By Justice Bhanwar Singh and Dr NK Bahl
Recently, Chief Justice of India DY Chandrachud urged the centre to look into the issue of low pensions being given to district court judges elevated to High Courts. He also stated: “We are the guardians of the district judiciary. Nothing else is there on my mind, but how can we help them? We are conscious of the financial implications in other segments. Handle this differently. This is about the district judiciary.”
Pension is the reward or compensation in lieu of long services rendered by a judicial officer for his social security after retirement. In UP, a pensioner judicial officer gets half of the last drawn basic pay, plus dearness allowance (DA). A judicial officer is entitled to full pension if he has completed 20 years of continuous service. The entitlement of pension starts on completion of 10 years continuous service.
The consolation is that this pension is a family pension and the dependent wife and children of a deceased pensioner also get it from the date of his death, which is again half of what he would get on that date. On the death of pensioner/family pensioner, enhanced rate of family pension at the rate of 50% of the last pay drawn with DA will be paid for a period of 7 years from the date following the date of death or up to the date on which pensioner would have attained the age of 67 years whichever is earlier. After that, family pension will be paid at the rate of 30% of the last pay drawn along with DA. However, a government servant is not entitled to two pensions in the same service or post at the same time or by the same continuous service.
Under the old pension scheme (OPS), the government pays the entire pension amount to the employees after retirement. None of the amount is deducted from the salary of the employee when they are in service. After retirement, the judicial officer receives the pension amount and DA every month. DA is revised twice a year. Accordingly, their pension keeps on increasing on a half-yearly basis.
If the pensioner or his nominee reaches between 80 and 85 years, he gets an additional hike in basic pay to the tune of 20% in pension/family pension. Similarly, he gets 30% hike in basic pay if he/nominee attains 85 to 90 years; 40% hike on reaching between 90 to 95 years and 50% hike on reaching between 95 to 100 years.
On reaching 100 years, the pensioner/ nominee gets an additional hike of 100% in basic pension. Additional DA is also payable on all such hikes. However, very few pensioners/nominees reach this threshold. The Supreme Court has recommended that the pension of a judicial officer on accomplishing the age of 65, 70 and 75 should be hiked to 5%, 10% and 15% in their basic pension.
As far as family pension is concerned, it is 30% of the last pay drawn by the pensioner along with DA. Only one person is entitled to family pension at a time, according to the entitlement. Even the daughter-in-law or divorced daughter is entitled to family pension up to the age of 25 years or before crossing the prescribed limit of her own income, whichever is earlier, provided there is no other claimant.
Family pension is admissible to the husband/wife of a deceased pensioner till his/her death or remarriage. Thereafter, it goes to the unmarried son/unmarried daughter and widower/widowed father/ mother of the deceased pensioner, provided their income is below the prescribed limit, and further, they were totally dependent on the deceased pensioner. For this, the treasury officer will obtain the certificate of age and income from the entitled member for disbursement of family pension.
Pension commutation is a financial option available to pensioners that allows them to exchange a portion of their regular pension payments for a lumpsum payment. In other words, it is a process of converting a part of future pension into an immediate, one-time payment. The admissible pension to a judicial officer is subject to commutation/encashment up to a maximum of half of the total pension. On commutation, the basic pension is reduced to half if commutation is sought for its fullest, i.e., 50% or to the extent of balance after deducting percentage of encashment. But this lumpsum amount is recoverable gradually in 15 years in equal monthly installments from the date of its payment. On full recovery, the pension gets restored to its full. The commuted lumpsum is income tax free. In the event of the death of the pensioner, the commuted lumpsum is not recovered from the family pension.
The pension commutation formula is equivalent to 50% of half the basic pay multiplied by the commutation factor, further multiplied by 12. For example, if the last drawn basic salary of an employee is Rs 1 lakh, then lumpsum commutation amount will be Rs 25,000 multiplied by commutation factor and 12. The commutation factor is calculated according to the age of the pensioner. This factor reduces inversely with the age of the pensioner at the time of retirement. Computation factors are given in the table attached to Commutation of Pension Rules, 1954.
This factor is selected at the age which will be on his next birthday. So if a judicial officer retires at 60, the commutation value is to be reckoned at the age of 61. Similarly, when judges retire from the High Court at the age of 62, commutation factor is to be taken up according to 63 years.
