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Sunday, June 25, 2017

Justice at last for PSU absorbees who had opted for 1/3rd pro-rata pension: Government implements decision of the Madras High Court for payment of 100% pension, as affirmed by the Supreme Court, for all similarly placed employees

On dismissal of the SLP filed by the Central Government against the judgement of the Madras High Court, the Department of Pension and Pensioners’ Welfare of the Government of India has issued orders for all similarly placed employees finally undoing more than four decades of patent injustice.

In the 1970s, Government employees who opted to join Public Sector Undertakings (PSUs) or autonomous bodies were made entitled to a payment of lumpsum amount in lieu of pension that had accrued from their Government Service. In terms of Rule 37-A of the Central Civil Service (Pension) Rules, 1972 (added in 1973), an employee was entitled to a lump sum amount not exceeding the commuted value of one-third of the pension and terminal benefit equal to twice the aforesaid lump-sum amount, subject to the condition that the Government servant surrendered his right of drawing two-thirds of his pension.

Later, on the directions of the Supreme Court, orders were issued to restore 1/3rd pension after the period of commutation culminated.

An employee however approached the Central Administrative Tribunal stating therein that even the rest of the 2/3rd portion needed to be restored on culmination of the period of commutation since the undertaking taken under Rule 37-A was in contravention to provisions of Section 12 of the Pension Act, 1871, which provided that a person could not be made to wish away his right to pension by any authority. The petition filed by the employee was however dismissed by the Tribunal.

The order of the Tribunal was then challenged by the employee, K Ganesan, in the Madras High Court, which ruled in his favour and held  that the undertaking taken from the employee was repugnant of the Pensions Act and the 2/3rd commuted amount also needed to be restored after expiry of the period of commutation. The Madras High Court directed the Government to do the needful and set aside the order of the Tribunal. The High Court also observed that the earlier decisions of the Supreme Court were not on this point and neither were the provisions of the Pensions Act brought to the knowledge of the Supreme Court. The High Court however refused to grant interest on the arrears in view of the major delay in challenging the provisions of the Rules by the employee.

The Central Government thereafter went into appeal to the Supreme Court but the SLP was dismissed in 2016. The Government thereafter filed a Review which was also dismissed in March 2017.

The Government has now issued orders implementing the decision for all similarly placed employees thereby directing the release of 100% pension from the date of culmination of the period of 15 years from commutation. As a result, all such PSU/Autonomous bodies absorbees shall be entitled to 100% restoration of pension on the date of completion of 15 years from the date of commutation. All such employees would now be entitled to full arrears from the 4th, 5th, 6th and the 7th Pay Commissions, as the case may be.

Again, this case shows as to how the above proactive approach of the Department of Pension & Pensioners’Welfare is in contrast with the approach of Department of Ex-Servicemen Welfare under the Ministry of Defence. While even single-liner judgements and orders of the High Courts and the Supreme Court are implemented across the board for all similarly placed employees/pensioners by the former, the latter does not even implement decisions for specific petitioners unless multiple litigation is indulged in, including contempt and execution applications. 

Thursday, June 8, 2017

Penury Grant enhanced to Rs 4000 per month from the existing Rs 1000

In a progressive move, the Government has enhanced the rate of the monthly Penury Grant to Rs 4000 from the existing Rs 1000 which had remained constant since the year 2011.

The Penury Grant is payable to those ex-servicemen and widows who are living in a state of penury and are not in receipt of pension from any source. The recipient has to be over the age of 65 years to be eligible.

It may be recalled that earlier a one-time grant at the rate of Rs 30,000 was granted to needy veterans and their widows and the system was then changed in the year 2011 to a monthly payout of Rs 1000.

Most of the ex-servicemen affected by the grant are those who were released without any pension on reduction of establishment or for other reasons without completion of minimum pensionable service.

The payout of this scheme is through the Armed Forces Flag Day Fund.

The new letter issued by the Government today can be accessed by clicking here.

Friday, May 19, 2017

After decades of judicial pronouncements, disability benefits finally made admissible by the Government to pre-2006 voluntary retirees with effect from 01 January 2006

The Government has finally given effect to judicial pronouncements whereby cases of premature retirement and personnel ‘discharged at own request’ were held eligible to disability and war injury benefits.

