Vinod Chandran, J.

The Writ Appeals have been filed by the Indian Rare Earths Ltd. (IRE) and Government of India, both of them, respondents before the learned Single Judge. The issue arose in the context of a pay revision, which was agreed to by the employer and the representative unions of the employees, by a settlement under Section 18 of the Industrial Disputes Act, 1947 ('the Act' for brevity). The period in which the dispute arose was between 01-07-2003 to 30-06-2008. There was a specific clause in the agreement, which granted 100% neutralization of the quarterly average increase or decrease of the All India Consumer Price Index (AICPI) for persons drawing basic pay upto Rs.6,500/- and those drawing above, had 75% neutralization.

2. Clause 5(3) of the long term settlement is extracted below for ready reference:

“It is agreed that if the Government of India approves 100% D.A. neutralization irrespective of any Basic Pay to similarly placed PSU of DAE, IREL will also adopt 100% of the D.A. neutralization system subject to obtaining specific Government approval.”

3. Earlier, the Company had made a recommendation to the Department of Atomic Energy (DAE), which was declined b