Case: Pensioners' Assn.,Ex-Assam Oil.Offic&amp;Ors Vs. Union Of India

no bearing on the merits of the present case since in that case the controversy was raised by those who were working on the appointed day as employees of the Assam Oil Company Limited and were taken over as the employees of the Indian Oil Corporation but had retired thereafter before December, 1994. That is to say the benefit of the revised formula of computation of the pension under the 1995 scheme was available to only those who had retired after December, 1994. It is submitted that no question relating to retirees prior to 14.10.1981 was involved in that decision. Therefore, deletion of the part of the scheme providing for those who were "retired from December, 1994 onwards" will cover only those employees who may have retired after the appointed day and before December, 1994. In the first place it may be indicated that the argument as advanced makes no difference on the merits as the embargo placed on availability of pensionary benefits according to the revised formula on the basis of the date of retirement has been removed. That is to say broadly the benefit of the revised formula would be available to those who had retired even prior to December, 1994. In absence of any such provision providing for application of the revised formula to those who "retired from December, 1994 onwards", the 1995 formula would be applicable to all members of the Scheme of 1983 irrespective of date of their retirement. It is the case of the respondents also that the revised formula of 1995 would be applicable to those who are members of the Scheme of 1983. We have already found that pensioners under the 1973 scheme would also become members of the 1983 scheme as per the provisions of the scheme of 1983 itself. We also notice that the submissions have been advanced on behalf of the respondents against the facts averred and narration made in the pension scheme of 1983. The entitlement of the petitioners for pensionary benefits according to the revised formula is in consonance with the facts and the provisions of Section 6 (1) and Section 12 (3) and (4) of the Act and the Pension Scheme of 1983. Any other interpretation would be against the facts and the meaning and the spirit of these provisions. 9. Respondents have placed reliance upon a decision reported in (1909) 8 SCC p. 30, V.Kasturi Vs. M.D. State Bank of India & Anr., to contend that an amendment enhancing the pension or providing for a new formula of computation of pension would not be applicable to the earlier retirees unless such provision is expressly made applicable to them. We, however, find that the above noted decision would be of no help to the respondents case since what has been held is that if a person is already getting pensionary benefits and an amendment is effected for upward increase in pension, such a retiree would be entitled for the enhanced benefit and the same could not be denied for the reason that he had already retired before the change came into effect. Certainly those who were not entitled for pension at all, could not be included in the fold of the pensioners to whom enhancement of pensionary benefit would be applicable. That is to say such benefit would be available to existing pensioners and not to those who were not entitled to pension at all nor they were getting the same. Besides the above, we have already found that the petitioners have been members of the scheme of pension of 1973 framed by their erstwhile employer Assam Oil Company Ltd. under which they had been getting their pension according to the rules framed to administer the pension fund. That is to say they were the members of the existing pension fund at the time of taking over of the undertaking by the central government. Pension fund also stood transferred and vested in the central government/successor company as would be evident from the averments made in the scheme framed in the year 1983. We have already discussed in detail how the pensioners of the specified company also became members of the scheme of 1983 which was made effective from 14.10.1981. There is no denial of the fact that the petitioners were still being paid their pensionary benefits. In such facts and circumstances the petitioners would be entitled for the benefit of the new formula introduced in 1995, rather that benefit could not be denied to the petitioners in the igh of the decision in the case of Kasturi (supra). Even according to the respondents the benefit of the new formula was available to those who were members of the 1983 scheme. Reliance placed on another decision of this Court reported in (1998) 6 SCC p. 328, Hariram Gupta Vs. State of U.P. would also not be applicable to the facts of the case in hand. It is not the case of the respondents that the petitioners are to be deprived of the benefit of the new formula in view of any cut-off date excluding them or due to financial constraints of the like reasons. On the other hand, the case of the respondents is that the petitioners had no concern whatsoever with the successor company since they had retired prior to the appointed date; there was no pension fund for them nor the successor company had to do anything with their pensionary benefits since it was a case where annuities were purchased in their name from the LIC, therefore, it was a matter between the petitioners and the LIC. In view of the provisions of law which have been discussed in the earlier part of the judgment as well as factual position, the stand taken by the respondents is not sustainable. The petitioners were beneficiaries of the 1973 pension scheme and had also become the members of the 1983 scheme which made them entitled for the benefit of formula for revision of pension made effective from 1995.

