High Court of KeralaDivision Bench2023-10-11Contempt Case Closed; EPFO directed to reconsid...

Cont. Case (C) No. 2500 of 2019

Case / Petition Number:Cont.Case (C) No. 2500 of 2019

Case Details & Bench

Court: High Court of Kerala
Hon'ble Judges: Anil K. Narendran
Sophy Thomas
Judgment Date: 2023-10-11
Court Decision / Holding: Contempt case closed, without prejudice to the right of the Employees Provident Fund Organisation to reconsider the petitioners’ entitlement to higher pension in view of the Supreme Court judgment dated 04.11.2022 in Civil Appeal Nos. 8143-44 of 2022 and connected matters.
Final Disposition: Contempt Case Closed; EPFO directed to reconsider petitioners’ entitlement to higher pension in light of the Supreme Court’s 2022 judgment, with further remedies available if necessary.

Parties to the Case

Appellants / Petitioners

B.R. Hareendran Nair
Rajendran Nair P.

Respondents

Sunil Bharthwal IAS
Shri. Ranjay Moosha Hari

Legal Representation & Advocates

Counsels for Petitioners

• V.V. Nandagopal Nambiar
• Chitra Johnson

Counsels for Respondents

• Nita N.S.

Case Synopsis & Summary

This Contempt of Court case (Cont.Case (C) No. 2500 of 2019) before the Kerala High Court concerns petitioners 3 and 41 in WP(C) No. 2410 of 2017, who filed a contempt petition under Section 12 of the Contempt of Courts Act, 1971, alleging willful disobedience of the High Court’s Annexure-1 judgment dated 12 October 2018 in WP(C) No. 2410/2017 and connected matters. The petition targets the Employees’ Provident Fund Organisation (EPFO) for non-compliance with directions relating to pension benefits under the 1995 Pension Scheme, as amended by G.S.R. 609(E) (22 August 2014). The Supreme Court’s later decision in Sunil Kumar B. v. EPFO (2022) upheld the validity of the 2014 amendment and set out directions on pension-related relief, including extensions for exercise of options and transfer of funds for exempted establishments. The Kerala High Court, after hearing counsel, held that the petitioners’ entitlement to higher pension requires reconsideration by the EPFO in light of the 2022 Supreme Court judgment. The contempt petition is then closed, with a direction that the EPFO reconsider the petitioners’ entitlement to higher pension in accordance with the apex court’s 2022 directions, leaving open the possibility of further remedies. The order thus reinforces compliance with law and preserves avenues for adjustment under the SC decision.

Provisions of Law Cited

Section 12 of the Contempt of Courts Act, 1971Notification No. G.S.R. 609(E) dated 22 August 2014Employees’ Provident Funds and Miscellaneous Provisions Act, 1952Paragraph 11(3) of the Pension Scheme (1995)Paragraph 11(4) of the Pension Scheme (as amended in 2014)Article 142 of the Constitution of India

Submissions & Arguments

Contentions of Appellants / Petitioners

The petitioners contend that there has been willful disobedience of Annexure‑1 judgment dated 12.10.2018 in WP(C) No. 2410/2017 and connected matters, and rely on the 2014 amendment to the pension scheme (G.S.R. 609(E)) and the Supreme Court’s 2022 decision directing re‑calibration of entitlements. They seek enforcement of the directions and immediate consideration of higher pension benefits, including extension of options under the pension scheme, in line with the 2022 judgment and prior precedents such as RC Gupta. The petition asserts that the contempt is warranted to ensure compliance with the court’s previous directions and the evolving legal framework governing pension and EPF entitlements.

Contentions of Respondents

The respondents submit that the apex court’s 2022 judgment requires reconsideration of entitlement by the EPFO in accordance with law and directives. They indicate that the EPFO will undertake the required exercise to align with the 2022 decision and, pending that process, the contempt petition should be disposed of with a clear statement that the authorities will implement the judgment within a specified timeframe. They emphasize deference to lawful procedures and that contempt remedies can be kept in reserve while the authorized reconsideration proceeds.

Cited Precedents (2)

Case Name	Citation	Treatment	Explanation
Employees Provident Fund Organisation v. Sunil Kumar B.	2022 (7) KHC 12 : AIR 2022 SC 5634	Positive	Cited for validating the 2014 amendment (G.S.R.609(E)) and providing directions that influenced the petitioners’ entitlement; the apex court’s decision is central to the reconsideration framework applied by the Kerala High Court.
R.C. Gupta and others v. Regional Provident Fund Commissioner, Employees Provident Fund Organisation and others	[(2018) 14 SCC 809]	Positive	The High Court agrees with RC Gupta’s view on interpretation of the pre-amendment proviso to paragraph 11(3) of the pension scheme and applies it to the current context.

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Extracted Judgment Text

Exact text extracted from official judgment records.

