Thursday, March 18, 2010

Pension bonanza for ex-servicemen after Supreme Court ruling

Some 30,000-40,000 armed forces officers who were commissioned or retired between 1986 and 1996 are in for a pay arrears and pension bonanza with the Supreme Court upholding a high court ruling that the amount has been erroneously calculated.

Upholding the Kerala High Court ruling that "rank pay" should be included while calculating an officer's pay and pension, the Supreme Court has directed this be re-recalculated and paid with retrospective effect from Jan 1, 1986.

"We also direct interest to be paid thereon at 6 percent per annum," a bench of justice Markendey Katju and justice RM Lodha ruled. The judgment was delivered last week but a copy was made available only Tuesday.

The judgment will not apply to officers who were commissioned or retired post-1996 as they are covered under the Fifth and Sixth Pay Commissions.

"With this judgment, the pay of all affected officers will have to be re-fixed from Jan 1, 1986, with consequential benefits on pay, pension, commutation and leave encashment," the Retired Defence Officers Association (RDOA) that pursued the case in the Supreme Court said in a statement.

"The anticipated arrears would range from a couple of thousand rupees to a few lakh per officer depending upon the rank held and reckonable service of the officer. About 30,000 to 40,000 officers, both serving and retired, including widows, would be directly benefited," the statement said. 

According to the RDOA, the defence ministry committed a "faux paus" by not including "rank pay" in the total emoluments and then doing the pay fixation, as had been recommended by the Fourth Pay Commission, which presented its final report in 1987.

"This resulted in huge financial loss to the officers with cumulative effect on pay, DA, pension, gratuity and commutation," the association said.

Acting on the plea of Major AK Dhanapalan, a single judge bench of the Kerala High Court October 5, 1998, directed that the calculations be done afresh. A division bench of the high court upheld this July 4, 2003.

The government appealed against this in the Supreme Court and the RDOA also filed its own plea.

Many similar petitions were filed in various high courts all over the country by other officers as well.

"These were clubbed together and transferred to the Supreme Court to be heard along with an transfer petition of similar nature that had arisen out of a case that was allowed on the basis of the judgment in Major Dhanapalan's case," RDOA said.  

Source : Economic Times.

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