June 20, 2021

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Father’s pensionary benefits

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This article is written by Preeti Pallavi Jena, pursuing a bachelor of law from the school of law, KIIT University, Odisha. This article says about the pension, who can avail of it, its history.

Table of Contents

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Pensiones are given after the retirement of a Government servant. This they get after they achieve the age of retirement that is mostly 60. This is because it is the age of retirement which has been extended now to 65. After this age, each and every Government Officer gets their pension for their future survival. But in case if the servant died before acquiring the age limit, then soon after his death, his spouse will get 50% of the amount. But from 2005 then rule got changed and a new rule took place which said that from January 2005 no one will be awarded any pensions anymore.

The retirement age limit has been extended by the Full Retirement Age (FRA) from 65 to 66 and it will be 67 in the next few years almost all over the world. The increasing age limit of retirement has been done by the Congress party to strengthen social security’s finance. The Full Retirement Age means the age at which a person gets retired and he will be receiving the full retirement benefits after getting retired from his working place or department. But if you claim the benefits before reaching the maximum age limit of the person then your pension will be reduced as per the age. In India, the retirement age is from 60 to 65 for men. In special cases like the health sector and education purposes, it has been increased to 65. In 2005, The Pension Fund Bill took away the right of providing pensions to the individuals by the government and said that the individuals are themselves responsible to save their money for their future benefits and it’s no more the government. The Pension Fund Regulatory and Development Authority Bill, 2005 creates a new authority to regulate the new pension system that will give old age income security to every individual, including unorganized sectors. The NPS implement the pension funds and keep records of them. This is already implemented for the new government workers. The time period for getting the receipt of the pension is 10 years.

Nearly 370 years back in Germany, Duke Ernest first created the idea of providing funds to the widows of the clergymen. This was made in the year 1645. Next in the year 1662, again a fund similar to the above was established which gave funds to the widows of teachers. These funds are the first examples of pension. In the 17th and 18th century providing pensions became common in parts of Europe. This was provided as a compensatory cost for the loss of spouses, generally, the men who lost their lives in terms of civil or military services. 

In 1889, the government made the law that it would be applicable to every worker and it got implemented in the same year itself. It was initiated by Otto Von Bismarck who called this ‘The Old Age and Disability Bill’. In 1908, The Old Age Pensions Act was introduced and it came to effect on January 1st, 1909. In the UK after World War II, the state pension got more implemented and the National Insurance Act, 1946 gave coverage of social security.

Pension is the benefit that government officers get after their retirement or their widow gets it if there is any cause of death of such a person. This is referred to as a salary to the employees after getting retired or to their family.

In 1995, the government tried converting the EPF(Employees Provident Fund) to EPS (Employees Pension Scheme). This provides the workers both from the public and private sector to receive the retirement benefit called ‘gratuity’. This is given to those workers who qualify for the minimum eligibility conditions.

In 1995, the National Old Age Pension was introduced in NSAP (National Social Assistance Program) which provides pension monthly to the poorest people which is up to 30%. Finally, on 1  January 2004, the Government of India made a pension system. This came to effect on 1 May 2009 and provided for every citizen working.

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There are 2 types of pensions:

Defined benefit

The servants working there know very well how much pension they would be getting after their retirement beforehand. They know this because they know how to calculate the accurate amount of money they are going to receive once they get retired.

Defined contribution

Here the servants add an amount to the individual account which is created for him only and will keep the money as savings and it will be kept as secured and once he gets retired, the same amount will be handed over to him either monthly or yearly as per his demand.

As per the GEP Law, The Orphans Pension Rule was changed as The Child Pension’s Rule from 1 June 2018. If a child wants to get the pension, then they will be getting it only if the pensioner is deceased. This gives the right that the spouse and the children who are left out can get the amount. For a child to be eligible he must be his own biological child or he can also be an adopted child of the deceased person.

Disabled children can also get the pensions of their father. They receive it if after the age of 25 he is unable to earn for living. It is just that the child must be physically and mentally disable and is not being able to maintain himself financially. And if he is permanently disabled and dependent fully then he will be benefited till his death.

  • The pension can be awarded to the widow up to her death or till she remarries to someone else.
  • This pension can also be awarded to her if she is childless after her 2nd marriage and if her income is not satisfactory or is very less to survive.
  • If there are 2 twins who need to receive the pension then it should be given equally without any discrimination.
  • This pension can be paid to the children, but first, the elder one gets it, till the time he is not ineligible the younger one won’t be getting the pension.
  • If both the parents of the child are dead and both are working then the child will receive the pension from both sides.
  • A child is eligible to get a pension till the age of 22. It doesn’t matter that at that time he is working or a student.
  • Till the age of 18, the guardian gets the pension to take care of the child, once he crosses the age limit he can provide his account details as now he is a major will be eligible to get the pension directly.

