Principal Bench of CAT’s Judgement in favour of Pre-2006 Pensioners

The Principal Bench of CAT New Delhi, has in a remarkable judgement has quashed the clarifications issued in the Office Memorandum dated 3.10.2008 and 14.10.2008 (No: 38/37/08-P&PW(A) .Pt.1) regarding the fixation of revised pension in respect of pre-2006 pensioners. As we all know, pre-2006 Pensioners have been not treated at par with Post 2006 pensioners as far as revised pension fixation is concerned.

The resolution dated 29.08.2008 by which Government accepted the recommendations of Sixth Pay Commission report as well as the clause in para 4.2 of the Office Memorandum dated 01.09.2008, define the minimum revised pension as " revised pension, in no case, shall be lower than fifty percent of the minimum of the pay in the pay band plus the grade pay corresponding to the pre-revised pay scale from which the pensioner had retired".

However, it could be seen that in the O.M. No: 38/37/08-P&PW(A) .Pt.1 dated 14.10.2008, Department of Pension and Pension welfare has formulated a fitment table by misinterpreting the Government decision on fixation of pension for pre-2006, Pre-1996 and Pre-1986 Pensioners.

It is apparent that pensioners retired before 2006, are in the loosing side as their minimum pay is pegged at only 50% of minimum of pay band (and 50% of grade pay) corresponding to pre-revised pay scale in which the employee had retired. On plain reading it may look what was done by the Government is correct. But it is gross misinterpretation of 6CPC recommendations and acceptance of 6cpc recommendations in the resolution by way of formulating a wrong fitment table that has caused a huge financial loss to pre-2006 pensioners.

The OM dated 14.10.2008, has advocated that the minimum pension of employees fall under pre-revised scales from S-9 to S-15 will not be less than 50% of Rs.9300 plus 50% of the grade pay corresponding to the pre-revised pay scale. So an employee who retired prior to 2006 when he was receiving a basic pay of Rs.13225 in the pre-revised pay scale of S-15 (Rs.8000-275-13500) will receive a minimum pension of only Rs.4650 + Rs. 2700 (50% of Rs.9300 and Rs.5400), if the revised pension is less than the minimum pension.

Principal Bench of Central Administrative Tribunal (CAT) has come to the rescue of pre-2006 pensioners in this aspect by pronouncing judgement to the effect that O.M dated 14.10.2008 is quashed and revised pension fixation has to be done to the Pre-2006 pensioners on the basis of as per the resolution dated 29.08.2008.

It is also indicated by CAT that in the garb of clarification, respondents misinterpreted minimum of pay in the pay band as minimum of the pay band and that this interpretation is apparently erroneous.

The order portion is as follows:

"PARA 30: In view of what has been stated above, we are of the view that the clarificatiory OM dated 3.10.2008 and further OM dated 14.10.2008 (which is also based upon clarificatiory OM dated 3.10.2008) and OM dated 11.02.2009, whereby representation was rejected by common order, are required to be quashed and set aside, which we accordingly do. Respondents are directed to re-fix the pension of all pre-2006 retirees w.e.f. 1.1.2006, based on the resolution dated 29.08.2008 and in the light of our observations made above. Let the respondents re-fix the pension and pay the arrears thereof within a period of 3 months from the date of receipt of a copy of this order. OAs are allowed in the aforesaid terms, with no order as to interest and costs"