Delhi High Court

Ntpc Retired Employees Welfare ... vs Ntpc Ltd. And Ors on 21 May, 2025

Author:
Jyoti Singh

Bench:
Jyoti Singh

$~
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Date of Decision: 21st May, 2025
+ W.P.(C) 6357/2019 & C.M. APPL. 13912/2021
NTPC RETIRED EMPLOYEES WELFARE ASSOCIATION AND
ORS. ..... Petitioners
versus
NTPC LTD. AND ORS. ..... Respondents

+ W.P.(C) 108/2011 & C.M. APPL.14413/2017
ANIL KUMAR ..... Petitioner
versus
NATIONAL THERMAL POWER CORPORATION & ORS
..... Respondents

+ W.P.(C) 109/2011 & C.M. APPL. 14417/2017
RAJKUMAR MISHRA ..... Petitioner
versus
NTPC & ORS ..... Respondents

+ W.P.(C) 1259/2013
VEENA CHARAN PAHARI ..... Petitioner
versus
NTPC LTD AND ORS ..... Respondents

+ W.P.(C) 2010/2016
ADITYA N. SHUKLA ..... Petitioner
versus
NATIONAL THERMAL POWER CORPORATION
LTD. & ORS ..... Respondents

+ W.P.(C) 2289/2016
JALESHWAR NATH SINHA ..... Petitioner
versus
NATIONAL THERMAL POWER CORPORATION LTD AND
ANR ..... Respondents

Signature Not Verified
Digitally Signed
By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 1 of 68
Signing Date:24.05.2025
16:15:34
+ W.P.(C) 2327/2016
NARENDRA KUMAR AGGARWAL ..... Petitioner
versus
NATIONAL THERMAL POWER CORPORATION LTD & ANR
..... Respondents

+ W.P.(C) 4839/2016
DEEPAK KUMAR GOEL ..... Petitioner
versus
NATIONAL THERMAL POWER CORPORATION LTD AND
ANR ..... Respondents

+ W.P.(C) 6125/2016
HARISH CHANDRA GOEL ..... Petitioner
versus
NATIONAL THERMAL POWER CORPORATION LTD. & ANR
..... Respondents

+ W.P.(C) 6595/2016
RAJVEER SHARMA ..... Petitioner
versus
NATIONAL THERMAL POWER CORPORATION LTD. & ANR
..... Respondents

+ W.P.(C) 671/2016 & C.M. APPL. 2775/2016
MAHESH CHANDER GULATI ..... Petitioner
versus
NTPC LTD. SELF CONTRIBUTORY SUPERANNUATION
BENEFIT (PENSION) TRUST & ANR ..... Respondents

+ W.P.(C) 8101/2016
DHARAM PAL GUPTA ..... Petitioner
versus
NATIONAL THERMAL POWER CORPORATION LTD AND ORS
..... Respondents

Signature Not Verified
Digitally Signed
By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 2 of 68
Signing Date:24.05.2025
16:15:34
+ W.P.(C) 6179/2016
BALDEV RAJ MADAN ..... Petitioner
versus
NATIONAL THERMAL POWER CORPORATION LTD AND
ANR ..... Respondents

+ W.P.(C) 6930/2016
SHEO NARAYNA RAM ..... Petitioner
versus
NATIONAL THERMAL POWER CORPORATION LTD. & ANR.
..... Respondents
+ W.P.(C) 6931/2016
MAHENDRA PRASAD ..... Petitioner
versus
NATIONAL THERMAL POWER CORPORATION LTD. & ANR
..... Respondents

+ W.P.(C) 7076/2016
SHREE NARAIN SINGH ..... Petitioner
versus
NATIONAL THERMAL POWER CORPORATION LTD. & ORS.
..... Respondents

+ W.P.(C) 8094/2016
K K VARSHNEY ..... Petitioner
versus
NATIONAL THERMAL POWER CORPORATION LTD AND ORS
..... Respondents
+ W.P.(C) 10022/2016
MK SAMUEL KUTTY ..... Petitioner
versus
NATIONAL THERMAL POWER CORPORATION LTD AND ORS
..... Respondents
+ W.P.(C) 8105/2016
RAKESH KUMAR GARG ..... Petitioner
versus
NATIONAL THERMAL POWER CORPORATION LTD AND ORS
..... Respondents

Signature Not Verified
Digitally Signed
By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 3 of 68
Signing Date:24.05.2025
16:15:34
+ W.P.(C) 8107/2016
IQBAL SINGH PARSWAL ..... Petitioner
versus
NATIONAL THERMAL POWER CORPORATION LTD AND ORS
..... Respondents

+ W.P.(C) 8112/2016
KAMAL SHER SINGH AJJAN ..... Petitioner
versus
NATIONAL THERMAL POWER CORPORATION LTD AND ORS
..... Respondents

+ W.P.(C) 8116/2016
DEV PRAKASH SINGH CHAUHAN ..... Petitioner
versus
NATIONAL THERMAL POWER CORPORATION LTD AND ORS
..... Respondents

+ W.P.(C) 8117/2016
SHIVA PUJAN LAL ..... Petitioner
versus
NATIONAL THERMAL POWER CORPORATION LTD AND ORS
..... Respondents

+ W.P.(C) 8119/2016
MAN MOHAN SINGH ARORA ..... Petitioner
versus
NATIONAL THERMAL POWER CORPORATION LTD AND ORS
..... Respondents

+ W.P.(C) 8146/2016
SATYENDRA NATH PANDEY ..... Petitioner
versus
NATIONAL THERMAL POWER CORPORATION LTD AND ORS
..... Respondents

+ W.P.(C) 9513/2016
SAROJ KUMAR DE ..... Petitioner

Signature Not Verified
Digitally Signed
By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 4 of 68
Signing Date:24.05.2025
16:15:34
versus
NATIONAL THERMAL POWER CORPORATION LTD AND ORS
..... Respondents

+ W.P.(C) 9536/2016
KULDIP KUMAR DADA ..... Petitioner
versus
NATIONAL THERMAL POWER CORPORATION LTD AND ORS
..... Respondents

+ W.P.(C) 9538/2016
SUJIT KUMAR DATTA ..... Petitioner
versus
NATIONAL THERMAL POWER CORPORATION LTD AND ORS
..... Respondents

+ W.P.(C) 9539/2016
RAM NARAYAN CHOUDHARY ..... Petitioner
versus
NATIONAL THERMAL POWER CORPORATION LTD AND ORS
..... Respondents

+ W.P.(C) 9848/2016
MARKANDEY ..... Petitioner
versus
NATIONAL THERMAL POWER CORPORATION LTD AND ORS
..... Respondents

+ W.P.(C) 9963/2016
PREM KRISHNA ..... Petitioner
versus
NATIONAL THERMAL POWER CORPORATION LTD. & ORS.
..... Respondents
+ W.P.(C) 9974/2016
ASHOK KUMAR GUPTA ..... Petitioner
versus
NATIONAL THERMAL POWER CORPORATION LTD. & ORS.
..... Respondents

Signature Not Verified
Digitally Signed
By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 5 of 68
Signing Date:24.05.2025
16:15:34
+ W.P.(C) 10113/2016
RAMPAL ..... Petitioner
versus
NATIONAL THERMAL POWER CORPORATION LTD. & ORS.
..... Respondents

+ W.P.(C) 1093/2017
HARI DUTT SHARMA ..... Petitioner
versus
NATIONAL THERMAL POWER CORPORATION LTD AND ORS
..... Respondents

+ W.P.(C) 1414/2017
VINOD PURI ..... Petitioner
versus
NATIONAL THERMAL POWER CORPORATION LTD. & ANR
..... Respondents

+ W.P.(C) 1848/2017
S G SHARMA ..... Petitioner
versus
NATIONAL THERMAL POWER CORPORATION LTD AND
ANR ..... Respondents

+ W.P.(C) 2092/2016
SPS CHAUHAN .....Petitioner
versus
NATIONAL THERMAL POWER CORPORATION LTD. & ORS
.....Respondents
Counsel for Petitioners:
Ms. S. Janani, Senior Advocate with Ms. Sharika Rai, Advocate.
Mr. P.C. Shukla, Advocate for Petitioner in W.P.(C) 671/2016.
Ms. Unni Maya S., Advocate for Petitioner in W.P.(C) 1259/2013.
Counsel for Respondents:
Mr. Sanjay Rawat, Advocate for Respondent No.2 in W.P.(C)
1259/2013, W.P.(C) 8117/2016, W.P.(C) 8119/2016 and W.P.(C)
1093/2017.

Signature Not Verified
Digitally Signed
By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 6 of 68
Signing Date:24.05.2025
16:15:34
Mr. Aman Lekhi, Senior Advocate with Mr. Vikram Singh Baid and
Mr. Ritwiz Rishabh, Advocates for R2 in W.P.(C) 2010/2016,
W.P.(C) 6357/2019 and W.P.(C) 1093/2017.
Mr. Vikram Singh Baid, Advocate in W.P.(C) 2092/2016.
Mr. Adarsh Tripathi and Mr. Ajitesh Garg, Advocates for Respondent
No.1 NTPC in W.P.(C) 2010/2016, W.P.(C) 6125/2016, W.P.(C)
6357/2019, W.P.(C) 8101/2016, W.P.(C) 6930/2016, W.P.(C),
8094/2016, W.P.(C) 8112/2016, W.P.(C) 8116/2016, W.P.(C)
8119/2016, 9513/2016, 9536/2016, W.P.(C) 1093/2017, W.P.(C)
1414/2017 and W.P.(C) 1848/2017.
Mr. J.S. Lamba, Advocate for Respondent No.1 NTPC in W.P.(C)
4839/2016, W.P.(C) 7076/2016, W.P.(C) 8105/2016, W.P.(C)
8107/2016, W.P.(C) 8117/2016 and W.P.(C) 8146/2016.
Mr. Puneet Taneja, Mr. Anil Kumar and Mr. Manmohan Singh
Narula, Advocates for Respondent / NTPC in W.P.(C) 108/2011,
W.P.(C) 109/2011, W.P.(C) 1259/2013, W.P.(C) 6595/2016, W.P.(C)
671/2016 and 6931/2016.
Mr. Debesh Panda, Senior Standing Counsel with Ms. Zehra Khan
and Mr. Vikramaditya Singh, Mr. Kanishk Aggrawal, Ms.
Anauntta Shankar, Advocates for Respondent No.3 in W.P.(C)
9513/2016.
Mr. Kaustabh Anshuraj, Advocate for R3 in W.P.(C) 109/2011.
Mr. Roshan Lal Goel, Advocate for applicant in W.P.(C) 1259/2013
and W.P.(C) 2010/2016.
Mr. Ranjan Sardana, Advocate for Respondent No. 2 (NTPC Trust) in
Item No. 91, 92, 100, 102, 104 and 118.
Mr. Ram Singh Bisht, Advocate for Respondent No. 2 in W.P.(C)
10022/2016, W.P.(C) 9513/2016, W.P.(C) 9538/2016, W.P.(C)
9539/2016, W.P.(C) 9848/2016, W.P.(C) 9963/2016, W.P.(C)
9974/2016, W.P.(C) 10113/2016 and W.P.(C) 1848/2017.
Ms. Meghha Katari, Ms Ishita Nagpaul & Ms Krati Somvanshi,
Advocates for the Respondent No.1 in W.P.(C) 9513/2016, W.P.(C)
9848/2016, W.P.(C) 9963/2016 and W.P.(C) 10113/2016.

Signature Not Verified
Digitally Signed
By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 7 of 68
Signing Date:24.05.2025
16:15:34
CORAM:
HON'BLE MS. JUSTICE JYOTI SINGH
JUDGEMENT

JYOTI SINGH, J.

1. These writ petitions are filed by the Petitioners under
Article 226
of
the Constitution of India seeking quashing of Circular No. 17/2003 dated
03.02.2003 issued by Pension Trust as also Supplementary Trust Deed dated
09.08.2011 and Approvals dated 03.02.2003 and 06.02.2013. Writ of
mandamus is sought to National Thermal Power Corporation Limited
('NTPC') to pay post-retirement benefits including pension and commuted
value of pension to the Petitioners as per erstwhile 'Self-contributory
Superannuation Benefit (Pension) Scheme for NTPC Employees, 1995'
('1995 Scheme'), amongst other reliefs. Since common questions of law are
raised in these petitions, they were heard together and are being decided by
this common judgment. Be it also noted that with the consent of the parties,
writ petition being W.P. (C) No. 6357/2019 was treated as a lead matter and
hence, facts narrated hereinafter are from the said writ petition and counter
affidavits filed in response thereto.

2. Factual matrix to the extent necessary and as averred in the writ
petition is:

A. Petitioner No.1 is NTPC Retired Employees Welfare
Association of Ramagundam, Telangana and is duly registered.
Petitioner No.2 is an individual who joined NTPC on 24.12.1982 as
Assistant Administrative Officer and retired as Additional General
Manager on 30.06.2008. Petitioner No.3 joined on 06.06.1981 as
Senior Engineer and retired as General Manager on 30.06.2012 while

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 8 of 68

Signing Date:24.05.2025

16:15:34

Petitioner No.4 joined on 25.04.1981 as Assistant Grade-IV and
retired on 28.02.2017 as Deputy Manager. Petitioner No.5 joined
NTPC on 13.11.1981 as Junior Supervisor and retired on 30.06.2006
as Deputy Manager.

