The Kerala High Court on Wednesday held that the transfer of Provident Fund of retired and serving employees of the cooperative banks from the Employees Provident Fund Scheme and Employees Pension Scheme could be made to the Kerala State Cooperative Employees Pension Board only with the consent of the employees.
The court also said that the employees were free to join any scheme which give them better benefits.
A Division Bench comprising Justice C N Ramachandran Nair and Justice C K Abdul Rehim passed the order while disposing of an appeal filed by the pension board against a single judge’s order upholding the decision of the board. The single judge had passed the order on a petition filed by the employees of a district cooperative bank challenging the proposal to transfer the funds of the members of district cooperative banks as well as the State Cooperative Bank to the board.
The petitioners submitted that the retired employees as well as the existing employees continuing as members of the Employees Provident Fund Scheme 1952 and the Employees Pension 1955 could not be compulsorily transferred to the board.
The Bench held that state government or banks could not demand transfer of fund of employees who are members of the Employees Provident Fund Scheme 1952 and Employees Pension Scheme 1995 to the pension board. Those who opt to transfer the membership from the pension schemes to the scheme of the board could apply for the same and the Employees Provident Fund Commissioner should transfer the funds.
“After the establishment of the self-financing pension scheme under the board in 1993, the provisions of EPF Act did not apply to the establishment. However, the provisions of the Kerala Cooperative Societies Act did not provide for compulsory transfer of funds of retired employee as well as serving employees to the board,” the court pointed out.
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