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Rajasthan High Court · body

2002 DIGILAW 1949 (RAJ)

Naveen Chandra Kasliwal v. LIC of India

2002-12-13

SHIV KUMAR SHARMA

body2002
JUDGMENT 1. 1. Late Smt. Sushila wife of the petitioner, was employed in the Life Insurance Corporation of India (for short the LIC) on January 6, 1958. She was due to retire on August 31, 1998. During the period of her employment Smt. Sushila had become the member of LIC Employees' Group Terms Insurance Scheme 1997 (for short 1997 Scheme'). Senior Divisional Manager of Division office Ajmer (respondent No.2) vide letter dated December 11, 1997 intimated .Smt. Sushila that she will be entitled to the following benefits on her retirement (i) Contributory Provident Fund, as per Rules. (ii) Gratuity, as per Rules and due and admissible. (iii) Payment under Group Insurance Scheme. (iv) Payment against unavailed privilege leave etc. Smt. Sushila unfortunately met with an accident and sustained serious fracture over her leg. She therefore sought voluntary retirement with immediate effect and was allowed to retire voluntary w.e.f. April 24, 1998. Smt. Sushila thereafter died on May 7, 1998. The petitioner vide representation dated June 24, 1998 requested respondent No.2 to make payment in lieu of claim under Group Term Insurance of his late wife Smt. Sushila. But respondent No.2 vide letter dated June 12, 1999 turned down the request of the petitioner. In the instant writ petition, the petitioner seeks to quash the aforesaid letter of respondent No.2 with a further prayer to allow the benefit, of Group Term Insurance under 1997 Scheme to his late wife Smt. Sushila and make payment of sum assured i.e. Rs. 1.20 lakhs. 2. The respondents in their return to the writ petition averred that on May 7, 1998 late Sint. Sushila was not an employee of the respondent LIC and was relieved from services of the LIC on April 24, 1998 and her membership under 1997 Scheme automatically ceased on April 24, 1998. The respondents further pleaded that the case of the petitioner does not fall within the definition of Employee' and 'Member'. Neither the provisions of Rule 31 (3)(b) and 41 (5)(a) of LIC (Employees) Pension Rules, 1995 (for short 1995 Rules) nor Rule 8 of 1997 Scheme permits the competent authority for payment of commutation and Group Term. Insurance Benefit in lieu of commutation in her case. No benefits under the scheme were allowable except in case of death of an employee who was member of the Scheme. Insurance Benefit in lieu of commutation in her case. No benefits under the scheme were allowable except in case of death of an employee who was member of the Scheme. Thus the claim of petitioner was validly declined and petition deserves to be dismissed. 3. I have pondered over the rival submissions and weighed the material on record. 4. It will be necessary at this juncture to consider the provisions contained in 1995 Rules. Rule 31 of 1995 Rules relates to pension on voluntary retirement. It reads as under : "31. Pension on voluntary retirement : (1) At any time after an employee has completed twenty years of qualifying service he may, by giving notice of not less than ninety days, in writing to the appointing authority, retire from service. Provided that this sub-rule shall not apply to an employee who is on deputation unless after having been transferred or having returned to India he has resumed charge of the post in India and has served for a period of not less than one year. Provided further that this sub-rule shall not apply to an employee who seeks retirement from service for being absorbed permanently in an autonomous body or a public sector undertaking to which he is on deputation at the time of seeking voluntary retirement. (2) The notice of voluntary retirement given under sub-rule (1) shall require acceptance by the appointing authority : Provided that where the appointing authority does not refuse to grant the permission for retirement before the expiry of the period specified in the said notice, the retirement shall become effective, from the date of expiry of the said period. (2) The notice of voluntary retirement given under sub-rule (1) shall require acceptance by the appointing authority : Provided that where the appointing authority does not refuse to grant the permission for retirement before the expiry of the period specified in the said notice, the retirement shall become effective, from the date of expiry of the said period. (3) (a) An employee referred to in sub-rule (1) may make a request in writing to the appointing authority to accept notice of voluntary retirement of less than ninety days giving reasons therefor : (b) on receipt of a request under clause (a), the appointing authority may, subject to the provisions of sub-rule (2), consider such request for the curtailment of the period of notice of ninety days on merits and if it is satisfied that the curtailment of the period of notice will not cause any administrative inconvenience, the appointing authority may relax the requirement of notice of ninety days on the condition that the employee shall not apply for commutation of a part of his pension before the expiry of the notice of ninety days. (4) An employee, who has elected to retire under