B. In order to take care of post-retirement needs and contingencies
of death or permanent disablement while in service, in 141st Meeting
of the Board of Directors of NTPC held on 18.03.1994, it was decided
to introduce a Self-Contributory Superannuation Benefit (Pension)
Scheme to be administered through an irrevocable Trust recognised
under the
Income Tax Act, 1961
(hereinafter referred to as the '1961
Act'). Memorandum of Agreement ('MoU') was executed on
07.03.1997 between NTPC and NTPC Executives' Federation of
India ('NEFI') and Supervisory Employees' Joint Committee
('SEJC'), representing the Executives and Supervisors of NTPC,
respectively. As per the MoU, a Trust was to be created to manage
and administer the Pension Scheme and NTPC's contribution was
limited to Rs.100/- per annum for all employees taken together and
rest of the contribution was to be made by the employees to make the
Scheme financially viable. Contributions were to be deducted from
the salaries of the employees each month as per Rules framed from
time to time by the Board of Trustees. It was also agreed that
Executives and Supervisors working in NTPC on the date of signing
of the MoU as also those who joined in future shall compulsorily
become members of the Scheme. As per the MoU, members were to
contribute their prescribed Percentage Salary Contributions along with
some Additional Contributions to the Pension Fund. Additional

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 9 of 68

Signing Date:24.05.2025

16:15:34

Contributions were to be recovered from the monthly pay of the
individual members. It was specifically agreed that income tax
exemption will be obtained to the effect that income of the Trust will
not be chargeable to income tax and necessary legal formalities/
approvals for proper implementation of the Scheme will be promptly
taken. Clause D.4.5 provided that MoU shall be irrevocable and shall
remain operative and effective in perpetuity till the Pension Scheme
continued to be in operation. Salient features of the Pension Scheme
were enumerated in Annexure-I and formed integral part of the MoU.

MoU was to become effective from 01.04.1995 and recoveries/
contributions were to start from the said date. Relevant Clauses from
the MoU are as follows:-

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 10 of 68

Signing Date:24.05.2025

16:15:34

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 11 of 68

Signing Date:24.05.2025
16:15:34
C. Pursuant to the MoU, NTPC executed a Trust Deed on
12.03.1997 called National Thermal Power Corporation Ltd. Self
Contributory Superannuation Benefit (Pension) Trust (hereinafter
referred to as the 'Trust Deed'). It was provided in the Trust Deed that

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 12 of 68

Signing Date:24.05.2025

16:15:34

the Trust shall be irrevocable and Trustees shall hold monies of the
Trust for the benefit of the members and beneficiaries and Trust shall
be administered, managed and controlled in accordance with the
provisions of the Trust Deed and the Rules framed at the time of
executing the Trust Deed and as amended from time to time. Clause 8
of the Trust Deed provided that Trustees may at any time with the
consent of NTPC or on recommendation by NTPC, through a
Supplementary Deed, amend or add to the provisions of the Trust
Deed or the Rules, provided that such alteration does not adversely
affect the benefits being paid from the Trust or the benefits accrued
upto the date of such amendment or the object of the Trust, provided
further that no alteration shall be made without prior approval of the
Commissioner of Income Tax (hereinafter referred to as the 'CIT').

The moneys of the Pension Scheme, being the Trust property, would
consist of the accumulations of the contribution being the total of
Contributions received by the Trustees in accordance with the Rules,
as also interest, dividend, securities and other accretions arising from
the assets of the Trust as reduced by payments and disbursements to
the members and other Beneficiaries, such credits and debits being
made in accordance with the Rules. Trust Deed was deemed to take
effect on and from 01.04.1995 for all intents and purposes. Rules were
also framed for regulating the Trust and the Scheme on 12.03.1997.
Relevant Clauses of the Trust Deed are as follows:-

"B. The Corporation do hereby constituted an irrevocable Trust for
the management and administration of the aforesaid Pension Scheme
and has nominated the aforesaid persons as Trustees of the Trust. The
Trustees have agreed, to act as the "First Trustees" hereof on the
terms and conditions contained in Rules of the Trust annexed hereto,

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 13 of 68

Signing Date:24.05.2025

16:15:34

which shall be integral part of the these Presents.

NOW THIS DEED WITNESSETH AND IT IS HEREBY AGREED
AND DECLARED AS FOLLOWS:-

1. The name of the Pension Trust shall be 'National Thermal Power
Corporation Ltd. Self Contributory Superannuation Benefit (Pension)
Trust' or such other name or title as the Trustees may from time to
time determine with the prior approval of the Commissioner of Income
Tax having jurisdiction over the Trust (hereinafter referred to as 'the
Commissioner').

2. These presents shall constitute a Trust established in India which
Trust shall be irrevocable and the Trustees shall hold the moneys of
the Trust upon trust for the benefit of the Members or other
Beneficiaries more particularly set forth in the Rules and no money
belonging to the Trust in the hands of Trustees shall be recoverable by
the Corporation under any pretext whatsoever, nor shall be
Corporation have any lien or charge or encumbrance of any
description on the same.

3. It shall be obligatory on the part of the Trustees to pay to the
Members or other Beneficiaries the benefits according to the Trust
Rules.

4. The Trust shall be administered, managed and controlled in
accordance n with provisions of these presents and the Rules. The
decision of the Board of Trustees shall be final and binding upon the
Members and/or Beneficiaries in all respects or matters arising out of
these presents and the Rules.

xxx xxx xxx

8. The Trustees may at any time with the consent of the Corporation
or on a recommendation from the Corporation by a Supplementary
Deed amend or add to the provision of the Trust Deed or the Rules
provided, that such alteration does not adversely affect the benefits
being paid from the Trust or the benefits accrued upto the date or
such amendment or the object of the Trust provided that no alteration
in the Trust Deed, Rules, Constitution or Conditions of the Trust shall
be made without the prior approval of the Commissioner.

9. The moneys of the Trust shall be vested in the Trustees who shall
have the entire control of the moneys of the Trust and shall administer
the Pension Scheme in accordance with the provisions of these
presents and the Rules which shall be binding on the Corporation, the
Trustees and the Members or other Beneficiaries. The Trustees shall
arrange for the Investment of the trust moneys and payment of the
amounts due to the Members and other eligible Beneficiaries in

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 14 of 68

Signing Date:24.05.2025

16:15:34

accordance with the Rules.

xxx xxx xxx

11. The moneys of the Pension Scheme, being the Trust property, shall
consist of the accumulations of the contribution being the total of
Contributions received by the Trustees in accordance with the Rules,
Interest, dividend, securities and other accretions arising from the
assets of the Trust as reduced by payments and disbursements to the
Members and other Beneficiaries such credits and debits being made
in accordance with the Rules.

12. In the event of the Corporation being would up reconstructed,
reconstituted or amalgamated with any other Corporation, the
Trustees may make such arrangement or enter into such agreements
as they in their sole discretion shall think fit and proper for the
continuance of the Pension Scheme by such reconstructed,
reconstituted and amalgamated Corporation as if such reconstructed,
reconstituted and amalgamated Corporations were the Corporation
within the meaning of these presents provided that no arrangements
or agreements under this Clause shall be entered into without the
previous approval of the Commissioner. Such arrangements or
agreements, shall be subject to such conditions as may be imposed by
the Commissioner.

xxx xxx xxx

14. This deed of Trust shall be deemed to have take effect on and from
01.04.1995 for all intents and purposes."

D. On 09.10.1997, NTPC issued Corporate Personnel Circular
No.354/97 (hereinafter referred to as the '
CPC
') introducing 1995
Scheme and providing that the Scheme will be totally self-
contributory by contributions from the employees directly deducted
from their salaries and sent to the Pension Trust. Salient features of
the Scheme were separately provided as an enclosure to the CPR
which provided that all existing employees in the pay scales
applicable to Supervisors and Executive categories, who were on roll
of NTPC as on 01.04.1995 shall be deemed to be the members of the
Scheme from the said date. Those employees who were on roll of

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 15 of 68

Signing Date:24.05.2025

16:15:34

NTPC as on 01.04.1995 and superannuated during 01.04.1995 to the
date of issue of the CPR, had the option to become members of the
Scheme. All employees appointed/promoted in the said categories in
future were to become members of the Scheme compulsorily, from
the dates of such appointments/promotions. Clause 6 stipulated the
modes of Contributions viz.: (a) Fixed monthly Percentage Salary
based on age of the member on the date of entry to the Pension
Scheme; (b) Past Service Contribution; and (c) Monthly Additional
Contribution. NTPC was required to contribute only Rs.100/- per
annum for all employees taken together.

E. Board of Trustees were empowered by Para 6.3 of the Scheme
to review the availability of the monies of the Trust annually or at
such interval as may be deemed fit by them to decide any revision in
the members' contribution under the 1995 Scheme. Defined benefits
that were to accrue to the members were prescribed in para 7. Para
7.1.1 provided minimum of 10 years of continuous service from the
date of joining the Pension Scheme as Qualifying Service. Under para
7.1.2, it was provided that subject to provisions of the Rules, a
member on superannuation will be entitled to superannuation benefit
(pension) commencing from the month following the month of
superannuation, pension at the rate of 1.25% per year of Reckonable
Service, limited to 50% of salary last drawn and for Reckonable
Service of less than 40 years benefit was to reduce proportionately.
On the death of a member, beneficiary was entitled to get Pension at
the rate of 50% of last drawn salary of the member from the month
following the date of death of the member. Similar provision was

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 16 of 68

Signing Date:24.05.2025

16:15:34

provided in case of Permanent Disablement or Incapacity of a member
while in service under para 7.3. Member was entitled at his or her sole
discretion to commute a part of the eligible pension as per provisions
of annuity purchased from Life Insurance Corporation of India
(hereinafter referred to as the 'LIC') by the Trust and as per applicable
laws. Pension was payable during the lifetime of the member.
F. It was further provided that consequent upon death of the
pensioner, nominee of the pensioner shall be paid the cost of Annuity
by LIC. 1995 Scheme was in addition to Employees' Pension
Scheme, 1996 operated by Regional Provident Fund Commissioner,
pending exemption from Government of India. Salient features of
1995 Scheme for Executive and Supervisory categories are as
follows:-

"1.0 OBJECTIVES:-

In order to take care of post retirement needs and contingencies of
death or permanent disablement while in service of the Corporation a,
'Self Contributory Superannuation Benefit (Pension) Scheme (herein
after called the 'Scheme') has been introduced. In the first stage the
Scheme shall be applicable for NTPC employees in the pay scales
applicable to Executives & Supervisors categories.

xxx xxx xxx
5.1.1 Employees who were on the roll of the Corporation as on
01.04.1995 and during the period from 01.04.1995 to date of issue of
this circular have Superannuated will have the option to become the
Member of the Scheme for which a separate communication will be
issued by the Trust.

5.1.2 All Employees who are appointed / promoted in the Supervisor
on Executives scale of pay in future will compulsorily become the
Member of the Scheme from the date of such appointments/
promotions. In the event of any dispute as to the eligibility of any
Employee to become Member, decision of the Employer shall be final.

xxx xxx xxx

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 17 of 68

Signing Date:24.05.2025

16:15:34

6.1 CONTRIBUTION TO THE TRUST BY THE CORPORATION
The Corporation shall contribute to the Trust an amount of Rs.

100/- per annum for all the Employees taken together and such
Contribution shall be made over the Trust before the end of the
accounting year of the Corporation.

6.2. CONTRIBUTION TO THE TRUST BY THE MEMBERS-

Every Member shall make following contributions to the Trust by
way of deduction from his salary.

(a) FIXED PERCENTAGE SALARY CONTRIBUTION PAYABLE
MONTHLY:

A fixed Percentage of monthly Salary based on age of Member on the
date of his entry to the Pension scheme determined as under:-

AGE PERCENTAGE OF SALARY
33 Yrs and below 1.0%
Above 33<= 38 Yrs 1.5%
Above 38<=43 Yrs 2.0%
Above 43<=48 Yrs 3.0 %
Above 48<=53 Yrs 4.0%
Above 53 Yrs 5.0%

The above mentioned Percentage shall remain same till he actually
leaves the service of the Corporation unless otherwise revised by the
Board of Trustees.

(b) PAST SERVICE CONTRIBUTION:-

Every Member shall contribute at the rate determined in para (a)
above as based on age & Salary as on 01.04.95 as Contribution for
Past Service rendered by him with the Corporation. This Contribution
for Past Service shall be payable at the time of becoming Member of
the Pension Scheme or maximum 10 (ten) years in annual or 120
monthly instalments together with compound interest @ 12% per
annum. A detailed communication in this regard shall be notified by
the Trust separately.

