SC: Pension cannot be denied due to incorrect deductions

 The court ruled that an employee cannot be denied their pension if they have not consciously given up their right to receive it


As per a new judgement passed by the Supreme Court, an employee can’t be denied pension just because his/her employer made any wrong deductions on their part. 

A bench of Justices Abhay S Oka and Rajesh Bindal dismissed an appeal filed by the Calcutta State Transport Corporation and others. The appeal was made against the High Court’s division bench decision of March 5, 2021, directing the employer to release the pension of the employee Ashit Chakraborty and others.

In its appeal, the corporation argued that the employee’s salary underwent routine deductions for the contributory provident fund and that he received statements about these deductions. However, the employee did not raise any objections to these deductions at the time. The issue only arose after his retirement. Under these circumstances, the corporation believed that he should not be eligible to receive the pension scheme’s benefits.

To the appeal, the employee also argued and stated that he had chosen to enrol in the pension scheme, and it was the responsibility of the employer to accurately calculate his salary and make appropriate deductions under various categories. If the corporation made an error in this process, the employee should not be penalised and suffer for it.

Siding with the employee’s submission, the court dismissed the corporation’s argument that there were other employees in similar situations who might also claim similar relief, stating that this would not prevent the court from granting the employee the relief he is entitled to.

The bench also stated that the fact that some incorrect deductions were made from his salary and he was treated as a member of the CPF scheme cannot be used to deny his legitimate claim for pension.

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