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Permanent transfer of Railway servants to Government Companies/Corporations – Grant of retirement benefits to permanent Railway servants on absorption prior to 21.9.67. (official digest)

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Official Railway Board digest, not the complete circular. Permanent transfer of Railway servants to Government Companies/Corporations – Grant of retirement benefits to permanent Railway servants on absorption prior to 21.9.67.

Text of the circular

Permanent transfer of Railway servants to Government Companies/Corporations – Grant of retirement benefits to permanent Railway servants on absorption prior to 21.9.67. (official digest)

RBE No. 171/2002 Date: 2002-09-26 Official source: https://indianrailways.gov.in/railwayboard/uploads/directorate/establishment/order_july-sep.jsp

Official Railway Board digest - gist only, not the complete circular.

Reference: F(E)III/95/PN1/1 dt. 26.9.2002

Permanent transfer of Railway servants to Government Companies/Corporations – Grant of retirement benefits to permanent Railway servants on absorption prior to 21.9.67. In terms of para 4 of the Board’s letter of even no. dated 7.4.95, which was based on DOP&PW’s Office Memorandum No.4 (6)/85-P&PW(D) dated the 3 rd Jan.1995, CPF benefits received in terms of Ministry of Railways letter dated 15.6.61 were to be refunded by the said employee to the Railway/Government together with interest at the rate applicable to SRPF accumulations on the date of such refund and calculated in the same manner as interest on SRPF is worked out. The above provision had been subject of litigation in various Courts. The CAT, Principal Bench, in its judgement in one such case, quashed and set aside the above provision regarding the manner and rate of interest at which the amount is refundable. The CAT ordered further that simple interest @ 6% or rate applicable to GPF/SRPF accumulation during that particular year, whichever is less for that year on the refundable amount from the date of payment under letter dt. 15.6.61 till the date when the refund is made, should be charged from the concerned employee. High Court of Delhi upheld the said judgement. In the appeal filed in the Madras High Court against a similar judgement of CAT, Madras, the High Court inter-alia observed that it is only equitable that if the Govt. is to have interest on the Provident Fund amount, which the employees had received at the time they left the Govt. service, the Govt. also should pay interest on the pension which, according to it’s own policy it was required to pay to those employees for the period of delay in disbursing that pension. The modalities of implementing the above stated judgement of the High Court of Delhi were under active consideration of the Government in the DOP&PW in consultation with Ministry of Finance. The President is now pleased to decide that SRPF benefits received in terms of Ministry of Railways letter dt. 15.6.61 will have to be refunded by the said employee to the Railway with interest @ 6% or rate applicable for SRPF accumulations during that particular year, whichever is less. Interest on arrears becoming due to an absorbee shall be payable either from 1.4.95 or 3 months from the date of submission of claim of the absorbee, whichever is later. The rate of interest would be 6% or the rate of interest applicable to SRPF accumulations during the particular year, whichever is less. The pension sanctioning authority, where the absorbed employee was emp0loyed prior to absorption, will have to work out the interest on the SRPF accumulation to be refunded by the concerned employee received by him in terms of Ministry of Railways’ letter dated 15.6.61 in accordance with the above provisions. Wherever higher rate of interest has been charged on SRPF accumulation from the concerned absorbee, the excess amount charged from him shall be refunded to the concerned employee.

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