C N VENUGOPALAN
Former (Independent) Director (GoI Nominee) e-State Bank of Travancore (2011-14) &
Ex-Manager, Union Bank of India
“Nandanam”, Kesari Junction, N Paravur, Kerala -683513 Mobile:9447747994
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No.260228 28th February, 2026
To: Bank pensioners/ groups
Dear all,
Diversionary tactics of Indian Banks’ Association (IBA) in Civil Appeal No. 7993 of 2023 ( SLP No.5561 of 2016 ) - M C Singla & Ors. Vs. Union of India & Ors. before the Honourable Supreme Court.
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The core issue to be decided by the Honourable Supreme Court in the above Civil Appeal is whether regulation 35 (1) of the Pension Regulations of the banks mandate updating of pension in line with the periodic revision in the Basic Pay of active personnel or not. But in the court proceedings on 25.02.2026, the counsel of the respondents were, sans probity, attempting to confuse the Court by drawing attention to the Dearness Relief on pension, a matter covered by regulation 37 by way of diversionary tactics to evade responsibility and for taking strategic advantage.
FALSE AFFIDAVIT OF INDIAN BANKS’ ASSOCIATION BEFORE THE HONOURABLE SUPREME COURT
The IBA had earlier filed an affidavit dated 24.08.2022 before the Honourable Court falsely affirming that the Pension Regulations, 1995 of the banks do not have any provision for updating the pension despite regulation 35 (1) as amended in 2003 stating in unambiguous terms that “Basic Pension and additional pension, wherever applicable, shall be updated as per the formulae in Appendix-I”. Initially, the regulation in its notified form stood as “In respect of employees who retired between the 1st day of January, 1986 but before the 31st day of October, 1987, basic pension and additional pension will be updated as per the formula given in Appendix-1”. The intention behind the regulation was for extending the benefit of updating of pension to employees who retired period prior to the implementation of the Pension Regulations also and not for confining the benefit of updating only to the employees who retired between 1st January, 1986 and 31st October, 1987. The amendment of 2003 removed the time frame of retirement for the purpose of updating, imported the words “wherever applicable” and substituted the phrase “will be updated” with the phrase “shall be updated” with a view to give emphasis to the updating of all, irrespective of the date of retirement of the employee. Even a lad and a lass can conclude that if updating of pension was not intended under the Pension Regulations, the regulation should never have made a mention about updating and should not have been amended as aforesaid in 2003.
SETTLEMENT DATED 29.10.1993 PURSUANT TO THE INDUSTRIAL DISPUTES ACT 1947.
The settlement dated 29.10.1993 between IBA and All India Bank Employees’ Association signed pursuant to Section 2(p) and Section 18 (1) of the Industrial Disputes Act, 1947 read with Rule 58 of the Industrial Disputes (Central) Rules, 1957) states vide clause 6 that “Dearness Relief to pensioners will be granted at such rates as may be determined from time to time in line with the dearness allowance formula in operation in Reserve Bank of India” and vide clause 12 that “Provisions will be made a scheme, to be negotiated and settled between the parties to this Settlement by 31st December 1993 for applicability, qualifying service, amounts of pension, payment of pension, commutation of pension, family pension, updating and other general conditions, etc, on the lines as are in force in Reserve Bank of India”. But when pension was updated in the Reserve Bank of India by the Department of Financial Services, Government of India with effect from 01.03.2019 by various factors, depending on the date of retirement of the employees, vide letter F No.11/5/2001-IR dated 05.03.2019, similar updating was not granted to employees of the state-run banks in breach of the settlement.
SMALL COMMITTEE MEETING DATED 26.03.1994 of IBA WITH UNITED FORUM OF BANK UNIONS FOR IMPLEMENTATION OF THE SETTLEMENT DATED 29.10.1993.
