Employees Provident Fund Organisation v. SASI K and others (WA No. 375 of 2021)

# _`IN THE HIGH COURT OF KERALA AT ERNAKULAM`_ # _`PRESENT`_ ``` THE HONOURABLE MR. JUSTICE AMIT RAWAL ``` ``` & ``` ``` THE HONOURABLE MRS. JUSTICE C.S. SUDHA MONDAY, THE 12[TH] DAY OF FEBRUARY 2024 / 23RD MAGHA, 1945 ``` ``` WA NO. 375 OF 2021 ``` ``` AGAINST THE ORDER/JUDGMENT WP(C) 16096/2019 OF HIGH COURT OF ``` ``` KERALA ``` ## _`APPELLANTS/RESPONDENTS NOS.2 AND 3 IN WP(C):`_ ``` 1EMPLOYEES PROVIDENT FUND ORGANIZATION REPRESENTED BY CHIEF PROVIDENT FUND COMMISSIONER, BHAVISHYANIDHI BHAVAN, 14,BHIKAJI CAME PLACE, NEW DELHI 110 066 2REGIONAL PROVIDENT FUND COMMISSIONER, EMPLOYEES PROVIDENT FUND ORGANIZATION, BHAVISHYANIDHI BHAVAN, PATTOM PALACE P.O, THIRUVANANTHAPURAM 695 004 ``` ``` BY ADV SAJEEV KUMAR K.GOPAL ``` ## _`RESPONDENTS/WRIT PETITIONERS & RESPONDENTS 1 & 4 IN WP(C):`_ ``` 1SASI K AGED 57 YEARS, S/O. THE LATE K BALAN NAIR, ASSISTANT MANAGER(NC) EMPLOYEE CODE 1710 KERALA STATE FINANCIAL ENTERPRISES LIMITED, KUMKUMATH HOUSE, AKAMBADAM, KUMARANELLUR P.O, WADAKANCHERY, THRISSUR 680 590 2MURALI V, AGED 54 YEARS, S/O.V ASUDEVA PANICKER, ASSISTANT MANAGER, EMPLOYEE CODE 1954 KERALA STATE FINANCIAL ENTERPRISES LIMITED, VASUDEVAM, AYANIMOODU, VEDIVACHANKOIL P.O, THIRUVANANTHAPURAM 695 501 3SANJEIVAN K K, AGED 53 YEARS, S/O. KRISHNAN K K, MANAGER GR. III, EMPLOYEES CODE 2280, KERALA STATE FINANCIAL ENTERPRISES ``` ``` WA NO. 375 OF 2021 ``` ``` 2 ``` ``` LIMITED, KANNANGANATTU HOUSE, KUNNATHANGADI, VELUTHOOR P.O, THRISSUR 680 012 4XAVIER P A, AGED 55 YEARS, S/O. THE LATE P L ANTONY, SPECIAL GRADE ASSISTANT, EMPLOYEES CODE 2280, KERALA STATE FINANCIAL ENTERPRISES LIMITED, PANENGADAM HOUSE, PANANGATTUKARA P.O, WADAKANCHERY, THRISSUR 680 623 5PREMACHANDRAN M R S/O. THE LATE RAGHAVAN EZHUTHACHAN, AGED 56 YEARS, MANAGER, EMPLOYEE CODE 2226, KERALA STATE FINANCIAL ENTERPRISES LIMITED, MULLAPARAMBIL HOUSE, KUMARANELLUR P.O, MARATHUKUNNU, WADAKANCHERY, THRISSUR 680 590 6NARAYANAN A K, AGED 55 YEARS, S/O. KUNCHAPPU, ASSISTANT MANAGER, EMPLOYEE CODE 1912 KERALA STATE FINANCIAL ENTERPRISES LIMITED, AMMANATH HOUSE, PUNNAMPARAMBU, THEKKUMKARA P.O, THRISSUR 680 589 7RAMACHANDRAN K N, AGED 57 YEARS, S/O. K R NARAYANAN EZHUTHACHAN, ASSISTANT MANAGER, EMPLOYEE CODE 1918 KERALA STATE FINANCIAL ENTERPRISES LIMITED, KULANGARA VALUPPIL HOUSE, THEKKUMKARA P.O, WADAKANCHERY, THRISSUR 680 589 8UNION OF INDIA, REPRESENTED BY ITS SECRETARY, MINISTRY OF LABOUR AND EMPLOYMENT, DEPARTMENT OF EMPLOYMENT, GOVERNMENT OF INDIA, SHRAM SAKTI BHAVAN, NEW DELHI 110 001 9KERALA STATE FINANCIAL ENTERPRISES LIMITED, REPRESENTED BY ITS MANAGING DIRECTOR, BHADRATHA, MUSEUM ROAD, THRISSUR 680 020 ``` ``` WA NO. 375 OF 2021 ``` ``` 3 ``` ``` BY ADVS. M.GOPIKRISHNAN NAMBIAR K.JOHN MATHAI JOSON MANAVALAN KURYAN THOMAS PAULOSE C. ABRAHAM ``` ``` THIS WRIT APPEAL HAVING BEEN FINALLY HEARD ON ``` ``` 12.02.2024, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ``` ``` WA NO. 375 OF 2021 ``` ``` 4 ``` ## **JUDGMENT** ## **Amit Rawal, J.** 1. Assessee had approached the Single Bench vide W.P.(C)No.16096/2019 by claiming the following reliefs: “(i) issue a writ of mandamus or such other writ, direction or order compelling the respondents to collect contribution on the basis of actual salary drawn by the petitioners in terms of the proviso to paragraph 11(3) of the Employees’ Pension Scheme, 1995 from the date of joining the pension scheme; - (ii) issue such other writ, direction or order as is deemed just and necessary in the facts, features and circumstances of the case.” 2. Learned Single Bench vide judgment dated 25.02.2020 allowed the writ petition by issuing slue of directions to the EPF as well as establishment to ascertain quantification of the amount by making book adjustment and credit contribution to the EPFO. 3. Learned counsel appearing on behalf of the appellants submitted that the matter is covered by the ``` WA NO. 375 OF 2021 ``` ``` 5 ``` judgment of the Supreme Court in **Employees Provident Fund Organisation** v. **Sunil Kumar** [2022 (6) KLT 234 (SC)] wherein it has been held as follows: “ 44. We accordingly hold and direct:- (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 22nd 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 1st 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 ``` WA NO. 375 OF 2021 ``` ``` 6 ``` Amendment) would be entitled to exercise option under paragraph 11(4) of the post amendment scheme. Their right to exercise option before 1st September 2014 stands crystalised in the judgment of this Court in the case of R.C.Gupta (supra). The scheme as it stood before 1st September 2014 did not provide for any cut-off date and thus those members shall be entitled to exercise option in terms of paragraph11(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 1st September 2014 without exercising any option under paragraph 11(3) of the pre-amendment scheme have already exited ``` WA NO. 375 OF 2021 ``` ``` 7 ``` from the membership thereof. They would not be entitled to the benefit of this judgment. (vi) The employees who have retired before 1st 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 `15,000/- per month as an additional contribution under the amended scheme is held to be ultra 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. ``` WA NO. 375 OF 2021 ``` ``` 8 ``` (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.” Learned counsels appearing on behalf of the respondents/petitioners do not deny this fact. In this view of the matter, judgment of the learned Single Bench is set aside and the writ appeal is allowed in terms of the operative part of the judgment of the Hon'ble Supreme Court extracted hereinabove. **Sd/-** **AMIT RAWAL JUDGE** **Sd/-** **C.S. SUDHA JUDGE** nak