The Chief Provident Fund Commissioner v. Sunil Kumar B. & Ors. (W.A. No. 376 of 2021)

## **`IN THE HIGH COURT OF KERALA AT ERNAKULAM`** ## **`PRESENT`** ## **`THE HONOURABLE MR. JUSTICE AMIT RAWAL`** ## **`&`** ## **`THE HONOURABLE MRS. JUSTICE C.S. SUDHA`** ``` TUESDAY, THE 13[TH] DAY OF FEBRUARY 2024 / 24TH MAGHA, 1945 WA NO. 376 OF 2021 ``` ## **`AGAINST THE JUDGMENT DATED 26.2.2020 IN WP(C) NO.1850 OF 2020 OF HIGH COURT OF KERALA APPELLANTS/RESPONDENTS 2 AND 3 IN WP(C):`** - **`1 EMPLOYEES PROVIDENT FUND ORGANISTION REPRESENTED BY CHIEF PROVIDENT FUND COMMISSIONER, BHAVISHYANIDHI BHAWAN, 14-BHIKAJI CAMA PLACE, NEW DELHI - 110 066.`** - **`2 REGIONAL PROVIDENT FUND COMMISSIONER EMPLOYEES PROVIDENT FUND ORGANISATION, BHAVISHYANIDHI BHAWAN, PATTOM PALACE P.O., TRIVANDRUM - 695 004.`** ``` BY ADV SAJEEV KUMAR K.GOPAL ``` ## **`RESPONDENTS/WRIT PETITIONERS & RESPONDENTS 1 & 4 IN WP(C):`** - **`1 SAJEEV V.M., AGED 56 YEARS S/O.MADHAVAN V.P., SENIOR MANAGER, EMPLOYEE CODE - 1732, KERALA STATE FINANCIAL ENTERPRISES LIMITED, VETTIYATTIL HOUSE, MANKUTHIPADOM EAST, PADY P.O., THRISSUR - 680 699.`** - **`2 RAJENDRAN N. AGED 57 YEARS`** - **`S/O.GOPALAN NAIR, SENIOR MANAGER, EMPLOYEE CODE - 1539, KERALA STATE FINANCIAL ENTERPRISES LIMITED, NANGEELIL HOUSE, AYYANTHOLE P.O., THRISSUR - 680 003.`** - **`3 AMMINIKUTTY T. AGED 55 YEARS`** - **`D/O.SIVARAMAN NAIR, SENIOR MANAGER, EMPLOYEE CODE - 1773, KERALA STATE FINANCIAL ENTERPRISES LIMITED, MADASSERY HOUSE, KOLATHUR, NELLAYI P.O., THRISSUR - 680 305.`** - **`4 MANJULA K. AGED 57 YEARS`** W.A.No.376 of 2021 2 ``` D/O.AYYAPPAN NAIR K., SENIOR MANAGER, EMPLOYEE CODE - 1541, KERALA STATE FINANCIAL ENTERPRISES LIMITED, KURUVAT HOUSE, NANDIPULAM P.O., THRISSUR - 680 312. ``` - **`5 VALSAN K.V. AGED 54 YEARS`** ``` S/O.VELAYI K.A., SENIOR MANAGER, EMPLOYEE CODE - 3657, KERALA STATE FINANCIAL ENTERPRISES LIMITED, KATHUMADA HOUSE, EAST KODALY, PADY P.O., THRISSUR - 688 699. ``` - **`6 REGHU K.N. AGED 56 YEARS`** ``` S/O.NARAYANA PISHARODY, SENIOR MANAGER, EMPLOYEE CODE - 1374, KERALA STATE FINANCIAL ENTERPRISES LIMITED, KEEZHADOORPISHRAM, MELADOOR P.O., THRISSUR - 680741. ``` - **`7 SUMAYA A.I. AGED 51 YEARS`** ``` D/O.ISMAYIL P.K., SENIOR MANAGER, EMPLOYEE CODE - 2513, KERALA STATE FINANCIAL ENTERPRISES LIMITED, AYYARIL NADUVILE VEEDU, EAST OF LIGHT HOUSE STOP, AZHIKODE P.O., THRISSUR - 680 666. ``` - **`8 SALINI K. AGED 56 YEARS`** ``` D/O.DAMODARA MENON, DEPUTY MANAGER, EMPLOYEE CODE - 1769, KERALA STATE FINANCIAL ENTERPRISES LIMITED, CHAITHRAM, AMBADY LANE, KODAKARA, THRISSUR - 680 684. ``` - **`9 ABDUL KADER A.K. AGED 56 YEARS`** ``` S/O.KUNJUPOKER KUTTY, DEPUTY MANAGER, EMPLOYEE CODE - 1814, KERALA STATE FINANCIAL ENTERPRISES LIMITED, AYYARIL NADUVILE VEEDU, EAST OF LIGHT HOUSE STOP, AZHIKODE P.O., THRISSUR - 680 666. 10KHYUNNISA V.I. AGED 55 YEARS D/O.IBRAHIM V.M., SPECIAL GRADE ASSISTANT, EMPLOYEE CODE - 3581, KERALA STATE FINANCIAL ENTERPRISES LIMITED, GCDA HOUSE NO.34, SANTHINAGAR, VEDIMARA, MANNAM P.O., ERNAKULAM - 680 520. ``` ## **`11 MINI T.V. AGED 53 YEARS`** W.A.No.376 of 2021 3 ``` D/O.VIJAYAN T.A., DEPUTY MANAGER, EMPLOYEE CODE - 2832, KERALA STATE FINANCIAL ENTERPRISES LIMITED, THEKKINIPPURA HOUSE, VADAKKUMPURAM P.O., N.PARUR, ERNAKULAM - 683 521. ``` - **`12 MARY NIRMALA K.S. AGED 50 YEARS`** - **`D/O.STANISNAUS K.X., DEPUTY MANAGER, EMPLOYEE CODE - 3593, KERALA STATE FINANCIAL ENTERPRISES LIMITED, KONATH HOUSE, GOTHURUTH P.O., ERNAKULAM - 683 516.