### Employees Opting for Higher Pension Under Pre-Amended Para 11(3) Before Retirement are Entitled to Enhanced Benefits

The petitioners are retired employees of various cooperative banks and federations in Chhattisgarh who superannuated prior to 01.09.2014.

During their service, they contributed to the Employees' Provident Fund on wages exceeding the statutory ceiling.

Following the Supreme Court’s decision in *R.C. Gupta v. Regional Provident Fund Commissioner* (2018), the EPFO issued a circular on 23.03.2017 allowing employees to exercise joint options for higher pension.

The petitioners submitted these options, deposited differential contribution amounts, and were subsequently granted higher pensions via revised Pension Payment Orders (PPOs).

However, in March 2023, the EPFO unilaterally reduced their pensions back to the original lower rates and issued fresh PPOs, citing the Supreme Court’s subsequent judgment in *EPFO v. Sunil Kumar B.* (2022).

The petitioners challenged these reduction orders through a batch of writ petitions.

1. Whether the EPFO’s action in reducing the higher pension already granted to retired employees (who retired prior to 01.09.2014) is legally sustainable under the categorization established in the *Sunil Kumar B.* judgment.

2. Whether the petitioners fall under Paragraph 50.7 (ineligible) or Paragraph 50.8 (eligible) of the *Sunil Kumar B.* judgment.

The court primarily applied Para 11(3) and 11(4) of the Employees’ Pension Scheme, 1995 (pre and post-amendment) and Para 26(6) of the Employees’ Provident Fund Scheme, 1952.

It relied on the precedent set in *R.C. Gupta v. Regional Provident Fund Commissioner (2018) 14 SCC 809*, which held that the proviso to Clause 11(3) did not prescribe a cut-off date for exercising options for higher pension.

It further interpreted the landmark ruling in *EPFO v. Sunil Kumar B. (2023) 12 SCC 701*, specifically Paragraphs 50.7 and 50.8, which distinguish between retirees who did not exercise any option and those who did.

The court examined whether the petitioners were "existing members" or had "exercised any option" under the unamended scheme.

The EPFO argued that under Para 50.7 of *Sunil Kumar B.*, employees who retired before 01.09.2014 without exercising an option under Para 11(3) were excluded.

However, the High Court observed that the petitioners *had* already submitted their joint options and deposited the required differential amounts following the *R.C. Gupta* judgment and the EPFO's 2017 circular.

The court interpreted the word "any" in the phrase "without exercising any option" to mean that Para 50.7 only applies to those who remained totally silent.

Since the petitioners had exercised their options and the EPFO had already verified and acted upon them by granting higher pensions, their cases were governed by Para 50.8 of *Sunil Kumar B.*, which protects those who exercised the option prior to retirement or under the window provided by previous judicial mandates.

The court rejected the EPFO's "mistake" argument, noting that the grant of higher pension was in strict conformity with the law then prevailing.

It held that the petitioners are eligible for higher pension as they had exercised the option under the unamended scheme, falling under the protective ambit of Para 50.8 of the *Sunil Kumar B.* judgment.

The EPFO was directed to restore the higher pension immediately and release all arrears within 90 days, failing which the amount would carry interest at 6% per annum.