22 July 2019


Supreme Court

LIC of India and Ors. v. Krishna Murari Lal Asthana and Ors.




SC grants interim relief to LIC pensioners

The Supreme Court disagreed with a High Court interpretation that equated authority to implement rules laid down by the Central Government with the power to lay down policy under the rules. The matter stemmed from Life Insurance Corporation of India granting certain pensionary benefits to former employees, however it did not receive approval from the Central government, as mandated under the LIC Act. The High Court had accepted arguments that since the Chairman of the Corporation had been issuing circulars periodically, and the same were followed by the Corporation, no governmental sanction could be required under the Life Insurance Corporation Act. Dismissing the interpretation, the Supreme Court concluded otherwise. It distinguished the Chairman’s instructions as giving effect to the rules laid down by Parliament; they could not confer benefits not envisaged in the rules.

The Court expressed regret over the length of legal proceedings, yet stopped short of disposing of the matter on its merits. It also acknowledged absurdities in the pension system, which had resulted in some persons receiving disproportionate allowances. One such instance pointed out by counsel for aggrieved pensioners was that of a much lower ranked employee receiving twice the pension as a former executive director.


Union of India v. Hira Lal MANU/SC/1652/1996
All India Reserve Bank retired Officers Association v. Union of India MANU/SC/0151/1992
State of Andhra Pradesh and Anr. v. K. Jayaraman and Ors. MANU/SC/0446/1974
Section 48 Life Insurance Corporation Act, 1956

Tags : Lic pension rules

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