Notices

 

 

 
                                                                                                                                    Dated  13-1-2009
From
          The Secretary
          Bar Council of Kerala

To

          The Secretaries of all the Bar Associations in the State.

Sir,

          Sub: Proposed Advocate Welfare Fund Amendment Act, 2008 – present financial position of Welfare Fund and its retrospective liabilities –      concrete proposals and suggestions called for to make the fund stable at first and for further make the scheme more beneficial.

 

          On 10-6-2008 a Draft Bill was introduced to amend the Advocate Welfare Fund Act enhancing the yearly benefits from Rs. 9,375/- to Rs. 14,285/- up to a maximum of Rs. 5,00,000/-.  By the proposed amendment an additional yearly income of Rs. 1 Crore is expected.  Some Lawyer Organizations have opposed the proposed Bill and demanded for further enhancement of benefits.  Hence the Bill was not placed in the last Assembly Session.  A joint meeting of the lawyer organizations were held on 10-12-2008 at Ernakulam and the Advocate General (Chairman of the Advocate Welfare Fund Trustee Committee) presided over the meeting.

          Without making the fund stable and viable at first it is not possible for a further enhancement or taking any retrospective liability to the fund.  In view of the present financial position the proposed amendment was made only prospectively.

          The Kerala Advocates’ Welfare Fund came into force on 5-4-1981 with a total liability of Rs. 2,12,16,000/- (2.12 crores) for payment of retrospective  benefits to the then members who have previous years of practice prior to the Act 1981.  The yearly benefit in 1981 was Rs. 1,000/- per year and maximum of Rs. 30,000/- the previous years of practice prior to the Act 1981 was taken for calculation at the ratio 4:1.

          In 1989 when the Act was amended the total benefit was enhanced from Rs. 30,000/- to Rs. 60,000/- with retrospective effect.  In 1993 the maximum benefits was again enhanced to Rs. 1 lakh with retrospective effect and the ratio for calculating previous  practicing years prior to the Act was amended as 2:1 instead of 4:1.  Thereby the total retrospective liability prior to the Act 1981 came to an amount of Rs. 13,26,00,000/- (Rs. 13.26 Crores).

          Thereafter in 2000 the yearly benefit was again enhanced from Rs. 3125/- to Rs. 9,375/- and the maximum of Rs. 3 lakhs and that too with retrospective effect.  Hence the retrospective liability prior to the Act 1981 alone would come to the tune of Rs. 40 Crores.  In all the previous amendments retrospective effect prior to the Act was given and so the additional benefits for previous years prior to the Act 1981 made the fund not viable.

          Hence in the recent amendment the increased benefits would be made applicable only prospectively starting from 10-6-2008.  I hereby enclose the detailed statements regarding the annual income and annual disbursement from 2003 to 2008.

          When the new amendment was proposed by way of a Draft Bill there has been several demands from various Advocate Organizations for further increase and new benefits with retrospective effect.  The details of important amendments proposed are enclosed along with this letter.

          Before the proposed amendment there are several advocates who have exceeded 32 years of practice eligible to receive a maximum benefit of

Rs. 3,00,000/-, but still continuing payment of subscription and affixing the stamps without any benefit.  Now after the proposed amendment they would get Rs. 3,00,000/- till the date of new amendment and thereafter an amount of Rs. 14,285/- per year up to a maximum of Rs. 5,00,000/- by paying an amount of Rs. 3,000/- as yearly subscription instead of the existing Rs. 1500/- per year.  Accordingly, a fixed annual benefit of Rs. 9,375/- would be made payable for the period of practice prior to 10-6-2008 as per schedule 1 and the benefits for the period thereafter would be paid at the rate of Rs. 14,285/- upto a maximum of Rs. 5,00,000/-.

          As on 31-10-2008 there are 937 persons eligible for Rs. 3,00,000/-.  The amount required for disbursing the above said 937 persons at the rate of Rs. 3,00,000/- alone would come to a total requirement of Rs. 28,11,00,000/- (Rs. 28.11 Crores) whereas the total amount in the welfare fund as on 31-10-2008 is only Rs. 4,27,00,000/- (Rs. 4.27 Crores).  There may be other claimants having total practice less than 32 years and for disbursing such claimants further additional amount has to be found out.

          The inflow and outflow for the last 5 years and the number of claimants disbursed would reveal the present financial position of the fund.

