EPF Pension : EPFO Circular To Fix Higher Pension On Pro-Rata Basis Questioned In Kerala High Court

A retired employee of the Kerala Industrial Infrastructure Development Corporation has moved the High Court challenging a circular of the Employees Provident Fund Organization, implementing pro-rata (in proportion) system for higher pensions for those retiring from September 1, 2014.

Petitioner seeks that his pension be calculated by taking an average of 60 months salary as provided under the Pension Scheme, 1995. Pro-rata system leads to a significant reduction in the pension sum, he contended. 

If the pension is calculated taking an average of 60 months preceding the exit from the Pension Scheme, the petitioner would be entitled to a pension of Rs.52,361/-. However, if the pension is calculated based on the Circular issued by the EPFO on February 14, the pension would drop down to Rs.31,161/-. The petitioner argued that the circular is against the Supreme Court's judgment in the EPF Pension case (EPF Organisation v. Sunil Kumar 2022 LiveLaw (SC) 912)

Petitioner's counsel had also submitted a letter issued by EPFO asking the petitioner to remit a sum of Rs. 28,29,782/- before the 30th of April, 2024.

Standing counsel for EPFO argued that it is merely an internal circular and as such cannot be stayed.

The High Court had earlier directed the respondents to file a statement detailing the pension amount that would be received by the petitioner if he were to remit the amount as required by the EPFO.

On March 26, single bench of Justice Devan Ramachandran noted that certain portions of the pension are admitted by the government and thus directed them to pay those sums, subject to further orders from the Court. “Needless to say, if any further amounts are found due by this court, the same shall be also be paid by the respondents to the petitioner in due course,” it ordered.

Matter has been posted for April 2, 2024.

The plea has been moved by Advocates PN Mohanan, CP Sabari, Amrutha Suresh and Gilroy Rozario

Case Title: VR Balu v. Union of India and ors.

Case Number: WP(C) No. 8177 of 2024

Click here to read/download the order

Interim order dated February 29, 2024

Related - EPF Pension : Kerala High Court Restrains EPFO From Reducing Higher Pension Received By Petitioners

EPF Pension | Kerala High Court Seeks Response Of PF Authorities On Plea Against Limiting Higher Pension For Not Exercising 'Fresh Joint Option

EPF Pension | Kerala High Court Directs EPFO To Allow Opting Of Higher Pension Without Insisting On Submission Of Option Form Under Para 26(6) Of The Scheme