CASE REVIEW

Presented by: Name - Monika Jain

Roll No. - 174 ASODR 261

CASEShri Tarek Firdousi that deduction from his pay towards Central Government Group Insurance Scheme may be stopped and deductions made during the last few months may be paid back to him. His grounds are that he never asked for this deduction and he is not at all interested in it so the government cannot forcibly deduct this amount from his monthly emoluments.

Issues InvolvedThe question is that an employer

want to opt out of CGEIS (CentralGovernment employees insurance scheme).

He want payment return which is deducted under this scheme.

Whether scheme is optional or mandatory?

Rule• "Central Government Employees Group Insurance

Scheme, 1980" means the Group Insurance Scheme detailed in the Annexure to the Ministry of Finance (Department of Expenditure) O.M. No. F.15(3)/78-WIP, dated the 31st October, 1980 and as set out in the Schedule.

• This scheme is for all government employee including canteen employee excluding armed forces.

• It came into force from 1st January,1982. This scheme provides for the Central Govt. employees the two fold benefit viz. (1) insurance cover to help their families and (2) lump sum payment to augment their resources on retirement.

Amount deducted under this scheme

30% of the subscription will go to insurance Fund and 70% will go to saving Fund.

Group of employee

Subscription per month (Rs) Amount of Insurance cover (RS)

From date of joining to succeeding 1st

January

From succeeding 1st January

A 40 120 1,20,000B 20 60 60,000C 10 30 30,000D 5 15 15,000

Interpretation of RuleAll those `employees' entering Central

Government service after 1st Nov., 1980 will be compulsorily covered under the `scheme'.

Those who are joining on 1st January they are eligible for both insurance and saving fund.

Those who are joining after 1st January they are eligible for insurance fund upto 1st January of next year and after that they eligible for both.

Amount deduction under this scheme is not refundable until on death or on retirement.

ReferenceTHE

ALL INDIA SERVICES (GROUP INSURANCE) RULES, 1981, by sub-section (1) of section 3 of the All India Services Act, 1951 (61 of 1951)

Group Insurance Scheme detailed in the Annexure to the Ministry of Finance (Department of Expenditure) O.M. No. F.15(3)/78-WIP, dated the 31st October, 1980

ConclusionAccording to rule given in the Annexure

to the Ministry of Finance (Department of Expenditure) O.M. No. F.15(3)/78-WIP, dated 31st October, 1980, it is mandatory for all central government employee.

So can not skip this scheme.And the deducted amount will not be

returned. The beneficial amount only given at the

time of death or retirement.

Thank you