Year

Inflow

Outflow

No. of claimants Disbursed

2003

Rs. 2,68,28,000/-

Rs. 3,77,52,000/-

129

(Death         -  50

Retirement  - 79)

2004

Rs. 2,61,12,000/-

Rs. 3,90,72,000/-

173

(Death         - 53

Retirement   - 120

2005

Rs. 2,98,49,000/-

Rs. 2,53,74,000/-

97

(Death        -48

Retirement  - 49

2006

Rs. 4,62,20,535/-

Rs. 2,84,89,470/-

124

(Death         -  40

Retirement   - 84)

2007

Rs. 3,64,78,260/-

Rs. 3,49,53,950/-

175

(Death         -  76

Retirement   - 99)

2008

(As on 31-10-2008

Rs. 4,00,20,300/-

Rs. 2,47,67,470/-

103

(Death           -  61

Retirement    -  42)

 

          Total number of advocates as on 31-10-2008           - 32774

          Welfare Fund Members admitted till date                 - 19147

          Existing Members                                                  -  15688

 

Government  Grant

Year

Amount

Year

Amount

Year

Amount

1981-82

Nil

1986-87

Rs. 5 lakhs

1991-92

Rs. 5 lakhs

1982-83

Nil

1987-88

Rs. 5 lakhs

1992-93

Rs. 1 lakh

1983-84

Nil

1988-89

Rs. 2 Lakhs

1993-94

Rs. 1 lakh

1984-85

Rs10 Lakhs

1989-90

Rs. 5 lakhs

1994-95

Rs. 1000/-

1985-86

Rs. 5 Lakhs

1990-91

Rs. 5 lakhs

1995 to 08

Nil

 

          A total amount of Rs. 44,01,000/- (Rupees forty four lakhs and one thousand only) was received so far as Grant from the Government.

          Legal Benefit Fund  (as per Section 76 of Kerala Court Fees and Suit Valuation Act) An amount of Rs. 15,53,800/- (Rs. 15.53 lakhs) was received on 16-7-2005, Rs. 1,74,17,500/- (Rs. 1.74 Crores) received on 17-6-2006, Rs. 68,95,235/- (Rs. 68.95 lakhs) on 16-7-2007 were received from the Legal Benefit Fund.

          As on this date a total amount of Rs. 2,58,66,535/- (Rs. 2.58 Crores) was received from the Legal Benefit Fund.

          There were 2533 claimants till this date claimed the benefit as Death, Cessation of retirement benefits and an amount of Rs. 25,53,45,801/- (Rs. 25.53 Crores) was disbursed from the fund so far.

          “The Bar Council of Kerala at its meeting held on 21-12-2008 resolved to forward a copy of the data relating to the brief history and financial scenario of the Welfare Fund Scheme to all the Bar Associations and Lawyer Organizations to call for their written concrete proposals.  Accordingly, I am herewith forwarding the above data along with a copy of the minutes of the joint meeting of various advocates organizations convened on 10-12-2008 at Ernakulam for your perusal and study.  I request you to go through the entire facts and circumstances of the fund and suggest your further proposal to improve the ways and means situations of the fund and thereafter to suggest further amendments to make the fund more stable and beneficial”.

          Your further proposals may kindly be forwarded within 2 weeks to the undersigned without delay.

          Thanking you,

 

                                                                                      Yours faithfully,

                                                                                             Sd/-

                                                                                  T.H. ABDUL AZEEZ,

                                                                            secretary

Data as on 31.10.2008

Total Number of Advocate on the  Rolls of Bar Council of Kerala as on 31.10.2008   

32770
Members in the Welfare fund as on 31.10.08 19147
Total amount in the Welfare Fund as on 31.10.08 4 crores 27 lakhs
Number of Advocates who have completed 32 years and eligible for                Rs.3 lakhs as on 31.10.08 937
Amount required for 937 persons for disbursing their claims 28 Crores 11 Lakhs
Number of staff in the Welfare Fund Office 3 + 1
Total Salary per year Around 6,00,000/-
Printing cost Rs.10,000/-
Telephone Expenses Around 25,000/-
Meeting Expenses around 21,000/-
Maximum Number of meeting per year 2 or 3 meetings

 

Welfare   Fund   Trustee   Committee

 

Chairman Advocate General
Secretary  Bar Council Secretary
Treasurer    Bar Council Treasurer
Members  

1. A member nominated by Government

 

2. 3 members nominated by Bar Council

  3.  President Bar Federation
4.  Law Secretary

   

 

IMPACT OF RECKONING OF PRIOR PRACTICE (IN 1981) 

 RATION  4:1 

YEAR OF ENROLMENT

NO.OF ADVOCATES  

AMOUNT PAYABLE 

COMPUTATION 

1976

 

1268

 

X1000

1268000

1972

 

1057

 

X2000

2114000

1968

 

513

 

X3000

1539000

1964

 

419

 

X4000

1676000

1960

 

483

 

X5000

2415000

1956

 

370

 

X6000

2220000

1952

 

452

 

X7000

3164000

1948

 

224

 

X8000

1792000

1944

 

120

 

X9000

1080000

1940

 

102

 

X10000

1020000

1936

 

180

 

X11000

1980000

1932

AND MORE

79

 

X12000

948000

 

 

 

 

 

 

 

 

 

 

TOTAL LIABILITY

21216000

 

