Jharkhand may pay Rs 2,585 cr to Bihar as pension liability | patna | Hindustan Times
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Jharkhand may pay Rs 2,585 cr to Bihar as pension liability

patna Updated: Oct 19, 2012 19:03 IST
Subhash Pathak

The Jharkhand government may have to pay Rs 2,585 crore to Bihar as its share of pension liabilities as the Supreme Court has not provided any relief to the former.

Though a three-member bench of the apex court headed by chief justice of India Altamas Kabir on Thursday admitted the Jharkhand government's suit challenging the provisions of the Bihar Reorganisation Act, 2000, pertaining to share of pension liabilities, it did not stay the Union ministry of home affairs (MHA) order through which it was directed to clear the amount as claimed by Bihar.

Challenging the norms for division of pension liabilities of the Bihar Reorganisation Act, 2000, the Jharkhand government had filed a suit in the apex court early this year claiming that it happened to be an exceptional act, which stipulated distribution of pension liabilities on the basis of the number of retired employees and not as per population ratio - the standard practice in reorganisation of other states.

Principal secretary, finance department, Bihar, Rameshwar Singh, who was in New Delhi with his Jharkhand counterpart Sukhdeo Singh, said the Bihar government had paid pension to the tune of Rs 5,334.84 crore to the employees who retired after the bifurcation of the state.

However, Jharkhand had so far been able to contribute only Rs 50 crore, that too only last year, leaving the entire burden of pension to be shared by Bihar.

The issue regarding distribution of pension liabilities between the two states assumed considerable significance recently when the Bihar government sought the Centre's intervention as an arbitrator to ensure that the expenditure it had incurred on account of pension be deducted from the grants to Jharkhand. The MHA had last month warned Jharkhand to pay the pension liabilities as claimed by Bihar or be ready to face consequences.

Jharkhand's finance commissioner Sukhdeo Singh said chief minister Arjun Munda would be apprised of the developments in the apex court. "The Supreme Court's refusal to stay the Centre's order should not be treated as if Jharkhand's claim had been rejected. We have all the legitimate grounds to support our contention in course of hearing of the case," he said.

In its reply, the Bihar government had urged the court to issue a direction to the MHA and the Union ministry of finance to deduct Rs 7,706.38 crore from the central grants to Jharkhand and deposition of the same into Bihar's account with the Reserve Bank of India as reimbursement of pension payments.

To justify its claim, the Bihar government contended that apart from the pension liabilities to the tune of Rs 5,334.38 crore, the state had to bear the expenditure of Rs 2,371.54 crore as interest.