## **`IN THE HIGH COURT OF KERALA AT ERNAKULAM`** ## **`PRESENT`** ``` THE HONOURABLE MR.JUSTICE ANIL K. NARENDRAN ``` ## **`&`** ``` THE HONOURABLE MRS.JUSTICE SOPHY THOMAS ``` ``` WEDNESDAY, THE 11[TH] DAY OF OCTOBER 2023 / 19TH ASWINA, 1945 ``` ``` CON.CASE(C) NO. 2500 OF 2019 ``` ``` AGAINST THE JUDGMENT DATED 12.10.2018 IN WP(C)NO.2410/2017 ``` ``` OF HIGH COURT OF KERALA ``` ## **`PETITIONERS/PETITIONERS 3 & 41:`** - **`1 B.R.HAREENDRAN NAIR, AGED 62 YEARS S/O K.RAGHAVAN NAIR, GEETHAM HOUSE, VARA-135A, PROGRESSIVE LANE, ARAPPURA ROAD, VATTIYOORKAVU.P.O, THIRUVANANTHAPURAM, PIN-695013. EPF A/C NO.NO.KR/KKD/0000279/000/0000267 PPO NO KR/TVM/00075307.`** - **`2 RAJENDRAN NAIR P., AGED 62 YEARS, S/O PARAMESHWARAN PILLAI K., SREERAGAM HOUSE, VARA 468-B, VATTIYOORKAVU.P.O, THIRUVANANTHAPURAM, PIN-695013. EPF A/C NO.KR/KKD/0000279/000/0000382 PPO NOKR/TVM/00075490.`** ``` BY ADVS.V.V.NANDAGOPAL NAMBIAR SMT.CHITRA JOHNSON ``` ## **`RESPONDENTS/RESPONDENTS 4 & 5:`** - **`1 SUNIL BHARTHWAL IAS, AGED 52 YEARS, FATHER'S NAME NOT KNOWN TO THE PETITIONERS, CENTRAL`** - **`P.F.COMMISSIONER, EPF HEAD OFFICE, BHAVISHANIDHI BHAVAN, 14-BHIKAJI CAMA PLACE, NEW DELHI-110066.`** - **`2 SHRI.RANJAY MOOSHAHARI, AGED 50 YEARS FATHER'S NAME NOT KNOWN TO THE PETITIONERS, REGIONAL PROVIDENT FUND COMMISSIONER, EMPLOYEES PROVIDENT FUND ORGANISATION, REGIONAL OFFICE, BHAVISHYA NIDHI BHAVAN, PATTOM, THIRUVANANTHAPURAM-695001.`** ``` SMT NITA N.S- RESPONDENTS ``` 2 Cont.Case (C)No.2500 of 2019 ``` THIS CONTEMPT OF COURT CASE (CIVIL) HAVING COME UP FOR ADMISSION ON 11.10.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ``` 3 Cont.Case (C)No.2500 of 2019 ## **JUDGMENT** ## Anil K. Narendran, J. The petitioners, who are petitioners 3 and 41 in W.P.(C)No. 2410 of 2017, have filed this Contempt Case, invoking the provisions under Section 12 of the Contempt of Courts Act, 1971 alleging willful disobedience of the directions contained in Annexure-1 judgment dated 12.10.2018 in that writ petition along with W.P.(C)No.13120 of 2015 and connected matters. 2. The SLP filed by the Employees Provident Fund Organisation against the judgment dated 12.10.2018 in W.P.(C) No.13120 of 2015 and connected cases were dismissed by the Apex Court vide order dated 01.04.2019 in SLP (C) - Diary No.9610 of 2019. That order was recalled and the Apex Court rendered a detailed judgment dated 04.11.2022 in Civil Appeal Nos.8143 of 2022 and 8144 of 2022 and connected matters- **Employees Provident Fund Organisation v. Sunil Kumar B. [2022 (7) KHC 12 : AIR 2022 SC 5634]** . In that judgment, the Apex Court held that the provisions contained in Notification No.GSR 609(E) dated 22.08.2014 is legal and valid. The directions contained in paragraph 44 of the said judgment of the Apex Court dated 04.11.2022 read as follows: “44. We accordingly hold and direct:- 4 Cont.Case (C)No.2500 of 2019 (i) The provisions contained in the notification No. G.S.R.609(E) dated 22nd August 2014 are legal and valid. So far as present members of the fund are concerned, we have read down certain provisions of the scheme as applicable in their cases and we shall give our findings and directions on these provisions in the subsequent subparagraphs. (ii) Amendment to the pension scheme brought about by the notification No. G.S.R. 609(E) dated 22[nd] August 2014 shall apply to the employees of the exempted establishments in the same manner as the employees of the regular establishments. Transfer of funds from the exempted establishments shall be in the manner as we have already directed. (iii) The employees who had exercised option under the proviso to paragraph 11(3) of the 1995 scheme and continued to be in service as on 1[st] September 2014, will be guided by the amended provisions of paragraph 11(4) of the pension scheme. (iv) The members of the scheme, who did not exercise option, as contemplated in the proviso to paragraph 11(3) of the pension scheme (as it was before the 2014 Amendment) would be entitled to exercise option under paragraph 11(4) of the post amendment scheme. Their right to exercise option before 1[st] September 2014 stands crystalised in the judgment of this Court in the case of **R.C. Gupta and others v. Regional Provident Fund Commissioner, Employees Provident Fund Organisation and others [(2018) 14 SCC 809]** . The scheme as it stood before 1[st] September 2014 did not provide for any cut-off date and thus those members shall 5 Cont.Case (C)No.2500 of 2019 be entitled to exercise option in terms of paragraph 11(4) of the