The Telegraph
Since 1st March, 1999
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SC orders re-look at pension claims

New Delhi, Nov. 13: The Supreme Court has directed the government to examine afresh the claims of several organisations that they have pension schemes better than the government’s.

Following up on its order upholding the Centre’s 1996 pension scheme, a division bench of Justices S. Rajendra Babu and K.G. Balakrishnan said: “If establishments which have their own pension schemes apply to the concerned authorities, the concerned authorities shall examine the same in the light of the judgment.”

Under the Centre’s scheme, of the employer’s total contribution, an amount equivalent to 8.33 per cent of the basic salary and dearness allowance of an employee would be transferred every month to a pension fund set up by the Centre. Out of this, the provident fund department would disburse monthly pension after retirement.

While delivering the first order on November 11, the judges exempted organisations with “better pension schemes” than that offered by the government from its ambit, but said the issue would be examined separately. Recently they set aside all interim orders made so far by several high courts affirming or striking down the pension schemes of individual companies and directed the government to examine their claims afresh.

The bench said: “We have perused the orders made by the concerned authorities and have found that they have not taken into consideration the necessary facts which require to be considered in a matter of this nature.

“Therefore, we set aside all those orders whether affirmed by the high courts or not in writ proceedings and remit the same to the concerned authorities for fresh disposal in accordance with law after giving due opportunity to all parties concerned.”

The bench said the Centre’s pension act was a social welfare legislation to “provide for the institution of provident fund, pension and deposit-linked insurance fund for employees in factories and other establishments”.

“If the legislation is not patently arbitrary, this court will not monitor implementation of such policy unless the same is discriminatory or arbitrary. Since the scheme is for the welfare of the employees, the same cannot be held to be violative of the Constitution.”

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