The issue centres around a pension rule that permitted central government employees to shift en masse from the 1960s to the 1980s to public sector undertakings (PSUs) that needed experienced workers at the time. To aid and promote the move, the Centre allowed the employees to avail of 100% lump sum pension in advance for 15 years.
The rules had till then permitted a partial one third commutation. Acomplicated formula is at work for pension calculations.Essentially, such employees who had claimed a lump sum upfront in a particular year, went on to fight for restoration of pension (effectively arrears) as per service years, after accounting for the lump sum payment made earlier. The issue was a fight against effective downgrade of pension slabs.
Several legal battles ensued, beginning in 1983. In 1987, the SC first allowed one-third restoration for Central govern ment employees after a 15-year period, and a decade later extended the benefit to those who had shifted to PSUs.
K Ganesan, who was with the finance ministry and in 1986 moved to BHEL, a PSU, after availing of lump sum pension in advance, launched a fight in the Madras high court.In 2007, the court upheld the plea.
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