Railway Authorities Cannot Retain RELHS Contributions if Medical Facilities are Denied or Deactivated

The applicant, an ex-serviceman and retired Railway Loco Pilot (Goods), superannuated on January 31, 2019.

At retirement, the respondents deducted ₹54,000 from his retiral dues for the Retired Employees Liberalised Health Scheme (RELHS) based on an undertaking/option form he signed.

the respondents subsequently disabled the applicant’s UMID card (medical card) on the grounds that as an ex-serviceman already availing medical facilities under the Ex-Servicemen Contributory Health Scheme (ECHS) of the Defence Ministry, he was ineligible for RELHS.

Despite a recommendation for a refund by the Senior Divisional Personnel Officer on January 1, 2025, the respondents rejected the applicant's claim via an order dated April 3, 2025, citing the lack of specific rules for refunds and the applicant’s voluntary undertaking.

1. Whether the respondents are legally justified in retaining the RELHS contribution after deactivating the applicant's medical facilities on the grounds of technical ineligibility.

2. Whether the applicant is entitled to a refund of the deducted amount of ₹54,000 despite having signed an initial undertaking for the scheme.

Railway Board Circular dated February 23, 2017, which initially made joining RELHS mandatory.

Railway Board letter dated July 31, 2018, regarding exemptions from mandatory joining of RELHS for those covered by other schemes.

the equitable principle that the administration cannot retain a subscription fee if it concurrently denies the benefit of the service for which the fee was collected.

The Tribunal reasoned that the respondents' position was contradictory; they argued that the deduction was valid based on the applicant's voluntary option, yet they unilaterally disabled his UMID card/medical facility because he was an ex-serviceman.

The Tribunal noted that the applicant was already covered under the ECHS scheme and thus exempted from the mandatory requirement of RELHS according to applicable guidelines.

The court found that once the respondents deactivated the applicant's access to medical facilities under RELHS, the legal basis for retaining his contribution vanished. Retention of the funds without providing the corresponding medical coverage was deemed arbitrary and unjustifiable.

The Tribunal allowed the Original Application and quashed the impugned rejection order dated April 3, 2025. The respondents were directed to refund the amount of ₹54,000 to the applicant within a period of three months from the date of receipt of the certified copy of the order.