Supreme Court directs Centre to clear all OROP arrears by Feb 28 next year

New Delhi: The Supreme Court on Monday directed the Centre to clear all One Rank One Pension(OROP) arrears totalling Rs 28,000 crore for ex-servicemen by February 28 next year, saying the government is duty-bound to comply with its 2022 judgement on the matter.

A bench headed by Chief Justice D Y Chandrachud took note of the financial difficulties pointed out by the Centre in paying the entire Rs 28,000 crore OROP dues in one go, and laid down the schedule to the Ministry of Defence to pay the arrears to the ex-servicemen, categorised under several heads. It noted that out of 25 lakh Defence pensioners, four lakh did not qualify for the OROP scheme as they were getting enhanced pensions.

During the hearing, it also took strong note of the Centre's sealed cover report giving details on the payment of the OROP dues to retired military personnel, saying it wanted to “put an end to this sealed cover procedure” which is “fundamentally contrary to the basic principle of fair process in a court of law”.

“While on the one hand, the Union government is bound to comply with the terms of the OROP scheme and as a matter of fact the UOI is duty-bound to comply with the judgement of this court in terms of the OROP scheme.

But at the same time while fixing a time schedule for payment, the materials, which have been placed on the record now, has the significant bearing on the nature of the order which should be passed by this court with regard to the compliance of the time lines,” the bench noted in its order.

The bench at the outset refused to accept the sealed cover report submitted by Attorney General R Venkataramani and asked him to read the report as pertained to compliance of the court's judgement.

The bench said there cannot be anything secret about the report which cannot be divulged to the ex-service personnel seeking payment of OROP arrears.

“We want to put an end to this sealed cover procedure which is being followed by the Supreme Court because the high courts will follow it and this is fundamentally contrary to the basic principle of fair process in a court of law,” the bench observed at the outset, and said it was not averse to considering the financial difficulties as pointed out by the Centre in paying the entire amount in one go.

Considering the financial difficulties cited by the Centre, the bench, also comprising justices P S Narasimha and J B Pardiwala, allowed it to clear the dues in a staggered manner.

The Ministry of Defence was seeking extension of the deadline for clearing the OROP dues.

Reducing the time limit to February 28 next year, the bench gave the time schedule for payment of arrears to different groups of pensioners under the OROP scheme.

The bench directed that the six lakh family pensioners and gallantry award winners shall be paid their OROP dues by April 30, 2023.

It said around four-five lakh retired servicemen aged 70 years and above shall be paid their OROP arrears in one or more instalments by June 30.

The OROP dues for 10-11 lakh remaining pensioners shall be paid in three equal instalments by February 28 next year, the bench said, making it clear that the payment of the dues "will not affect further equalisation of pension of ex-servicemen to be done in 2024".

The attorney general said the Defence ministry had taken up the matter with the Finance Ministry, which expressed its inability to provide the funds in one go and suggested a staggered payment.

Senior advocate Huzefa Ahmadi, appearing for the ex-servicemen, said these payments were due way back in March 2019.

Giving a schedule of the payment of OROP arrears, the government had said, “The outlay for the arrears is of the order of Rs 28,000 crore. The planned budget outlay for 2022-23 is not in a position to assimilate the huge outlay in one go.”

“The Ministry of Defence being a strategic sector has to strike a fine balance between the financial outgo on its operational commitments and the expenditure incurred on its personnel including the defence pensioners. Since the resources are limited..., the expenses are needed to be regulated in such a way that the individual needs are met without compromising the operational readiness of our armed forces...it is for the reason that (like in the past) OROP has been approved for disbursement in four instalments,” it had said.