The Bombay High Court on 18 April ruled that the Employees’ Provident Fund Organisation (EPFO) cannot deny eligible employees a higher pension due to procedural lapses or delays by the employer. The court observed that employees cannot be penalised for shortcomings attributable to their employers or the authorities.
The court noted that the petitioners had exercised their option, contributed on actual wages, and submitted supporting documents, yet their claims were rejected solely due to non-submission of Form 6A and certain challans.
A bench led by Justice Amit Borkar examined cases where applications for pension on higher wages under the Employees’ Pension Scheme, 1995, were rejected due to procedural lapses and delays.
Terming the rejection arbitrary and inconsistent with the beneficial nature of the Employees’ Pension Scheme, 1995, the court set aside the impugned orders and directed the authorities to reconsider the claims. All writ petitions were accordingly allowed, with no order as to costs, according to a report by SCC Online.
What is the dispute?
The dispute started after some employees submitted their applications to seek pension on higher wages. These petitioners had fulfilled a long tenure of service, contributed to provident fund on actual wages, and exercised the joint option under the scheme. They submitted the applications through the online facility, along with Form 3A, (EPF) account statements, and joint option forms certified by employers.
However, the respondent authority rejected the claims on the grounds that employers failed to produce Form 6A and acknowledged challans from the employers. As a response, petitioners argued that the statutory obligation to maintain and submit such records lies with employers, and employees cannot be burdened with the consequences of non-production. They reiterated that the denial of pension despite fulfilling eligibility conditions was arbitrary.
The respondents also contended that submitting a joint option along with proof of remittance of contributions on wages above the statutory ceiling was mandatory, and that, despite repeated reminders, employers failed to furnish acknowledged copies of Forms 3A and 6A.
What was the basis of the court’s decision?
The court observed that the petitioner had relied on Form 3A, the EPF account statement, and a joint option form certified by the employer, along with an undertaking to deposit any differential contribution. It noted that these documents sufficiently establish employment, wages drawn, and the contributions made.
It was also noted that Form 3A reflects yearly contribution details, and the EPF account statement shows the running account of deposits. If these records indicate that deductions were made from higher wages and contributions were credited, they provide a basis for examining the claim. Therefore, in such a situation, the non-submission of just one document, namely, Form 6A or certain challans, cannot be treated as a ground of rejection, as per the report.
After hearing the arguments, the court emphasised that the authority must be satisfied that a valid joint option was exercised in accordance with law and that contributions on wages above the statutory ceiling were done, as these are essential conditions. However, it also clarified that these requirements must be applied in a reasonable manner, and the authority cannot insist on a perfect set of documents in every case, particularly when old records are involved, as in such cases, perfection may not be possible.
Accordingly, the court quashed the impugned orders dated 8 April 2025, 9 April 2025, and 4 December 2025, remanded the matters for fresh consideration. The authority was instructed to complete reconsideration within 12 weeks, pass a reasoned order, and grant pensionary benefits if entitlement is established, the case details read.