1. The first petitioner is the Union of employees of the Indian Naval Canteen Service and petitioners 2 to 4 are employees of the Naval Canteen working at Cochin. They inter alia seek for a direction that they are entitled to receive their salary and other pecuniary benefits in accordance with the recommendation of the 6th Central Pay Commission Report (for short 'CPC Report') and further seeks a direction to the respondents to revise the pay structure and pay scales of Indian Naval Canteen Services (for short 'INCS') Employees in tune with Part A of Section (1) of the First Schedule to the Central Civil Services (Revised pay) Rules 2008 with effect from 01/01/2006, and further to restore the incentives for small family which was granted to the employees of INCS from 1984 to 2010, continuously.

2. The facts involved in the above case would disclose that INCS is an establishment, which caters to the requirements of Indian Navy and they are bound by regulations known as Indian Naval Canteen Service Regulations 1976 (for short 'INCS Regulation') which is produced as Ext.P4. According to the petitioners, the employees of INCS is part and parcel of Indian Navy and they were given revision of scale of pay and other perquisites on the basis of 3rd, 4thand 5th CPC Report. However, when the 6th CPC Report was published, they were not treated on par with Central Government employees and they were not given the benefits of the 6th CPC Report. The petitioners submit that the 1976 INCS Regulation was amended by the Indian Naval Canteen Control Board (for short 'INCCB') in 2008 after the implementation of the 6th CPC Report. According to the petitioners, the intention behind the amendment was to extract maximum output from the civilian employees of INCS and to deny the service benefits granted to the employees by treating them on par with Central Government employees. According to them, by deletion of Clause 5 of the 1976 INCS Regulations, the protection given to the civilian employees of the organisation by treating them as naval force was conspicuously avoided. It is, therefore, their contention that it was only by virtue of the amendment that they are not treated on par with Central Government employees.

3. The petitioners contend that when they are included within the definition of Naval Force and are working under Naval Establishment in INCS and by virtue of the amendment made to the INCS Regulations, INCCB had implemented a pay scale of its own which has no connection whatsoever with the pay scale of Central Government employees. Hence it is contended that this action of INCCB is arbitrary, illegal and violative of Article 14 of the Constitution of India. It is also contended that INCS is an authority constituted and established by the Government of India and the Bombay High Court has admitted that INCS is a naval establishment by the Government of India and it is coming under the direct control of Indian Navy and hence amenable to the jurisdiction of this Court under Article 226 of the Constitution of India. It is also contended that INCS is to be treated as an instrumentality of the State coming under Article 12 of the Constitution of India.

4. Another argument raised is that all along the employees of the INCS were granted all the service benefits of Central Government employees when it was revised or modified from time to time and thus they have acquired a legitimate right and legitimate expectation to continue to receive the same salary and other benefits as that of Central Government employees. Petitioners also rely upon Ext.P15, a clarification issued by the Ministry of Finance stating that the 6th CPC recommendation can be extended to the employees of Autonomous organisation, quasi Governmental Organisation etc. whose pattern of emoluments, structure etc. are identical to those of Central Government employees. Therefore, it is the contention of the petitioners that if the autonomous bodies are in a position to bea