According to a change made in the Central Civil Services (Pension) Rules, 2021, the retirement benefits of former government employees (from their previous government job) can be withheld or denied if they are found to be guilty of misconduct, fraud or any wrong activity even after they have become an employee of the public-sector firm they are currently working for.
A notification pertaining to this amendment, via a new clause in sub-rule 29 of rule 37, was issued by the Department of Pension and Pensioners’ Welfare (DoPPW).
As per the notification, “…the dismissal or removal from service of the public sector undertaking of any employee after his absorption in such undertaking for any subsequent misconduct shall lead to forfeiture of the retirement benefits for the service rendered under the Government also and in the event of his dismissal or removal or retrenchment the decision of the undertaking shall be subject to review by the Ministry administratively concerned with the undertaking,” the notification dated 22 May 2025 said.
Earlier, the rule did not recommend any such forfeiture of retirement benefits for misconduct.
The Rule 37 (29)(c) of CCS (Pension) Rules, 2021 was amended based on the Order dated 09.01.2023 of the Supreme Court of India in SLP No.4817/2020 titled as Suraj Pratap Singh Vs CMD BSNL & Ors.
It is pertinent to mention here that Rule 37A pertains to conditions for payment of pension on absorption as a result of conversion of a government department into a public-sector undertaking (PSU).