 

 

 

 

 

IMPACT AFTER ENHANCEMENT MADE IN 1993 (2:1)                            (Excluding fraction )

(RS. 3125 PER YEAR = RS.6250/- FOR EVERY 4 YEARS)

  

 

 

 

 

1268 X 6250

 

7925000

 

 

1057 X 12500

 

13212500

 

 

513 X 18750

 

9618750

 

 

419 X 25000

 

10475000

 

 

483 X 31250

 

15093750

 

 

370 X 37500

 

13875000

 

 

452 X43750

 

19775000

 

 

224 X 50000

 

11200000

 

 

120 X 56250

 

6750000

 

 

102 X 62500

 

6375000

 

 

180 X 68750

 

12375000

 

 

79 X 75000

 

5925000

 

 

TOTAL LIABILITY

132600000

 

 

 

Data as on 31.10.2008

Total Number of Advocate on the  Rolls of Bar Council of Kerala as on 31.10.2008

  32770
Members in the Welfare fund as on 31.10.08   19147
Total amount in the Welfare Fund as on 31.10.08   4 crores 27 lakhs
Number of Advocates who have completed 32 years and eligible for Rs.3 lakhs as on 31.10.08   937

Amount required for 937 persons for disbursing their claims

  28 Crores 11 Lakhs
Number of staff in the Welfare Fund Office   3 + 1
Total Salary per year   Around 6,00,000/-
Printing cost   Rs.10,000/-
Telephone Expenses   Around 25,000/-
Meeting Expenses   around 21,000/
Maximum Number of meeting per year   2 or 3 meetings

       

 

Cash flow/fund flow statement with existing rates.

A.INFLOW

  2003

2004

2005

2006

2007

2008

a) Admission fee

 

  3,02,000

  (1006)

 

2,58,000

(860)

 

3,21,000

(1070)

 

1,42,200

(474)

 

1,74,300

(581)

 

1,25,400

(418)

 

b)Annual Subscription

 

1,20,84,000

 

1,24,06,000

 

1,52,92,000

 

1,66,89,000

 

17,07,600

 

2,66,30,750

 

2) Sale of

stamps

 

 

 

1,06,63,000

 

 

 

1,09,25,000

 

 

 

1,11,68,000

 

 

 

1,08,75,150

 

 

 

1,11,60,900

 

 

 

1,18,60,000

 

3. Legal  benefit fund

 

 

nil

 

 

nil

 

 

15,54,000

 

 

1,74,17,500

 

 

68,95,235

 

 

nil

 

4.Enrolment

fee

 

 

2,52,000

 

 

1,72,000

 

 

2,06,000

 

 

1,59,525

 

 

1,32,025

 

 

1,56,150

 

5.Other income (interest on investment)

 

35,27,000 

 

23,51,000

  

 

13,08,000  

 

9,37,160  

 

10,39,800  

 

12,48,600 

 

TOTAL Rs.

 

2,68,28,000

 

2,61,12,000

 

2,98,49,000

 

4,62,20,535

 

3,64,78,260

 

4,00,20,300

 

B.Outflow

 

 

(D 50+79)

 

(D 53+120)

 

(D 48+49)

 

(D 40+84)

 

(D 76+99)

 

(D 61+42)

1.Retirement

benefit 

 

 

3,72,06,000  

 

3,84,31,000 

 

 

2,48,18,000 

 

 

2,79,13,125 

 

 

3,42,67,450 

 

 

2,40,83,700

 

2.Medical Aid

 

 

17,000

 

 

28,000

 

 

22,000

 

 

27,500

 

 

65,000

 

 

15,000

 

 

3.Establishment

5,29,000

 

 

6,13,000 

 

5,34,000 

 

5,48,845 

 

6,21,500 

 

6,68,770 

 

 

 

3,77,52,000

(129)

 

3,90,72,000

(173)

 

2,53,74,000

(97)

 

2,84,89,470

(124)

 

3,49,53,950

(175)

 

2,47,67,470

(103)

 

  

Cash flow/fund flow statement (Estimated)

 

A.INFLOW 

 AMOUNT(Rs.) 

a)      Admission fee 

                     3,00,000-00 

b)      Annual subscription 

                   3,10,00,000-00 

2. Sale of stamps 

                   1,60,00,000-00 

3. Legal benefit fund 

                    50,00,000-00 

4. Enrolment fee 

                    1,75,000-00 

 5. Other income (interest on investment)  

                     20,00,000-00 

                         TOTAL

                  5,44,75,000-00 

B.OUT FLOW

  

1. Retirement Benefit (Death claim +Cessation) 

 4,10,00,000-00

 2. Medical Aid 

                          75,000-00 

3. Establishment

                     7,00,000-00

 

                     4,17,75,000-00

 

     Present Status of Kerala Advocates Welfare Fund - Download Presentation