Consumer Forum says Government Employees can claim retirement benefits only as per service conditions

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The National Consumer Disputes Redressal Commission (NCDRC), presided by Dr. Inder Jit Singh, has held that a government servant is not defined as a “consumer” under the Consumer Protection Act. Therefore, government servants are entitled to claim retirement benefits only according to their service conditions, relevant regulations, or statutory rules.

Case Background

In this particular case, the complainant was a clerk at the Punjab National Bank. He applied for a pension but did not refund the bank’s contribution to the provident fund that he had already received. As a result, his pension application was deemed incomplete and unsuccessful. After the complainant’s passing, his widow applied for a family pension but also did not refund the bank’s provident fund contribution. Her application was also deemed incomplete. The bank sent a letter to the widow, offering her the option to pay back the provident fund amount plus interest in order to have her late husband’s pension case approved. Eventually, the bank paid the widow arrears for her late husband’s basic pension and her own family pension for certain periods.

However, the widow passed away shortly after, leading the bank to stop the family pension payments. Subsequently, the son of the late complainant filed a complaint against the bank. He argued that the bank demanded and received a refund of the provident fund contribution it had previously paid to his late father, along with interest on that refund amount. This was a prerequisite for paying the basic and family pensions to the complainant’s wife. The District Forum allowed the complaint, and the bank appealed to the State Commission, which dismissed the appeal and directed the bank to deposit the employee contribution with interest. The bank then approached the National Commission with a revision petition.

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NCDRC’s Decision

The bank argued that the complainant had no legal standing to raise any issue regarding the pension paid by the bank before any forum under the Consumer Protection Act. The bank contended that the State Commission had no jurisdiction to entertain the complainant’s complaint and that pensionary benefits in the bank are regulated by special laws and cannot be bequeathed by the beneficiary of such pension benefits. The bank also argued that the State Commission’s reasoning was contrary to the regulations and circulars it relied upon.

The NCDRC emphasized that a government servant cannot raise any dispute regarding their service conditions or the payment of retirement benefits before any forum under the Consumer Protection Act. The commission referred to a Supreme Court judgment that held that a government servant does not fall under the definition of a “consumer” and is entitled to claim their retirement benefits strictly in accordance with their service conditions, regulations, or statutory rules.

The NCDRC observed that the matter at hand was not a service matter but rather an issue of unfair trade practice and principles of natural justice. The commission noted that the bank charged interest on getting the refund of the employee contribution but was hesitant to pay interest at the same rate on paying the pension, which was due from an earlier date. The NCDRC upheld the State Commission’s order of allowing interest on arrears of the pension and dismissed the bank’s petition.

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Conclusion

In summary, the NCDRC has ruled that government servants are not considered “consumers” under the Consumer Protection Act and are entitled to claim retirement benefits according to their service conditions and relevant regulations or statutory rules. In the specific case mentioned, the NCDRC upheld the State Commission’s decision to allow interest on arrears of the pension, dismissing the bank’s petition.

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