scheme, as it stands at present. Their exercise of option shall be in the nature of joint options covering preamended paragraph 11(3) as also the amended paragraph 11(4) of the pension scheme. There was uncertainty as regards validity of the post-amendment scheme, which was quashed by the aforesaid judgments of the three High Courts. Thus, all the employees who did not exercise option but were entitled to do so but could not due to the interpretation on cut-off date by the authorities, ought to be given a further chance to exercise their option. Time to exercise option under paragraph 11(4) of the scheme, under these circumstances, shall stand extended by a further period of four months. We are giving this direction in exercise of our jurisdiction under Article 142 of the Constitution of India. Rest of the requirements as per the amended provision shall be complied with. (v) The employees who had retired prior to 1[st] September 2014 without exercising any option under paragraph 11(3) of the pre-amendment scheme have already exited from the membership thereof. They would not be entitled to the benefit of this judgment. (vi) The employees who have retired before 1[st] September 2014 upon exercising option under paragraph 11(3) of the 1995 scheme shall be covered by the provisions of the paragraph 11(3) of the pension scheme as it stood prior to the amendment of 2014. (vii) The requirement of the members to contribute at the rate of 1.16 per cent of their salary to the extent such salary exceeds Rs.15,000/- per month as an additional contribution under the amended scheme is held to be ultra 6 Cont.Case (C)No.2500 of 2019 vires the provisions of the 1952 Act. But for the reasons already explained above, we suspend operation of this part of our order for a period of six months. We do so to enable the authorities to make adjustments in the scheme so that the additional contribution can be generated from some other legitimate source within the scope of the Act, which could include enhancing the rate of contribution of the employers. We are not speculating on what steps the authorities will take as it would be for the legislature or the framers of the scheme to make necessary amendment. For the aforesaid period of six months or till such time any amendment is made, whichever is earlier, the employees’ contribution shall be as stop gap measure. The said sum shall be adjustable on the basis of alteration to the scheme that may be made. (viii) We do not find any flaw in altering the basis for computation of pensionable salary. (ix) We agree with the view taken by the Division Bench in the case of **R.C. Gupta** (supra) so far as interpretation of the proviso to paragraph 11(3) (pre-amendment) pension scheme is concerned. The fund authorities shall implement the directives contained in the said judgment within a period of eight weeks, subject to our directions contained earlier in this paragraph. (x) The Contempt Petition (C) Nos.1917 - 1918 of 2018 and Contempt Petition (C) Nos. 619-620 of 2019 in Civil Appeal Nos. 10013-10014 of 2016 are disposed of in the above terms.” 3. Heard the learned counsel for the petitioners and also the learned Standing Counsel for the Employees Provident Fund 7 Cont.Case (C)No.2500 of 2019 ## Organisation, for the respondents. 4. In view of the judgment of the Apex Court dated 04.11.2022 in Civil Appeal Nos.8143-44 of 2022 and connected matters **[2022 (7) KHC 12 : AIR 2022 SC 5634]** , the entitlement of the petitioners for disbursement of higher pension requires reconsideration at the hands of the Employees Provident Fund Organisation. 5. The learned Standing Counsel for the respondents would submit that the aforesaid exercise shall be undertaken by the Employees Provident Fund Organisation in accordance with law. In the said circumstances, this Contempt Case is closed, without prejudice to the right of the Employees Provident Fund Organisation to reconsider the entitlement of the petitioners for disbursement of higher pension, in view of the judgment of the Apex Court dated 04.11.2022 in Civil Appeal Nos.8143-44 of 2022 and connected matters **[2022 (7) KHC 12 : AIR 2022 SC 5634]** . Sd/- **ANIL K. NARENDRAN, JUDGE** Sd/- **SOPHY THOMAS, JUDGE** AV/18/10 8 Cont.Case (C)No.2500 of 2019 ## **`APPENDIX OF CON.CASE(C) 2500/2019`** ``` PETITIONER ANNEXURES ``` ``` ANNEXURE1 CERTIFIED COPY OF THE JUDGMENT DATED 12.10.2018 IN WP(C)NO.2410/2017. ANNEXURE 2 TRUE COPY OF THE LETTER DATED 24.10.2019 ANNEXURE 3 TRUE COPY OF THE LETTER DATED 24.10.2019. ```