(c) ADDITIONAL CONTRIBUTION, PAYABLE MONTHLY:-

Additional Contribution to be made by a member to the Trust shall be
decided by the Board of Trustees from time to time and such
Contribution shall be realized by the Corporation as deduction from
the Salary of the Member every month or by such other mode as the
Board of Trustees may decide upon in consultation with the
Corporation / Actuary. The Board of Trustees shall have power and
authority to determine Additional Contribution amount from time to
time in consultation with the Corporation / Actuary (Presently this

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 18 of 68

Signing Date:24.05.2025

16:15:34

amount works out to be Rs.375/- per month per Member w.e.f.
01.04.1995. This amount will be escalated @ 8% per annum for
subsequent financial years)
6.3 REVIEW OF CONTRIBUTION BY TRUST:-

The Board of Trustees shall review the availability of the moneys of
the Trust annually or at such interval as may be deemed fit by the
Board of Trustees to decide any revision in the Members' Contribution
under the Pension Scheme
xxx xxx xxx

7.1 PENSION ON SUPERANNUATION OF MEMBER:-

7.1.1 Qualifying Service
As on date of Superannuation a Member should have completed a
minimum of 10(Ten) years of Continuous service from the date of his
joining the Pension Scheme. Provide that in case of Members who are
on the rolls of NTPC as on 1495, the minimum qualifying service will
be five (5) years (i.e. Past Service Future Service).
7.1.2 Rate of Pension:-

Subject to the provisions of these Rules, a Member on Superannuation
will be entitled to Superannuation benefit (Pension) commencing from
the month following the month of Superannuation, Pension at the rate
of 1.25% Per year, of Reckonable Service limited to 50% of salary last
drawn. For Reckonable Service of less than 40 years the benefit shall
be proportionately reduced.

7.2 PENSION ON DEATH OF A MEMBER WHILE IN SERVICE:-

On death of a Member the Beneficiary will be entitled to get Pension
at the rate of 50% of last drawn Salary of the Member. The Pension
being payable from the month following the date of the death of the
Member.

7.3 PENSION ON TOTAL PERMANENT DISABLEMENT /
INCAPACITY WHILE IN SERVICE:-

On the discharge of a Member from the service of the Corporation
due to his Total Permanent Disablement / Incapacity while in service,
such Member will be entitled to Pension at the rate of 50% of his last
drawn Salary. The Pension being payable from the month following
the date of discharge from service.

7.4 COMMUTATION OF PENSION:-

The Member may at his sole discretion commute a part of the eligible
Pension as per the provisions of Annuity purchased from the LIC by
the Trust and as per applicable laws."

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 19 of 68

Signing Date:24.05.2025

16:15:34

G. On 11.06.1997, approval was granted by CIT to the Pension
Trust under Rule 2(1) of Part 'B' of 4th Schedule of 1961 Act to take
effect from 01.04.1995. Subsequently, MoU was executed on
10.01.1998 for employees of NTPC in the workmen category.
Meetings were held by Board of Trustees on 05.12.1997 and
22.01.1998 regarding investment of the Trust Funds, recovery of
contributions, authorization to investment committee for purchase of
annuities etc. Pension Trust Communication (PTC) 03/98 was issued
on 06.02.1998 for deduction of Past Service Contribution for
Executives and Supervisors from February, 1998 onwards in
maximum 120 installments.

H. Petitioners were members of the 1995 Scheme and having
made contributions, they were entitled to continue to receive benefits
thereunder. However, illegally and arbitrarily, the Board of Trustees
introduced a new restructured scheme on 03.02.2003, which was a
'Defined Contribution' Scheme ('2003 Scheme') instead of the earlier
'Defined Benefit' Scheme and adversely affected the rights of the
Petitioners to higher pension. The Scheme was arbitrarily made
applicable retrospectively from 01.04.2002, taking away vested and
accrued rights of even those who had retired prior to the introduction
of the Scheme.

I. Aggrieved with the 2003 Scheme, one Mohd. Yunus, an ex-
employee of NTPC who retired as a Senior Materials Officer on
31.07.2002 filed a Writ Petition (Civil) No. 740/2004, before the
Allahabad High Court. His pension was not sanctioned, as according
to NTPC, annuities from LIC were kept in abeyance on the ground

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 20 of 68

Signing Date:24.05.2025

16:15:34

that there was steep hike in annuity prices affecting the viability of the
Pension Scheme. Upon restructuring, pension of Mohd. Yunus was
fixed at Rs.1,015/- whereas under the 1995 Scheme, he would have
been entitled to Rs.8,078/-.

J. The writ petition was allowed by Allahabad High Court vide
judgment dated 17.12.2009 holding that since Mohd. Yunus had
retired on 31.07.2002, he was entitled for pension under the 1995
Scheme. This judgment was challenged by the Pension Trust before
the Supreme Court and Civil Appeal No. 8054/2011 was dismissed on
09.12.2015. Supreme Court observed that retiral benefits of Mohd.
Yunus stood crystalized on the date of his retirement i.e. 31.07.2002
and any rules/guidelines notified thereafter including Circular dated
03.02.2003 could not be made applicable to him.

K. While the matter was pending in the Supreme Court, the
judgment of Allahabad High Court possibly paved the way for the
Trustees to carry out an amendment to the Trust Deed dated
12.03.1997, invoking para 8 of the Deed and a Supplementary Trust
Deed was executed on 09.08.2011 and the CIT granted approval vide
order dated 06.02.2013, retrospectively from 01.04.2002.

3. Owing to the amendment in the 1995 Scheme, three writ petitions
being W.P. (C) Nos. 108/2011, 109/2011 and 1259/2013 were filed in this
Court challenging the amendment and the consequential reduction in the
pension. The remaining writ petitions referred to above were filed post the
judgment of the Supreme Court in the case of
Secretary, NTPC Pension
Trust v. Mohd. Yunus and Others
, Civil Appeal No. 8054/2011, dated
09.12.2015, seeking similar reliefs. The second batch of writ petitions was

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 21 of 68

Signing Date:24.05.2025

16:15:34

dismissed by learned Single Judge of this Court vide judgment dated
28.02.2017 on ground of maintainability. The judgment was challenged
before the Division Bench of this Court and the appeals were disposed of
vide judgment dated 01.11.2018.

The Division Bench held that after the
judgment of the Supreme Court in
Mohd. Yunus
(supra), it was no longer
open to NTPC/Pension Trust to contend that writ petitions were not
maintainable against them. During the course of hearing of the appeals,
NTPC/Pension Trust also raised an objection that the writ petitions were
barred by delay and laches.

This contention was also negated by the
Division Bench observing that the Petitioners were awaiting the outcome of
the decision of the Supreme Court with regard to the correctness of the
judgment of Allahabad High Court in
Mohd. Yunus
(supra) and could not
be faulted for filing petitions after the decision was pronounced. It also
needs mention at this stage that the Division Bench segregated the appeals
into two categories based on the dates of retirement of the Petitioners i.e.
those who retired prior to 03.02.2003 and those who retired post thereto. In
the former category were the Appellants in appeals being LPA Nos. 200,
229, 230, 233, 241, 242 and 253/2017. In the case of these Appellants, the
Division Bench additionally observed that they were similarly placed as
Mohd. Yunus, who had retired prior to the said date and deserved to be
placed on the same pedestal. This judgment was taken up in appeal by
NTPC Pension Trust and by order dated 29.09.2022, in Civil Appeal Nos.
4695-4726/2019, the Supreme Court remitted the matter back to the learned
Single Judge of this Court for examining the writ petitions on merits
upholding the judgment of the Division Bench on the issue of
maintainability. All rights and contentions of the parties were kept open.

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 22 of 68

Signing Date:24.05.2025

16:15:34

Subsequently, the earlier three writ petitions were also tagged with the batch
of petitions remanded by the Supreme Court and all were heard together.

4. From a holistic reading of the documents filed by the Pension Trust,
further chronology of events is:

A. On 18.01.1999, PTC 07/99 was issued with respect to options
with regard to change in the number of installments for recovery of
Past Service Contributions due to change in retirement age from 58 to
60 years. By letter dated 16.08.1999, clarification was given by the
Actuary, M/s. K.A. Pandit, on Annuity and Resignation Rates in
actuarial valuation. Meeting of the Board of Trustees was held on
20.08.1999 to discuss actuarial valuation of 1995 Scheme to assess
the impact of increase in retirement age.

B. On 06.07.2000, CPR No. 444/2000 was issued by NTPC
revising the pay scales and allowances for employees in the Executive
category below scheduled posts at the Board level. Revision was to
take effect from 01.01.1997 and basis this revision, meeting of the
Board of Trustees was convened on 02.08.2000 to assess the impact
of the pay revision. It was felt that an increase in contributions was
required to keep the Trust economically viable and presentation was
made by the Actuary giving various options toward the viability
including increase in contributions. Actual data of revised pay was
called from all the Units to be provided to the Actuaries to enable
them to make realistic estimates of increase required in the
contributions and it was decided that for the time being, pension
would be paid on pre-revised salaries and decision to pay pension on
revised pay, including in cases already settled, was to be taken along

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 23 of 68

Signing Date:24.05.2025

16:15:34

with decision regarding increase in Contributions.

C. Various meetings were held thereafter as brought forth by
Pension Trust, including presentations and discussions by and with
the Actuaries on enhancement of additional contributions and
provisional recovery of lumpsum amounts from all categories of
employees. Finally, in the 20th Meeting of the Board of Trustees held
on 19.12.2002, decision was taken to restructure the 1995 Scheme
from 'Defined Benefit' to 'Defined Contribution' Scheme. Under the
restructured Scheme, contribution structure was changed for
Executives by contribution of 1% of Basic Pay w.e.f. September,
2002 as Monthly Percentage Salary and Additional Contribution at
Rs.788/- per month escalating at 8% per annum. The Defined Benefit
was also changed to payment of pension based on actual contribution
of the principal amount with interest at the rate not exceeding pro rata
earnings on the investment by the Trust. It was decided that all cases
of superannuation after 01.04.2002 and cases of death while in service
or of incapacitation after 31.08.2002, except cases already settled, will
be settled based on the new principles. Resolution was subject to
approval by NTPC and CIT as per Clause 8 of the Trust Deed.
Pending the final decision, pension payable to employees who retired
w.e.f. 01.04.2002 was kept in abeyance.

D. Following the aforesaid decision, PTC No. 16/2002 was issued
on 19.12.2002, restructuring the 1995 Scheme for Executives both in
respect of contributions and the benefits. The changes can be
encapsulated as follows:-

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 24 of 68

Signing Date:24.05.2025

16:15:34

"2.0 The contribution structure has been changed as under for
executives:

a) Monthly Percentage salary contribution in case of
Executives shall be 1% of Basic Pay w.e.f. September, 2002.

b) Additional contribution for executives shall be Rs. 788/-

p.m. escalating 8% pa, w.e.f. the month of September, 2002.
Actual monthly recovery of Additional Contribution will be
separately communicated by the TRUST.

c) Excess contributions paid by members for the month of
September, October and November, 2002 will be adjusted
against contributions payable in future months.

3.0 For the purpose of this adjustment, Accounting Units of
NTPC will not deduct any contribution from the salary of
December, 2002 for Executive categories of Employees.
4.0 Detailed communication about revised rates of contribution
deduction's, adjustment of excess contributions, if any, and
about benefit structure is being issued by the Trust separately.
This is for necessary action at the end of Accounting Units."

E. In the 107th meeting of NBC held on 27.12.2003, it was decided
that 1995 Scheme shall continue to operate as a Defined Contribution
Scheme. PTC 17/2003 was issued on 03.02.2003 formulating the
restructured Defined Benefit Scheme as Defined Contribution Scheme
(hereinafter referred to as the '2003 Scheme'). This meant that
purchase value of pension annuity was limited to 'Actual
Accumulated Contribution' made by a member to the Pension Trust.
The methodology of working out Accumulated Contribution was as
follows:-

"2.1 Computation of 'Accumulated Contribution' as stated in
para 2.0 above in case of Executives (Except in case of those
Executives who have specifically opted out as at para 3.1.1
below):-

2.1.1 The contributions paid by each Member till September
2002 along with pro-rata earnings after adjustment of amount

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 25 of 68

Signing Date:24.05.2025

16:15:34

paid by Trust for purchase of pension annuities till date, will be
credited to the individual's accounts. Plus
2.1.2 Amount of Contribution paid w.e.f. October 2002 for
executives as per para 3.1 (ii). Plus
2.1.3 Residual amount after purchases of Pension Annuities in
case of death as stated in para 3.1 (i) for Executives. Plus
2.1.4 Interest earned by the Trust on the total amount in the
credit of each individual as stated in para 2.1.1, 2.1.2 and 2.1.3
above will also be credited to the individual account on pro-rata
basis during the financial year.

2.1.5 The effective rate of earning will be determined and
notified to the Members from time to time by the Trust.
2.1.6 The sum of total amount as above at para 2.1.1, 2.1.2,
2.1.3 and 2.1.4 will here in after will be called "Accumulated
Contribution".

2.2 Computation of 'Accumulated Contribution' as stated in
para 2.0 above in case of specified Executives as mentioned in
para 3.1.1 below:-

2.2.1 The contributions paid by each Member till September
2002 in case of Specified Executives along with pro-rata
earnings after adjustment of amount paid by Trust for purchase
of pension annuities till date, will be credited to the individual's
accounts, Plus
2.2.2 Amount of Contribution paid w.e.f. October 2002 for
Specified Executives as per para 3.1.1. Plus
2.2.3 Interest earned by the Trust on the total amount in the
credit of each individual as stated in para 2.2.1 and 3.1.1 for
Specified Executives will also be credited to the individual
account on pro-rata basis during the financial year.
2.2.4 The effective rate of earning will be determined and
notified to the Members from time to time by the Trust.
2.2.5 The sum of total amount as above at para 2.2.1, 2.2.2, and
2.2.3 will here in after will be called "Accumulated
Contribution".

3.1.1 Contributions (To be called category 'B')
In case of those specified Executives who have specifically opted
out of the decision of the Trust as paragraph 3.1 (i) and 3.1 (ii)
le. category 'A' above, will be required to contribute as per the
existing rate of Percentage Salary Contribution plus Additional

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 26 of 68

Signing Date:24.05.2025

16:15:34

Contribution at the rate of Rs. 1067/- p.m., which includes Rs.

