A former Kerala Industrial Infrastructure Development Corporation employee has petitioned the High Court to contest an Employees Provident Fund Organization circular introducing a pro-rata pension system for retirees from September 1, 2014.

The petitioner argues for the calculation of his pension based on the average of 60 months' salary as stipulated in the Pension Scheme, 1995, rather than the pro-rata system. He contends that the pro-rata method significantly diminishes the pension amount.

If the pension is calculated using an average of 60 months preceding the exit from the Pension Scheme, the petitioner would be entitled to Rs.52,361/-. However, under the Circular issued by the EPFO on February 14, the pension would decrease to Rs. 31,161/-. The petitioner argues that this circular contradicts the Supreme Court's ruling in the EPF Pension case (EPF Organisation v. Sunil Kumar 2022 LiveLaw (SC) 912).

The petitioner's counsel presented a letter from the EPFO requesting a payment of Rs. 28,29,782 by April 30, 2024. EPFO's standing counsel argued that it's an internal circular and not subject to a stay. Previously, the High Court instructed the respondents to provide a statement outlining the pension amount the petitioner would receive upon remitting the required sum to the EPFO.

On March 26, the 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.

A 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