Earlier, as per regulations, disabled and war injured retirees were not allowed disability and war injury benefits if they had sought retirement on their own volition. This practice was held to be illegal by the Delhi and the Punjab & Haryana High Courts. Later when a Government letter was issued by the Ministry of Defence entitling such personnel to benefits, it was made applicable only to those who had retired after 01-01-2006. This cut-off date was also held illegal by the Armed Forces Tribunal later. The Punjab & Haryana High Court had also endorsed the action of the Tribunal. Later, the Chandigarh Bench of the Tribunal had taken the official establishment to task for not giving effect to judicial dicta.

A Committee of Experts constituted by the then Raksha Mantri, Mr Manohar Parrikar, had also strongly recommended the resolution of the issue and the recommendation on the said point was accepted by the Minister.

The letter resolving the matter has finally been issued by the Ministry of Defence and can be downloaded and accessed by clicking here.

The benefits have been made applicable with financial effect from 01 January 2006 and to all cases where the disability was declared attributable to, or aggravated by military service.

This settles one of the most important issues concerning our disabled veterans.

There is however one problem still existing in the dispensation wherein the letter again only talks about ‘disability element’ and not ‘disability pension’ which consists of both elements, that is, service element as well as disability element. 

Friday, May 12, 2017

Orders for “Notional Pension Fixation Formula” under the 7th Pay Commission regime, as approved by the Cabinet, issued

As all are aware, the 7th Central Pay Commission (CPC) had recommended two formulae for calculation of pension of pre-2016 retirees. While the first formula involved calculation of pension based on a notional basis, the second involved the multiplication of old 6th CPC pension X 2.57. The orders for the second formula were issued earlier and the first formula was recently accepted with certain modifications by the Cabinet.

The Government of India has today issued orders for calculating pension based on the first formula for civil pensioners who retired prior to 2016 and similar orders for defence pensioners shall be issued separately since military pensions involve certain additional complexities as compared to civilians. Pensioners shall be entitled to receive the higher pension out of the two formulae.

The revision shall be undertaken by notionally fixing the pay in the pay matrix recommended by the 7th CPC in the level corresponding to the pay in the pay scale/pay band and grade pay at which such pensioners had retired (for pension) or died (for family pension). This will be done by notional pay fixation under each intervening Pay Commission based on the Formula for revision of pay.

The pension under the new dispensation shall also be allowed from 01-01-2016.

The new orders can be accessed and downloaded by clicking here.

Again, please DO NOT mail me individual queries on email or social media. You are free to discuss the above @ the comments section of this post.

Thank You.

Friday, May 5, 2017

Clarifications and update on the Cabinet decisions on pay and pensionary issues emanating out of the 7th Central Pay Commission

There is a press note floating around on social media regarding certain decisions taken by the Cabinet related to pay and pensionary modalities related to the 7th Central Pay Commission (CPC). Though many have questioned its veracity, this is to confirm that it is absolutely a valid document and has been officially issued by the Ministry of Finance.

That said, let me run through some of the important decisions taken by the Cabinet, clarifications thereon and their impact. Please note that the new Pay Rules issued by the Ministry of Defence do not take into account the changes in the pay structure or removal of anomalies and these shall be incorporated through separate amendments in the rules issued on 03 May 2017.

Restoration of Percentage based Disability Pension Rates
The 7th CPC had recommended ‘flat/slab’ rates of disability pension for the defence services rather than the ones based upon ‘percentage of pay’. Civil disabled personnel were however retained on the percentage system as before. As stated earlier, frankly, I never expected this regressive 7th CPC recommendation to be accepted by the Government, but unfortunately it was. While recommending this aspect, the 7th CPC had also made unfounded and uncharitable remarks against disabled soldiers by casting aspersions on those who have incurred disabilities while in service which was discussed in detail by me earlier in my opeds, here and here. This resulted in a massive decrease after the 7th CPC resulting in a payout even lower than 6th CPC rates for almost all post-2016 retirees of all ranks and also for pre-2016 retirees of certain ranks. The arbitrariness of this decision becomes evident from the following chart at the apex levels:

(100% Disability)
Rates under the 6th CPC as on 31 Dec 2015
Rates applicable after the 7th CPC as on 01 Jan 2016
Lt Gen
Rs 52,560
Rs 27,000
Head of Central Armed Police Force
Rs 52,560
Rs 67,500

This issue was much close to my heart. Thankfully, the then Defence Minister, Mr Manohar Parrikar, fully understood the consequences and took personal interest in getting the matter referred to an Anomaly Committee. The Defence Services HQ as well as the Ministry, and even civilian employee organisations, supported the resolution of this anomaly which now stands addressed and the Cabinet has decided to retain the old system of calculation on percentage basis, that is, 30% of pay shall remain the disability element for 100% disability. I however do hope that a protection clause is introduced for pre-2016 retirees of lower ranks who stood to gain from the slab rates.

