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The Department of Pension & Pensioners’ Welfare (DoPPW) has issued an important clarification on pension commutation for retired Central Government employees whose departmental or judicial proceedings remain pending after retirement.
Through Office Memorandum No. 4/37/2026-P&PW(D)(4), dated 29 October 2026, the Government has explained when commutation of provisional pension is prohibited and how an eligible pensioner can apply after the proceedings are finalised.
The most important clarification concerns the one-year application deadline, which determines whether a medical examination is necessary.
Can provisional pension be commuted during departmental or judicial proceedings?
Under Rule 8 of the CCS (Pension) Rules, 2021, provisional pension may be sanctioned to eligible retired government employees while specified departmental or judicial proceedings remain pending.
However, the DoPPW memorandum clarifies that Rule 4 of the CCS (Commutation of Pension) Rules, 1981 prohibits commutation of provisional pension during such proceedings.
This means that receiving provisional pension does not automatically provide the right to commute a portion of it while the covered proceedings remain unresolved.
The memorandum also refers to Rule 84(2) of the CCS (Pension) Rules, 2021, which makes the relevant provisions of the 1981 Commutation Rules applicable to pension commutation authorised under the 2021 rules.
When can a pensioner apply for commutation after proceedings are finalised?
Once the departmental or judicial proceedings are concluded, the competent authority may issue an order authorising pension, either wholly or partly.
After the pension-authorising order is issued, an eligible pensioner can submit a commutation application under Rule 13 of the CCS (Commutation of Pension) Rules, 1981.
The applicable medical examination requirement depends on when the application reaches the Head of Office.
The one-year period is calculated from the date of issue of the pension-authorising order, not from the original retirement date.
This distinction is particularly important for employees whose disciplinary or judicial proceedings continue for several years after retirement.
Example: How does the one-year deadline work?
Consider a Central Government employee who retired in March 2024 while departmental proceedings were pending.
The employee received provisional pension during the proceedings, but commutation was not permitted.
Suppose the proceedings are finalised and the competent authority issues an order authorising pension on 15 December 2026.
If the Head of Office receives the eligible commutation application within one year of that order, a medical examination will not be required under the clarification.
However, if the application is received after the prescribed period, medical examination becomes mandatory under Rule 18.
The pensioner’s eligibility for commutation will continue to be governed by the applicable pension rules.
What should affected pensioners Do?
Employees whose departmental or judicial proceedings have concluded should first obtain and examine the order authorising their pension.
Pensioners should retain copies of the authorising order, application and acknowledgement of receipt.
These records can help establish whether the application was submitted within the required timeline.
Does This Clarification Apply to Defence Pensioners?
The memorandum specifically concerns the CCS (Pension) Rules, 2021 and the CCS (Commutation of Pension) Rules, 1981.
These provisions apply to the relevant categories of Central Government civilian pensioners.
The document does not expressly extend this clarification to Armed Forces pensioners governed by separate defence pension regulations.
Military pensioners should therefore examine their commutation entitlement under the applicable defence pension rules rather than assume that the CCS provisions automatically apply.
Has the Government Changed the Pension Commutation Restoration Period?
No. The memorandum dated 29 October 2026 does not announce any change to the existing period for restoration of commuted pension.
It also does not revise the maximum permissible commutation percentage or introduce a new general commutation benefit.
Its purpose is specifically to clarify the admissibility of commutation in cases covered under Rule 8 and the medical examination requirement following the conclusion of proceedings.
Source
Department of Pension & Pensioners’ Welfare, Government of India
Office Memorandum No.: 4/37/2026-P&PW(D)(4)
Date: 29 October 2026
Subject: Admissibility of commutation of pension in the cases covered under Rule 8 of the CCS (Pension) Rules, 2021.
Official Government Website: https://doppw.gov.in/
Central Government Pensioners’ Portal: https://pensionersportal.gov.in/
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