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High Court of KeralaDivision BenchContempt Case closed; EPFO to reconsider entitl...

Cont.Case (C) No. 1772 of 2019

Case / Petition Number:CON.CASE(C) NO. 1772 OF 2019

Case Details & Bench

Court
High Court of Kerala
Hon'ble Judges
  • Anil K. Narendran
  • Sophy Thomas
Judgment Date
2023-10-20
Court Decision / Holding
Contempt Case is closed, without prejudice to the right of the Employees Provident Fund Organisation to reconsider the petitioners’ entitlement for disbursement of 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 to reconsider entitlement in accordance with law and the Supreme Court guidance; liberty reserved to EPFO to act in light of the apex judgment.

Parties to the Case

Appellants / Petitioners

  • G.R. Radhakrishnan Nair
  • S. Sasidharan Nair
  • Manoharan Thampi

Respondents

  • Sunil Barthwal
  • Andrew Prabhu

Legal Representation & Advocates

Counsels for Petitioners

  • • Sri. R. Sanjith
  • • Smt. C. S. Sindhu Krishnah

Counsels for Respondents

  • • Smt. Nita N.S.

Case Synopsis & Summary

Cont.Case (C) No. 1772 of 2019 arises from a petition for contempt alleging willful disobedience of the High Court's Annexure A1 judgment dated 12 October 2018 in WP(C) No. 31088 of 2016 and connected matters. The petitioners, who were petitioners 1, 6 and 7 in the linked writ petition, contend that the respondents—the Chief Provident Fund Organisation and its officers—have not complied with the pension directions issued by the Kerala High Court and that non-compliance affects the pension entitlements of the beneficiaries. The respondents oppose the contempt on the ground that any adjustment or disbursement must proceed in accordance with the law and the Supreme Court’s 2022 decision. The Apex Court’s 2019 dismissal of the EPFO’s SLP and its subsequent 2022 judgment in Employees Provident Fund Organisation v. Sunil Kumar B. laid down that the 2014 pension-scheme amendment (G.S.R. 609(E)) is legal and valid, directing read-downs and extension of certain options. In light of the 2022 Supreme Court ruling, the Kerala High Court held that the petitioners’ entitlement to higher pension requires reconsideration by the EPFO in conformity with law. The contempt petition is thus closed, with liberty to EPFO to reconsider entitlement consistent with the apex judgment, without prejudice to rights and further orders.”

Provisions of Law Cited

Section 12 of the Contempt of Courts Act, 1971Article 142 of the Constitution of IndiaEmployees Provident Funds and Miscellaneous Provisions Act, 1952

Legal Doctrines & Maxims

  • Ultra vires
  • Article 142 of the Constitution of India (doctrine)

Submissions & Arguments

Contentions of Appellants / Petitioners

The petitioners contend that the respondents willfully disobeyed Annexure A1 directions of the High Court's judgment dated 12.10.2018 in WP(C) No. 31088/2016 and connected matters and seek strict compliance by ordering disbursement of higher pension in accordance with the 2014 amended pension scheme and subsequent directions. They rely on the Supreme Court's 04.11.2022 decision in Civil Appeal Nos. 8143-44 of 2022 and connected matters to urge read-downs and extension of options under paragraphs 11(3) and 11(4) of the pension scheme, arguing that the EPFO must implement the Court's directions without delay. They contend that the entitlement of existing retirees and in‑service employees must be safeguarded, and that any delay or denial prejudices pensioners who were entitled under both pre- and post-amendment regimes. The petitioners also argue that to the extent any part of the amendment appears ultra vires, the remedy lies in proper judicial read‑downs by this court and compliance with the apex judgment.

Contentions of Respondents

The respondents submit that the entitlement exercise should be undertaken by the EPFO in accordance with law, and that the contempt petition should be disposed of in line with the Supreme Court's 2022 decision. They maintain that no clear wilful disobedience is established and that the proper course is to direct the EPFO to reconsider entitlements within the statutory framework and procedures, ensuring compliance with the apex judgment and applicable statutes. They emphasize that changes to pension-related benefits must be effected through lawful processes and not by unilateral orders in contempt proceedings, awaiting EPFO's compliance with the Supreme Court's directions.

Cited Precedents (2)

Case NameCitationTreatmentExplanation
R.C. Gupta and others v. Regional Provident Fund Commissioner, Employees Provident Fund Organisation and others(2018) 14 SCC 809PositiveCited as authority for interpretation of paragraph 11(3) proviso and the pre-amendment pension scheme; Kerala HC adopts the interpretative framework laid down in this decision.
Employees Provident Fund Organisation v. Sunil Kumar B.AIR 2022 SC 5634; 2022 (7) KHC 12PositiveSupreme Court held the 2014 amendment to the pension scheme legal and valid; directions therefrom guide reconsideration of entitlements, underpinning the court's approach in this case.