The pension of the father is not excluded from the payment required for maintaining children. This has been clearly said by the Kerala High Court in the case of Abdul Sathar v Pathimuthu & Ors.

Here the petitioner was trying to waste the time of the respondent by restricting the pension that needs to be given to him. This is because the petitioner did not want that the respondent will get a chance to avail it. The court clearly pointed out whatever the petitioner was doing in front of the family court to deliver the cash to the respondents and scrutinized it in front of the execution court. Finally, the Kerala high court held that there is no restriction for respondent 2 and respondent 3 to get any money or stipend. Here the respondents 2 and 3 are the children of the petitioner.

Facts 

  • In this case law, the respondents are the petitioner’s wife, daughter, and son. The petitioner challenged the procedure. The family court directs the petitioner to pay month-to-month expenses to respondents 1 and 2 at Rs. 2000/- each.
  • Ignoring the fact that the petitioner applied to put aside the ex parte order, the application made was dismissed. An application was recorded against the petitioner’s employer where the Kerala State Road Transport Corporation (KSRTC) retained the pensionary benefits payable to the petitioner. The amount of Rs. 1,94, 533/- was deposited by KSRTC as per the order given by the family court. This order was challenged by the petitioner. 
  • But, the court in the judgment held that there was no error occurred by the family court while guiding KSRTC for giving deposits for maintenance. The petitioner approached the execution court after this. The petitioner filed that the amount which is deposited should not be given to the respondents. The respondent did not agree to this. The suit was appointed on 30.12.2011. 
  • The petitioner excluded the ex parte order which can be done only with the condition that the petitioner should deposit the entire amount for maintenance.
  • The petitioner failed to prove it and hence the application was dismissed. The petitioner challenged in the High Court. He also dismissed the petitioner’s need to give Rs. 3, 70,000/- to the respondent.
  • In the E. A No.81/2017, the first respondent filed a petition to direct the K.S.R.T.C to submit the withheld amount and pay it out to the respondent filing the case, to which the petitioner agreed to have no objection.
  • It also stated that the pensioners aren’t attached to and only directed by the authorities to be held back, and hence, no violation had been made. 
  • The petitioner’s counsel countered that as stated in Section 11 of the Pensions Act of 1871, if no pension is granted to a former employee on the sole grounds of part work experience, it is likely to be attached by a process of a count.
  • He also referred to the Code of Civil Procedure and stated that the gratitude and stipends offered to the pensioners are not likely to be attached by ant process. He further suggested that the challenged order is wrong and most likely should be set aside.
  • To this, the counsel of the respondents argued that the petitioner has been continuously dragging these proceedings for the past 20 years by adoption of tardy tactics and he also has refused to maintain his children. The original petition was filed before time and the petitioner’s application to reject the decree was put away by the family court and was also further confirmed by the very court itself.

Issue

Is the benefit from a father’s pensionary exclusion from being dispensed towards the unfulfilled obligations payable to his children? This is the issue that arises for consideration in the petition.

                 

Judgment 

The petitioner has the right to take care of his children. This falls under Article 15(3) and Article 39 of the Constitution of India. The parliament has the right to protect neglected children and women. Hence the parliament made it mandatory that the man needs to maintain his wife and children.

The parliament said that Section 39 of the Transfer of Property Act, 1882 gives a person the right to receive maintenance over a property. That’s Why it is held that the spouse and children do not go within it, as family pensions need to be paid to the wards of the beneficiary. The court dismissed the petition and said to give the entire money which was withheld by the respondents under the law.

In a general context, the provisions of a retirement plan show the proper distribution alternatives for the beneficiaries. However, in the case of the death of the parent who was getting a pension, the pension policies vary according to the policy chosen by the parent. These choices made by the parents have a great influence over the tax treatments and the ways to get access to these payments. According to the rule stated in the article, the pension can only be procured by the spouse of the deceased. After the death of a spouse, it may also be granted to the dependent child up to the age of 25. However, there are some exceptions for some cases where the child gets the pension even after the age of 25. These cases are: when the daughter is divorced or widowed and when the child is disabled. In these mentioned circumstances, the laws abiding by the pension are waived for them. 

In the past few years, it has been observed our Indian pension system has been undergoing a crisis of confidence. Several problems such as pressure on public finances, demographic ageing, skewed coverage due to unorganized employment, and low returns from provident funds have come to the surface. Hence, the policymakers have to find a solution to all this keeping in mind that the children benefiting from the previous pension scheme shouldn’t be suffering and even consider making a few policies for the betterment of these orphans. This will not only help these children in a financial manner but also will empower them to pursue a career and make a stand in society.


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