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Judgment
Petitioners, 4 in number, through the instant writ petition have sought the intervention of this Court for issuance of declaration to the effect that they
are entitled for benefit of GPF-cum-Pension Scheme in the light of memorandum of Association of Indian Institute of Management Kozhikode
(IIMK), Ext.P1 and relevant Bill No.20 of 2017 promulgated on 25.1.2017 Ext.P2 with a further prayer to declare the decision taken as per Ext.P4
Circular discriminating the petitioners from similarly situated employees.
The sum and substance of the averments in the petition are that IIMK was registered on 21.8.1996 under Societies Act, 1860 as a Self Financing
autonomous institution under the supervision of 1st respondent, Central Government. Its memorandum of Association Rules enable the institutions to
create Faculty and Non Faculty Posts in the Institute and to make such appointments thereto as are necessary within the overall ratio for Students-
Faculty and Non faculty, to make Rules and Bye-laws for the conduct of the affairs of the institute ,to meet the expenses of the Institute including
expenses incurred in the exercise of its power and discharge of the functions out of the Fund. Government of India passed a bill giving more
autonomous power to the institutions in the country on 31.12.2017. On cursory glance of the bill presented, all rights and debts and other liabilities of
every existing Institute would mutatis mutandis be transferred to the corresponding institutions and every person employed before the commencement
shall hold the office or service in the corresponding institutions, with the same tenure, at the same remuneration, upon the same terms and conditions
and with the same rights and privileges as to pension, leave, gratuity, provident fund shall continue to do so till the employment is terminated. The bill
also empowered the Board of Governors of each institution to take decisions on question of policy relating to administration and working of the
institution much less the constitution of pension, insurance and provident funds for the benefit of the academic, administrative, technical and other
staff. On 14th May 1997 vide Ext.P3, Indian Institute of Management, Calicut invited application for Administrative position with a note that the
qualifications for the positions would be relaxed at the discretion of the institution.
The petitioners are the employees of the 2nd respondent (IIMK) working on different ranks for the last twenty (20) years whereas the 2nd
petitioner retired from service. The aforementioned bill came into force with effect from 31.1.2018. Some of the petitioners retired and in dilemma of
not given the benefit of the GPF scheme but are covered under the National Pension Scheme as many other similar institution have already permitted
the employees to convert from CPF to GPF. To highlight their predicament and detriment, counsel for the petitioner has taken the attention of this
Court to various documents.
The Board of Directors of IIMK vide circular dated 24.10.2000, Ext.P4 had in principle approved to introduce GPF-cum-Pension Scheme for the
employee of the institution and the matter was referred to the Government of India for approval. The Ministry of Human Resources and Development
agreed to introduce the scheme in respect of only those employees who were, prior to joining the institution, working in organizations where the
scheme was in operation and had opted for the same. Such employees were requested to furnish their willingness before 10.11.2000 with a further
condition that the scheme would be applicable subject to the undertaking of the previous employer to transfer the pro-rata pensionary benefits.
The extract of the minutes of the 124th meeting of the Board held on 18.8.2008, the institution noticed that there should not be hitch in allowing the
employees to switch over from CPF to GPF and before switching over to the Pension Scheme, they should refund such retirement benefits, if any,
paid to them under the CPF scheme, as determined by the institution.