The minutes dated 26.03.1994 of the meeting recorded in its preamble that “The terms of reference for the committee was to formulate regulations to be adopted by individual boards of the banks for setting up pension fund. This was to be done on similar lines as Reserve Bank of India Pension Regulations applicable to Reserve Bank of India employees and Central Civil Services (Pension Rules) applicable to Central Government employees by making suitable modifications in relation to its applicability to the banking industry” and clause 4.2 of the minutes recorded that “ Formula for up-dating pension should be on the lines of the same given in the Reserve Bank pension scheme. Any change therein should be introduced only after mutual agreement”. As per the minutes of the Small Committee, resultant of the mischievous acts of the IBA resultant of the mischievous acts of the IBA the employees of banks are entitled to updating of pension on the lines of RBI Pension Scheme and also Central Civil Pension Scheme.
REGULATION 56 OF THE BANK (EMPLOYEES) PENSION REGULATIONS, 1995
Regulation 56 of the Pension Regulations viz. “Residuary provisions” viz. “In case of doubt, in the matter of application of these regulations, regard may be had to the corresponding provisions of Central Civil Services Rules, 1972 or Central Civil Services (Commutation of Pension) Rules, 1981 applicable for Central Government employees with such exceptions and modifications as the Bank, with the previous sanction of the Central Government, may from time to time, determine.” The regulation was structured so to give the Pension Regulations of banks the colour of the Central Civil Service Pension Scheme making it explicit that the pension in the banks shall be updated along with the implementation of each bipartite settlement in the same way the Central Civil Pension is updated along with the implementation of each Pay Commission. It further makes it imperative that the additional pension granted to Central Civil Pensioners on attaining the age of 65 and above also shall be granted to the pensioners of banks. IBA and banks had always been in doubt in the matter of application of the Pension Regulations, and no exceptions or modifications from the Central Civil Pension Scheme has been identified and notified making them inapplicable to the bank pensioners. Banks are thus bound to pay pension aligned with Central Civil Pension Scheme as regulation 56 has to come into play. These are the terms of offer of the Pension Scheme and banks having taken back the CPF of employees as consideration for payment of pension, cannot renege out of the promise to pay pension on the lines of Central Civil Pension Scheme.
CENTRAL CIVIL PENSION VIS-À-VIS BANK PENSION
Central Civil Pension is paid as a social security measure on retirement without any contract or agreement to pay it. But in the case of banks, pension is paid as a retirement benefit in lieu of the Contributory Provident Fund by taking the CPF of employees as consideration for payment of pension as mandated by the Pension Regulations. The Pension Funds were created by transferring into it the CPF of employees and collecting back from employees who retired on or after 01.01.1986, the CPF paid to them at the time of retirement along with interest at 6 percent till the date of its refund or till 01.04.1995, whichever was earlier. The payment of pension thus arises out of a contract to pay it in consideration of the CPF paid back and banks cannot renege out of its promise to pay pension as stipulated under the Pension Regulations and also the updating as envisaged under regulation 35 (1) and regulation 56. Pension is deemed as property even if it is payable as a social security benefit by the government and in the case of banks, pension is payable out of the real property viz. the CPF of employees and pensioners held in trust solely for payment of pension.
CAN BANKS DENY THE UPDATING OF PENSION ON GROUNDS OF COST INVOLVED?
The Honourable Supreme Court has laid down in umpteen number of judgments that paucity of funds cannot be a ground for payment of statutory dues like pension. Section 10 (7) of the parent legislation viz. Banking Companies (Acquisition & Transfer of Undertakings) Act 1970 pursuant to which the Bank (Employees’) Pension Regulations, 1995 were framed, permits the Boards of Banks to declare a dividend and to retain surplus profits as accumulated reserves in the books of accounts only after making due provision for superannuation funds, among other establishment expenses like bad debts. Banks have to pay the pension payable in terms of the Pension Regulations, even if they are operating in red. But banks had been paying dividend ranging from 10 to 270 percent a year and also accumulating their reserves manifold without paying the updated pension mandated by regulation 35 (1) and regulation 56 for years together.
