"The 9th Bipartite was signed on 27th April 2010. There have been a series of meetings and grand gala celebrations all over the country over the success of the bipartite which is one of the major mile stone in our bipartite relations with the Indian Banks association. It is also a historic achievement as far as securing the 2nd Option on Pension. There have been a number of enquiries as to the implementation of the settlement and also expectations from the rank and file across the country that they would be able to draw the revised salary from the next month as such. The process of getting the agreement vetted by the Government for the purpose of amendments to our regulation was a long drawn procedure in the earlier days. However, over a period of time we have been able to reduce the delay and see that the in principle clearance is available for the implementation pending the amendments to the regulation of our service rules.
2. While appreciating the anxiety of the members across the country, we would only like to assure them that the implementation of the 9th bipartite is not going to be delayed at all and it will take place within the next few days. The leadership of the Confederation is in constant touch with the Indian Banks’ association and our information reveal that the officials of IBA are on their job of obtaining necessary instructions from the Government for the implementation of the salary revision and payment of acturial arrears on adhoc basis at the earliest possible.
3. The next task would be to commence the process of implementation of the 2nd Option on Pension. Comprehensive instructions are being issued to all the banks to speed up the process of obtaining the option and giving effect to the scheme without further delay.
4. Comrades, we have covered a long distance and it is now only a matter of few days before the 9th bipartite along with the 2nd Option on Pension in the Banking Industry is implemented. Let us look forward to cherish the historic moment.
With greetings,
(G.D.NADAF)
GENERAL SECRETARY "
On account of IBA agreeing to extend 2nd Option on Pension to CPF Optees, funding of pension gap by Optees at 2.8 times of revised pay as on 01.11.2007, a question has arisen as regards tax on the amount to be recovered, out of arrears of salary and allowances payable on account of 9th Bipartite settlement. According to Income tax rules, the gross arrears receivable on account of salary revision is taxable. A portion of arrears is invested in Pension fund towards future liability of Banks who have agreed to extend pension to CPF Optees. Therefore, the contribution has to be treated as investment in Superannuation Schemes and the amount to be exempted from payment of tax.
"No./1452/145/10 10.05.2010
To,
The Chairman,
The Indian Banks’ Association,
World Trade Centre,
MUMBAI – 400 020.
Dear Sir,
2ND OPTION ON PENSION
CONTRIBUTION TOWARDS PENSION FUND BY CPF OPTEES
As per pension settlement, the employees and Officers are eligible to exercise one more option towards the Pension Scheme, in lieu of the Contributory Provident Fund. The agreement also refers to the funding of the Pension Fund gap by way of contribution by the employees and Officers who are in service, out of the arrears payable to them on account of the 9th Bipartite settlement; apart from surrendering of Bank’s Contribution of PF accumulated in their respective accounts.
2. The contributions made by the employees towards the Superannuation Benefits; such as Provident Fund, Pension Fund etc., are eligible for the tax exemption as per the Income Tax rules and treated as investments in the eligible securities for all practical purposes. Thus, the money, so contributed towards pension fund in Bank is liable to be exempted from the payment of Income tax by the Tax authorities. It is in this background, there is a need to issue proper instructions to all the Banks at the time of sending guidelines for the implementation of the 9th Bipartite settlement as well as the payment of arrears to cover inter-alia:
a) The amount contributed from the CPF Optees towards their part of contribution for the Pension Fund in view of the 2nd Option on Pension extended to them should be treated on par with their contributions towards the superannuation benefits and necessary exemption should be extended at the time of deduction of tax at source. Thus, the recovery made out of arrears for the purpose of payment towards Pension Fund to the extent of 2.8 times of the revised Pay for the month of Nov.2007 should be treated as investment towards the superannuation benefits and necessary exemption should be allowed for the purpose of calculation of Income tax. In other words, the payment made towards Pension Fund on account of the 2nd Option on Pension should not be treated as taxable at the hands of the Officers.
b) The Bank Managements, while furnishing Form – 16 as well as the statement of arrears paid to the Officers should make necessary entry to this effect to enable the Officers’ concerned to utilize the same at the time of submission of their returns.
c) In view of the fact that the tax on the income for the year 2007-2008, 2008-2009, 2009-2010 have already been deducted at source, the Officers’ should also become eligible to apportion this amount as investment in the next three years’ income, since the money contributed is very substantial and they may have already exceeded their entitlement for such investments.
3. We therefore, request you to obtain special permission from the CBDT to exempt the entire contribution towards pension fund, from payment of tax. Please therefore look into the matter and take necessary action without further delay.
Thanking you,
Yours faithfully,
(G.D.NADAF)
GENERAL SECRETARY"
Source : AIBOC
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«Oldest ‹Older 201 – 205 of 205C N Venugopalan
Ex-Manager, Union Bank of India
Nandanam
Kesari Junction,
N Parvoor,
Kerala – 683 513
Phone. 0484 2447994 Mob: 9447747994 E-Mail: ceeyenvee@gmail.com
No.20100611 11th June, 2010
The Hon'ble Minister for Finance,
Govt. of India,
New Delhi
Sir,
Fresh Pension Option to Bank Employees –
Government shall not offend the Constitution and substantive law
I invite your kind attention to letter No. PMO ID No.9 3 2010 – PMP4 164953 and 164954, both dated 2nd June, 2010 from the Prime Minister's Office, forwarding my letter Nos. 20100511 and 20100511 (a) dated 11th May, 2010 to your office for appropriate action.