The Ministry of Human Resource Development vide communication dated 10.7.2009 considered the proposal in consultation with the Ministry of
Finance, Department allowing GPF-cum-pension scheme to the employees of five Inter University Centers namely IUAC New Delhi, CEC New
Delhi, NAAC Bangalore, INFLIBNET Ahmedabad and UGC-DAE CSR Indore in respect of the employees who had joined prior to 1st January,
2004 and opted for the same. The petitioners, since, were discriminated as they also joined before 2004 made a detailed representation but did not
yield any result compelling them to approach this Court vide W.P.(C) No.11093 of 2014. This Court vide judgment dated 23.2.2015, Ext.P11 disposed
of the writ petition with a direction to the respondent to decide the representation as expeditiously as possible within a period of four months. It is
contended that till filing of the writ petition no such decision has been taken. It is only by way of the counter for the first time, the decision Ext.R2(f)
dated 23.8.2019 has been attached rejecting the representation which sans not only reasons but any application of mind. It is highly injustice on the
part of the respondent in not permitting petitioners to be part of any pension scheme and even though they joined prior to 1st January 2004 as their
tenure of appointment was between 1997-2002. During the pendency of the writ petition, the petitioners came across certain documents ie., Ext.P19
dated 17.2.2020 an Office Memorandum issued by the Govt. of India Department of Pension, wherein the Central Government employees who were
covered under Central Civil Services (Pension) Rules, 1972 have been accorded option to convert into GPF scheme, Ext.P20, the minutes of the 124th
meeting of the Board of Governors of IIM Bangalore held on 18.8.2008, whereby it is mentioned that there should be no hitch in allowing the
employees to switch over from CPF to GPF. Since the employees of the respondent are governed by the Central Government Rules and the benefit
has been extended to many other institution, the petitioners are also entitled to avail the benefit and urged this Court for allowing the writ petition.
On the contrary, learned counsel appearing on behalf of the 2nd respondent opposed the aforementioned prayer by submitting that no doubt Section
11(q) of the IIM Act empowers the Board of Governors to specify by regulations ie., constitution of pension, insurance and provident fund but in 2019,
IIMK formulated regulations 2019, which was forwarded to the Ministry of Human Resource Development. The aforementioned regulations were
called as Indian Institute of Management, Kozhikode Regulations â€" 2019. Pursuant to Ext.R2(b), the minutes of the meeting of Directors of IIMs
held on 19.6.2000, the 2nd respondent Institute circulated Ext.P4 Circular requesting those employees who were prior to joining the Institute, as on
1.1.2004, working in organizations where the GPF-cum Pension scheme was in operation to submit their willingness to be covered under the scheme
before 10.11.2000.
The employees of IIMK raised a grievance of discriminatory treatment in the matter of extending the benefit of GPF cum pension had approached
this Court vide W.P.(C) No.12907 of 2005 (Anil Kumar Pathiyath and Others v. Union of India and Others). This Court vide judgment dated
21.4.2006, Ext.R2(c) dismissed the writ petition. The the question with regard to bring the petitioners within the GPF-cum-Pension Scheme as sought
was a matter within the domain of the Executive Government. The court's power for judicial review is not a power to review the decision of the
executive but only to review the decision making process. Vide R2(d) dated 30.6.2009, Ministry of Finance, Department of Expenditure came out with
a office memorandum on the subject of transition from contributory Provident Fund to Defined Contribution Pension Scheme for the employees of
autonomous bodies. The employees recruited prior to 1.1.2004 were given an option either to remain in the existing CPF scheme or move over to the
NPS. As per the instructions/clarification issued by the first respondent regarding switch over from CPF to old GPF Cum Pension scheme R2(e), the
petitioners who entered into service on or before 31 December 2003 and governed by the CPF Scheme, are not eligible for switch over to the GPF-
cum-Pension Scheme. There is no challenge to the order dated 23.8.2019 issued by the 1st respondent, Ext.R2(f) and urged this Court for dismissal of
the writ petition.
I have heard the learned counsel for the parties and appraised the paper book. In view of the Indian Institute of Management Bill, 2017, Board of
Governors have been given power to constitute the scheme with regard to pension etc. The relevant portion of Ext.P4 circular of IIMK reads as
follows:
The Board of Governors of the Institute had approved in principle to introduce GPF-cum-Pension Scheme for the employees of the Institute and the
matter has been referred to the Government of India for approval. The MHRD has agreed to introduce the scheme in respect of those employees
who were, prior to joining the Institute, working in organizations where the scheme was in operation and had opted for the same. Such employees are
requested to furnish their willingness to be covered under the scheme to Administration before 10.11.2000. The applicability of the scheme to such
employees will be subject to the previous employer undertaking to transfer the pro-rata pensionary benefits of such employees to the institute within a
reasonable time. The employee (s) concerned should forward their application for transfer of pensionary benefits to their previous employees through
the institute. The option once exercised shall be final.