`** - **`13 USHA T. AGED 53 YEARS`** - **`D/O.VIJAYAN P., ASSISTANT MANAGER, EMPLOYEE CODE - 3690, KERALA STATE FINANCIAL ENTERPRISES LIMITED, THALIYAKKATTIL HOUSE, MAPRANAM, MADAYIKONAM P.O., THRISSUR - 680 712.`** - **`14 RASHEED K.K. AGED 49 YEARS`** - **`S/O.KUNJAVDU, DEPUTY MANAGER, EMPLOYEE CODE - 2825, KERALA STATE FINANCIAL ENTERPRISES LIMITED, KADAMBOTT HOUSE, EDAVILANGU P.O., THRISSUR - 680 671.`** - **`15 MADHU M.K. AGED 53 YEARS`** ``` S/O.SUBRAMANIAM NAMBOODIRI, ASSISTANT MANAGER, EMPLOYEE CODE - 3485, KERALA STATE FINANCIAL ENTERPRISES LIMITED, MALIKA KOVILAKAM, KONATHUKUNNU P.O., VELLANGALLUR, THRISSUR - 680 662. ``` - **`16 BEEMA BEEVI K.K. AGED 52 YEARS`** ``` D/O.KASSIM K.M., ASSISTANT MANAGER, EMPLOYEE CODE - 3169, KERALA STATE FINANCIAL ENTERPRISES LIMITED, KALLOOPARAMNIL HOUSE, THAZHEKKAD P.O., KALLETTUMKARA VIA., THRISSUR - 680 697. ``` - **`17 VINEETHA N.V. AGED 48 YEARS`** ``` D/O.VENUGOPALAN N.T., ASSISTANT MANAGER, EMPLOYEE CODE - 5024, KERALA STATE FINANCIAL ENTERPRISES LIMITED, VALATHARA HOUSE, PADY P.O., EAST KODALY, THRISSUR - 680 699. ``` - **`18 JOSE K.P. AGED 48 YEARS`** W.A.No.376 of 2021 4 ``` S/O.PAULOSE K.A., DESPATCH ASSISTANT, EMPLOYEE CODE - 3861, KERALA STATE FINANCIAL ENTERPRISES LIMITED, KANNUKADAN HOUSE, WEST KODALY, PADY P.O., THRISSUR - 680 699. ``` - **`19 SREEMU K.P., AGED 52 YEARS D/O.PERENJINI K.P., DEPUTY MANAGER, EMPLOYEE CODE - 3409, KERALA STATE FINANCIAL ENTERPRISES LIMITED, THAYYIL HOUSE, VADANAPILLY P.O., THRISSUR - 680 614.`** - **`20 SHARMILA V.H., AGED 47 YEARS D/O.HYDROSE V.K., SPECIAL GRADE ASSISTANT ATTENDANT, EMPLOYEE CODE - 6766, KERALA STATE FINANCIAL ENTERPRISES LIMITED, VALIYAKATH HOUSE, VALAPAD P.O., THRISSUR - 680 567.`** - **`21 KOMALAM V.A. AGED 49 YEARS`** ``` D/O.ADIMA V.K., OFFICE, EMPLOYEE CODE - 4498, KERALA STATE FINANCIAL ENTERPRISES LIMITED, KUNTHARA HOUSE, VALAPAD P.O., THRISSUR - 680 567. ``` - **`22 SARITHA K.H. AGED 49 YEARS`** - **`D/O.HARIDAS K BK, OFFICE EMPLOYEE CODE - 8775, KERALA STATE FINANCIAL ENTERPRISES LIMITED, KUNNUMPARAMBIL HOUSE, CHENTHRAPPINNI P.O., THRISSUR - 680 687.`** - **`23 REKHA M.R. AGED 39 YEARS`** ``` D/O.RAVI M.R., SPECIAL GRADE ASSISTANT, EMPLOYEE CODE - 6043, KERALA STATE FINANCIAL ENTERPRISES LIMITED, MAMPULLY HOUSE, ANTHIKAD P.O., THRISSUR - 680 641. ``` - **`24 SHEEBA K.K. AGED 39 YEARS`** ``` D/O.RAVI M.R., SPECIAL GRADE ASSISTANT, EMPLOYEE CODE - 6043, KERALA STATE FINANCIAL ENTERPRISES LIMITED, MAMPULLY HOUSE, ANTHIKAD P.O., THRISSUR - 680 641. ``` ``` 25SMITHA M.V. AGED 39 YEARS D/O.VIJAYAN M.K., JUNIOR ASSISTANT, EMPLOYEE CODE - 9589, KERALA STATE FINANCIAL ENTERPRISES LIMITED, KADAVIL HOUSE, THRITHALLUR P.O., THRISSUR - 680 619. ``` - **`26 SHARMILA M.S.