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Supreme Court will reconsider the RC Gupta ruling, and EPFO challenges will be heard by a three-judge panel The order came after a slew of appeals were filed against a slew of High Court rulings that threw down the 2014 amendment plan. The Supreme Court referred the legality of the Employees Pension (Amendment) Scheme 2014 to a three-judge Bench on Tuesday. In light of the Supreme Court's ruling in the RC Gupta case in 2016, a bench of Justices UU Lalit and Ajay Rastogi announced they are sending the issue to a bigger bench. The Court reasoned that as the RC Gupta ruling was issued by a Division Bench, it would not be proper for another Division Bench to hear the matter. The order came after a slew of appeals were filed against a slew of High Court rulings that threw down the 2014 amendment plan. The Employees Provident Fund Organisation has petitioned the Supreme Court to overturn the High Court rulings.
The question before the Court in the RC Gupta case was whether there was a cut-off date for workers to take advantage of the Employees Pension Scheme (EPS) option, which allows both the employer and the employee to make unlimited pension contributions. When the EPS was first implemented in 1995, clause 11(3) stipulated that the highest pensionable wage be limited to Rs. 5,000 per month, which was later increased to Rs. 6,500 per month in 2001. However, a proviso was inserted to Clause 11(3) a few months after the EPS was written, with effect from March 16, 1996, allowing the employer and employee to decide for contribution on salaries exceeding Rs. 5,000 or Rs. 6,500 per month. The Pension Fund was obliged to receive 8.33 percent of such contributions on full pay. In 2014, the EPS program was modified to raise the maximum pensionable salary from Rs. 6,500 to Rs. 15,000 rupees.
However, new members who earned more than Rs. 15,000 and joined after September 2014 were totally removed from the plan. Existing members had six months from September 2014 to determine whether they wished to take advantage of the unlimited contribution option. Following that, the modifications were challenged in several High Courts, resulting to the current round of challenges before the Supreme Court. The three-judge panel will now decide whether the RC Gupta decision would apply to the current batch of appeals.
Tags : #Supreme Court of India #EPFO #Employees Pension Scheme #RC Gupta judgment #Employees Pension (Amendment) Scheme 2014
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