Kunju, M.S. vs Kottayam Co-operative Agricultural and Rural Development Bank Ltd. and Others

Thottathil B. Radhakrishnan, J.—Petitioner retired from the service of the first Respondent, a Co-operative Bank. By virtue of the Kerala Co-operative Societies Employees Self-financing Pension Scheme, 1994, hereinafter, the "Scheme", framed by the Government of Kerala in exercise of powers conferred u/s 80A of the Kerala Co-operative Societies Act, 1969, the "Act", for short, he is entitled to pension. That is payable by the Pension Fund under the Scheme. The necessary papers in terms of Clause 27 of the Scheme was forwarded to the Fund. It verified the records and found that in 1978, a particular component was added on to the emoluments of the Petitioner and such addition was carried and enjoyed till he retired in 2004. With its view that the same is an anomaly and the Petitioner was not entitled to that component, the Fund took a stand, which amounts to re-fixation of the last drawable emoluments or pay for the purpose of determining pension under the Scheme. The Petitioner challenges that.

Clause 27 of the Scheme, as it stood on the date of retirement of the Petitioner, provided that the application has to be forwarded to the Fund by the then Chief Executive of the employer society, through the Assistant Registrar having jurisdiction, with relevant records and verification certificate. After the retirement of the Petitioner, Sub-clause 3 was added to Clause 27, whereby the Officers of the Pension Fund were empowered to verify the books of accounts in respect of the Pension Fund. They were also obliged by that Sub-clause to verify the service book and pay-fixation due to pay revision, promotion, awarding of time bound higher grade etc. The society was to furnish records to the Officers of the Pension Fund, on request. In purported exercise of this authority under the power to verify, the Pension Fund has essentially trimmed down the last drawn pay of the Petitioner to what, in the opinion of the Officers of the Pension Board, ought to have been his last drawable pay, for the purpose of determining pension under the Scheme. This is impermissible. The Scheme is one that is brought by the Government in exercise of the statutory power u/s 80A and is not by itself a piece of primary legislation. The power to fix or re-fix a pay, which carries with it, the power to rectify an anomaly that has crept into the fixation or re-fixation of pay, primarily, rests with the employer as part of the jural relationship between the employer and the employee or in the repository of any statutory power, including the power of superintendence. In the frame work of the Act in hand, such power may be available with an authority exercising the powers of the Registrar or any superior authority in the Government, who has the power to decide on the question of fixation, re-fixation and rectification of anomaly in that regard, in so far as it relates to pay. That power does not trickle down to the Officers of the Pension Fund by virtue of Sub-clause 3 to Clause 27. The appropriate course of action would be for the Pension Fund to put a case up for the consideration of the competent authority under the Act, when it notices an anomaly on verification of materials under Sub-clauses 2 and 3 of Clause 27 of the Scheme and to get orders from that authority in that regard. I deem it appropriate to indicate that, all little errors that would not call for such a course, but only a real infraction of the Act, Rules and the resultant illegality being of such nature as would adversely and unjustly affect the interest of the Fund, gravely, depending on the impact of the noticed anomaly, on the pension to be fixed. The Fund is not be a Monitor of the societies, but is only to monitor that the Fund does not bleed, financially, though it may ignore small abrasions. And, any procedure involved in such matters ought not to be dragged on.

In the aforesaid scenario, the Petitioner is right in pointing out that his last drawable pay ought not to have been trimmed down by the Pension Fund.

The question now, is as to whether the case should go back for following the procedure noticed above. On the facts, it does not appear to be necessary. This is because, the so called erroneous fixation, which the Petitioner enjoyed, went to him in 1978 and a close examination of Ext. P-2 would show that, even his last drawn pay, as allowed by the employer first Respondent bank, was reckoned by the Fund to determine the contribution to be made by the employer and such contribution has been received by the Fund from the first Respondent, in terms of Ext. P-2. Therefore, treating the facts of the case as an exceptional one and without intending to create any precedent in that regard, I do not find that any injustice has resulted to the Fund, in the case in hand. It is hence ordered that the Petitioner''s pension shall be fixed at Rs. 7,448 from 1-3-2004 and arrears shall be released to him accordingly. Let that be done within a period of one month from now. The impugned decisions, contrary to this, are quashed. Writ petition is allowed accordingly. No costs.