360/- as referred to para 3.1 (ii) (c) above, to be escalated at the
rate of 8% every year w.e.f. month of April 2003. Plus surrender
value of summer and winter liveries as at para 3.1 (ii) (a) and
para 3.1 (ii) (b) respectively as above. This will workout to Rs.
788/-pm considering escalations at specified rates.
(Percentile contribution at the rate of 1% to 4% depending upon
age as on 1.4.95 in accordance with the Trust Circular No.
PTC-01/97 dated 21-10-1997.)
The deficiency / shortfall in the common death pool account in
category 'A' Executives in any financial year shall be debited to
such category of 'A' Executives only. Under no circumstances it
will be debited to the accounts of category 'B' Executives."

F. As far as the benefits under 2003 Scheme were concerned, they
were as follows:-

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 27 of 68

Signing Date:24.05.2025

16:15:34

G. In the 21st meeting of the Board of Trustees held on 11.03.2003,
the decision taken in the 20th meeting was confirmed along with
confirmation of PTC 17/03 dated 03.02.2003 and PTC 18/03 dated

03.02.2003. As per the documents placed on record by Pension Trust,
several attempts were made from time to time for revival of 1995
Scheme by looking into fresh actuary valuations etc. but no resolution
could be found. By communication dated 28.10.2010, approval was
sought from CMD, NTPC for amendment of 1995 Scheme w.e.f.
01.04.2002 and execution of Supplementary Trust Deed in accordance
with provisions of Trust Deed and 1961 Act, as also approval from
CIT.

H. Supplementary Trust Deed was executed on 09.08.2011 for
restructuring the Pension Scheme as Defined Contribution Scheme
with effect from 01.04.2002 and approval was received from Ministry
of Power, Government of India on 01.12.2011. Ministry directed that
administrative cost of the Scheme shall be borne by the Trust Fund
and members' contribution should not be less than 1% of Basic Pay +
DA as also that NTPC should immediately stop contribution to the
existing 1995 Scheme. Admittedly, CIT, granted approval on
06.02.2013 under Rule 4 of Part 'B' of Fourth Schedule of 1961 Act,
retrospectively from 01.04.2002.

SUBMISSIONS AND CONTENTIONS ON BEHALF OF THE
PETITIONERS:

5. The action of the Respondents in not paying post-retirement benefits
to the Petitioners as per 1995 Scheme is arbitrary, illegal and discriminatory.

The Scheme was introduced in 1995 as a welfare measure for providing

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 28 of 68

Signing Date:24.05.2025

16:15:34

social security to the employees, who at the relevant time were members as
also those who were to join in the future. The 1995 Scheme was made
operative from 01.04.1995 and was formulated with the prior approval of
Government of India, Board of Directors of NTPC and CIT. As per MoU
dated 07.03.1997, the 1995 Scheme was a Self-Contributory Scheme
wherein NTPC's liability was limited only to Rs.100/- per annum for all
employees taken together and the rest of the contribution was by the
employees. Employees were made members of the Scheme compulsorily
and had no option not to become members and/or contribute to this Scheme.
In consonance with the salient features of the 1995 Scheme, members of the
Scheme including the Petitioners were to contribute in three ways i.e.
Monthly Fixed Percentage Salary Contribution, Past Service Contribution
and Monthly Additional Contribution. The Scheme assured defined benefits
on the date of superannuation providing that a member on superannuation
will be entitled to pension commencing from the month following the month
of superannuation at the rate of 1.25% per year of Reckonable Service
limited to 50% of the salary last drawn and for Reckonable Service of less
than 40 years, the benefit was proportionately reduced. It was thus assured
that by contributing substantial parts of their earnings including for the past
service, Petitioners would have a defined pension to cater for their post-
retirement period for a life time. In case of death or disablement of an
employee while in service, the Beneficiary was entitled to pension at the rate
of 50% of the last drawn salary of the employee. There was thus no
justification for the amendment in the Scheme and that too, resulting in
considerable reduction in the quantum of monthly pension.

6. For management and administration of the 1995 Scheme, an

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 29 of 68

Signing Date:24.05.2025

16:15:34

irrevocable Pension Trust was formed whereby the Trustees were to hold
monies of the Trust for the benefit of the Members/Beneficiaries. Albeit,
Clause 8 of the Trust Deed empowered the Trustees at any time with the
consent of NTPC or on its recommendation to amend or add to the
provisions of the Trust Deed by a Supplementary Deed but this was subject
to two riders i.e. the alteration should not adversely affect the benefits paid
under the Trust or the benefits accrued upto the date of such amendment or
the object of the Trust and no alteration would be without 'prior approval' of
the CIT. In the present case, both conditions have been violated inasmuch as
firstly, there was no prior approval from the CIT which was admittedly
granted on 06.02.2013 w.e.f. 01.04.2002 and secondly, the restructured
Scheme was a Defined Contributary Scheme and the pension payable was
considerably reduced. Thus, the amendment was illegal and invalid and
cannot be sustained in law. Moreover, the amendment was sought to be
made applicable retrospectively to those who had retired prior to 03.02.2003
i.e. to employees who retired on or after 01.04.2002 and whose pensions
were kept in abeyance awaiting the restructuring of the pension. It is a
settled law that any change in service condition of an employee and that too,
the one which adversely effects his or her interest can only be prospective
and with the consent of the employee.

7. Right of the Petitioners to receive retiral benefits under 1995 Scheme
stood crystallized on the respective dates of their retirements prior to
03.02.2003 and therefore, 2003 Scheme could not be made applicable to
take away vested rights that had accrued on retirement. The Supreme Court
in Mohd. Yunus clearly held that retiral benefits of Mohd. Yunus stood
crystalized on the date of his retirement i.e. 31.07.2002 and thus any

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 30 of 68

Signing Date:24.05.2025

16:15:34

Rule/Guideline notified thereafter including the Scheme dated 03.02.2003
would not be applicable to him. Cases of Petitioners, who retired prior to
03.02.2003, are squarely covered by
the said judgment
of the Supreme Court
and no differential treatment can be meted out to them.

8. Insofar as the Petitioners who retired post 03.02.2003 are concerned,
they would also be governed by the 1995 Scheme and 2003 Scheme will be
inapplicable. 1995 Scheme was regulated by Trust Deed dated 12.03.1997.
Clause 8 of the Deed provided that any amendment could be with the prior
approval of Board of NTPC and CIT. Therefore, any amendment could be
valid only when the approval came. There is no dispute that in the present
case, CIT gave his approval on 06.02.2013 albeit retrospectively from
01.04.2002. Therefore, there was no prior approval and post-facto approval
cannot take the place of 'prior approval' in law. Therefore, at the highest,
the 2003 Scheme could be valid and operate from on or after 06.02.2013,
when the approval was granted and will be inapplicable to retirees before the
said date. Additionally, even the Supplementary Trust Deed was executed
only on 09.08.2011 and there is no gainsaying that a Trust Deed could be
amended only by a Supplementary Deed and even on this score, the 2003
Scheme cannot apply retrospectively.

9. The employees of NTPC including the Petitioners had no option but
to compulsorily become members of the Pension Scheme and their
contributions were deducted directly from the pay. Petitioners contributed
not only a percentage from their current salary and also made additional
contribution on a monthly basis but the contributions extended to past
service also. These contributions were on an assurance of a defined benefit
in the form of monthly pension to the extent of 50% of the last drawn salary

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 31 of 68

Signing Date:24.05.2025

16:15:34

to cater to the needs of their retired lives. Illustratively, Petitioner No. 2
joined NTPC on 24.12.1982 and after receiving six promotions retired as
Additional General Manager on 30.06.2008. Thus, calculation under the
1995 Scheme taking the Reckonable Service, which includes past and
escalated future service, said Petitioner was entitled to a sum of Rs.24,934/-
as pension on the last drawn salary of Rs.75,121/- (Basic Pay + DA)
whereas under the 2003 Scheme, he is getting Rs.583/-.

10. The cut-off date of 01.04.2002 for implementation of the restructured
Pension Scheme has no nexus with the object sought to be achieved as the
pensioners who retired prior to this date and those thereafter, were a
homogenous class of retirees who had all contributed under the 1995
Scheme. Moreover, the justification given by the Pension Trust for
restructuring the Pension Scheme is also without any basis and incorrect on
facts. Trustees assert four reasons for restructuring the 1995 Scheme i.e.
increase in wages, enhancement in age of retirement, increase in rates of
purchase of annuities and reduction in returns from investments. If there was
a revision in the salary, employees' contribution also increased since
contributions were a fixed percentage of the salaries. If there was
enhancement in age of retirement from 58 to 60 years, the employees
contributed for two more years. It is Trust's own imagination that the Trust
fund was unviable. The Actuaries were hired by the Trustees and rendered
reports to suit their dictates. Neither were the reports shared with the
employees and/or their representatives nor the basis of the reports were ever
shared or made known. The income of the Trust, to the best of knowledge of
the Petitioners, was manifold higher than the money invested in the purchase
of pension annuity. Illustratively, for the Financial Year 2002-03, interest

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 32 of 68

Signing Date:24.05.2025

16:15:34

earning of the Trust was Rs.26.02 crores, whereas amounts spent on
purchase of pension annuity was only Rs.2.48 crores. Similarly, for every
preceding year, the interest income from the contributions of the Member
was far more than the money spent on purchase of annuities. Moreover, as
per Guidelines of Ministry of Finance, Government of India, Trust had to
invest its investable funds in Central and State Governments securities and
PSUs/Financial Institutions securities, but the Trustees never furnished any
details of the investments of the funds and/or the quantum of returns against
each investment. Additionally, the liveries, shoes and raincoats which were
being given to all NTPC employees on yearly basis free of charge were also
stopped and value of these items was added to pension contribution for each
employee.

11. The prime reason sought to be brought forth by the Respondents for
restructuring the Pension Scheme was increase in purchase price of
annuities, which is nothing but a disguise to take away the defined benefits
under 1995 Scheme. There can be no doubt that while formulating the 1995
Scheme, NTPC would have taken the assistance of Consultants and
Accountants/Actuaries, who in turn would have taken into consideration
factors such as price escalation, availability of funds in future etc. and
catered for all the fluctuations. No details have been furnished by the
Respondents with regard to investments of its investable funds in Central
Government and State Governments Securities as well as in PSU/Financial
Institutions Securities. No documents have been filed to show the alleged
paucity of funds by the Pension Trust and in fact, strangely now the
argument is taken that the 1995 Scheme had become unviable in the initial
years, which albeit incorrect, only goes to show that all the while the 1995

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 33 of 68

Signing Date:24.05.2025

16:15:34

Scheme was being operated by the Trust, they were not managing the same
in the manner it should have been.

12. Contention of the Respondents that from time to time, decisions were
taken in various meetings to ascertain the viability of the Trust and that too,
in a transparent manner with the consent and in the presence of the
Petitioners and the other employees, is of no aid to the Respondents.
Petitioners and other similarly placed employees The amendment was
carried out by the Board of Trustees without putting the Petitioners to notice
and/or hearing them. Much emphasis was laid on the meeting held on
02.09.2002 but the fact is that only employees working in the Noida office
attended the meeting, which was a miniscule percentage of the total
employees. Petitioners or individual employees had no voice vote in these
meetings. Even otherwise, in law the new restructured Scheme could not be
made applicable retrospectively and therefore, their consent or knowledge is
meaningless. Objection of delay and laches is misconceived. It is settled law
that pension is a continuing cause of action and Courts have been always
liberal in condoning delays in matters pertaining to retiral benefits.
SUBMISSIONS AND CONTENTIONS ON BEHALF OF NTPC:

13. The writ petitions are not maintainable being barred by delay and
laches. The cause of action was the restructuring in the 1995 Scheme and
consequent reduction in pension, which happened in the year 2003 but the
Petitioners approached the Court belatedly after several years. Delay and
laches is a recognized doctrine and those who are not vigilant in pursuing
their rights cannot be heard to claim that their vested rights are taken away
and seek relief after several years. While exercising jurisdiction under

Article 226
of the Constitution of India, the Constitutional Court must

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 34 of 68

Signing Date:24.05.2025

16:15:34

consider delay as an important factor before examining the case on merits.
[Ref.:
U.P. Jal Nigam and Another v. Jaswant Singh and Another
, (2006)
11 SCC 464]

14. DPE issued O.M. dated 12.04.1991 permitting individual CPSEs at
their discretion to work out a suitable annuity scheme through LIC based on
purely voluntary contributions by the employees to the fund without any
liability on the PSE or the Government of India and contribution of the
Management to the superannuation fund was restricted to Rs.100/- per
annum for all employees taken together. Board of Directors of NTPC in
141st meeting held on 18.03.1994 approved the proposal to formulate a self-

contributory superannuation benefit pension scheme. Pursuant thereto, an
MoU was executed on 07.03.1997 between NTPC, NEFI and SEJC,
respectively envisaging formulation of a Trust to regulate the Pension
Scheme. Another MoU was executed on 10.01.1998 with the Associations
of workmen. Accordingly, Pension Trust was created and Trust Deed was
executed on 12.03.1997. The Pension Trust comprised originally of four
Trustees from NTPC Management and six from employees' representatives.
Trust was irrevocable and governed by the rules framed in this regard. The
effective date of the Pension Scheme was fixed as 01.04.1995.