Improvement in Pension calculation system for pre-2016 civil and defence retirees
The Cabinet has also accepted an improvement over and above the system of pension calculation which was finally effectuated after the 7th CPC. Rather than basing the pensionary calculations on the “Old Pension X 2.57” formula, an option would be provided to calculate the pension based upon the notional pay stage from which the employee had retired as opposed to the minimum of pay as was the system followed till the 6th CPC. Calculation of pension in this manner would definitely enhance the pension of civil pensioners and perhaps a small number of defence pensioners, who, in all probability would be provided the opportunity of choosing the most beneficial option, that is, the new formula, 2.57 multiplication formula or OROP rates. Contrary to popular perception, this does not exactly result in OROP for pre-2016 civil employees as is being projected, since while this is based on notional data, the military OROP is operated on live date of fresh retirees, moreover while this system is expected to be revised only after ten years, the military OROP as per the current scheme is meant to be revised after every five years.

Issuance of Pay Rules rather than Instructions on Pay
There were messages in circulation that the Chiefs of the Defence Services have been sidelined and downgraded since the earlier system of issuance of Special Army Instructions, Special Navy Instructions and Special Air Force Instructions (SAI/SNI/SAFI) has been discontinued and a new dispensation of ‘Pay Rules’ has been initiated. This seems to be an extreme case of over-interpretation and negative imagination of fertile minds. SAI/SNI/SAFI were never issued under the authority of the Chiefs or the Defence Services HQ but were always issued by the Ministry of Defence, that is, the Government of India. ‘Orders’ such as Army Orders (AO) etc were (and are) issued by the Defence Services HQ under the power of the Chiefs. The new Pay Rules have been promulgated under the authority of Article 309 of the Constitution of India and are statutory in character rather than being mere executive instructions like was the case till now. With this, the pay rules of the Defence Services are at par with the statutory pay rules of the civil services which are also issued under the authority of Article 309 of the Constitution of India.

Defence Pay Matrix to have 40 stages
The 7th CPC had recommended only 24 stages in the defence matrix while 40 stages were provided to civilians. This anomaly has been rectified and now the defence pay matrix shall also have 40 stages. This will particularly be helpful for JCOs towards the retiring years and will also beneficially affect their pension and other retiral benefits.

Multiplication factor of 2.67
This anomaly had been rectified earlier for Brigadiers and a multiplication factor of 2.67 had been applied for the said rank. Now the benefit of multiplication for Index of Rationalization (operative at the beginning of the entry pay) has also been extended to Lieutenant Colonels, Directors to Government of India and Colonels, that is, Levels 12A and 13 of the Pay Matrix. Further, just to clarify, this multiplication factor has no link with pensions whatsoever. 

Other Anomalies
There shall be pay protection for the amount of Military Service Pay (MSP) on promotion from the rank of Brigadier to Major General. It may be recalled that MSP is not entitled to ranks above the rank of Brigadier. No decision has been taken by the Government on the aspect of Non Functional Upgradation till now since the matter is being considered sub judice. On directions of the Supreme Court, the Government is re-considering the issue of NFU for Central Armed Police Forces for which a meeting was recently held. The issue is to be considered by the Government and the fresh decision is to be placed before the Supreme Court in August 2017. The most pertinent anomaly of enhancement of Military Service Pay, especially for JCOs, also remains pending along with other matters and probably these issues would be clearer after various anomaly committees submit their reports and a decision is taken thereafter by the Cabinet. Non-inclusion of 'X Group Pay' for pension is also a cause of concern, it may be recalled that till now the same was included as an element for pension. The committee on allowances has already submitted its report which will now be examined by the Government. Unlike pay and pension which are admissible retrospectively from 01 January 2016, most freshly rationalized allowances shall only be admissible prospectively.

This is all I have to say at present, please DO NOT mail me individual queries on email or social media. You are free to discuss the above @ the comments section of this post.

Thank You.

Wednesday, May 3, 2017

Seventh Central Pay Commission orders for pay issued by Ministry of Defence

The Ministry of Defence has issued the orders for the new pay regime on implementation of the recommendations of the 7th Central Pay Commission for all ranks.

