Punjab to re-examine 15-yr period of pension restoration after commutation

The Punjab and Haryana high court has dismissed 800 odd petitions from Punjab pensioners after the state government said that it was ready to re-examine the 15-year period of pension restoration in the case of those who opted for commutation.

Commutation of pension refers to a lump sum amount of payment availed by an employee at the time of retirement in lieu of a portion of pension surrendered voluntarily.

The pleas were from the state pensioners, who had sought restoration of commuted pension after a period of about 12 years, arguing that the existing 15-year period was arbitrary and unjustified.

An employee who opts for the scheme can get 40% of the pension amount at the time of retirement. The amount of commuted portion of pension stands recovered in approximately 11.5 years in about 135 instalments along with the interest, whereas the state is recovering this amount for a period of 15 years in 180 instalments, the petitioners had submitted.

“The state is recovering the amount at an exorbitant rate over and above the amount of commuted pension which is impermissible as there can be no undue enrichment on the part of the state”,” they had argued.

As per proceedings, the 5th Central pay commission in January 1997 recommended that employees of the Central government may be permitted to commute up to 40% of their pension and the commuted period was kept at 15 years. The Punjab government in May 1998 adopted the same in toto. It has remained unchanged since then.

The high court bench of justice Lisa Gill and justice Sukhvinder Kaur observed that having availed of a benefit which is clearly voluntary in nature, it is not open to the petitioners to raise the grievances, at this stage, to seek a variation in the terms and conditions accepted by them with “open eyes.”

“The counsel for petitioners were unable to point out any material on record to indicate that the formula adopted is per se and ex-facie irrational or arbitrary which calls for interference by this court,” it recorded dismissing the pleas.

The court said that stay orders, if any petition, passed would stand vacated and the government can effect recoveries from pensioners. Such recovery, however, be made in a staggered manner to obviate any hardship to the pensioners, it directed.