pension is accepted, it would mean that a Director level officer
retiring after putting in merely 2 years of service in their pay
band (S-24) would draw more pension than a S-29 grade
officer retiring before 1.1.2006 and that no S-29 grade officer,
whether existing or holding post in future will be fixed at
minimum of the pay band, i.e., Rs.37,400/-. Therefore, fixation
of pay at Rs.37,400/- by terming it as minimum of the pay in the
pay band is erroneous and ill conceived; and

        d)     That even the Minister of State for Finance and Minister
        of State (PP) taking note of the resultant injustice done to the
        pre-11.2006 pensioners (pages 169-170) had sent formal
        proposal to the Department of Expenditure seeking rectification
        but the said proposal was turned down by the officer of the
        Department of Expenditure on the ground of financial
        implications. Once the Central Government has accepted the
        principle of modified parity, the benefit cannot be denied on the
        ground of financial constraints and cannot be said to be a valid
        reason.

        30.    In view of what has been stated above, we are of the
        view that the clarificatory OM dated 3.10.2008 and further OM
        dated 14.10.2008 (which is also based upon clarificatory OM
        dated 3.10.2008) and OM dated 11.02.2009, whereby
        representation was rejected by common order, are required to
        be quashed and set aside, which we accordingly do.
        Respondents are directed to re-fix the pension of all pre-2006
        retirees w.e.f. 1.1.2006, based on the resolution dated
        29.08.2008 and in the light of our observations made above.
        Let the respondents re-fix the pension and pay the arrears
        thereof within a period of 3 months from the date of receipt of a
        copy of this order. OAs are allowed in the aforesaid terms, with
        no order as to interest and costs."


6.    The Full Bench had set aside the orders dated 3.10.2008 and

11.2.2009 (Annexure R-2 and Annexure R-11). Thus the stipulation that

the pension will be reduced pro-rata as contained in para 4.2 of OM dated

3.10.2008 which was the basis of fixation of pension at the reduced rate by

the respondents stands already quashed.             Order dated 11.2.2009

(Annexure R-11) which only reiterated the clarification contained in OM

dated 3.10.2008 and earlier OM dated 1.9.2008 having also been quashed

by the Full Bench, in the case of the applicant his entitlement remains

intact at Rs.10500/- and the reduction communicated and executed vide

Annexure A-2 and Annexure A-3 has thus become erroneous as the basis

for such reduction itself is no longer available. In view of the above, this

application is allowed to the following extent :-

(a)   It is declared that the applicant is entitled to 50% of his minimum pay

in the scale of pay of Rs.15600 and 50% of the grade pay attached to it as

pension.



(b)   Consequently, it is declared that Annexure A-2 and Annexure A-3

being erroneous are liable to be quashed and set aside. It is accordingly

ordered.



7.    Respondents, especially, respondent No.2 shall forthwith authorize

respondent No.4 to reschedule the pension as earlier available to the

applicant (ie. Rs.10500/- p.m). Any recovery that has been effected in the

wake of issue of Annexure A-2 and Annexure A-3 orders shall be refunded

to the applicant.



8.    The applicant has claimed interest at the rate of 12% per annum. As

the mistake committed by the respondents is not in the character of

deliberate misinterpretation of the rule, showing indulgence no interest is

directed to be paid by the respondents.



9.    The applicant has also challenged the Amendment Rules, 2011 to

the Central Civil Service (Pension) Rules.           Though counsel for the

applicant advanced his argument focusing upon the aforesaid relief, we are

of the considered view that in view of the quashing and setting aside of

Annexure A-2 and Annexure A-3 orders, no orders may be necessary to be

passed in connection with the prayer at 8 (1).

10.   The time limit calendered for passing of necessary orders by the

respondent No.2 is one month from the date of communication of this

order. The time limit scheduled for restoring the pension at Rs.10500/- is

within two weeks from the date of receipt of the authority from respondent

No.2 by respondent No.5. And time limit fixed for payment of arrears of

pension and also refund of recovery already made is four weeks from the

date of receipt of the communication from the respondent No.2 by

respondent No.5 restoring the pension.



11.   Under the above circumstances, there shall be no order as to costs.

                (Dated this the 23rd day of January 2012)




K.GEORGE JOSEPH                                          Dr.K.B.S.RAJAN
ADMINISTRATIVE MEMBER                                JUDICIAL MEMBER

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