15. The contributions made by the employees were directly deducted
from the salary and sent to Pension Trust created for the purpose and the
Trustees were solely responsible to administer the pension fund for
employees of NTPC. Annuities were purchased from LIC and upon
superannuation of an employee, cost of annuity was to be paid by the Trust
to LIC after which the latter would start paying monthly pension to the
retiree. Therefore, NTPC had no control over the affairs and day-to-day

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 35 of 68

Signing Date:24.05.2025

16:15:34

administration of the Trust and contributions from the Petitioners and other
employees were solely the domain of the Pension Trust.

16. Pension Scheme was introduced vide
CPC
dated 09.10.1997 for
employees in the Executive and Supervisory categories w.e.f. 01.04.1995
and for administration of the Scheme, Trust had taken a Master Policy from
LIC to pay the pension benefits as per the Scheme. Trust invested the funds
in approved securities as per Government Guidelines and provisions of 1961
Act. 1995 Scheme was based on defined benefit pattern in which pension
payable was already pre-defined as a percentage of last salary drawn and
was paid based on length of service i.e. Reckonable Service which is total of
Escalated Future Service and Past Continuous Service and salary included
the Basic Pay and Dearness Allowance. For those in service before
01.04.1995, Past Service Contribution was to be made while for those who
joined after 01.04.1995, contributions included Percentile Salary
Contribution and Additional Contribution, which was a fixed lumpsum
amount. The contributions were deposited in a Pool Account of the Trust to
constitute the corpus.

17. Prior to introduction of the 1995 Scheme, Pension Trust had called for
an Actuarial Report on the viability of the Scheme. Scheme was proposed
based on certain assumptions such as: (a) rate of mortality in service;

(b) cost of annuity; (c) rate of increase in salaries; and (d) return on
investment. The Scheme was not etched in stone or immutable. Clause D.4.5
in the MoU contemplated discontinuation of the Scheme itself as is clear
from the expression 'till the Pension Scheme continues' and thus, no
permanency could be attached to the Scheme. Secondly, availability of
money was subject to periodical review, which is clear from a reading of

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 36 of 68

Signing Date:24.05.2025

16:15:34

Clause 6.3 of the salient features of the 1995 Scheme and Clause 3.3 of the
Trust Rules and the Actuaries had to be engaged from time to time to
scrutinize the availability of funds.

18. In 2000, there was a shift as changed circumstances transformed the
basis of actuarial assumptions for the Scheme, necessitating restructuring of
the same to make the Scheme workable. Increased additional contributions
were required from members, but there was disinclination on the part of the
members to do so. Other factors also contributed to the viability of the
Scheme being: enhancement in age of superannuation from 58 to 60 years;
revision in annuity rates by more than 50% by LIC w.e.f. 01.04.2002;
increase in salaries w.e.f. 01.01.1997; and decline in the return on
investments. The issue of age enhancement was considered by the Board of
Trustees in 9th Meeting held on 20.08.1999 along with the issue of payment
of pension on revised salaries and it was felt that actuarial valuation was
required. The agenda was again considered in the 12th Board Meeting held
on 02.08.2000, 13th Board Meeting held on 11.10.2000, 14th Board Meeting
held on 16.02.2001 and 15th Board Meeting held on 08.06.2001. In the 14th
and 15th meetings, there was discussion on the increase in annuity rates as
also return on investments. Board of Trustees decided that since there was
increase of about 20% in the cost of annuity purchased from LIC and
reduction in interest rates on investment from 12.5% to 10.5% per annum,
members' contributions should increase correspondingly. However, it was
also decided that till actuarial valuation report was received regarding the
impact of these factors on the 1995 Scheme, pension should continue on the
pre-revised salaries.

19. In the subsequent meetings, it was brought forth by the Actuaries that

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 37 of 68

Signing Date:24.05.2025

16:15:34

the increase in salaries and cost of purchase of annuity made it imperative
that there was a substantial increase in the contributions by employees from
3% to 8% i.e. 2.75 times increase in Percentage Salary Contribution and
increase upto Rs.730/- per month in Additional Contribution or if entire
contribution was to be made from Percentage Salary Contribution then
members were to pay at the rate 6% to 25% of the salary. However,
employees did not agree to the increase in contributions. In the 18th meeting
held on 28.12.2001, Actuary was asked to study various alternatives of the
benefit and contribution structure and make a detailed presentation in the
next meeting. Board of Trustees also took a second opinion from Mercer
Human Resource Consulting ('Mercer'). It was highlighted by the
Consultant that there was a deficit of Rs.1,443.82 crores as against total
liability of Rs.2,226.02 crores.

20. A communication was issued by the then Senior Manager (HR) on
03.07.2002 to all Heads of HR in each project, highlighting the change in
assumptions and informing that: (i) Pension Scheme was viable only if there
was 50% increase in the members' contributions; (ii) private insurance
companies when contacted for purchase of annuities were unable to offer
anything in the near future; and (iii) Income Tax Authorities were contacted
to modify the rules allowing a direct disbursement of pension by the Trust.
Feedbacks were sought from the employees and meetings were held at
different levels with the employees' association and in fact NEFI
representing the Executive cadre sought closure of the 1995 Scheme.
However, all efforts to continue the Scheme in its present form failed and
hence, in the 20th Board Meeting held on 20.12.2002, Trustees decided to
restructure the Pension Scheme and make payment of pension on the basis

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 38 of 68

Signing Date:24.05.2025

16:15:34

of actual contributions by the members and pro rata interest earned by the
Trust on such contributions. Thus, the nature of the Scheme changed from
Defined Benefit to Defined Contribution and it was decided that in all cases
of retirement on or after 01.04.2002, payment would be made as per the
amended Scheme. Employee-wise account was created from earlier pool
fund and contribution of the employee was utilized to pay pension only to
that employee. Element of cross-subsidy amongst employees was
eliminated. Under the restructured 2003 Scheme, there was no linkage either
with last drawn salary of the member or the length of service.

21. Accordingly, PTC 17/2003 was issued implementing the 2003
Scheme and under the said Scheme purchase value of annuity remained
limited to 'Actual Accumulated Contribution' of an employee. The
Accumulated Contribution paid by each employee till September, 2002
along with pro rata earnings was credited into the individual account of the
employee. Initially, for collection of contributions, Executive and
Supervisors were divided into categories 'A' and 'B', however, pursuant to
25th Meeting of the Trustees on 23.07.2004, the categories were merged.
Executives and Supervisors now contributed a Fixed Percentage of the
Salary being 1% of the Basic Pay and Additional Contribution of Rs.388/-
per month from April, 2003 along with a one-time lumpsum Contribution of
Rs.3,401/- in the month of April, 2004.

22. In the 27th Board Meeting held on 29.04.2005, it was resolved that
monthly Pension payable to all employees will be uniform and for Financial
Year 2005-06, contribution will be Rs.453/- per month, which constituted
surrender value of Washing Allowance of Rs.147/- per month, Tea Subsidy
Component of cash and Canteen Compensation of Rs.306/-. Additionally, a

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 39 of 68

Signing Date:24.05.2025

16:15:34

sum of Rs.3,967/- was payable in the month of April, 2005, which was
reimbursement value of summer liveries for the year 2005. This was
communicated earlier to all employees vide Circular dated 15.04.2005.
Therefore, pension payable to an employee under 2003 Scheme was the
contribution of the employee plus interest on it till the date of his
superannuation. Where an employee decided to withdraw his contribution
before superannuation to invest in other pension schemes, his contribution
retained with the Trust was reduced according to withdrawal and interest
continued to accumulate on the balance amount.

23. The fact the Scheme as originally conceived could not work was
found in both the actuarial reports i.e. report dated 15.02.2007 by M/s. A.K.
Pandit and report dated 10.06.2008 by M/s. Watson and Wyatt. The change
in 1995 Scheme did not infringe any vested rights of the Petitioners as 1995
Scheme was never conceived as a never ending Scheme. Review of the
working of the scheme was engrained in the Scheme as a continuous process
and entitlement of pension was contingent upon revision of the contributions
by members, which they refused to increase. If the Trust became unviable,
there was no way the Scheme could have continued in its present form. It
would be travesty of justice to remaining employees if the Scheme
continued, as with the depletion of the Trust Fund there would be nothing
remaining for the future employees.

24. The decision to restructure the 1995 Scheme was not a hasty decision
and was taken after due deliberations and consideration. Process of review
of contributions and benefit structure was started from the year 2000 itself.
Consultative process was adopted and matter was discussed at length with
stakeholders such as different unions, employees' associations, Actuaries,

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 40 of 68

Signing Date:24.05.2025

16:15:34

Board of Trustees etc. It is not correct for the Petitioners to contend that they
were not put to notice before allegedly adversely reducing the pensions as
they were duly represented in most of the meetings through their Unions etc.
and in fact, the Unions and Associations requested for the 1995 Scheme to
be terminated forthwith as they were not willing to deposit extra
contributions. It was neither feasible nor practical to expect NTPC or the
Trust to take individual consent from each employee being thousands in
numbers. In any case, mere amendment in a Pension Scheme does not and
cannot tantamount to change in service conditions of the Petitioners as it is
always open to an employer to fix a cut-off date, which in the present case
was taken after weighing the pros and cons of continuing the 1995 Scheme
and the viability of the Trust Fund and was not arbitrary.

25. It is clear from a reading of the Trust Deed dated 12.03.1997 that
while the Trust was irrevocable, the Deed itself envisaged a provision for
alteration, addition or amendment to the Deed and power to alter emanated
from Clause 8 of the Deed, which provides that the Trustees may at any time
with the consent of NTPC or on its recommendation by a Supplementary
Deed amend or add to the provision of the Trust Deed or the Rules. Much
was argued by the Petitioners that a condition precedent to amendment of
the Deed was that there should be no adverse effect on the benefits being
paid to the employees, overlooking the fact that 1995 Scheme was never
intended for the benefit of an individual employee but was for the collective
interest of the whole class of employees and once it could not address the
larger interest, it had to be restructured. Petitioners have accepted the 1995
Scheme with all its terms and cannot question the change. [Ref.
Union of
India and Others v. N. Murugesan and Others
, (2022) 2 SCC 25]. Insofar

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 41 of 68

Signing Date:24.05.2025

16:15:34

as the requirement of prior approval of the CIT is concerned under Clause 8,
the approval was given on 06.02.2013 w.e.f. 01.04.2002. In any case, the
only effect of delayed approval would be that the Trustees shall be held
liable for tax implications on the contributions received as per Rule 9 of
Schedule 4, Part B of 1961 Act but this cannot invalidate the changes made
in the Pension Scheme.

26. Petitioners have completely glossed over the fact that the 1995
Scheme was a purely, voluntary, self-contributory scheme and not a
statutory pension scheme. The Scheme was not a part of the conditions of
service of the Petitioners and was brought in as an added benefit and
therefore, it is not open to the Petitioners to even argue that by the change in
Scheme, there is an adverse effect on their service conditions. The Trust was
created with a purpose of regulating and managing the Pension Scheme and
NTPC/Trust cannot be saddled with any liability if the Trust became
unviable.

27. Petitioners wrongly contend that they have paid full amount of Past
Service Contributions with interest. Recovery with respect to Past Service
Contribution was stopped from 01.09.2002. The Scheme itself envisaged
recovery in 120 installments starting from October, 1997 and therefore, only
50% of the 120 installments was actually paid by the members and all
contributions made were credited to their respective accounts along with due
interest. From September, 2002, amount of Additional Contribution was
reduced to Rs.360/- per month and lumpsum contribution of Rs.3,149/- was
paid annually while Rs.5,508/- was payable once in three years. Moreover,
Fixed Percentage Contribution payable at the rate of 1% to 5% of the salary
depending upon of age of the member, was initially reduced to 1% for all

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 42 of 68

Signing Date:24.05.2025

16:15:34

age groups from September, 2002 onwards and altogether stopped from
December, 2003. From April, 2012 onwards, no contribution was recovered.

28. NTPC Trust has filed a plethora of financial documents during the
hearing of the petitions but there were no substantive arguments by the
Petitioners to controvert them. The viability of the 1995 Scheme was
determined as per actuarial valuation by qualified Actuaries, who are experts
in the field. Long term viability of the Pension Scheme is determined by an
Actuary based on sources of contributions to the funds (contributions
payable by the Member and earnings from investments) and total liability of
pension payment for all members as per benefit structure of the Scheme;
current and expected annuity rates; mortality and morbidity data; and
employees' age profile etc. Before amendment of the Scheme to defined
contribution pattern, expert Actuaries undertook a detailed exercise and
deliberated on many alternatives: (a) payment of pension on notional salary
with some assumed increase in the salary instead of calculation of pension
on actual salary; (b) calculate pension in two parts i.e. separate pension
calculation for service rendered upto 01.01.1997 (pension to be calculated
based on salary drawn as on 31.12.1996) and second, to calculate pension
based on service on or after 01.01.1997 till date of separation of an
employee; (c) refund of annuity purchase price to the Trust instead of return
to the nominee; and (d) multiple time increase in contribution payable by the
employees. On a holistic exercise, it was found that only restructuring of the
Scheme would be in the interest of the collective of the employees.

