No.4/79/2006-P&PW (D)
Government of
Ministry of Personnel, Public
Grievances & Pensions
(Department of Pension &
Pensioners’ Welfare)
3rd
Floor, Lok Nayak Bhawan
New Delhi-110 003, Dated
OFFICE MEMORANDUM
Subject:- Restoration
of 1/3rd commuted portion of pension in respect of Government
servants who had drawn lumpsum payment on absorption in public sector
undertakings/autonomous bodies – implementation of Andhra Pradesh High Court
judgement dated 24.12.03 in Writ Petition No. 8532 of 2003 followed by the
Supreme Court Judgement dated 29.11.06 in Civil
Appeal No. 5269 of 2006 arising out of SLP Nos. 21647-648 of 2005 and
the Supreme Court Judgment dated 24.7.07 in Review Petition No. 643 of 07.
The undersigned
is directed to say that the Government servants who had drawn lump sum payment
in respect of pro-rata pension (1/3rd as well as 2/3rd)
on absorption in a PSU/Autonomous Body and have become entitled to restoration
of 1/3rd commuted portion of pension as per the provisions of this
Department’s O.M. No. 34/2/86-P&PW dated 5th March 87 after 15
years from the date of commutation or 1.4.85 whichever is later, are regulated
vide this Department O.M. No. 4/59/97-P&PW(D) dated 14th July
1998 as clarified from time to time.
2. Andhra
Pradesh High Court in its judgement
dated 24.12.03 in Writ Petition No. 8532 of 2003 followed by the Supreme Court
Judgement dated 29.11.06 in Civil Appeal
No. 5269 of 2006 arising out of SLP Nos. 21647-648 of 2005 and the Supreme
Court Judgment dated 24.7.07 in Review Petition No. 643 of 07 has decided as
under:-
“………..the public sector undertaking absorbees are also entitled for
dearness relief etc. but not on entire pension commuted as on the date of
retirement. Moreover they received
lumpsum amount by way of terminal benefits on surrendering on 2/3rd
pension. In that way, they have already
parted with 2/3rd pension, it cannot be said to revive after 15
years. But, in case of Central
government pensioners 2/3rd pension was continued to be received by
them. Therefore, what is restored is 1/3rd
pension which means full pension. But
the same principle cannot be applied to say that the absorbee will get full
pension after15 years in case those who had commuted 1/3rd pension and
received terminal benefits for 2/3rd pension had he not surrendered,
he continue to receive 2/3rd pension, the same principle apply as in
case of Central Government employee. But
having received the cash compensation in respect of the surrender value of 2/3rd,
he cannot be allowed to say that he is also a pensioner as far as 2/3rd
pension is concerned. Such absorbee
stand on a different footing and they fall in a different class by themselves
on this issue. Under those
circumstances, the inescapable conclusion is that 1/3rd pension has
to be arrived at only on the basis of the basic pension divided by three after
completion of 15 years which becomes drawable as on the date of respective
dates and not to be arrived by deducting Rs. 403/- from the pension. Therefore, the petitioner will be entitled to
as follows:-
Restorable Pension:
From 28.06.87 to 31.12.1995
Basic Pension (604/1/3rd )
Rs. 201/-
Rs. 538/-
Dearness Relief
Rs. 125/- Additional Benefits:
Total
Rs. 864/-
From 01.01.96 onwards (5th Pay Commission)
1/3rd of Basic Pension(1,350/ 1/3rd ) Rs. 450/-
Rs. 185/- Interim Relief
Rs.
1,998/- Dearness Relief
Rs. 540/- Fitment
Total Rs. 3,173/-
In this case the employee had commuted minimum permissible pension i.e.
1/3rd. But, even if lesser
portion is commuted, the pro-rata commuted portion has to be deducted from the
basic pension to arrive at restorable pension, but however, he will get
dearness relief, interim relief etc. on full basic pension”
3. The
modalities of implementation of above judgement have been under active
consideration of the Government. The
President is pleased to decide that in partial modification of this
Department’s O.M. No. 4/59/97-P&PW (D) dated 14th July
1998, the Government servants who had
drawn lump sum payment in respect of pro-rata pension (1/3rd as well
as 2/3rd) on absorption in a PSU/Autonomous Body and have become
entitled to restoration of 1/3rd commuted portion of pension as per
the provisions of this Department’s O.M. No. 34/2/86-P&PW dated 5th
March 87 after 15 years from the date of commutation or 1.4.85 whichever is
later, shall be entitled to the benefit
of revision of restored amount of 1/3rd commuted portion of pension
as explained hereunder:-
( I ) As
on 01.01.1986
(a)
The
full pension of the absorbees shall be notionally revised w.e.f. 1.1986 based
on full pension on absorption in accordance with the instructions for revision
of pension, issued for implementing the 4th Pay Commission Recommendations.
(b)
The
restorable 1/3rd pension shall be the sum of the following:-
I.
1/3rd
of full pension as on 31.12.1985.
II.
Dearness
Relief on full pension as on 31.12.1985.
III.
Additional
benefits on full pension as per this
Department
( II ) As
on 01.01.1996
(a)
The
full pension of the absorbees shall be notionally revised w.e.f. 1.1.1996 based
on full pension as on 31.12.95 in accordance with the instructions for revision
of pension, issued for implementing the 5th Pay Commission Recommendations
(b)
The
restorable 1/3rd pension shall be the sum of the following:-
I.
1/3rd
of full pension as on 31.12.1995.
II.
Dearness
Relief on full pension as on 31.12.1995.
III.
IR-I
and IR-II
IV.
Fitment
@ 40% of the full pension as on 31.12.1995*
(*
in terms of this Deptt.
4. Payment of
DR shall be on full pension and is subject to the condition that the absorbed
employee was not re-employed/employed under the Central Government or State
Government or a Corporation/Company/Body/Bank under them in
5. The benefit
of revision of restored amount of 1/3rd commuted portion of pension
shall be admissible from the date the commuted portion of pension is restored.
6. This issues
with the concurrence of Ministry of Law vide their UO No. 11088/07-A dated 17.8.2007 and Ministry of
Finance (Department of Expenditure) vide their UO No. C-47/E.V./2007 dated
27.8.2007.
7. Hindi
version will follow.
(Amitabh
Dwivedi)
Under Secretary to the government of
To
All Ministries/Departments of the Government
of
(As per mailing list)