The court has ordered EPFO to reconsider higher-pension applications from employees of exempted provident fund establishments, saying internal trust rules cannot alone override statutory rights.
The Bombay High Court has given relief to private-sector employees who were denied a higher pension under the Employees’ Pension Scheme, 1995, after the Employees’ Provident Fund Organisation rejected their applications by relying on the internal rules of exempted provident fund trusts. The court said those trust rules could not, on their own, defeat an employee’s statutory right to seek a pension based on higher wages, according to reports by Business Today and The Economic Times.
The dispute arose because some employers run their own provident fund trusts instead of participating in the standard EPF arrangement. In those cases, EPFO had argued that the trusts’ rules either imposed a salary ceiling or did not expressly allow employees to exercise the joint option for a higher pension. The petitioners countered that an employer’s trust rules cannot override the pension framework under EPS-95, particularly where employees had contributed on actual salaries above the statutory wage cap, as explained in the Business Today report and covered again by The Economic Times.
In its ruling, the court held that a higher-pension request could not be refused simply because a trust deed referred to a ceiling on contributions or did not mention the joint option. According to the judgment quoted by Business Today, the court said that a joint option cannot be turned down on the basis that trust rules cap contributions or because the employer did not remit pension contributions on wages above the ceiling. The court also referred to the Supreme Court’s decision in EPFO v. Sunil Kumar B., which upheld the 2014 amendments to EPS-95 and confirmed that eligible employees who had contributed on actual wages above the limit could not be barred from pursuing the higher-pension route if they met the scheme’s conditions.
The High Court also addressed a practical problem that often arises in older pension cases: missing records. It said alternative methods of verification should be considered where historical documents are unavailable, including giving affected employees a chance to be heard. The bench set aside EPFO’s rejection orders and directed the authorities to process the petitioners’ joint options within eight weeks, with no order as to costs, according to The Economic Times and Business Today.
The ruling does not mean every EPFO member will automatically qualify for a larger pension. Eligibility still depends on the scheme’s rules, contribution history and supporting documentation. But the judgment is significant because it reinforces a distinction that has become central in several pension disputes: internal trust rules may govern a provident fund, but they cannot by themselves cancel a statutory entitlement under EPS-95 for workers who otherwise satisfy the scheme’s requirements. Reports by Law Trend and SriVax said the decision is likely to be watched closely by employees of exempted establishments facing similar objections.
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