Salient Features of the Affidavit filed by LIC in Supreme Court in SLP 29956-29957
The powers to frame Rules and Regulations inter alia on terms and conditions of service of employees got vested with the Central Government under Section [48] of the LIC Act after amendments were incorporated by LIC (Amendment) Act, 1981 and the Supreme Court had held these amendments could not have retrospective effect and hence LIC Employees Bonus and Dearness Allowance, without restriction, could be protected up to February 2, 1981, the date of first Notification under the amended LIC Act. Most of the LIC Pensioners would well remember those days when this singular achievement got them Bonus up to February 2, 1981 and unlimited DA up to a particular level till March 31, 1983.
It would be remembered that later changes in service conditions like reduction in retirement age for recruits after March 1983 and increase in retirement age to 60 for all in 1998, service conditions relating to wages in 1985, 1989, 1996, 2000, 2005 and 2010 and introduction of Pension in lieu of Corporation contribution towards PF etc. in June 1995, came to be implemented after Notifications were issued by the Central Government under Section [48] of LIC Act, 1981 as amended. Even changes in Pension Rules for granting consequential benefits after wage revision came through Notifications till June 2000.
It may also be noted that in 2000, LIC was given limited power to change the Basic Pension and Rates of Dearness Relief, Minimum pension and Family Pension after every wage revision in respect of those who had ceased to be in service after the effective date of wage revision, which provision enabled the Chairman, LIC to modify the Basic Pension Rates of Dearness Relief, notified under the Annexure IV of LIC (Employees) Pension Rules 1995, Minimum Pension and Family Pension in relation to those with cessation of service after effective date of wage revision. The notification specifically states “the power of the Chairman is in respect of employees and when wage revision is effected retrospectively, retirees after the date are deemed as employees for the purpose.” This Annexure provided for revision of Dearness Relief every six months beginning February and August.
The bone of contention by the litigant was three fold viz. grant of Dearness Relief, not as per Annexure but as per Revision Rules, both in respect of levels of Basic Pay and periodicity implying thereby payment of increased Dearness Relief every three months as for in-service employees and percentage of neutralization as per salary scale slabs and grant of stagnation increment and in the writ filed in 2007 in Jaipur High Court, the plea was for grant of Pension to correspond to current scales of pay.
The Writ filed in 2007 in the Jaipur High Court had referred to the Resolution passed by the LIC Board in November 2001 for grant of uniform rate of Dearness Relief for pre-August 1997 retirees.
The Resolution and the Agenda Note were placed before the LIC Board in November 2001, for consideration and the Resolution, referred to the proposition made by a Board Member, for giving weightage of 11.25% after merger and it also said the cost would be huge and pointed out that the Agenda Note had made proposals that would cost about Rs.51 crores initially and about Rs.5 to 6 crores annually. The Agenda Note had made proposals to upgrade Basic Pension at 600 and 1148 points to 1740 points, by merger of Dearness Relief payable up to 1740 points and pay Dearness Relief @ 0.23% thereon and if approved by the Central Government to implement prospectively from the date of publication in Official Gazette. Presumably, the calculations that added up to Rs.51 crores were for payment of Dearness Relief at 100% for the pre-August 1997 pensioners with Basic Pension modified to 1740 points by merger of Dearness Relief upto 1740 points payable but without any weightage for the revision granted in wage structure from August 1997. The Resolution said the Board, after some discussion, approved the proposal.
The acceptance by the LIC Board only signified full neutralization by merger of actual Dearness Relief paid with tapering off of percentage higher basic pension and prospective implementation from the date of publication in Official Gazette.
The Jaipur High Court Single Judge Bench which heard the two writ petitions, allowed the two writs and ordered that LIC could consider implementation of the Board Resolution and there could not be any discrimination in the matter of grant of Dearness Relief with a cut-off date 31-7-1997.
When the LIC went on appeal to the Division Bench, the Hon’ble Court observed that counsel for the Government had averred before the Single Judge Bench that the Board Resolution was pending before the Government and LIC was free to take its decision and said that since the Government had not come on appeal, the appeal filed by LIC were dismissed.
In the Review Petition, LIC has contended that LIC Act as amended in 1981 has not come under challenge and till such time the amendments are in vogue, the power vests with the Government only.
Disposing of the Civil Review Petition filed by the LIC, the High Court ordered dismissal, as there was no error apparent on the face of record to warrant a review under Review Jurisdiction.
The SLPs filed by LIC have been dismissed by the Supreme Court on the ground that Judgement of Division Bench of the Jaipur High Court had not come under challenge and that the petitioner could not show error apparent on the face of record in the order dismissing Review Petition.
The order of 8th August 2013 of the Supreme Court had stated that, that order did not preclude LIC from filing fresh SLP and condonation of delay in filing of SLP cannot be claimed as a matter of right. Subsequently LIC had filed SLPs and they have been admitted with condonation of delay.
The grounds adduced by LIC in the SLPs.
(To be continued)
(To be continued)