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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`** ``` FRIDAY, THE 20[TH] DAY OF OCTOBER 2023 / 28TH ASWINA, 1945 ``` ``` CON.CASE(C) NO. 1772 OF 2019 ``` ``` ARISING OUT OF THE JUDGMENT DATED 12.10.2018 IN WP(C)NO. 31088/2016 OF HIGH COURT OF KERALA ``` ## **`PETITIONERS/PETITIONERS 1,6 & 7:`** ``` 1 G.R.RADHAKRISHNAN NAIR AGED 64 YEARS S/O GANGADHARAN PILLAI,SENIOR INSPECTOR,PPO NO. KR10337,KERALA STATE HOUSING FEDERATION LIMITED, SARASWATHY VILAS, TC 1678/1, ATRWA-41, TMANACAUD P.O., THIRUVANANTHAPURAM-695 009. ``` ``` 2 S.SASIDHARAN NAIR, AGED 66 YEARS S/O PONNAPPAN PILLAI, DESPATCH ASSISTANT, PPO NO.KR/TVM/00066957,KERALA STATE HOUSING FEDERATION LIMITED, VISHAKOM HOUSE,WARD XI NO.118,VILAVOORKAL,MALAYINKIL.P.O,TRIVANDRUM-695571. ``` - **`3 MANOHARAN THAMPI.`** ``` S/O KALI PILLAI(LATE)SENIOR INSPECTOR(RTD), PPO NO.MD/NKL/00103842,KERALA STATE HOUSING FEDERATION LIMITED,RAGAMNALAMTHENGU, VAYAKALLOOR,KANJAMPURAM(PO),KANYAKUMARI P.O, TAMILNADU-629154.. ``` ``` BY ADVS. SRI.R.SANJITH SMT.C.S.SINDHU KRISHNAH ``` ## **`RESPONDENTS/RESPONDENTS 2 & 3:`** ``` 1 SUNIL BARTHWAL AGE AND FATHER'S NAME NOT KNOWN TO THE PETITIONERS, THE CHIEF PROVIDENT COMMISSIONER, THE EMPLOYEES PROVIDENT FUND ORGANISATION,BHAVISHYA NIDHI BHAVAN,14, ``` 2 Cont.Case (C)No.1772 of 2019 ## **`BJIKAJI CAMA PALACE, NEW DELHI-110066.`** ``` 2 ANDREW PRABHU, AGE AND FATHER'S NAME NOT KNOWN TO THE PETITIONER,REGIONAL PROVIDENT FUND COMMISSIONER,THE EMPLOYEES PROVIDENT FUND ORGANIZATION,KALOOR,ERNAKULAM-682017. ``` ``` BY ADV SMT.NITA.N.S. ``` ``` THIS CONTEMPT OF COURT CASE (CIVIL) HAVING COME UP FOR ADMISSION ON 20.10.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ``` 3 Cont.Case (C)No.1772 of 2019 ## **JUDGMENT** Anil K. Narendran, J. The petitioners, who are petitioners 1, 6 and 7 in W.P.(C)No.31088 of 2016, 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 A1 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.1772 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.1772 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 pre-amended 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.1772 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.1772 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/10/11 8 Cont.Case (C)No.1772 of 2019 ## **`APPENDIX OF CON.CASE(C) 1772/2019`** ## **`PETITIONER ANNEXURES`** - **`ANNEXURE A1 CERTIFIED COPY OF THE JUDGMENT DATED 12/10/2018 IN W.P.(C)N0.31088/2016 OF THE HONOURABLE DIVISION BENCH OF THE HONOURABLE HIGH COURT OF KERALA.`** - **`ANNEXURE A2 TRUE COPY OF THE COMMUNICATION BEARING NO.KR/KCH/10337/34 SPECIAL CELL(6)/2019/3004 A DATED 17/05/2019.`** - **`ANNEXURE A3 TRUE COPY OF THE COMMUNICATION BEARING NO. KR/KCH/10337/21 SPECIAL CELL(6)/2019/2330 DATED 26/04/209.`** - **`ANNEXURE A4 TRUE COPY OF THE COMMUNICATION BEARING NO.KR/KCH/10337/46/SPECIAL CELL(6)2019/23329A DATED 26/04/2019`** - **`ANNEXURE A7 TRUE COPY OF THE DEMAND DRAFT SUBMITTED BY THE 1ST PETITIONER.`** - **`ANNEXURE A6 TRUE COPY OF THE DEMAND DRAFT SUBMITTED BY THE 2ND PETITIONER.`** - **`ANNEXURE A7 TRUE COPY OF THE DEMAND DRAFT SUBMITTED BY 3RD PETITIONER.`**