this rule and has given necessary notice to that effect to the appointing authority, shall be precluded from withdrawing his notice except with the specific approval of such authority : Provided that the request for such withdrawal shall be made before the intended date of his retirement. (5) The qualifying service of an employee retiring voluntarily under this rule shall be increased by a period not exceeding five years, subject to the condition that the total qualifying service rendered by such employee shall not in any case exceed thirty-three and it does not take him beyond the date of retirement. (6) The pension of an employee retiring under this rule shall be based on the average emoluments as defined under clause (d) of rule 2 of these rules and the increase, not exceeding five years in his qualifying service, shall not entitle him to any notional fixation of Pay for the purpose of calculating his pension." (Emphasis supplied) 5. A look at the aforesaid provision goes to show that at any time after the employee completed twenty years of qualifying service he is entitled to seek voluntary retirement after serving 90 days notice on the appointing authority. A look at the aforesaid provision goes to show that at any time after the employee completed twenty years of qualifying service he is entitled to seek voluntary retirement after serving 90 days notice on the appointing authority. A request may also be made by the employee in writing to the appointing authority to accept notice of voluntary retirement of leas than 90 days and on receipt of such request the appointing authority may curtail the period and relax the requirement of ninety days on the condition that the employee shall not apply for commutation of a part of his pension, before the expiry of the notice of ninety days. 6. As per sub-rule (5) of Rule 41 of 1995 Rules commutation of pension shall become absolute in the case of an employee retiring voluntarily, who submits an application for commutation of pension before the date of retirement on the date following the date of retirement, provided that the employee governed by sub- rule (3) of rule 31 shall not apply for commutation of a part of his pension before the expiry of the notice of three months and the commutation of pension shall become absolute only on the expiry of the period of notice referred to in sub-rule (1) of rule 31. 7. In the instant case Smt. Sushila wife of the petitioner sought voluntary retirement under sub-rule (3) of Rule 31 of 1995 Rules and the appointing authority accepted the request of voluntary retirement before the statutory period of 90 days, therefore in view of proviso appended to sub-rule (5) of Rule 41 the wife of the petitioner did not apply for commutation of a part of her pension before the expiry of the notice of three months and the commutation of pension would become absolute only on the expiry of the period of notice of three months. But before the expiry of the notice period Smt. Sushila died on May 7, 1998 and could not apply after expiry of the statutory period of three months. 8. It appears from the material on record that main object behind the introduction of 1997 Scheme was to cover the loss of commutation of pension caused to the employee on his/her sudden death while in service. The relief assured under 1997 Scheme is a security umbrella. 8. It appears from the material on record that main object behind the introduction of 1997 Scheme was to cover the loss of commutation of pension caused to the employee on his/her sudden death while in service. The relief assured under 1997 Scheme is a security umbrella. On the date of death of Smt. Sushila 90 days period of notice had not expired and till expiry of notice period of 90 days she ought to have been treated as remained in the service of LIC in view of proviso appended to sub-rule (5) of Rule 41 of 1995 Rules according to which she could only apply for commutation of pension after expiry of three months and commutation of pension would become absolute only on the expiry of the period of notice of three months i.e. on July 24, 1998. As per the provisions of the 1997 Scheme, Smt. Sushila was falling in category III and was entitled to Rs. 1.20 lakhs, the sum assured under category III. Rule 2(a) of 1997 Scheme defines the term 'Employee' according to which Employee means any person employed in the service of Corporation on full time work on permanent basis and who is governed by 1995 Rules. As Smt. Sushila at the time of her death, was governed by proviso appended to sub-rule (5) of Rule 41 of 1995 Rules, she was the employee of the LIC for the purposes of 1997 Scheme and petitioner being the heir of Smt. Sushila is entitled to the relief sought in the writ petition. 9. For the reasons aforementioned the writ petition succeeds and stands allowed. The decision communicated vide letter dated June 12, 1999 to the petitioner is declared illegal and the respondents are directed to make payment of Rs. 1.20 lakhs, the sum assured under 1997 Scheme, to the petitioner. The respondents shall ensure compliance of the order within sixty days from today. If amount is not paid within this period it shall carry interest @ 18%a per annum.There shall be no order as to costs.Petition allowed. *******