The Government that evolves out of the magnificent Constitution of the nation has the responsibility of conserving and protecting its grandeur by ensuring various guarantees like right to equality of the citizens besides its own sanctity. For the very same reason, the Government has to secure the various assurances and guarantees relating to equality of the people of all manners to place itself at the pinnacle of glory. The Government itself becoming a party to creating circumstances in which a certain community feels totally aggrieved will not be able to retain its sheen. The aggrieved will tend to make a hue and cry and will ultimately be driven to Courts of Justice for redressing their grievance resulting in huge influx of petitions in Courts that are already saddled with heavy backlog of cases.
IBA and Bank Unions have concluded an agreement to extend a fresh Option for Pension to those who could not exercise it when offered in 1995 because of the presence of an adverse chapter providing for forfeiture of entire past service of an employee in case one participated in strike any time. Though fresh option was legally mandatory to be extended to them when the particular clause was scrapped from the Pension Regulations in February, 1999, Public Sector Banks fraudulently kept the amendment in camera and failed to comply with the legal requirement and deprived majority of bank men of their legitimate right. Albeit the fact that the draft Pension Regulations of 1993 and the Final Pension Regulations sanctioned by the Government categorically stated that "an option once exercised shall be final and irrevocable", banks revoked the options of some employees (including me) exercised in response to the draft Regulations. This was done at the behest of IBA which is a mere voluntary organization of banks and had no powers to overstep the authority of the Government. IBA and Bank Unions, through their whimsical actions, evolved several queer banking equations, proving themselves as totally incompetent to address wage related issues of bank men. If the government goes by the recommendations of IBA – to be better called Indian Blunder Arcade- its very image will be get tarnished soon. It has become imperative that the Government set up a separate Pay commission for the Bank employees for determining the compensation for labour in the industry as in the case of Government servants.
contd.......
Now that the Government is examining the modalities of extending fresh Option for Pension, it is inevitable that the absurdities are eliminated and full justice is rendered to the people who have been stranded in life for want of income after serving the banks for making what they are now. I felt is desirable that proper feed back on items of strategic importance be given to MOF as otherwise, the wrong implementation of the scheme may generate an impression among the banking community that the MOF and the Hon'ble Minister heading it are devoid of the requisite faculties of mind. With a view to preventing fresh anomalies in the process of implementation, the following items deserve special attention:-
1. Banks are alleging deficit in Pension Funds and lack of financial muscles and make an attempt to recover from the beneficiaries of Pension Scheme a substantial amount from their wages. This has no locus-standi. The simple question that pops up is "what banks and Government would have done if every one had opted for Pension when offered initially?"
1. The recovery of Provident Fund (employer's share) paid at the time of retirement together with 56 percent on it from the retired is a gross anomaly. While commissioning the Pension Scheme in 1995, all those who retired from 01 01 1986 were given its coverage on refund of the CPF paid on retirement along with 6 percent simple interest. This is having precedence and if it is done, it will bring in some amount of fair play. One who retired 10 years back paying 56 percent of the CPF ( say on Rs.2.50 to Rs.3.5 lakhs) may not be suffering much, but one who retired recently say in 2009 also paying back the same 56 percent ( say on Rs.7.00 to Rs.9.00 lakhs ) will be the worst victim of the stipulation. The former must have at least enjoyed the interest on the amount while the latter has not at all. Subjecting the latter to such an irrational payment is vitiated by gross injustice. The envisaged recovery as also its modality is equally not maintainable.
2. Pension is payable under one and the same Pension Regulations. Recovery of a levy from one segment is illegal as another set of employees are paid pension without the levy.
3. While concluding the pact on Pension, the date from which Pension is payable to the already retired is reportedly fixed as 27th November 2009, the date of signing the pact. This deprives the beneficiaries of the Pension payable to them from the date of retirement to such arbitrary date, albeit their legal eligibility to get the same. In my own case, the amount of Pension forfeited through the pact would be Rs.9.00 to Rs.10.00 lakhs for the past eight years. If the bank and the government are to snatch away the pittance payable to an employee on retirement for its functioning, it poses a big shame to the great nation. The wage pact was one to be signed much earlier and the undue delay in signing the same has also put the beneficiaries to the loss of pension for the delayed period as per the "black pact". When one set of people who have done the same work for the organization are paid pension from the date of their retirement, denying the pension payable to the others till the arbitrary date is quite unfair from legal and social angles. It is heard that the date is agreed upon at the instance of the Hon'ble Finance Minister after the parties to the pact consulted him. If so, it can cast a shadow on the reputation of the Minister who himself is a legal luminary and a versatile genius and the decision takes things to the nadir of ethics.
contd.........
Ref:Mr.C.N.Venugopal 12th June.
Indeed it is real facts are highlighted and congrats to your earnest efforts to set right things in its right direction.It is also a fact that nothing will derive instantly.However a day will surely come for Bankmen to rejoice.
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