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Monday, June 08, 2015

LIC NEEDS TO PAY RIGHT AMOUNT TO ELIGIBLE PENSIONERS


As the deadline for the payment of interim relief as per the Supreme Court order dt 7/5/2015 is nearing and considering no movement seems to have taken place at least upto 5th June 2015 it would be worthwhile to envision the options before LIC.

What is payable:

“20% of the amount as per the impugned judgments pertaining to the High Court”:
(In view of the plural used for “judgments”, the use of singular used in “the High Court” can reasonably be construed   as a collective phrase representing all the three High Courts).
It has to be based on the judgments of High Courts of Rajasthan (dt 12/1/2010), Punjab & Haryana (dt 9/11/2012), and Delhi (dt 30/1/2013) (corrected on 25/2/2013).
  1. In case of Chandigarh petitioners, the petitioners had prayed for interest at 12% and the HC allowed the petition in terms of the Jaipur Bench judgment dated 12/1/2010.Although the HC had not mentioned its granting of the prayer for interest, it had not also specifically ruled against interest payment. So the interpretation according to petitioners will be that interest is also payable. If LIC excludes interest payment, they run the risk of being hauled up for contempt in the ongoing contempt proceedings in Chandigarh HC.
  2. If LIC pays interest to Chandigarh petitioners, LIC will be adopting an inconsistent approach by making the interim payments in a discriminatory manner among the three sets of petitioners with legal consequences thereof.
  3. In case of Delhi judgment, the prayer is only for payment of revised pension on 100% DR neutralisation. But the  HC has  observed,     There being complete identity of the issues raised we would further record that concededly the law declared by the Jaipur Bench of the Rajasthan High Court has to be applied in rem”.
    ……………………………………………………. “we dispose of the instant writ petition granting a declaratory relief: The members of the petitioner No.1 and No.2 Associations would be entitled to pensionary benefits as per the decision of the learned Single Judge of the Jaipur Bench of Rajasthan High Court as affirmed by the Division Bench thereof subject to the said decisions not being interdicted by the Supreme Court. We clarify. If Petition seeking Special Leave to Appeal afore-noted is dismissed or upon Leave to Appeal being granted but the Civil Appeal being dismissed, LIC would give benefit of the view taken by the Rajasthan High Court to all pensioners and would treat the decision in rem.”
In my view, even though the prayer by the Federation is limited to removal of DR anomaly and 100% DR neutralisation for pre-August 1997 retiree Class I officers, payment of interim relief has to be made in accordance with the view taken by the Jaipur Bench. In other words upgraded pension as ordered by Jaipur Bench will have to be paid to them.

To whom interim relief is payable

1) To all original petitioners in Jaipur & Chandigarh writ petitions. In Jaipur writ there are some post July 1997 retirees and a few Class III retirees as well as I remember.

2) Delhi HC beneficiaries If the interim relief has to paid as per the Delhi HC judgment, it has to be considered whether it has to be paid in rem i.e beyond the petitioners viz. Retired Class I Officers who are the members of the affiliated units of the Class I Federation, but also to 1) thousands of retired Class I Officers who are not the members of the Federation and 2) all eligible pensioners from other Classes of retired employees.

Considering  1) & 2) above  together, it would appear  that LIC will be well advised to pay the interim relief ordered by Supreme Court to all eligible retirees numbering  40000- plus and not merely the petitioners before the expiry of the deadline  to avoid running the risk of being exposed to contempt of court and a spate of litigations.

All this is subject to the caveat of LIC having to seek legal opinion and obtain Government advice/clearance in the matter of obeying the Apex Court orders.

Even if they needed some clarification from Supreme Court, LIC should have sought the same in the Vacation Bench  of the Supreme  Court at least mid-way, i.e before the end of May 2015.Filing an application just before the end of deadline(18th June 2015) for clarification will smack of dilatory tactics  by LIC .

Legal pundits may perhaps have their own views.

Greetings.

C H Mahadevan