P.SASIKUMAR Vs. UNION OF INDIA (UOI)

JUDGEMENT

(1.) The petitioners in these Writ Petitions are all employees of various establishments covered by the provisions of the Employees' Provident Funds and Miscellaneous Provisions Act , 1952 (hereinafter referred to as 'the EPF Act ' for short).

(2.) The main question that arises for consideration here is whether the provisions of the Employees Pension Scheme, 1995 and the Employees' Pension (Amendment) Scheme, 2014 are valid and sustainable or not?

(3.) The bare facts necessary to be taken note of before the questions of law are addressed, are the following. As already noticed above, the petitioners are all employees of various establishments covered by the provisions of the EPF Act . The Act provides for the formulation of a Scheme for the creation of a Provident Fund Account in the name of each employee of a covered establishment. The fund was to be constituted by depositing an employee's share at the rate of 10% or 12% of the basic wages including Dearness Allowance. The employer has also to contribute an identical amount, which together would constitute the Provident Fund. Initially, the Act did not provide for the creation of a Pension Fund or for the payment of pension. Later on, Section 6A was inserted, authorizing the creation of a scheme for the purpose of providing pension to the employees. Accordingly, the Employees Pension Scheme, 1995 was framed. As per the said scheme the maximum pensionable salary was Rupees six thousand five hundred per month and contributions to the pension fund were to be made only on that amount. The corpus of the pension fund was to be constituted by transferring 8.33% out of the employer's contribution under Section 6 of the Act. As per the scheme, the maximum pensionable salary was initially fixed as Rs. 5000/- and was later on enhanced to Rs.6500/-. Accordingly, contribution was payable only in respect of the said amount. Subsequently, a proviso was added to paragraph 11(3) of the Pension Scheme with effect from 16.03.1996 granting an option to the employer and the employee to contribute amounts towards the pension fund at the rate of 8.33% of the actual salary drawn by the employee, where the salary exceeded Rupees Six thousand five hundred per month. Thereupon, most of the employees who were drawing salaries in excess of the prescribed limit opted to pay contributions on the basis of the actual salaries drawn by them. However, requests made by some of the employees were rejected on the ground that the option was not exercised on or before 01.12.2004. The said action was under challenge before this Court in W.P.(C) Nos.6643 and 9929 of 2007.