On accepting the pension benefits from the previous employer, the service rendered by the employee in the previous organization shall be counted for
pensionary benefits along with the service in the institute and the final pension will be based on the combined service. The GPF contribution
transferred from the previous employment shall be kept in IIM's GPF account. If the employee concerned is already a member of the IIMK GPF, the
balance in their GPF account representing their own contribution together with interest accrued thereon shall be transferred to the new GPF account
and the amount of employer's contribution together with interest shall be forfeited to IIM.
It is in the background of the aforementioned circular, petitioners are affected as they have been discriminated of not giving the benefit of GPF as it
has been only confined to those employees who were, prior to joining the institution, working in the organization entitled to the said benefits. It is also
not in doubt that, University Grants Commission had granted the benefit of implementation of the scheme of GPF cum pension scheme vide
communication dated 3.8.2009, Ext.P8 to certain institutions. The relevant portion of the same reads as under:
I am directed to enclose herewith a letter received from Ministry of Human Resource Development, Dept. of Education, Government of India
regarding the implementation of GPF-cum-Pension scheme to five Inter University Centres, namely, IUAC, New Delhi; CEC, New Delhi; NAAC,
Bangalore; INFLIBNET, Ahmedabad and UGC-DAE CSR, Indore who have joined prior to 1st January, 2004 and had opted for the same.
Court cannot substitute the decision of the executive but only can interfere in the Rule making process, if pointed out to be suffering from prima
facie errors or erroneous interpretation. It is not the case herein, where the respondents intentionally omitted or erred in not implementing the GPF
scheme to the petitioners and accorded benefit only the one who had joined prior to 1st January 2004. The respondents have primarily relied upon the
judgment of the Single Bench in Anil Kumar Pathiyath (supra). For the sake of brevity, Para 11 and 12 of the judgment reads thus:
I do notice that there is some genuineness in the grievance voiced by the writ petitioners. In fact, even the tenor of the counter affidavit submitted
by the 2 respondent and the submissions of Mr Jayakumar would show that even the 2 respondent shares the above vow of mine. The counter
affidavit on behalf of the 1"" respondent is submitted by the Under Secretary in the Human Resources Ministry. That counter affidavit will show that
the Human Resources Ministry also persuaded the Ministry of Finance their level best to agree to the request of the petitioners that they be brought
under the GPF-cum-Pension Scheme. But in spite of all these, I do not think I will be justified in compelling the 1st respondent to bring the petitioners
within the GPF-cum-Pension Scheme as sought for by them and in granting the declaration sought for by them. As noticed by the Division Bench of
the Delhi High Court in its Judgment in LPA.559 of 2004, courts are expected to maintain judicial rest and not take over the functions of the executive
or the legislature. Whether the writ petitioners should be brought within the purview of the GPF-cum-Pension Scheme was a matter within the domain
of the executive Government. The court's power for judicial review is not a power to review the decision of the executive but only to review the
decision making process. A reading of the counter affidavit of the 1"" respondent will show that it was not in a casual manner that the respondent took
the decision to turn down the petitioners request for inclusion of them under the GPF-cum-Pension Scheme. The issue was considered at various
levels including the highest executive levels. There has been considerable discussions and deliberations over the issue. The matter was essential one of
policy for the respondent and the 1"" respondent has decided that Indulon of the petitioners under the GPF-cum-Pension Scheme will not be feasible on
cn relevant considerations including considerations of finance. I cannot say that the decision of the 1 respondent is per se illegal or is shockingly
arbitrary to noticed by the Supreme Court in Keshavananda Bharati v. State of Kerala (AIR 1973 SC 1461), the courts cannot be oblivious of the
practical needs of the Government. it is seen that similar requests by employees of NITS Jalandhar, Kurukshetra and Silchar were also turned down
by the Finance Ministry on the same reason. It cannot be as if there has been hostile discrimination against the petitioners. I am in respectful
agreement with all the observations of the Division Bench of the Delhi High Court in the judgment in LPA 559 of 2004 and I hold, gauging by the
principles laid down in that decision, that there is no warrant for interfering with the decision of the 1st respondent not to include the petitioners under
the GPF-cum Pension Scheme. The counter affidavit will reveal that the 1 respondent has been mindful of the problems of the petitioners and
alternative schemes like restructured defined contributory pension scheme for new entrants has been proposed and is under serious consideration. The
1st respondent has suggested that the employees are free to Join the pension scheme Introduced by the Ministry of Labour or can even work out
reliefs under the Annuity Scheme of the LIC.
