The Kerala High Court has observed that the new pension scheme that was made applicable to recruits joining the State Bank of India on or after August 1, 2010 does not have any legal effect.
The court passed the order on Tuesday while disposing of a petition filed by the State Banks’ Staff Union (Kerala Circle) challenging the introduction of the Defined Contributory Pension Scheme.
The court pointed out that in another case, the High Court had earlier held that it was for the Central Board of the SBI to decide whether to validate or not to validate the new pension scheme introduced in accordance with the procedures under Section 50 of the Act concerned.
According to the petitioners, the State Bank of India Act, 1955 did not empower the Central Board of the State Bank of India (SBI) to amend the pension rules without due process of law, that too with retrospective effect.