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SUPREME COURT OF INDIA
HIMA KOHLI, SANDEEP MEHTA, JJ.
Rajkaran Singh & Ors. - Appellants
Versus
Union of India & Ors. - Respondents
Civil Appeal No(s). 9721 of 2024 (Arising out of SLP(Civil) No(s). 30976 of 2017)
Decided On : 22-08-2024
(A) Constitution of India – Article 12 – State – For the purpose of determining whether an entity is an instrumentality or agency of State, neither all tests laid down in case of Ajay Hasia and Others v. Khalid Mujib Sehravardi and Others, (1981) 1 SCC 722, are required to be answered in positive nor a positive answer to one or two tests would suffice – It will depend upon a combination of one or more of relevant factors depending upon essentiality and overwhelming nature of such factors in identifying real source of governing power, if need be by removing the mask or piercing the veil disguising the entity concerned. (Para 25)
(B) Service Law – Pension – Denial of pensionary benefits under 6th Central Pay Commission (CPC) – Use of government pay scales for appellants suggests a level of integration into government's financial structure that goes beyond typical temporary employment – During course of their service, appellants received increments and promotions comparable to those of other government employees – Extension of Assured Career Progression (ACP) and alignment of terms and conditions with regular government employees, in particular, is an affirmative action indicating that government viewed and treated these employees as long-term assets, despite their ostensibly temporary status – Essence of employment and rights thereof cannot be merely determined by initial terms of appointment when actual course of employment has evolved significantly over time – Mere classification of employees as 'temporary' or 'permanent' is not merely a matter of nomenclature but carries significant legal implications, particularly in terms of service benefits and protections – Appellants' employment bears substantial hallmarks of regular government service – Denial of pensionary benefits solely on the basis of their temporary status, without due consideration of these factors, appears to be an oversimplification of their employment relationship with government – Denial of pensionary benefits to appellants is not tenable or justifiable in eyes of law as same is arbitrary and violates fundamental rights as guaranteed by Articles 14 and 16 of Constitution of India – Respondents directed to extend benefits of 6th Central Pay Commission including pensionary benefits under Revised Pay Scale Rules, 2008 to appellants. (Paras 28, 31, 32, 33, 34 and 36)
Facts of the case:
Present appeal by special leave, is preferred on behalf of appellants, assailing judgment dated 25th April, 2017 passed by High Court of Delhi, dismissing writ petition filed by appellants and upholding judgment dated 4th October, 2016 passed by Central Administrative Tribunal, Principal Bench, New Delhi in Original Application . Tribunal had rejected appellants’ claim for benefits of replacement scales of Revised Pay Rules, 2008 in accordance with 6th Pay Commission Report, with effect from 1st January, 2006.
Core issue presented for adjudication by Court is whether appellants herein, despite being classified as temporary employees of a scheme managed by contributory pooling of funds, can claim entitlement to pensionary benefits in accordance with 6th CPC.
Findings of Court:
Impugned judgment rendered by High Court does not stand to scrutiny and the same is unsustainable in eyes of law and is set aside.
Result : Appeal allowed.
JUDGMENT :
Mehta, J.
1. Heard.
2. Leave granted.
3. The present appeal by special leave, is preferred on behalf of the appellants, assailing the judgment dated 25th April, 2017 passed by the High Court of Delhi in Writ Petition (Civil) No. 3543 of 2017, dismissing the writ petition filed by the appellants and upholding the judgment dated 4th October, 2016 passed by the Central Administrative Tribunal, Principal Bench, New Delhi (hereinafter being referred to as the ‘Tribunal’) in Original Application Nos. 60 of 2013 and 459 of 2013. The Tribunal had rejected the appellants’ claim for benefits of the replacement scales of the Revised Pay Rules, 2008 (hereinafter referred to as ‘RP Rules’) in accordance with the 6th Pay Commission Report, with effect from 1st January, 2006.
Brief facts: -
4. The facts in a nutshell, are that the appellants (Appellant No. 1 to Appellant No. 6) were appointed to manage the Compulsory Saving Scheme Deposits (hereinafter referred to as SSD) Fund of the Special Frontier Force (hereinafter referred to as SFF) in various positions such as Junior Accountant, Accountant, Upper Division Clerk (UDC), and Lower Division Clerk (LDC), on running pay scales. The SSD Fund is a welfare initiative funded through the personal contributions of the SFF troops from their salaries. Upon having been engaged as above, the appellants also received Traveling Allowance (TA), Dearness Allowance (DA), House Rent Allowance (HRA), Special Security Allowance (SSA), Gratuity, Bonus, Winter Allowance, and High-Altitude Allowance, etc. along with salary as per the 4th and 5th Central Pay Commissions (‘CPC’).
5. On 1st January, 2006, the Union of India implemented the 6th Central Pay Commission and made the same applicable to all government employees of the SFF. However, these benefits were not extended to the appellants i.e. SSD employees and instead, an ad-hoc amount of Rs.3,000/- per month was given to each of them. For the sake of brevity, the details of the appellants with reference to their appointments, retirement, length of service, and their salaries in accordance with the different CPC are illustrated in a tabular form below:-
| Name of the Appellant | Appointment Date | Post | Date of Retirement | Service rendered | Salary paid initially | Salary paid after 2010 |
| Rajkaran Singh (‘A1’) | 1st January, 1975 | Lower Division Clerk | 31st August 2012 | 37 years and 8 months | Rs.220-270 | As per the 5th CPC & Rs.3,000/- instead of 6th CPC |
| Jagat Ram Joshi (‘A2’) | 25th April, 1975 | Lower Division Clerk | 28th February 2013 | 37 years and 10 months | Rs.220-270 | As per the 5th CPC & Rs.3,000/- instead of 6th CPC |
| Vishu Dutt Tripathi (‘A3’) | 2nd May, 1978 | Lower Division Clerk | 31st July 2013 | 35 years and 3 months | Rs.260-400 | As per the 5th CPC & Rs.3,000/- instead of 6th CPC |
| HK Naithani (‘A4’) | 27th November, 1982 | Lower Division Clerk | 31st August 2018 | 35 years and 9 months | Rs.260-400 | As per the 5th CPC & Rs.3,000/- instead of 6th CPC |
| Shiv Kumar (‘A5’) | 25th May, 2005 | Junior Accountant | 18th February 2014 (VRS) | 8 years and 9 months | Rs.5000-8000 | As per the 5th CPC & Rs.3,000/- instead of 6th CPC |
| Surat Singh (‘A6’) | 16th July, 1977 | Lower Division Clerk | 1st January 2009 (VRS) | 31 years and 5 months | Rs.260-290 | As per the 5th CPC & Rs.3,000/- instead of 6th CPC |
6. Upon attaining the age of superannuation i.e., 60 years, the appellants claimed pensionary benefits under the 6th Central Pay Commission (‘CPC’). On 28th July, 2011, appellant No. 1 (Rajkaran Singh) filed a representation to the respondent No. 1 seeking pensionary benefits under the 6th CPC, however, the same was rejected vide order dated 15th October, 2012, on the ground that he was not a government employ
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