Constituent policy

Supreme Court Upholds Center’s OROP Policy in Defense Forces; Says “No legal mandate that retirees of the same rank should receive the same pension”:

The Supreme Court on Wednesday upheld the manner in which the central government introduced the “One Rank One Pension” / (“OROP”) scheme in the defense forces, in accordance with its notification dated November 7, 2015.

“We find no constitutional infirmity in the adopted OROP principle,” the trial bench said in the judgment delivered today.

The bench however ordered that the reassessment exercise in accordance with the policy be carried out from July 1, 2019 and that the arrears be paid to retirees within 3 months.

All pensioners who occupy the same rank do not form much of a homogeneous class. Also, a new retirement benefit can be made applicable from a prospective date, on the sole condition that it cannot split a homogeneous class. The bench considered that the DS Nakara the judgment cannot be read as having mandated OROP.

The Court further held that the definition of OROP in Center policy cannot be considered arbitrary. The Court also cited the limited scope of judicial review of executive policy decisions.

At the same time, the Court ordered the refixation with effect from July 2019.

“As a result, we direct that a reassessment exercise be conducted by the government for a period of 5 years with respect to the pension payable to army personnel as set out in the OROP policy in accordance with the November 7 notification 2015. Reassessment exercise to be carried out from July 1, 2019 and arrears to be paid to army personnel within 3 months”, ordered the bench disposing of the petition.

The full judgment has not yet been uploaded.

The petitioners had questioned the notification dated November 7, 2015, issued by the Union Government in which, upon implementation of the OROP, it had adopted an amended definition of the term under which the gap between current and past retiree pension rates was to be closed at “periodic intervals”.

The petitioners call for an annual review of the OROP pension and the calculation of the pension based on the veterans’ 2014 salary. In accordance with the notification of 2015, the periodic revision of the pension was fixed at five years and the pension was fixed on the basis of the wages of 2013.

It was claimed in the plea that despite assurances from the prosecution of Parliament, what was being implemented was “different pensions for the same rank depending on when the person retired”.

Presentation of advice

We have not discriminated against any pensioners in any form; The heart of the policy maker is as broad as the citizen, but when we work at the table and finally come to politics, the concerns are always apparent: ASG Venkataraman

Regarding the speech of the Minister of Finance delivered on February 17, 2014, the ASG argued that the speech of the Minister of Finance in which the recommendation of the Koshiyari committee was endorsed was not based on any decision or recommendation of the cabinet of the Union at the time.

With respect to the Claimant’s assertion that one should only follow the same grade and not the same length of service and continue to grant or extend OROP benefits, the ASG, while referring to the affidavit, argued that the prerequisite for being eligible for the MACP is the completion of the studies required for the length of service.

Emphasizing the 3 eras with respect to MACP and non-MACP, ASG stated that for the purpose of calculating OROP, the union took the MACP as a basis and applied it to all retirees with the same length of service.

He also claimed that matching No MACP with MACP would result in a financial implication of INR 42,776.38 crore.

“If we do something, it will be an extra effort. Everything you create is a fundamental aspect. The heart of a decision maker is as wide as that of a citizen, but when we work at the table and we arrive finally to a policy, the concerns are still bare. This concern you have been doing for 1 year today, do it for this case but what would be its repercussions in other areas, “ ASG had submitted.

ASG Venkataraman argued that when the Union came up with the concept of OROP in 2013, it did not want to leave anyone behind after independence.

“When we drew it in 2013, we didn’t want to leave anyone after independence. Now my friend says you traveled to the past. ACP, MACP, everything is connected. When we wanted the program to travel to the future and policy makers instead of 10 years decided for 5 years. The Court must understand. When we formulated it, we covered the whole past of the 60s/70s,” said ASG.

He further added that “to change it through legal instructions, the implications of this are not known to all of us. Anything related to finance, economics should be viewed with ‘caution’. A period 5 years is reasonable in all matters of business and it has financial implications.”

By introducing the concept of periodic intervals, the period cannot be so large as to make the concept of OROP illusory and in effect enact a different rank pension; It would be futile to claim that the minutes of a meeting chaired by Raksha Mantri do not constitute an executive decision taken by the union: lead lawyer Huzefa Ahmadi

Appearing for the Claimants, Lead Counsel Huzefa Ahmadi, in his rebuttal submissions, argued that the Centre’s application of OROP resulted in a one rank different pension.

“I have never argued that any member of staff who has not been under the different terms of service should get the same OROP. To suggest that it would be a financial burden if my claim is accepted – that is totally incorrect. Enforcement by OROP by them resulted in a tier 1 diff pension because even according to them the figure of 6665 was for someone who accrued the same years of service versus someone who retired later after the same years of service. So where does the flat pension concept go? That’s the elephant in the room. After 5 years, we’ll go back to 1.5 years, even for equalization purposes. This difference will continue to get worse, submitted the lead attorney.

Regarding the Union’s position that the Finance Minister’s speech in which the recommendation of the Koshiyari Committee was endorsed was not based on any decision or recommendation of the then Union Cabinet, the Senior Counsel, while referring to documents and decisions of the executive, argued that it would be futile to argue that the minutes of the meeting chaired by the Raksha Mantri did not constitute an executive decision taken by the union.

He further added that the hiatus which was practically 1.5 years would only increase the gaps. This was also the solicitor’s assertion that “the union changed its position from the moment the statement was made on the house floor. The first statement was made by the Minister of Finance. Then in the budget speech – it’s done after the prime minister’s minister and the approval of the whole cabinet Mr. Jaitley’s speech emphatically adopts the definition of OROP It’s arbitrary not to consider the MACP for the simple reason that even following the 2015 decision, the OROP component will avoid the MACP.

“By introducing the notion of periodic intervals, the period cannot be long enough to render the notion of OROP illusory and in fact decree a different rank for pensions. This would be the practical effect of equalizing the pension after a period of 5 years, “ The lead attorney added.

“Older soldiers when they fought didn’t have the guns that soldiers have now. Until 3rd pay commission, that was exactly what you were giving,” the lead attorney said in conclusion.

Case Title: Indian Veterans Movement (An Indian Federation of Veteran Organizations Represented Against the Union of India Department of Veterans Welfare Secretary of the Ministry of Defense | Written Petition (Civil) 419/ 2016

(Story to be updated after the judgment is uploaded)