Decision (1 = appeal accepted, 0 = rejected): 1

Explanation:
1[ds]The respondents submit that the Indian Oil Corporation (AOD) Staff Pension Funds Scheme, 1983 was not meant for the retires who had retired earlier as employees of the Assam Oil Company Ltd., viz. those who had never become the employees of the Indian Oil Corporation. Therefore, they were not the beneficiaries of the Scheme of 1963. The Annuity based benefit as in vogue prior to the taking over of the company, under the scheme of 1973, it continues and the petitioners are entitled to pensionary banefits based on annuity purchased on their behalf. It is further sought to be impressed that it was a kind of an arrangement between those employees in whose names annuities were purchased and the LIC. There was no pensionary fund or any other monies for the benefit of the retired employees covered under the Scheme of 1973. Thus the employees who had already retired before the appointed day could have no link with the successor company which had taken over after the retirement of the petitioners. In so far the employees who were in service of the Assam Oil Company Ltd. on the appointed day of taking over, a new Scheme was promulgated for them in the year 1983 creating a trust for the pensionary benefit of such employees. The retirees ofday are neither covered not have any concern with the scheme of 1983 and that being the position there is no occasion for them to take any benefit of the revision of pension inreading of the above provision makes it clear that the Central Government or the successor company cannot claim to have totally snapped all its connections with the retired employees of the oil companies on the company being taken over, as it would be clear from the later part of Section 6(1) that the liabilities of the Central Government or the successor company would include all borrowings, liability of payment of taxes if any, and for the payment of any pension and other pensionary benefits to the persons employed in relation to its undertakings in India namely, the specified company i.e. the Assam Oil Company Limited. Thus, the liability of pension or pensionary benefits of the employees of the specified companies (Assam Oil Company Limited) cannot be said off in the manner tried to be done and canvassed by the respondents before us. The liabilities in relation to pension and pensionary benefits of the employees of the specified companies (Assam Oil Company Limited) are also very much taken over by the Central Government, or the successor company. We have already quoted Section 12 of the Act. To lay emphasis on(3) of Section 12 we would like to highlight that the Central Government or successor company after the appointed day shall constitute one or more trusts respect of the monies and other assets which are transferred or vested in government of the successor company having objects similar to the existing trust without prejudice to the existing rights of the beneficiaries of the trust.It is, therefore, clear from the scheme of 1973 that it has been framed by the then employers for the pensionary benefits of its employees. All details about entitlement,mode and manner of payment and different claims in different circumstances are all provided for in the rules framed under the Scheme. Pension could be reduced or stopped in terms of the scheme. In Certain eventualities the amount could even be forfeited to the fund. The manner in which the pension is to be calculated is also detailed in the rules. Therefore, to say that the pensionary benefit was an arrangement between the employee and the LIC, may not be correct. The erstwhile employer, namely the Assam Oil Company Ltd., did not act merely as a mediator in facilitating purchase of annuity for the employees. The scheme provided the manner in which the pensionary fund was to be raised and the manner in which it was to be disbursed and paid as pension. It provided all other details by which the objective to provide pensionary benefits to its employees was sought to be achieved. By no means it can be said that it was a matter exclusively between the employee and the LIC and nothing beyondis thus clear from what has been quoted above that the Pension Scheme 1983, has been framed and promulgated in pursuance of(3) of Section 12 of the Act and it is in respect of employees who were working and taken over as employees of the successor company with effect from the appointed day as well as those who were in receipt of pension or other pensionary benefits. It further mentions that the existing fund stood transferred and vested in Corporation with effect from 14th October, 1981 free from any trust constituted by the Assam Oil Company Limited in respect thereof. The fund as existed on the appointed day stood transferred and vested in the Central Government/successor company. We have already seen that the fund which was existing on that date, as constituted under the Scheme of 1973 was for the pensionary benefits of employees in service or retired before 14.10.1981. As per requirement of law under Section 12(3) of the Act, the objects of the 1983 Scheme are similar to the objects of the existing fund namely, the fund o 1973. The pension fund 1983 has been made effective from 14.10.1981. The fund then existing as constituted by the Assam Oil Company Limited stood transferred and vested in the successor company on the own showing of the respondents. It is totally incorrect to say that there existed no fund for pensionary benefits of the petitioners viz. retired employees of the Assam Oil Company Limited or that it did not vest in the successor company. The Trust Deed of 1983 does not talk of any partial transfer and vesting of the existing fund. further examination of the scheme shows that the working of the staff pension Fund Rules of Indian Oil Corporation Limited (AOD) is similar to the scheme of 1973 and the rules framed thereunder. The term transferred employee has been defined under rule 2(i) providing that the word transferred employee means an employee of the Assam Oil Company Limited who was on or before the appointed day a member of the existing fund and in respect of whom the money is lying to the credit in existing fund stood transferred or vested in the Corporation under Section 12(1) of the Act. The petitioners were undoubtedly the members of the existing fund namely, the fund created under the Scheme of 1973 for pensionary benefits of the employees of the company and which fund was existing on the appointed day. Therefore, under the definition of transferred employee the pensioners receiving pensionary benefit from the existing fund as on 14.10.1981 shall also be treated as transferred employees for the purposes of the Scheme of 1983 and further in the definition of the term member an employee of the Corporation includes a transferred employee. A perusal of the further details of the working of the Scheme of 1983 also shows that it functions in the same manner as did the 1973 Scheme i.e. by purchasing annuity from the LIC. Almost all the conditions are similar to that of the earlier scheme. The petitioners who have been the pensioner members of the 1973 Scheme on the appointed day cannot be deprived of the pensionary benefits of the corporation being very much the members of the scheme of 1983. That being the position the benefit of revised pension scheme of 1995 could not be denied tois not the case of the respondents that the petitioners are to be deprived of the benefit of the new formula in view of anydate excluding them or due to financial constraints of the like reasons. On the other hand, the case of the respondents is that the petitioners had no concern whatsoever with the successor company since they had retired prior to the appointed date; there was no pension fund for them nor the successor company had to do anything with their pensionary benefits since it was a case where annuities were purchased in their name from the LIC, therefore, it was a matter between the petitioners and the LIC. In view of the provisions of law which have been discussed in the earlier part of the judgment as well as factual position, the stand taken by the respondents is not sustainable. The petitioners were beneficiaries of the 1973 pension scheme and had also become the members of the 1983 scheme which made them entitled for the benefit of formula for revision of pension made effective from 1995.