The orders shall now be known as Rules rather than Instructions. For example, the modalities for Ranks other than Commissioned Officers of the Army shall be known as the “Army Pay Rules” rather than “Special Army Instructions”.

The orders for Ranks other than Commissioned Officers can be accessed and downloaded by clicking here.  

The orders for Commissioned Officers of the Army can be accessed and downloaded by clicking here.

The orders for Commissioned Officers of the Navy can be accessed and downloaded by clicking here.

The orders for Commissioned Officers of the Air Force can be accessed and downloaded by clicking here.

Wednesday, April 26, 2017

Interview in Times of India on Jadhav issue

The issue of Kulbhushan Jadhav’s sham trial by a military Court in Pakistan has truly hurt the conscience of all those who believe in the rule of law.

My Question and Answer session on the subject was published on the editorial page of The Times of India.

The same can be accessed here.

Sunday, April 9, 2017

Path-breaking move by the Ministry of Home Affairs for the bravehearts of the Central Armed Police Forces

There would be naysayers who would spare no effort to look down upon this move, but to apolitical persons like us, this is one of the most path-breaking concepts brought about by the Central Government for brave-hearts of the Central Armed Police Forces (CAPFs) the nation lost in the line of duty.

www.BharatKeVeer.gov.in is a website where any individual can contribute directly to the accounts of the kin of bravehearts of the CAPFs. The amount can either be contributed to the fund of the kin or to the “Bharat Ke Veer” corpus. A maximum contribution of Rupees Fifteen Lakhs can be made to the kin directly, and in case a higher contribution is made, then the amount over and above Rupees Fifteen Lakhs can be transferred to the corpus or to the account of the kin of another braveheart. 

The corpus would be managed by a committee of eminent personalities and senior government functionaries.

The concept is applicable to 8 CAPFs, including the Assam Rifles and National Security Guard.

Gratitude also goes out to Mr Akshay Kumar for his contribution to this cause and also to the leadership of CAPFs for strongly standing behind their men and women in uniform. 

Saturday, April 8, 2017

SC comes to the rescue of an HIV+ veteran- grants him Disability Pension

In what may be quite a progressive decision by the Supreme Court, a soldier suffering from AIDS and Meningitis has been granted disability pension by the Supreme Court, which was earlier refused by the Army and then also the Armed Forces Tribunal.

HIV+ population continues to suffer stigma in our nation and the military population declared HIV+ faces another major issue, and that is the fact that such soldiers can be discharged from service on medical grounds- at times without pension in case the condition is declared “neither attributable to, nor aggravated by military service”.

Though a harmonious interpretation of the rules would show that the condition needs to be declared attributable to service if the cause is unknown and can only be declared “not related to service” in case the reason is directly discernable such as contact with a commercial sex worker, more often than not, medical boards declare it ‘not related to service’ even if the reason remains unknown. Of course, it is well understood that there are plenty of ways how the virus can spread, and the individual may not even be at fault for his condition, but the stigma till date in our nation is such that personnel affected by the virus are left to fend for their own.

This decision is not just in line with the global effort to make AIDS less stigmatic but also protects the life and liberty of the individual by providing him and his family a means of a dignified life through disability pension and also ensuring medical treatment via the military medical establishment which is only permissible to pensioners as far as in-patient treatment is concerned.

Wednesday, March 22, 2017

Once again the High Court strikes down discrimination by Haryana Urban Development Authority in plot allotment based on ranks

The Punjab & Haryana High Court has once again held that there should be no discrimination based upon military ranks while deciding eligibility of defence personnel for plot allotment by Haryana Urban Development Authority (HUDA).

For those who are not aware, HUDA allows defence applicants to apply for sizes of plots depending upon the rank held by such applicants. This seems odd, since HUDA is not a military organisation and neither is the allotment in a military or official environment where any such hierarchy is required to be maintained. In fact, in my own opinion, there might be persons holding lower ranks having the financial means to apply and own larger plots whereas there might be cases of officers who may not be having the means and would want to own smaller plots, and hence, putting shackles on eligibility based upon rank and that too by a civilian organisation, may not be apt. Eligible applicants should have been allowed to own plots based upon their financial means and there ideally should have been no classification within the reserved category of defence personnel.

The sad part however is that even in the past, the High Court had passed similar orders which were upheld by the Supreme Court but till date the authorities concerned have not amended the policy in line with the decisions.