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1996 (3) TMI 576 - SC - Indian Laws

Issues Involved:
1. Upward revision of pension.
2. Dearness allowance or dearness relief.
3. Discontinuation of 6.38% deduction from pension.
4. Introduction of family pension and medical reimbursement schemes.
5. Comparison with State and Central Government pension schemes.
6. Financial burden on LIC.

Detailed Analysis:

1. Upward Revision of Pension:
The petitioners, retired and in-service employees of LIC, sought an upward revision of their pension. They argued that the pension amount under the existing scheme was meager and needed to be revised to ameliorate the conditions of old and infirm pensioners. The LIC countered that the pension fund was managed as an independent trust under the rules and regulations of the LIC Act and that any increase in pension would place a significant financial burden on the corporation.

2. Dearness Allowance or Dearness Relief:
The petitioners contended that unlike other employees, they did not receive dearness relief on their pension, which was necessary due to the rising cost of living. LIC responded that the pension fund was not akin to the pension schemes governing State and Central employees and was governed under different rules. The last increase in pension was in 1984, and any further increase would prompt similar demands from other employees, creating a financial strain.

3. Discontinuation of 6.38% Deduction from Pension:
The petitioners sought the discontinuation of the 6.38% deduction from their pension, arguing that it was unfair given the already meager pension amount. LIC did not specifically address this issue in their counter but emphasized that the pension fund was managed strictly according to the rules and regulations.

4. Introduction of Family Pension and Medical Reimbursement Schemes:
The petitioners requested the introduction of family pension and medical reimbursement schemes. LIC argued that the court could not substitute the existing pension plan with a new one as each service had its own conditions and benefits. The court agreed, stating that it could not rewrite the service conditions and that relief would be confined to the first two demands only.

5. Comparison with State and Central Government Pension Schemes:
The petitioners compared their pension benefits with those of State and Central Government employees, arguing for similar benefits. LIC countered that the pension fund was governed by different rules and regulations and that the benefits could not be compared directly. The court agreed, noting that each service had its own set of conditions and benefits, and a direct comparison was not permissible.

6. Financial Burden on LIC:
LIC argued that any increase in pension would place a significant financial burden on the corporation. They presented several schemes to the court, emphasizing that the pension fund was a reducing one and that any increase would require substantial subventions to maintain its viability. The court considered the financial implications and opted for Scheme 'C', which provided a reasonable increase in pension while taking into account the financial burden on LIC.

Conclusion:
The court accepted Scheme 'C', which provided a one-time final measure for increasing the pension. The scheme included an annual increase in pension, with a minimum pension amount of Rs. 575 per month. The court rejected the rest of the reliefs prayed for and made it clear that Scheme 'C' was in full and final settlement of all claims. The petition was disposed of with no order as to costs.

 

 

 

 

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