The Division Bench in LPA.559 of 2004, it is noticed, placed reliance on the principles emerging from the various decislons of the Supreme court
such as Union of India v. D.N.Aggarwal (AIR 1992 SC 96) and Indian Railway Construction Co.Ltd. v. Ajay Kumar (AIR 2003 SC 1843). Those
principles will apply in the instant case also. An administrativo decision taken by the executive authority keeping in view the financial and other
implications of the Issue is not to be interfered with lightly. In any event, the materials on record do not persuade me to invoke the discretionary
powers under Article 226 of the Constitution as to interfere with the decision already taken by the 1 respondent The result is that the Writ Petition fails
and the same will stand dismissed.
The ratio culled out in the judgment leaves no manner of doubt that the Court cannot interfere into the administrative decision of executive
authority, keeping in view the financial and other implications. Similar is the case herein, where the 2nd respondent had opted their own regulations
2019 and given approval by the Government Ministry of Human Resource and Development. But I cannot remain oblivious of the fact that IIM
Bangalore had in 2008 gave an option for the benefit of GPF cum pension scheme all its employees, who were appointed on or before 1.1.2004.
Though it has not been pleaded in the writ petition but placed on record by way of an affidavit dated 12.11.2020. The relevant portion of the same
reads thus:
(5) Representation from employees for switch over from CPF to GPF
8.1 Prof. Trilochan Sastry informed that as advised by the Board, the Director had appointed a sub-committee to look into the issue of permitting some
employees to switch over from CPF to the Triple Benefit Scheme, also known as GPF- cum-pension-cum-gratuity scheme. The committee comprised
Professors M.S Narasimhan, D. Krishna Sundar and Trilochan Sastry. He said that a total of about 28 (current and retired) employees were eligible to
opt for this scheme.
8.2 Prof. Sastry mentioned that the sub-committee had examined all the relevant documents available at the Institute, and had also compiled
information about other similar institutes that had permitted belated switchover from CPF to GPF. There was clear precedence as seen in the case of
some IITs/IIMs, that could have been replicated at IIMB also. The committee had recommended that a one-time last chance may be given by the
Board to the eligible employees who wanted to switchover from CPF to GPF.
8.3 In response to a query from Shri Thakur about the source of funds for payment of pension to retired employees, it was clarired that a separate
Terminal Benefit Fund had been earmarked for taking care of the pension liability. This fund was created and operated unsing Institute's own
resources and as such, there was no financial implication for the Government. Taking into consideration the clarification provided about the source of
pension funds, Shri Thakur opined that there should be no hitch in allowing the employees to switch over from CPF to GPF. He, however, desired that
the Institute, while allowing this provision to its eligible employees, may keep the Government informed about the declension of the Board.
Keeping in view the ratio culled out in the judgment in Anil Kumar Pathiyath (supra), this Court cannot interdict the decision making process of the
2nd respondent, in view of the financial implications. It is the prerogative of each and every institution being an autonomous body ie., unaided, to adopt
own procedure and regulations for efficient and smooth functioning. There would have been a force in the argument of the learned counsel had the
2nd respondent extended the benefit to the employees who were not enjoying the benefit of GPF in the early organization but nothing has been pointed
out to bring the case under Article 14 of the constitution of India.
For the reason aforementioned, I do not find any force in the submission of the learned counsel for the petitioner. Writ petition is devoid of the merits
and is accordingly dismissed.