29. Petitioners wrongly rely on the judgment of the Supreme Court in
Mohd. Yunus. Firstly, the judgment is not a judgment in rem. Secondly,
validity of Circular dated 03.02.2003, impugned in the present petition was

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 43 of 68

Signing Date:24.05.2025

16:15:34

never challenged and thirdly, most of the members of Petitioner No.1 have
superannuated much after the 2003 Scheme being notified while Mohd.
Yunus retired prior to the notification of the 2003 Scheme. Moreover, the
Trust had not provided complete details of the Actuary reports and financial
impact on the Trust Fund before the Allahabad High Court. The judgment
does not decide the workability of the pension Trust or the legality of the
2003 Scheme and it is for this reason that the Supreme Court remanded the
present writ petitions for a hearing on merits. Reliance was placed on the
following judgments:-

(
A) Deccan Paper Mills Company Limited v. Regency Mahavir
Properties and Others
, (2021) 4 SCC 786.

(
B) State of Uttar Pradesh and Others v. Arvind Kumar
Srivastava and Others
, (2015) 1 SCC 347
(C) State of Orissa and Another v. Orissa Khadi and Village
Industries Board Karmachari Sangh and Another, 2023 SCC
OnLine SC 281.

(
D) Manish Kumar v. Union of India and Another
, (2021) 5
SCC 1.

ANALYSIS AND FINDINGS:-

30. Coming first to the objection raised by Pension Trust that these writ
petitions are barred by delay and laches. There can be no dispute with the
legal proposition that doctrine of delay and laches is a well-recognized
doctrine and from time to time, the Supreme Court has held that doctrine of
delay and laches or for that matter limitation are statutes of repose and peace
and rest on foundations of greater public interest. It is, however, equally
settled that if in every case an argument against relief, which is otherwise
available to a party and just, is founded on mere delay, validity of that
defence must be tried on principles of equity, save and except, where there is

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 44 of 68

Signing Date:24.05.2025

16:15:34

a statutory bar to condone the delay. It is also settled that law recognizes a
continuing cause of action which may give rise to a recurring cause of action
as in the case of salary or pension. Relying on the judgment of the Supreme
Court in
M.R. Gupta v. Union of India and Others
, (1995) 5 SCC 628, in

Union of India and Others v. Tarsem Singh
, (2008) 8 SCC 648, the
Supreme Court held that it is the very essence of a continuing wrong that it
is an act which creates a continuing source of injury and renders the doer of
the act responsible and liable for continuance of the injury. If the wrongful
act is of such a character that injury caused continues then the act constitutes
a continuing wrong. It was further held that normally, a belated service
related claim will be rejected on ground of delay and laches in a writ petition
but one of the exceptions to the rule is in cases relating to continuing wrong
and where the claim is based on a continuing wrong, relief can be granted
even if there is a long delay in seeking the remedy, with reference to the date
on which the continuing wrong commenced, if such continuing wrong
creates a continuing source of injury. Of-course, there is an exception to the
exception where the grievance effects rights of third parties which in the
meantime have crystallized such as in cases of seniority or promotion. The
Supreme Court observed that if the issue relates to payment or re-fixation of
pay or pension, relief may be granted in spite of delay as it does not affect
rights of third parties.

31. By these writ petitions, Petitioners ventilate their grievances with
respect to re-fixation of their pension on account of restructuring in a
Pension Scheme, which has impacted their monthly pension and thus there
can be little doubt that their cause is a continuous cause arising out of a
continuing injury and the judgment in
Tarsem Singh
(supra), will apply in

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 45 of 68

Signing Date:24.05.2025

16:15:34

all four corners. Be that as it may, I am of the view that there is no
inordinate delay in filing the writ petitions and the reason is not far to seek.
It is true that the restructured 2003 Scheme was introduced on 03.02.2003.
However, it cannot be overlooked that having introduced the Scheme, the
Pension Trust was continuing to have deliberations and discussions on the
revival of the 1995 Scheme and in fact, the original Trust Deed was
amended by the Supplementary Trust Deed only on 09.08.2011 and
significantly, even the approval by the CIT was given on 06.02.2013. All
this while, Petitioners were hopeful that the 1995 Scheme may be restored.

Pertinently, a categorical stand is taken in most of the writ petitions that
whenever Petitioners represented, orally or in writing, protesting against the
restructuring of the Pension Scheme, they were asked to await the outcome
of the decision of the Supreme Court in the case of
Mohd. Yunus
(supra) as
even the Respondents lacked clarity on the validity and applicability of 2003
Scheme. This argument is even otherwise without any basis for the singular
reason that the Supreme Court remanded these writ petitions to be heard on
merits conscious of when the writ petitions were filed. The order does not
indicate that the issue of delay and laches was left open to be decided by this
Court considering that the Supreme Court was examining the judgment of
the Division Bench dated 01.11.2018, where Pension Trust had categorically
raised an objection qua some of the writ petitions that they were barred by
delay and laches. In light of this, the preliminary objection raised by the
Pension Trust is rejected.

32. Genesis of the disputes between the parties in the present writ
petitions lies in 1995 Scheme introduced by NTPC vide
CPC
No. 354/1997
dated 09.10.1997. Background to introduction of the 1995 Scheme was

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 46 of 68

Signing Date:24.05.2025

16:15:34

persistent demands from various Unions and Associations of the employees
of all categories in different PSEs of Government of India to introduce a
scheme, in addition to statutory schemes such as Contributory Provident
Fund and Employees' Pension Scheme, 1995 under
Employees' Provident
Funds and Miscellaneous Provisions Act, 1952
and Gratuity, for payment of
retirement benefits in case of superannuation, death or permanent disability
of an employee. Looking into these demands, Ministry of Programme
Implementation, DPE, Government of India, vide O.M. dated 12.04.1991,
issued a directive that individual PSEs may 'work out a suitable Annuity
Scheme through LIC, based on purely voluntary contributions made by the
employees to a fund outside the PSE without any liability on the
PSE/Government'. It was also decided that Management contribution to the
Superannuation Fund would be restricted to Rs.100/- per annum for all
employees of the PSE, taken together.

33. Pursuant to the said O.M., Board of Directors of NTPC in the 141st
meeting held on 18.03.1994, approved the introduction of a Self-
contributory Superannuation Benefit (Pension) Scheme to be administered
through a Pension Trust. Ministry of Power, Government of India gave its
in-principle approval for introduction of a pension scheme, vide letter dated
18.05.1995. NTPC appointed M/s. K.A. Pandit as an Actuary and Actuarial
Valuation Report dated 28.04.1993, formulating salient features of the
pension scheme, was received from the Actuary, wherein the assumptions
considered for valuation were: (a) Future Salary increase @ 7% p.a.;

(b) Return on Investment of Trust Fund @ 12%; and (c) Annuity rate of
LIC-100 times of monthly pension under Pension for Life with Return of
Capital to Nominee option, Mortality in service @ LIC table of 1970-73

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 47 of 68

Signing Date:24.05.2025

16:15:34

(3.45 death per 1000).

34. Subsequently, a revised Actuarial Valuation Report dated 16.03.1994
was received, as per which total value of pension liability at that time was
assessed at Rs.154.66 crores, to be funded by Percentage Salary
Contribution ranging from 1% to 5% depending on the age of the employee
along with Additional Contribution of Rs.280/- per month per employee,
escalated at the rate of 8% per annum. An MoU was executed on 07.03.1997
between NTPC and NEFI and SEJC, wherein it was mutually agreed to
formulate a Self-Contributory Superannuation Benefit (Pension) Scheme for
benefit of all NTPC employees and to create a Pension Trust to manage and
administer the Scheme. It was also agreed that NTPC's contribution shall be
limited to Rs.100/- per annum for all employees taken together and rest of
contribution will be by employees to make the Scheme financially viable
and the contributions were to be deducted from the salaries of the employees
on a monthly basis. Executives and the Supervisors, who were on roll of
NTPC on the date of signing of the MoU as also those who joined in future,
were to compulsorily become members of the Scheme. The percentage of
contributions as also Additional Contribution were prescribed in the MoU.
Clause D.4.1 provided that three Trustees would be from Executives'
Association and three from Supervisors' Association as nominated and
seven were to be nominated by the Management including the Chairman of
the Trust for managing the Trust properties. It was decided that NTPC shall
execute a Trust Deed and frame Rules for proper implementation of the
Pension Scheme with the approval of CMD, NTPC or any other authorized
officer. Trust was to be registered with the Registrar of Assurances.

35. Clause D.4.3 provided that income tax exemption will be obtained to

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 48 of 68

Signing Date:24.05.2025

16:15:34

the effect that income of the Trust will not be chargeable to income tax.
Clause D.4.5 stipulated that MoU shall be irrevocable and remain operative
and effective in perpetuity till the Pension Scheme continues to be in
operation. Salient features of the Scheme were enumerated in Annexure-1 to
the MoU and were integral part of the MoU. Clause D.4.7 categorically
provided that MoU shall become effective for all purposes and intents
from 01.04.1995 and recoveries/contributions shall start from 01.04.1995
and all employees on the rolls of NTPC as on 01.04.1995 shall make
contributions.

36. Trust Deed was executed on 12.03.1997 and Rules were framed. Soon
thereafter, the 1995 Scheme was introduced on 09.10.1997 with approval of
CIT on 11.06.1997. The Scheme became operational and several Circulars
were issued thereafter from time to time regulating the deductions made
from the employees towards contributions from past as well as present
service.

37. The 1995 Scheme was a defined benefit scheme and the corpus of the
Trust Fund was funded by contributions from the members through:

(a) monthly Percentage Salary Contributions fixed as per the employee's
age; (b) Past Service Contributions; and (c) Monthly Additional
Contributions. Being in the nature of a 'Defined Benefit' Scheme, the 1995
Scheme asssured pension at the rate of 1.25% per annum per year of
Reckonable Service, limited to 50% of last drawn salary and for Reckonable
Service less than 40 years, benefit was proportionately reduced. Therefore,
the 1995 Scheme had a direct linkage to the last drawn salary and
Reckonable Service and clearly, the pension was pre-defined. Reckonable
Service as defined in the Rules was total of Escalated Future Service + Past

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 49 of 68

Signing Date:24.05.2025

16:15:34

Continuous Service and Salary included Basic Pay + Dearness Allowance.

The sum of three contributions was deposited in a Pool Account of the
Pension Trust to make a corpus and the money in the corpus was to be
utilized by the Trust to buy annuities from LIC, as and when an employee
superannuated, died etc. The Trust invested the contributions in approved
securities as per Government Guidelines and provisions of 1961 Act.

38. There was a paradigm shift in 2000 with respect to the working of the
1995 Scheme and viability of the Trust Fund and the trigger, as brought
forth by the Respondents, was revision in salaries of the NTPC employees
w.e.f. 01.01.1997, following the ten years wage revision pattern in PSEs.
This and several other factors, as brought out above, eventually led to
introduction of the 2003 Scheme, which was a 'Defined Contribution'
Scheme in contrast to the 1995 Scheme, which was a 'Defined Benefit'
Scheme. Under the restructured 2003 Scheme, pension was to be calculated
based on actual contributions by the members and interest credited by the
Trust on such contributions with no linkage to last drawn salary or length of
service and the purchase value of annuity remained limited to the 'Actual
Accumulated Contribution' of an employee. Aggrieved by the restructuring
of the 1995 Scheme, one Mohd. Yunus, an ex-employee of NTPC who
retired on 31.07.2002, approached the Allahabad High Court and vide
judgment dated 17.12.2009, the Court held that he was entitled for pension
under the 1995 Scheme. The judgment was challenged by Pension Trust
before the Supreme Court but the Civil Appeal was dismissed on 09.12.2015
on the ground that rights of Mohd. Yunus crystalized on the date of his
retirement and any future Scheme, Rules or Guidelines, including 2003
Scheme, would be inapplicable to him.

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 50 of 68

Signing Date:24.05.2025

16:15:34

39. At the cost of repetition, I may note that in the present batch of
petitions, in writ petitions, bearing W.P. (C) Nos. 2327/2016, 2092/2016,
9539/2016, 6179/2016, 2289/2016, 4839/2016 and 2010/2016, Petitioners
are those members of the 1995 Scheme who retired prior to 03.02.2003
while Petitioners in the other writ petitions, save and except one, are those
who retired post 03.02.2003, the date on which the 2003 Scheme was
introduced albeit retrospectively to apply to all cases of superannuation after
01.04.2002 and to cases of death while in service/total incapacitation after
31.08.2002, except cases already settled by the Trust. Some members of
Petitioner No. 1 in W.P.(C) 6357/2019 are also retirees prior to 03.02.2003.

40. The moot question that arises for consideration before this Court is
whether the Petitioners will be governed by 1995 Scheme or the restructured
2003 Scheme. But before examining the said questions, it is important to
segregate the Petitioners in two categories.
In my view, cases of Petitioners
who retired prior to 03.02.2003 cannot be placed on the same pedestal as
those who retired post the said date as they are squarely covered by the
judgment of the Supreme Court in
Mohd. Yunus
(supra). Therefore, in
these cases, this Court need not enter into deciding the vexed question of
validity of the 2003 Scheme, which cannot be made applicable to them
retrospectively.

