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Thursday, November 05, 2015

RK CHOPRA'S QUERY


Shri R K Chopra's Query : Pension after getting commuted value.- Note (two paras.) revised.

I thank Shri K P Verma for pointing out a mistake regarding Shri S G Sreevastava's date of retirement.


I have therefore made a few changes in the note posted in PC on 04-10-2015 : " Pension after getting commuted value"

I had earlier said that Shri S. G. Sreevastava retired as AAO on 01-08-2012. If the date of birth happens to be first of a month, one retires on the last day of the previous month. If Shri Sreevastava completes 60 on 01-08-2012, he retires on 31-07-2012 and is not eligible for revised pay etc.

One can voluntarily retire on first day of the month, say, on 01-08-2012 ( rare case) and get benefit of revised pay etc.
There are employees retired on any day (including on 01-08-2012 voluntarily) during the pendency of pay revision and their pension has been fixed in the 01-08-2007 pay scales. All of them get their pay and pension re-fixed.
It may be added for information that pay, pension and family pension is payable for the day on which its recipient dies. If 'x' died on 01-08-2012 (an assumed and extreme case) 'x' is eligible for revised pension.

Formula and an illustrative example of AAO is given below indicating net pension as per now proposed and the old pay scales ended on 31-07-2012.
Formula : Pension as of date- Rs..'A' after commutation (Average of 50% of ten months of pay + FPA minus commuted amount.) ; DR : Rs. 'B' on the pension before commutation at the admissible rates / as per half yearly slab increase based on CPI. Total pension as per 01-08-2007 pay scales : Rs.'A' + Rs.'B'= Rs.'C'.

On revision as on 01-08-2012 : His pay will be re- fixed in the revised pay scale.
His new basic pension will be Rs.'A plus' after commutation. (Average of ten months of revised pay + revised FPA minus commuted amount) ; DR : Rs.'B minus' on his revised pension before commutation. His total pension post revision of pay scales : Rs.' A plus' + Rs.'B minus' = Rs.'C plus most often'.

He gets difference in computation amount, gratuity, leave encashment etc. -- some amount of arrears is always welcome.

To illustrate based on the Chart referred by Shri Chopra : stagnation etc. increments, FPA ( old or revised ) are not included. At the maximum of pay scales excluding FPA and without commutation : Before Revision:Rs.16320+Rs.18066 DR=Rs.34386;After Revision:Rs..31020+Rs.9213DR=Rs.40233.

Total Pension after getting (excluding) commuted value of pension:

Rs.16320 - Rs.5440 (commuted) = Rs.10880 + Rs.18066 DR = Rs. 28946 : total pension before revision.
Rs..31020 - Rs.10340 (commuted) = Rs.20680 + Rs.9213 DR = Rs.29893 : total pension after revision.

Shri Chopra may work out difference (approximate) in pension that he might get after revision of pay scales. Based on his revised pay fixed as per LIC Employees ( Staff ) Regulations. He must add FPA etc.which have been added / considered for his present basic pension.

SN