IS THERE ANY PAUCITY OF FUNDS FOR PAYING PENSION?
The Pension Funds of banks including State Bank of India stood at Rs. 4,27,664.13 Crores as on 31.03.2024 and at Rs.4,56,446.13 Crores as on 31.03.2025. All banks can afford to pay the updated pension as per the pattern of RBI out of the annual growth of the Pension Fund without touching the corpus of the Fund and their revenue account. The Pension Fund is growing at a robust pace and pensioners are passing away day by day, reducing the pension burden of banks. Banks have excluded employees who joined service after 31.03.2010 from the Pension Scheme with a view to making the huge Pension Fund, which is the property of employees and retired employees, their equity when the employees who joined service till 31.03.2010 and their families vanish.
CAN THE HONOURABLE SUPREME COURT REJECT THE CIVIL APPEAL No.7993 of 2023?
No. Any judgment rejecting the prayers in the Civil Appeal No.7993 of 2023 will be inconsistent with the ruling dated 01.07.2015 in Civil Appeal No.1123 of 2015 viz. State of Rajasthan and Anr. Vs Mahendra Nath Sharma by a two judges bench of the Supreme Court itself where it was laid down that pension shall not be less than 50% of the running pay banks corresponding to the pre-revised scales of pay. This makes it essential that the Honourable Supreme Court comes out on 12.03.2026 with a ruling that pension in the banks shall be updated from time in accordance with the revised scales of pay arising out of each bipartite settlement in terms of regulation 35 (1) and 56 of the Pension Regulations, 1995 or with effect from 01.03.2019 as done in RBI in adherence with clause 6 and 12 of the settlement dated 29.10.1993 and paid along with interest from the date of accrual.
IBA DUPED SUPREME COURT IN THE PAST TOO
The past tells us that IBA fiercely argued in Civil Appeal No.5252 to 5255 of 2018 viz. United Bank of India and Ors. vs. United Bank of India Retirees' Welfare Association and Others etc. [Civil Appeal Nos.5252-5255 of 2018 Arising out of SLP (Civil) Nos.7368-71 of 2017] and secured an order to the effect that the pre-November 2002 retirees are not entitled to 100 % D R Neutralisation on their full Basic Pension on 18.05.2018 by duping the Honourable Supreme Court and killing justice. Five years after that, the IBA recommended to the Government to sanction the benefit of 100 % D R Neutralisation from the date of its approval and accordingly the government sanctioned it from 01.10.2023 on a condition that “No arrears shall be payable for the period falling before the effective date” proving that the Supreme Court went wrong in its ruling dated 18.05.2018. IBA produced the Pension Regulations of the Mumbai based Union Bank of India instead of producing that of the Kolkata Based United Bank of India (now Punjab National Bank) as the latter was not updated till the date of the judgment, concealed the D R rates applicable to the segment of pensioners in the Pension Regulations and misled the sentinel of justice sans any trace of sanctity. The Honourable Supreme struck down the right ruling of the Honourable High Court of Calcutta as a result of the mischievous act of the IBA though the role of the Supreme Court is to set aside any wrong judgment of the High Courts.
The pre-November 2002 retirees of all banks numbering nearly two lakhs lost the D R on their Basic Pension for 221 months from 01.05.2005 to 30.09.2023, which was in the range of Rs.10 to Rs.18 lakhs excluding interest on an individual basis as a sequel to the wrong recommendation of IBA and wrong sanction of the government. The astonishing part of it is that the amounts are payable out of the Pension funds, which constitute the money and property of the employees/pensioners and not by the banks out of their revenue account or by the government, out of the exchequer.
Let all bank pensioners trust that their woes come to an end and Honourable Supreme Court stops their plundering by the banks through a landmark judgment in Civil Appeal No.7993 of 2023 soon.
With good wishes to all in the eve of HOLI
Yours faithfully,
C N VENUGOPALAN
सत्यमेव जयते