Pro-rata Pensioners Association vs Department Of Telecommunications And Ors

L. Narasimha Reddy, J

The applicant is an Association of Pensioners of a particular description, of Mahanagar Telephone Nigam Limited (for short, MTNL), the 2nd respondent herein. Department of Telecommunications are used to be the exclusive agency, in the field of Telecom Services. A set of its activity has been diverted to a State owned Corporation, the 2nd respondent herein. The employees as well as assets engaged in the activity that has been transferred to the 2nd respondent, were made over to it. In the case of employees, options were given for absorption. One of the conditions of absorption was as regards extension of pensionary benefits. Two alternative Schemes were evolved. Under option (a), the employee can retain the pensionary benefits available under the Government of India till the retirement from the service of MTNL in accordance with the Central Government Rules in force; and under option (b) the employees were to be governed by the Rules of the 2nd respondent. According to this, pro rata pension would be paid for the service rendered by the employees in the Department of Telecom, and for the service in the MTNL, the benefits as provided under the Rules would be extended. Depending on the option exercised by the employees, retirement benefits are being extended.

Here itself, it is essential to mention that the Dearness Allowance (DA) applicable to these two Schemes is different. It is either Industrial Dearness Allowance (for short IDA) or Central Government Dearness Allowance (for short, CGDA) depending on the relevant provisions of the Scheme.

This OA is filed with a prayer to direct the respondents to extend the benefit of IDA-Pension, with commutation, for the 2nd spell of service rendered by the employees in the MTNL on completion of the qualifying service of ten years and to make calculation of pensionary benefits on the basis of IDA. Another direction sought, is for formation of IDA-Pension Trust and finalization of framing of Rules as per directions issued by the Government of India. The applicant contends that its members are entitled to be extended the benefit of IDA-Pension, and that there is no justification for the respondents in denying the same.

The respondent Nos.1 & 3 are on one hand and respondent No.2 on the other, filed their separate counter affidavits. They submit that the alternative schemes were framed after elaborate consultations, and once the employees have exercised their options, they are governed by the relevant schemes. It is also stated that CCS (Pension) Rules, 1972 were amended.

We heard Shri M. K. Bhardwaj, learned counsel for the applicant and Shri D. S. Mahendru and Shri R. V. Sinha with Shri Amit Sinha, learned counsel for the respondents.

Quite large numbers of employees of the Telecom Department have been absorbed in the service of MTNL. Prolonged litigation ensued regarding the conditions of absorption and one of it was about the pensionary benefits. Since the employees that were absorbed, will have two spells of service, namely, partly in the Department of Telecom, and partly in MTNL, two different Schemes were framed in the matter of extension of pensionary benefits. The details thereof are given at the threshold of this order.

Since the service of the employees rendered in Telecom Department was governed by the CCS (Pension) Rules, requisite amendments were made to Rule 37-A, by adding Sub-rules 22, 23, & 24. They read as under:-

"(22) Nothing contained in sub-rules (13) to (21) shall apply in the case of conversion of the Departments of Telecom Services and Telecom Operations into Bharat Sanchar Nigam Limited [and Mahanagar Telephone Nigam Limited] in which case the pensionary benefits including family pension shall be paid by the Government.

(23) For the purposes of payment of pensionary benefits including family pension referred to in sub-rule (22), the Government shall specify the arrangements and the manner including the rate of pensionary contributions to be made by Bharat Sanchar Nigam Limited [and Mahanagar Telephone Nigam Limited] to the Government and the manner in which financial liabilities on this account shall be met.

(24) The arrangements under sub-rule (23) shall be applicable to the existing pensioners and to the employees who are deemed to have retired from the Government service for absorption in Bharat Sanchar Nigam Limited and Mahanagar Telephone Nigam Limited and shall not apply to the employees directly recruited by the Bharat Sanchar Nigam Limited and Mahanagar Telephone Nigam Limited for whom they shall devise their own pension schemes and make arrangements for funding and disbursing the pensionary benefits."

Added to this, two alternative Schemes were framed, and the employees were given option to choose either of them.

When the individual employees have exercised their options and are receiving the corresponding benefits, it is just not understandable as to how the applicant-association can seek modification of the Scheme, or extension of benefits meant for one option, to the other option. The various components of pension and the factors that govern it, cannot be changed just on the whims of certain individuals or associations. It is only after examining various aspects, such as, the interest of the employees and financial implications on the organization, that the Scheme was framed. The applicant is not able to demonstrate that any illegality has crept in the process of amendment of the rules, framing the Scheme or exercise of options by the employees.

We do not find any merit in the OA. It is accordingly dismissed. There shall be no order as to costs.