Calcutta High Court Upholds Right to Higher Pension for Employees of Exempted Establishments

Court Quashes EPFO's Rejection of Higher Pension Applications, Cites Supreme Court Precedent  

In a landmark decision, the Calcutta High Court has ruled in favor of employees from exempted establishments, granting them the right to higher pension benefits on actual wages under the Employees' Pension Scheme, 1995. The ruling came as a response to multiple writ petitions challenging the Employees' Provident Fund Organisation's (EPFO) rejection of applications for higher pension based on the contention that trust rules of exempted establishments limited contributions to statutory wage ceilings.  

Justice Shampa Dutt (Paul) presided over the case, which consolidated several petitions, including those filed by retired employees of major organizations such as the Steel Authority of India Limited and Bharat Petroleum Corporation Limited. The Court emphasized that employees of exempted establishments should not be excluded from higher pension benefits by citing unamended trust rules, as this would create an artificial classification between employees of exempted and unexempted establishments.  

The judgment referenced the Supreme Court's decision in EPFO v. Sunil Kumar B., which mandated uniform application of the pension scheme across both categories of employees. The Calcutta High Court found EPFO's reliance on trust rules to be contrary to the principles of natural justice and the directive of the Supreme Court.  

The Court quashed the EPFO's orders that denied higher pension applications based on the internal trust rules and clarified that statutory provisions should prevail over trust rules when the latter are less beneficial. Furthermore, it directed the EPFO to accept joint option applications for higher pension submitted before the cutoff date and process them accordingly.  

This decision marks a significant win for employees of exempted establishments, ensuring they receive equitable pension benefits akin to their counterparts in unexempted establishments.  

Bottom Line:

Employees of exempted establishments under the Employees' Pension Scheme, 1995 are entitled to higher pension benefits on actual wages, similar to employees of unexempted establishments, irrespective of trust rules restricting contributions to statutory wage ceilings.

Statutory provision(s): Employees' Pension Scheme, 1995, Employees' Provident Funds Scheme, 1952, Section 17 and 27A of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952.

Anuradha Roy v. Union of India, (Calcutta) : Law Finder Doc Id # 2808722