October 31, 2019: The Delhi High Court in the case of Union of India v. Association of the Employees of Indian Institute of Mass Communication ruled that the employees of Autonomous Bodies (“AB”) cannot be treated at par with the employees of Central Government in respect to pension schemes. The present petition was filed against the order dated January 2, 2014 of the Central Administrative Tribunal (“CAT”), Principal Bench, New Delhi.
Facts: The facts of the case were that the employees of Indian Institute of Mass Communication (Respondent No. 1) had made demands to shift to General Provident Fund -cum-Pension Schemes (“GPF”) whereas they were recruited with the condition of entitlement of benefits of Contributory Provident Fund (“CPF”) Schemes. With the implementation of recommendations of the 4th Pay Commission, an option was given to Central Government employees to shift from CPF to GPF-cum-Pension Scheme. The employees of Respondent No. 1 claimed this option as matter of right. The Department of Expenditure, Ministry of Finance did not agree to such proposals due to cost constraints. The matter was taken to CAT which disposed it in favour of the Respondents directing the Petitioners to implement the Pension Scheme.
This order was thus challenged on the grounds that it was illegal; it was passed without taking into consideration the Transaction of Business Rules (TOBR) as Ministry of Finance had granted no sanction to the Respondent No.1 to start Pension Scheme similar to that of Central Government. The contention of the Petitioner was that even though the ABs are created and established by the Government to discharge activities related to governmental functions, they have the autonomy to do so in accordance with their own set of Memorandum of Associations/Rules, etc. and the employees of ABs are not Central Government servants. These ABs have different pension schemes for their employees. Thus the employees of these ABs cannot claim parity in respect of retirement benefits with Central Government employees.
Judgement: The Court held that without the concurrence of the Ministry of Finance, the Pension Scheme, which had financial implications, cannot be introduced either in any AB and thus the writ petition was allowed.
October 31st, 2019