This lumpsum commutation amount is recoverable in 180 EMIs along with 8% interest. However, the nomenclature of this lumpsum commutation payment is misleading. It should be named as retirement loan and recoverable rate of interest and recovery schedule should be mentioned in the final pension payment order. It is a fact that many pensioners at the time of their retirement are not aware that this lumpsum commutation substantially amounts to retirement loan.
The old pension scheme has been abolished for those employees who have been appointed on or after April 1, 2004. The National Pension Scheme (NPS) was introduced on January 1, 2004. This is a defined contributory pension cum investments scheme with a minimum monthly contribution of Rs 100 and a maximum of Rs 1,50,000 up to 60 years of age. This scheme can be joined by any citizen of India between 18-60 years. A person who joins the service on or after January 1, 2004, could opt for OPS. The option to join OPS from NPS was closed from August 31, 2023.
Under NPS, a government employee can contribute 10% of his basic salary plus DA. The government contributes 14% of basic salary plus DA every month. The pension is not fixed and varies with variation in the share market because the contributions are invested in mutual funds.
There are 25 High Courts in India, but the salary of all High Court judges is regulated by Article 221 and the Second Schedule of the Constitution. Their salary and pension are Rs 2.25 lakh, per month and Rs 13.5 lakh per annum along with DA. The pension of High Court judges elevated from the Bar is calculated on the basis of their length of service. They are entitled to a pension of Rs 96,525 p.a. for each completed year of service and become entitled for a full pension of Rs 13.5 lakh p.a. on completion of 14 years of service. However, eligibility of pension starts at completion of 12 years of service.
The Supreme Court in P. Ramakrishnam Raju vs Union of India and others (AIR 2014 SC 1619) directed on March 31, 2014 that for pension benefits, 10 years practice as an advocate be added as qualifying service for judges elevated from the Bar with effect from April 1, 2004. Thus, the period of 14 years includes 10 years’ practice at the Bar. Later on, High Court Judges (Salary and Conditions of Service) Act, 1954, was amended and Section 14A was inserted, which provides that 10 years’ legal practice shall be added to the service of judges elevated from the Bar for the purposes of calculation of their pension.
The pension of High Court judges elevated from judicial service is also calculated on the basis of length of service. However, it is not based on each completed year of service. They become entitled to full pension on completion of 20 years service, including as a High Court judge.
But a few judicial officers who join the service at 43 years or more after qualifying for the Higher Judicial Services examination with seven years of practice at the Bar are not able to complete the full 20 years’ because all of them retire at 62 years if they are elevated to the High Court. Hence, they get less pension on a pro rata basis. They also get special additional pension Rs 45,016 per annum for each completed year as a High Court judge.
However, the qualifying period for full pension of judicial officers elevated to the High Court should be at par with advocates with 10 years’ practice who are elevated to the High Court. For both these categories, the qualifying period for full pension should be 14 years in order to ensure the notion of equality as enshrined in the Constitution. Judges are judges. Thus, one rank one pension should be the norm for constitutional posts also.
Be that as it may, the functions, duties, salary and allowances of judges should not be equated with bureaucrats. Professor Harvold Joseph Laski of Harvard University once said that judges are asked to perform divine justice, though they are human beings. Plato and his disciple Aristotle had said that doing justice is the duty of a ruler or the king and since this job has to be executed and performed with accuracy, proficiency and honesty by judges, they deserve an angelical status in the society.
To keep them stress-free, they should be given a good pension. In Covid times, a judge in the US dictated judgments at the age of 103 from his bed where he was hospitalised. In many European countries, judges are entitled to get the last drawn salary as their pension.
The present pension given to the judges is not so bad as a district judge with more than 20 years of service elevated as a High Court judge gets approximately Rs 1.7 lakh as pension. But a meagre pension of Rs 15,000 to Rs 30,000 to judges of the district judiciary elevated to High Courts appears to be the result of some special circumstances which calls for special attention from the government and the Supreme Court.
Pension actually is not an income; hence, it should be exempted from income tax if the pensioners are to be given true compensation for the services rendered by them. Moreover, the formula of calculation of pension should be revised. A pensioner should get 100% of his last drawn basic salary along with DA as pension so as to keep him stress-free and comfortable. In such a case, they will shelve their craving for re-appointment, and during their service, will work with complete independence.
To sum up, pension is a matter of status, dignity and social security of district judges elevated to High Court. A pittance undermines the image and status of judges in the mind of the general public.
—Justice Bhanwar Singh is a former judge of High Court of judicature at Allahabad and Dr NK Bahl is a former District and Sessions Judge, UP