Clarification with respect to judgment dated 4/11/2022 of Hon’ble Supreme Court of India on higher wages pension (EPS 1995) and also clarification to Shri N Rama Sabbaiah
Contents News/Article Date: 7th December 2022
Relating to which Act: The Employees Provident Funds & Miscellaneous Provisions Act, 1952
Applicable to which State: All the establishments in the States with PF coverage
Type: EPFO’s Notice No. AP / CDP / Pension / PPO / 68109 / 2022 / 14710 issued by Assistant PF Commissioner (Pension)
Pertains to employers and employees and in particular Shri N Rama Sabbaiah and all AP / RO / CDP / Special Cell / PPO
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In the previous instance, the Regional PF Commissioner – II (pension) Regional Office, Rajkot, has written a letter to Bharatiya Mazdoor Sangh, informing them that the office is yet to receive any further guidelines/instructions from the Head Office and that further instructions are awaited.
In a nutshell, Friday’s Supreme Court ruling gives EPFO members, who have availed of the EPS, another opportunity over the next four months to opt and contribute up to 8.33 percent of their actual salaries – as against 8.33 percent of the pensionable salary capped at Rs 15,000 a month
In the current instance, EPFO has sent a circular to all its officers with a copy of Shri N Rama Sabbaiah informing as follows, as described in a nutshell:
- Shri N Rama Sabbaiah was granted a monthly pension of Rs.1147/- with effect from 1/5/2007 to December 2018 on attaining the age of superannuation effective from 30/4/2007.
- Subsequently, Sabbaiah applied for revision of pension on 30/5/2018 on higher wages / actual wages but EPS contribution was on ceiling limit of 5000/- up to 31/5/2001 and on 6500/- from 1/6/2001 up to the date of retirement
- On the basis of the application dated 30/5/2018 along with the undertaking of the employer, EPFO revised the pension to 4013/- with a retrospective effect of 1/5/2007 together with arrears of 3,77,720/-
- Subsequently on re-examining as per orders from Head Office as per letter dated 4/6/2019, it was noticed that Sabbaiah neither exercised option as per para 26(6) of PF nor as per para 11 (3) of the pension scheme, 1995, while he was a member with the fund and further contributions to pension, were remitted on wage ceiling of Rs.5000/6500 respectively
- Whereas Sabbaiah exercised the option for a higher pension only on 30/5/2018 which is after the exit of the membership of EPS 1995.
- Whereas the judgment based on which Shri N Rama Subbaiah exercised the option is only in respect of members of the Employees Pension Scheme, 1995, and not to the Pensioners whose accounts have already been settled and have been drawing a pension.
- In view of the facts and circumstances, the EPFO Office was constrained to restore the monthly pension of 1147/- with effect from 11/2019
- Whereas the Orders of the Hon’ble High Court of Andhra Pradesh in respect of W. P. No. 21004 / 2019 were delivered on 16/9/2022 when the matter of higher pension is subjudice before the Hon’ble Supreme Court of India delivered its judgment vide its order dated 4/11/2022 and held that:
44(v) The employees who had retired prior to 1st September 2014 without exercising any option under para 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
In view of the aforesaid facts and circumstances, it is to inform you that you are not eligible for Higher Wage Pension.
Subject: clarification with respect of judgment dated 4/11/2022 of Hon’ble Supreme Court of India on higher wages pension (EPS 1995) and also clarification to Shri N Rama Sabbaiah
For greater details, attached is the notification