41. The case of Mohd. Yunus before the Allahabad High Court was that
since he had attained the age of superannuation on 31.07.2002, he was
entitled for payment of pension under the 1995 Scheme. Agreeing with
Mohd. Yunus, Allahabad High Court held that he would be entitled for
payment of post-retiral dues in accordance with the 1995 Scheme, existing
on the date of his retirement and any change made subsequently shall not

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 51 of 68

Signing Date:24.05.2025

16:15:34

affect his rights and accordingly, direction was issued to pay his post-retiral
dues as per the 1995 Scheme. The judgment was carried in appeal, which
was dismissed by the Supreme Court on 09.12.2015, holding that retiral
benefits of Mohd. Yunus crystalized on the date of his retirement i.e.
31.07.2002 and any rules or guidelines notified thereafter including the 2003
Scheme could not be made applicable to him. Applying the aforesaid
judgment, cases of Petitioners who retired prior to 03.02.2003, will be
governed by the 1995 Scheme and the 2003 Scheme, which was introduced
post their retirement will be inapplicable. The action of the Pension Trust to
make the scheme retrospectively applicable to retirees from 01.04.2002 to
take away their vested rights which crystallised on the dates of their
respective retirements, cannot be sustained.

42. The argument made on behalf of the Pension Trust that the judgment
is not a judgment in rem has no force. Supreme Court dismissed the appeal
holding that settled and crystallised right of Mohd. Yunus to receive pension
at the time of retirement cannot be adversely affected by any subsequent
change in a scheme or policy by giving it a retrospective effect. The ratio is
certainly applicable to the present cases and binding. Even otherwise, it is a
well settled proposition of law that once an employee retires under the
existing pension scheme, his right crystallizes on the said date and
subsequent change in the pension scheme cannot take away the said vested
right, retrospectively. Amendment if any, can only operate prospectively.
[Ref.:
Punjab State Cooperative Agricultural Development Bank Limited
v. Registrar, Cooperative Societies and Others
, (2022) 4 SCC 363 and
Bank of Baroda and Another v. G. Palani and Others, (2022) 5 SCC 612].

43. The next question that arises is as to what relief can be given to these

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 52 of 68

Signing Date:24.05.2025

16:15:34

Petitioners considering that many years have elapsed from the respective
dates of their retirements as also considering that the 1995 Scheme was a
Self-Contributory Scheme requiring the members to contribute Fixed
Percentage Monthly Salaries, Monthly Additional Contributions and Past
Service Contributions. To answer this question, I am guided by the judgment
of the Supreme Court in
University of Delhi v. Shashi Kiran and Others
,
(2022) 15 SCC 325. In the said case, the primary issue before the Supreme
Court in the Shashi Kiran batch of cases was whether having opted for CPF
while in service upto the cut off date consciously, the employees could
exercise an option to switch over to GPF for grant of pension. The Supreme
Court upheld the judgment of the Division Bench permitting the Appellants
in the said batch to switch over so that they could receive pension. Since the
litigation took many years to conclude, the second question that arose before
the Supreme Court was as to the financial impact of the decision of the
Division Bench. In this context, the Supreme Court examined that the Shashi
Kiran batch of cases involved only 75 persons and the shift of those
employees from CPF to GPF would not in any manner affect the strength
and character of the Fund as also considering that the original Petitioners
had approached the Court in 2010. It was further held that at this length of
time, it is not as if any floodgates would be opened or there will be a drain
on the resources of the State. In this light, the Supreme Court held that the
decision of the Division Bench did not warrant interference with the caveat
that original Petitioner would recoup the contribution under CPF with
interest. Mindful of the fact that years had elapsed in the litigation and some
of the employees may not be interested in switching over to GPF since it
entailed recouping the contribution under CPF, the Supreme Court directed

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 53 of 68

Signing Date:24.05.2025

16:15:34

that option must be given to them to decide if they wanted to switch over to
GPF at that point of time.

44. In the present case, Trust has taken a stand in the counter affidavit,
which is uncontroverted, that recoveries with respect to Past Service
Contribution were stopped from 01.09.2002 and Additional Contributions
payable monthly were reduced to Rs.360/-. Therefore, wherever part
contributions were not made till the date of retirements, the contributions as
envisaged in the 1995 Scheme shall have to be made to recoup the corpus of
the Trust Fund. However, with the passage of over two decades and at this
distant point in time, it may be possible that some of these Petitioners or
their beneficiaries may not be interested in recouping the balance
contributions under the 1995 Scheme. The only way to resolve this issue
will be to direct the Pension Trust to give an option to these Petitioners or
their beneficiaries, as the case may be, to contribute to the corpus and
wherever the option is favourably exercised, the member shall make the
required contribution, upon which the 1995 Scheme will apply and Defined
Benefits envisaged under the said Scheme will be granted along with
arrears. Be it ingeminated that the total number of these Petitioners is
miniscule and therefore, in any event, there is no apprehension of opening
floodgates or any significant financial impact on the Pension Trust Fund.

45. Coming now to the Petitioners who retired post 03.02.2003. The
submissions of the Petitioners, eloquently articulated by their learned
Senior Counsel can be encapsulated as: (a) 2003 Scheme cannot apply
retrospectively to those who were members of the 1995 Scheme when the
same was introduced and had contributed to the corpus of the Trust; (b) the
restructured Scheme adversely affected the pension of the members of the

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 54 of 68

Signing Date:24.05.2025

16:15:34

1995 Scheme and therefore, the alteration/amendment was wholly illegal in
light of the embargo in Clause 8 of the Trust Deed dated 12.03.1997; and

(c) albeit there is no quarrel with respect to the powers of the Trustees to
amend or add to the provisions of the Trust Deed dated 12.03.1997, but the
same could only be done by the mechanism and procedure provided in
Clause 8 of the said Deed, which stipulated that any alteration or addition to
the Trust Deed will be with the consent of NTPC or on its recommendation
by a Supplementary Deed and with the prior approval of the CIT and in the
present case, there was no prior approval, as admittedly CIT gave his
approval on 06.02.2013 retrospectively from 01.04.2002 and the
Supplementary Deed was executed on 09.08.2011 and therefore, at the
highest, 2003 Scheme would take effect from 06.02.2013.

46. Indisputably, the 1995 Scheme was introduced by NTPC in
furtherance of the Directive of the Government in O.M. dated 12.04.1991,
whereby individual PSEs were to work out a suitable Annuity Scheme
through LIC on purely voluntary contributions by the employees and the
Scheme was to be administered through a Trust by constituting a Pension
Fund. The liability of NTPC as a PSE was limited to Rs.100/- per annum for
the total employees taken together and remaining contribution was by
the employees. It needs emphasis that there are no allegations of
mismanagement or maladministration of the Trust Fund or misfeasance or
embezzlement by the Trustees. In fact, no serious arguments were canvassed
on behalf of the Petitioners to controvert the financial documents, including
actuarial reports or balance sheets etc., placed on record by the Trust, despite
hearings post the filing of these documents.

47. The main plank of the argument of the Pension Trust is that the 1995

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 55 of 68

Signing Date:24.05.2025

16:15:34

Scheme was not one etched in stone or immutable and by the very nature of
the Scheme it was vulnerable to discontinuation and to say the least subject
to periodic reviews for which purpose Actuaries had to be kept engaged in
order to scrutinize the availability of funds and consequently the viability of
the Trust and the Scheme.

48. One thing that comes out clearly from a close perusal of the
documents on record as also arguments of the respective parties is that in
less than 3 years from when the 1995 Scheme was introduced in the year
1997 albeit with effect from 01.04.1995, serious issues started cropping up
with respect to the viability of the Scheme. Respondents attribute this to
various factors such as enhancement in the age of retirement of employees
from 58 to 60 years; increase in the salaries first of the Executives and then
of the Supervisors followed by the workmen from 01.01.1997; increase in
rates of purchase of annuities from LIC; and decline in return on
investments. Plethora of financial documents have been placed on record by
the Respondents jointly which include minutes of several meetings of Board
of Trustees, balance sheets, communications with LIC and the
representatives of Unions and Associations of the employees, the main
stakeholders, as also Actuarial Reports by different Actuaries, being experts
in their field, with the purpose of showing that the Scheme was not viable in
its present form with the contemplated incoming contributions as also to
show the bona fides in making every possible attempt to keep the 1995
Scheme viable and ongoing. It would be pertinent to refer to some of these
documents in order to examine whether there is any force in the submissions
of the Respondents.

49. Documents evidence that prior to the introduction of the 1995

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 56 of 68

Signing Date:24.05.2025

16:15:34

Scheme, Actuarial Reports were called for to assess the viability of the 1995
Scheme. Both the reports dated 28.04.1993 and 16.03.1994 indicate that the
assumptions considered during the actuarial valuation were: (a) Future
Salary increase @ 7% p.a.; (b) Return on Investment of Trust Fund @ 12%;
and (c) Annuity rate of LIC-100 times of monthly pension under Pension for
Life with Return of Capital to Nominee option. The total liability was
assessed at Rs.154.66 crore to be funded by Percentage Salary Contribution
ranging from 1 to 5% and Additional Contribution of Rs.280/- per month
escalated at the rate of 8% per annum.

50. After the age of retirement was enhanced and salaries were revised in
NTPC in 2000, Board of Trustees held a meeting on 21.08.2000 to assess
the impact of the changed circumstances and to see if the Trust was
economically viable. Presentation was called for from the Actuary and as
suggested, actual data of revised pay was called for while deciding that for
the time being, pension will be paid on pre-revised salaries. In the 13th
meeting held on 11.10.2000, it was felt that increase in employees'
contribution will be required to keep the Trust viable and the rate of
Additional Contribution was revised to Rs.915/- from 01.04.2000. Circular
dated 15.11.2000 was issued for increase in Additional Contribution for
Financial Year 2000-01 for Executives. In the 14th meeting held on
16.02.2001, the impact of wage revision of workmen and Supervisors as
also increase in purchase price of annuity by LIC and lower rate of return on
investment was discussed again. Details of investments made during the
year 2000-01 was also circulated for consideration.

51. Actuarial Valuation Report for Executives dated 17.03.2001 with cash
flow and data summary was received, which indicated that as on 31.12.2000,

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 57 of 68

Signing Date:24.05.2025

16:15:34

the pension liability was Rs.348.45 crores while the corpus of the Trust was
only Rs.63.61 crores with a deficit to be funded by Additional Contribution
being Rs.1,400/- per month by Executives and Percentage Salary
Contribution at the then prevailing rate. These issues were again deliberated
upon extensively in the 15th meeting of the Board of Trustees held on
08.06.2001. It was brought forth in the meeting by the Secretary of the Trust
that increase in annuity rates of LIC was about 19 to 20% and reduction in
interest rates was approximately from 12.5 to 11% in one year. In the same
meeting, Trustees also discussed various alternate modules to make the fund
viable such as: (a) determination of rate of contribution based on single
percentile contribution rate varying with age group; (b) payment of pension
on fixed salary escalation instead of last drawn salary; and (c) return of
capital amount to the Trust instead of going to individual nominee.
Possibility of giving loans to the Trust against bonds for good investment
was also discussed.

52. In the 18th meeting held on 28.12.2001 elaborate discussions took
place on the Pension Scheme and views were expressed by Trustees
nominated by NEFI and Supervisory Associations and Unions as also views
of Management Trustees. After taking the respective views, it was decided
that the Actuary would study the various alternatives of benefit and
contribution structures to suggest alternatives including one with which
basic benefit structure does not change and in the meantime, pension was to
be paid treating the salary as 2/3rd of the salary drawn as an ad hoc measure.

53. Documents show that on 01.05.2002, CMD, Pension Trust wrote to
Chairman, LIC, requesting for reduction in annuity rates pointing out that in
the Self-Contributory Scheme of NTPC, entire corpus of the Fund was

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 58 of 68

Signing Date:24.05.2025

16:15:34

generated by the employees and till March, 2002, for a pension of Rs.1,000/-
per month, the annuity purchase price used to be approximately
Rs.1,13,852/- on annuity factor of 105.4, however, w.e.f. 01.04.2002 LIC
had substantially increased the price to Rs.1,71,184/- on annuity factor of
70.10 i.e. more than 50.36%, which was a huge burden on the Trust. In
furtherance thereof, efforts were made to explore any alternate agency for
purchasing the annuity, however, inter-office Memo dated 03.07.2002
shows that none of the agencies contacted was in a position to offer the
services.

54. Respondents have also placed on record the report by Mercer
indicating the detailed exercise undertaken to study the impact of rise in
annuity rates, salaries and reduction in interest regime as also to analyse the
way forward. It was inter alia recommended that: (a) under current
circumstances, it may be necessary to buy annuity from LIC; (b) annuity
with return of corpus would be a costly proposition and life annuity with a
ten years guarantee period was more feasible option being cost effective
with a return of significant portion of purchase price; (c) accrual rate of
pension at 1.25% was difficult to sustain unless the option of frozen past
service pension was adopted; and (d) accrual rate of pension of 1% was
feasible if contribution rates were enhanced as suggested.

55. Another significant document relied upon by the Trust is a
communication dated 10.09.2002 from Secretary General, NEFI addressed
to CMD, NTPC wherein it is stated that during the course of NEFI's
interaction with the Management on 07.08.2002, a presentation was made
proposing 3 models as alternatives, as suggested by the Actuaries, however,
as discussed in the subsequent meeting held on 10.09.2002, it was resolved

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 59 of 68

Signing Date:24.05.2025

16:15:34

after due deliberations that since none of the three models inspire
confidence, the Scheme be foreclosed and recovery from salaries of the
Executives on this count be stopped forthwith.

