Employees joining after 1 January 1986 are entitled to GPF-pension despite erroneous CPF options.

The respondents were employees of the erstwhile Indian School of Mines, Dhanbad (now IIT-ISM), appointed after 1 January 1986.

The Institute invited them to opt for the Contributory Provident Fund (CPF) Scheme, although it later stated that post-1 January 1986 entrants were entitled to the General Provident Fund-cum-Pension (GPF-cum-Pension) Scheme.

In 2017, the Institute placed the respondents under the GPF-cum-Pension Scheme, but, following objections from the Ministry of Human Resource Development and the Department of Expenditure, its Board of Governors reversed that decision in 2019 and restored CPF coverage.

The respondents’ writ petitions were allowed; the Union and other authorities appealed.

A separate appeal concerned an order directing that a later petitioner’s case be governed by the decision in the lead matter if the facts were similar.

1. Whether employees appointed after 1 January 1986, who had been asked by the Institute to opt for CPF, were entitled to the GPF-cum-Pension Scheme despite having opted for CPF.

2. Whether the Institute’s decision to place the respondents under the GPF-cum-Pension Scheme was invalid for want of prior Central Government approval or because of the resulting financial burden.

The Court applied the Office Memorandum dated 1 May 1987, as adopted by the Institute, and the Supreme Court’s interpretation in University of Delhi v. Shashi Kiran, 2022 SCC OnLine SC 594: employees joining service after 1 January 1986 were covered by the GPF Scheme, while CPF was an exception for employees who opted to continue under it.

The Court also relied on Krishna Rai v. Banaras Hindu University, (2022) 8 SCC 713, for the principle that estoppel cannot override the law.

It distinguished State of Rajasthan v. A.N. Mathur, (2014) 13 SCC 531, and Rajasthan Agriculture University, Bikaner v. State of Rajasthan, (2013) 12 SCC 610, on their facts.

The respondents had all joined after the relevant cut-off date, and the Institute had adopted the 1987 Office Memorandum.

The Court held that the Institute therefore had no basis to ask them to choose CPF; its own later communications acknowledged that post-cut-off entrants were entitled only to GPF-cum-Pension.

Their CPF choices and continued participation in that scheme could not validate an erroneous request or defeat their entitlement under the applicable rule.

Nor did the approval or funding objections alter the result: the Institute was correcting its own mistake, and the possibility of financial impact did not defeat the respondents’ entitlement.

It directed the appellants to treat the respondents under the GPF-cum-Pension Scheme.

Retired respondents who had not received CPF benefits were entitled to pension and other retiral benefits under that scheme; those who had already received CPF benefits were entitled to GPF pension upon refund of the Government contribution made towards CPF in favour of the Institute.