The Calcutta High Court has set aside an order of the Employees’ Provident Fund Organisation (EPFO) that had rejected the higher pension applications of retired employees from the Steel Authority of India Limited’s Central Marketing Organisation (CMO). The court held that the authority had misinterpreted the Supreme Court’s 2022 judgment on higher pension eligibility and acted contrary to the principles of natural justice.
Justice Shampa Dutt (Paul), delivering the judgment on November 14, allowed the petitions filed by superannuated employees of SAIL-CMO and directed the EPFO to accept any joint option application submitted on or before January 31, 2025, or within any further extension granted by the authority.
The petitioners had approached the court seeking to quash the EPFO’s February 5, 2025 order, which rejected their joint options for higher pension on the ground that SAIL-CMO’s Provident Fund Trust Rules did not permit such benefits. The employees retired at the age of 58 from an establishment that enjoys exemption under section 17(1) of the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952.
Their counsel pointed out that SAIL-CMO’s PF Trust had submitted revised rules to EPFO on October 4, 2024, but the authority refused to approve them, stating in a January 21, 2025 letter that no trust-rule modification after the Supreme Court’s 2022 judgment could be allowed. EPFO then rejected the joint applications based on these unapproved rules.
The court noted that the PF authority’s January 18, 2025 clarification relating to exempted establishments, which relied on the Supreme Court verdict, was “totally against the directions” of the apex court. Justice Dutt (Paul) observed that EPFO had “given its own interpretation” of the judgment, one that stood in “complete contradiction” to what the Supreme Court had directed.
Justice Dutt (Paul) took strong exception to EPFO’s approach, stating that the authority’s clarifications were not only arbitrary but also undermined the purpose of a beneficial social welfare legislation.
The court said the EPFO appeared to have “gone all out to deny the benefit” to members of exempted establishments by insisting that even amended trust rules after the Supreme Court’s ruling would not entitle them to higher pension. Such reasoning, the judge said, was “not acceptable,” violated natural justice, and amounted to an “abuse of the process of law.”
The court further directed that once employees remit the differential contribution to the pension fund—along with applicable interest—the EPFO must release the higher pension from the month following the remittance.
The petitioners highlighted that nearly 1,300 exempted establishments exist across the country, including 16 within SAIL. They argued that while EPFO manages provident fund and pension fund functions for unexempted establishments, pension under the Employees’ Pension Scheme, 1995 is uniform for both exempt and non-exempt units. EPFO’s refusal to process their joint options, therefore, had no legal basis.