`** W.A.No.376 of 2021 5 ## **`AGED 37 YEARS`** ``` D/O.SASIDHARAN K.K., ASSISTANT MANAGER, EMPLOYEE CODE - 5865, KERALA STATE FINANCIAL ENTERPRISES LIMITED, VELLAPARAMBIL HOUSE, THAMMANAM P.O., ERNAKULAM - 682 032. ``` ``` 27SREEDEVI K.G.,AGED 47 YEARS D/O.GOPI K.K., ASSISTANT MANAGER, EMPLOYEE CODE - 4784, KERALA STATE FINANCIAL ENTERPRISES LIMITED, KILIANTHARA HOUSE, EDAMUTTAM P.O., THRISSUR - 680 568. ``` ``` 28SOUBHAGYAVATHY T.K., AGED 36 YEARS D/O.KRISHNAN T.A., SPECIAL GRADE ASSISTANT, EMPLOYEE CODE - 7296, KERALA STATE FINANCIAL ENTERPRISES LIMITED, MANGATHARA HOUSE, ORUMANAYUR P.O., THRISSUR - 680 512. ``` ``` 29BHASURA B.K. AGED 44 YEARS D/O.BHASKARAN A., ASSISTANT MANAGER, EMPLOYEE CODE -5318, KERALA STATE FINANCIAL ENTERPRISES LIMITED, MEVELIL HOUSE, THALAKODU P.O., MULANTHURUTHY VIA., ERNAKULAM - 682 314. ``` - **`30 BABY V.V., AGED 57 YEARS D/O.VARGHESE V.T., SENIOR MANAGER, EMPLOYEE CODE - 1543, KERALA STATE FINANCIAL ENTERPRISES LIMITED, CHIVEPARAMBIL, NADAKKAVU P.O., ERNAKULAM - 682 307.`** - **`31 UNION OF INDIA(UOI) REPRESENTED BY ITS SECRETARY, MINISTRY OF LABOUR AND EMPLOYMENT, DEPARTMENT OF EMPLOYMENT, GOVERNMENT OF INDIA, SHRAM SHAKTI BHAVAN, NEW DELHI - 110 001.`** - **`32 KERALA STATE FINANCIAL ENTERPRISES LIMITED REPRESENTED BY ITS MANAGING DIRECTOR, BHADRATHA, MUSEUM ROAD, THRISSUR - 680 020.`** ``` BY ADVS. DSGI, SRI.S.MANU (B/O) ``` ``` STANDING COUNSEL SRI.M.GOPIKRISHNAN NAMBIAR (B/O) S.M.PREM ``` ``` THIS WRIT APPEAL HAVING BEEN FINALLY HEARD ON 13.02.2024, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ``` W.A.No.376 of 2021 6 ## **AMIT RAWAL & C.S. SUDHA, JJ. ========================** W.A.No.376 of 2021 **=========================** Dated this the 13[th] day of February, 2024 ## **JUDGMENT** ## **Amit Rawal , J .** The Chief Provident Fund Commissioner has filed the Writ Appeal against the judgment dated 26.02.2020 in W.P. (C) No.1850 of 2020 whereby the claim of the respondents for challenging the amendment brought in the Employment Pension Scheme was accepted by allowing the writ petition. The aforementioned Division Bench Judgment was assailed before the Supreme Court and Larger Bench of the Supreme Court in **The Employees Provident Fund Organisation & another v. Sunil Kumar B. & Ors. Etc.** [2022(6) KLT 234 (SC)] has set aside the judgments of the Division Bench of this court by holding the provisions contained in the notification dated 22.08.2014 to be legal and valid, in the following manner:- W.A.No.376 of 2021 7 _**“** 44. We accordingly hold and direct:-_ _(i) The provisions contained in the notification no. G.S.R. 609(E) dated 22[nd] 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 sub-paragraphs._ _(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_ W.A.No.376 of 2021 8 _case of_ _**R.C. Gupta** (supra). The scheme as it stood before 1[st] September 2014 did not provide for any cutoff 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 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]_ W.A.No.376 of 2021 9 _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.15000/- 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._ _(ix) We agree with the view taken by the Division Bench_ W.A.No.376 of 2021 10 _in the case of_ _**R.C. Gupta** (supra) so far as interpretation of the proviso to paragraph 11(3) (preamendment) 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 Honorable Supreme Court extracted herein above. Sd/- **AMIT RAWAL JUDGE** Sd/- **C.S. SUDHA JUDGE** skj