56. In light of all this, 20th meeting of the Board of Trustees was held on
19.12.2002. It is recorded in the minutes of the meeting that restructuring of
the 1995 Scheme was under review for quite some time as review was
needed in light of changes in the economic scenario in the country as well as
downward changes in the interest rates. Consequently, certain assumptions
made by formulating this Scheme by Actuaries also underwent substantial
changes. Detailed discussions held in various Trust meetings yielded no
useful solutions and no consensus could be reached on either the change in
benefit structure or contributions. It is also noted that pending the decision,
pension payments to employees retired after 01.04.2002 had been kept in
abeyance. After deliberation, it was resolved that the Self-Contributory
Defined Benefit Scheme must give way to the Defined Contributory Scheme
and pension would be then payable on the actual contribution of the
employee. In furtherance thereof, PTC 16/2002 was issued circulating the
change in the contribution structure for the Executive as follows:-

"NTPC LTD. SELF CONTRIBUTORY SUPERANNUATION BENEFIT (PENSION)
TRUST

Ref: pension: trust/ptc-16 Date: 19/12/2002

Pension Trust Communication (PTC) - 16/2002

Sub: Restructuring of contribution structure for Executives for the Self
Contributory Superannuation Benefit (Pension) Scheme.
1.0 The Board of Trustees in its 20th meeting held on 19/12/02 has
decided to change the contribution and benefit structure in respect of
executive categories of employees as under w.e.f. September, 2002.
2.0 The contribution structure has been changed as under for

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 60 of 68

Signing Date:24.05.2025

16:15:34

executives:

a) Monthly Percentage salary contribution in case of Executives shall
be 1% of Basic Pay w.e.f. September, 2002.

b) Additional contribution for executives shall be Rs. 788/- p.m.
escalating @ 8% pa, w.e.f. the month of September, 2002. Actual
monthly recovery of Additional Contribution will be separately
communicated by the TRUST.

c) Excess contributions paid by members for the month of September,
October and November, 2002 will be adjusted against contributions
payable in future months.

3.0 For the purpose of this adjustment, Accounting Units of NTPC will
not deduct any contribution from the salary of December, 2002 for
Executive categories of Employees.

4.0 Detailed communication about revised rates of contribution,
deduction's adjustment of excess contributions, if any, and about benefit
structure is being issued by the Trust separately.

This is for necessary action at the end of Accounting Units.

Sd/-

(R.K. RUSTAGI)
SECRETARY (TRUST)"

57. On 03.02.2003, PTC 17/2003 was issued i.e. the 2003 Scheme
postulating the salient features of the restructured contributions and the
benefits accruing thereon. From the aforementioned documents, it is
palpably clear that the decision to restructure the 1995 Scheme was not a
hasty or an overnight decision. Serious attempts and efforts were made by
the Respondents to continue the existing Scheme and to explore all
possibilities to make the same viable. Actuarial Reports were sought with
recommendations to work the Scheme. Request was made to LIC to reduce
the purchase price of annuities as that was a major factor impacting the
working of the Scheme financially. Several agencies were contacted to sell
the annuities on low price but none of the agencies were able to offer the
annuities being new in the field. Three alternatives were suggested by the

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 61 of 68

Signing Date:24.05.2025

16:15:34

Actuaries to continue the Scheme with some variations but neither of them
could be enforced. It is also pertinent to mention that at all stages, the
Employees' Associations and Unions were kept in the loop. They were
informed of the reasons for which the 1995 Scheme was no longer viable
and that enhanced contributions from them could work towards making the
Scheme viable, however, as the Minutes of the Meetings indicate the
employees expressed their disinclination to enhance the contributions as
sought and/or as recommended by the Actuaries. In fact, NEFI had sent a
written communication to CMD, NTPC to foreclose the Scheme as they
were unable to enhance the contribution. Finally, a decision was taken to
restructure the Scheme with a different structure of contribution as also
benefits to the employees.

58. The actuarial reports show that to maintain the existing pension
benefits Percentage Salary Contribution would have to be increased from 3
to 8% or 2.75 times with an Additional Contribution of Rs.730/- per month
escalated by 8% for Non-Executive or else if entire contribution was met
from Percentage Salary Contribution, then it will be 6% to 25% i.e. 7.25
times of the present rate with no Additional Contribution. For Executives,
Actuary informed that if only Percentage Salary Contribution was recovered
it had to be 6% to 25% or 7 times of present rate with no Additional
Contribution or Additional Contribution at Rs.988/- per month with 8% per
annum escalation etc. However, the employees were not willing to enhance
the contributions and pertinently on 07.02.2003, Supervisory Services
Associations sent a letter to Chairman of the Trust to implement the
restructured Pension Scheme with a rider that 1% of the Basic Pay deposited
in the accounts of the individuals should not be diverted in the Death Pool

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 62 of 68

Signing Date:24.05.2025

16:15:34

Account and Additional Contribution should be only kept on surrender items
which was Rs.788/- per month with escalation at 8% and no additional
deduction for Additional Contribution should be made. None of the
Associations were inclined to increase the Additional Contribution any
further.

59. Holistically seen, the restructuring was in the larger interest of all the
members and based on the availability of Funds with the Trust. Several
factors cumulatively resulted in the decision to restructure the 1995 Scheme
such as more than 50% increase in annuity rates by LIC of India, the annuity
service provider from 01.04.2002; salary revisions from 01.01.1997,
Actuary Reports suggesting manifold increase in contributions to sustain the
Scheme; employees and their representative bodies not agreeing to pay
revised contributions as suggested by the Actuaries. It was rightly flagged
by the Respondents that long term viability of the Pension Scheme is
determined by the Actuary Valuations based on sources of contributions to
the Funds by members and/or earnings from investments and total liability
of pension for all members as per the Defined Benefit structure of the
Scheme, current and expected annuity rates, mortality and morbidity data,
employees' age profile etc. As noted above, before restructuring the 1995
Scheme, Actuaries had undertaken a detailed exercise of actuarial valuation
deliberating over several alternatives such as payment of pension on
notional salary with some assumed increase in salary instead of calculations
of pension on actual salary. In fact, at some stage, it was also suggested to
calculate pension in two parts i.e. separate pension for service rendered prior
to 01.01.1997 (pension to be calculated based on salary drawn as on
31.12.1996) and second part to be calculated based on service on or after

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 63 of 68

Signing Date:24.05.2025

16:15:34

01.01.1997 till date of separation of employees. Refund of annuity purchase
price to the Trust instead of return to nominee etc. was also discussed. In
fact, even prior to introduction of the 1995 Scheme, actuary valuations were
carried out on certain assumptions as these valuations form the basis of
formulating any Pension Scheme. Mr. Lekhi, learned Senior Counsel
appearing for the Pension Trust rightly contended that even in the earlier
Actuary Report dated 16.03.1994, the Actuary had indicated present value of
pension as Rs.154.66 crore with the value of Percentage Salary Contribution
being Rs.29.33 crore and the resultant deficit as Rs.125.33 crores. It was
recommended that the Actuarial valuation of the Scheme should be carried
out every five years to monitor the Fund as this was how the viability could
be tested. The financial difficulties experienced by the Trust in operating the
1995 Scheme is duly supported by detailed actuarial reports indicating a
deficit which would have made the Scheme unviable. Having analysed the
documents and the financials, I am unable to come to a conclusion that the
action of restructuring the 1995 Scheme was malafide or arbitrary or
perverse.

60. Petitioners are right in arguing that Clause 8 of the Trust Deed while
empowering the Trustees to amend or add to the provision of the Trust Deed
placed two caveats on the Trustees. The first was that the amendment should
not adversely affect the benefits being paid from the Trust or accruing upto
the date of such amendment or the object of the Trust and the second being
the requirement of prior approval of the CIT. In fact, reading of Clause 8 of
the Trust Deed itself shows that the Pension Scheme was not cast in stone
and the Trustees had the power to amend, alter or add to the Scheme. Insofar
as the first condition is concerned, it is amply clear from the documents on

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 64 of 68

Signing Date:24.05.2025

16:15:34

record that had the Scheme continued in its present form of contributions
and defined benefits, it was unviable to run the Trust. Therefore, benefit of
few would have possibly resulted in discontinuing the Scheme totally and
this would have been detrimental to the larger interest of the collective of
employees and thus by restructuring and continuing the Scheme with a
different structure, the pension scheme could be sustained albeit with a
different structure.
Insofar as the prior approval of the CIT is concerned,
Pension Trust has taken a stand, and in my view rightly so that at best, the
delayed approval would result in tax liabilities but this cannot invalidate the
Scheme and in this view, I am fortified by a judgment of the Co-ordinate
Bench of this Court in
A.K. Saini & Ors. v. Union of India & Ors.
, 2015
SCC OnLine Del 13637, where a similar contention was raised by the
Petitioners that any amendment to the Trust Deed was permissible only with
the prior written approval of the Corporation and CIT. This contention was
negatived by the Court by holding that the third amendment was brought in
to bring parity amongst the employees and the mere fact that it was not
approved by CIT will not render the amendment void and at best it would
only deprive the Trust of tax benefits. In the present case, NTPC has stated
in its separate affidavit that it had approved the restructuring of the Scheme
and insofar as the CIT is concerned, approval was granted on 06.02.2013
from 01.04.2002 and at the highest, the impact of the delayed approval
would be in the tax regime but this cannot be a reason to invalidate the 2003
Scheme brought in after due deliberations and considerations, taking into
account actuarial reports as also keeping all stakeholders in loop. Execution
of the Supplementary Deed was only a ministerial act and no mileage can be
drawn by the Petitioners from its execution in 2011.

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 65 of 68

Signing Date:24.05.2025

16:15:34

61. It is a settled law that judicial review is concerned not with the
decision but with the decision-making process and a petition under
Article
of the Constitution of India is for judicial review and not an appeal.
Supreme Court has from time to time held that judicial review is not
concerned with the merits of the decision but the manner in which it was
taken.
In
R v. Panel
on Take-overs and Mergers, ex parte Guinness Plc,
Lord Donaldson, M.R. referred to the judicial review jurisdiction as being
supervisory or longstop jurisdiction and held that unless the restriction is
observed, the Court, under the guise of preventing abuse of power will be
guilty of usurping the power.

In
Tata Cellular v. Union of India
, (1994) 6
SCC 651, the Supreme Court held that the duty of the Court is to confine
itself to question of legality. Its concern should be: (a) whether the decision-
making authority exceeds its powers; (b) commits an error of law; (c)
commits a breach of rules of natural justice; (d) reaches a decision which no
reasonable authority would have reached; or (e) abused its power. Applying
these principles, in matters like the present one, this Court has only to see if
the restructuring of the Scheme is so irrational, arbitrary or perverse that it
cannot be sustained in law. For all the aforesaid reasons, this Court is unable
to reach a conclusion that the restructuring was irrational or perverse or that
the decision-making process was flawed or arbitrary.

62. Insofar as the argument of the Petitioners that individual notices were
not given to the Petitioners before restructuring the Scheme which had an
adverse impact on their pensions which were considerably reduced,
suffice would it be to hold that the representatives of the employees through
various Unions and Associations were also associated with the process of
restructuring and their suggestions on the actuarial reports including the

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 66 of 68

Signing Date:24.05.2025

16:15:34

advise to increase the contributions to keep the Scheme viable were invited.
It was neither practical nor feasible for the Respondents to serve individual
notices on the Petitioners and in my view, there is no legal requirement for
serving individual notices in matters of policy decisions pertaining to
restructuring of Pension Schemes.

63. Before parting, it is pertinent to mention that the 1995 Scheme was
introduced on 09.10.1997 and within a short span of less than 3 years,
questions were raised on the viability of the Scheme and the Trustees started
the process of actuarial valuations. Therefore, the Scheme did not run for
more than five years albeit the deductions/recoveries were made from
01.04.1995. Petitioners were completely aware of this process and the
possible unviability of the Scheme and as per the uncontroverted stand of
the Respondents, recovery with respect to Past Service Contribution was
stopped from 01.09.2002 and from the same date, amount of Additional
Contribution was also reduced to Rs.360/- per month. When the
restructuring took place, the Accumulated Contribution paid by each
employee till September, 2002 along with pro rata earnings was credited
into the individual account of the employee as under the 2003 Scheme,
purchase value of annuity was limited to 'Actual Accumulated Contribution'
of an employee. The present is not a case where the 1995 Scheme had a long
span giving rise to legitimate expectations and thus even on equity,
Petitioners have no case to assert that this Court should direct the
Respondents to restore the 1995 Scheme for retirees post 03.02.2003.

64. In light of the above findings, W.P. (C) Nos. 2327/2016, 2092/2016,
9539/2016, 6179/2016, 2289/2016, 4839/2016 and 2010/2016, are allowed
directing that the Petitioners therein will be entitled to pension under the

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 67 of 68

Signing Date:24.05.2025

16:15:34

1995 Scheme. However, keeping in view the long passage of time that has
elapsed since their retirements, Respondents shall within six weeks from
today give an option to these Petitioners/Beneficiaries, if they wish to
receive pension under the 1995 Scheme. Wherever the Petitioners choose to
be governed by the 1995 Scheme, they will make the requisite balance
contributions, if any, as envisaged under the Scheme and pension shall
resume. Arrears will be paid within 4 months from today. This direction will
apply to all those Petitioners in the other writ petitions who retired prior to
03.02.2003.

65. All other writ petitions, where the Petitioners have retired post
03.02.2003, are dismissed for the aforesaid reasons.

66. Pending applications also stand disposed of.

JYOTI SINGH, J
MAY 21 , 2025/Shivam

Signature Not Verified

Digitally Signed

By:KAMAL KUMAR W.P.(C) 6357/2019 and connected matters Page 68 of 68

Signing Date:24.05.2025

16:15:34