Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2026 Supreme(Online)(CAT) 336

CENTRAL ADMINISTRATIVE TRIBUNAL
Chhabilendra Roul, Member (A), Rajveer Singh Verma, Member (J)
All India Association of Central Tax Gazetted Executive Officers – Appellant
Versus
Union of India – Respondent
OA No.387/2024 | OA No.1428/2024

Advocates:
For the Appellants/Petitioners: Ms. Jasvinder Kaur
For the Respondents: Mr. Rajeev Kumar

An anomaly in pay scales, once corrected, must be corrected from the date the anomaly arose, not prospectively from the date of the correction order.

Headnote:(A) Central Civil Services (Revised Pay) Rules, 1997 - 5th Central Pay Commission - Implementation of upgraded pay scales - Anomaly correction - OM dated 21.04.2004 - Retrospective effect from 01.01.1996 - Principle that once an anomaly is identified and corrected, the correction must relate back to the date of its origin. (Paras 6.3, 8.2)

(B) Service Law - Pay Scale - Discrimination - Denial of retrospective benefit - Grant of upgraded pay scale w.e.f. 01.01.1996 to similarly placed employees of another department (CBDT) while denying the same to employees of CBIC - Held to be discriminatory and unsustainable. (Para 8.2)

(C) Judicial Precedent - Binding nature on coordinate benches - Once a coordinate bench of the Tribunal has taken a view on an identical controversy, a different view cannot be taken. (Para 8.4)

Facts of the case:
The applicants, consisting of serving and retired officers of the Central Board of Indirect Tax and Customs (CBIC), and legal heirs of deceased officers, challenged the denial of retrospective effect to upgraded pay scales recommended by the 5th Central Pay Commission. The 5th CPC recommended pay scales of Rs.6500-10,500 for Superintendents and Rs.5500-9000 for Inspectors w.e.f. 01.01.1996, but recommended higher scales for similar posts in other departments, creating an anomaly. The respondents conceded to the demand and upgraded the scales for CBIC officers vide OM dated 21.04.2004, but implemented it prospectively from that date instead of 01.01.1996. Several judicial pronouncements from various Benches of the Tribunal and High Courts had granted the retrospective benefit to similarly placed employees of the Income Tax Department. The respondents, however, denied the same benefit to the applicants, leading to the present Original Applications.

Findings of Court:
The Tribunal held that the issue was no longer res integra. It observed that the respondents could not discriminate against the applicants when similarly placed officers in other departments had been granted the benefit of upgraded pay scales w.e.f. 01.01.1996. The Tribunal also noted that a Coordinate Bench had already decided the issue in favor of similarly placed employees in OA No.3211/2023, and it had no reason to take a divergent view. The court concluded that once an anomaly is accepted and corrected, the correction must relate back to the date of its origin.

Issues: The main issue was whether the respondents could restrict the benefit of upgraded pay scales to 21.04.2004 while granting it from 01.01.1996 to similarly placed employees of other departments, and whether the principle of judicial precedent required the Tribunal to follow its earlier decision on the same issue.

Ratio Decidendi: The court ruled that the restriction of benefits to 21.04.2004 was unsustainable. The respondents had failed to show any rational basis for treating similarly placed employees differently. The court further held that when an anomaly is removed, it stands removed from its origin unless explicitly restricted. A coordinate bench is bound to follow the earlier view taken on the same legal issue. Result : The Original Applications were allowed. The respondents were directed to extend the benefit of the upgraded pay scales notified under O.M. dated 21.04.2004 with effect from 01.01.1996, with all consequential benefits including arrears and revision of pension. Arrears were to be computed and released within four months, failing which they would carry interest at the GPF rate. (Paras 8.4, 9) Applicants: Association of officers, individual serving and retired officers, and legal representatives of deceased officers of CBIC. Respondents: Union of India, Secretary, Ministry of Finance, Chairman, CBIC, and Secretary, DOPT. Dissenting Opinions: None. Power/court: Central Administrative Tribunal, Principal Bench, New Delhi. Judge(s) : Hon’ble Dr. Chhabilendra Roul, Member (A) and Hon’ble Sh. Rajveer Singh Verma, Member (J). Date of order : 09.01.2026 (pronounced) / 11.12.2025 (reserved). Case Number: OA No.387/2024 With OA No.1428/2024. Name of Counsel: For the Applicants: Ms. Jasvinder Kaur, Advocate. For the Respondents: Mr. Rajeev Kumar, Advocate.

Table of Content
1. the case involves taxation officers seeking pay scale upgradation from 1996. (Para 1 , 2 , 3 , 4 , 5 , 6 , 7 , 8)
2. applicants argue for retrospective pay benefit citing past judgments. (Para 9 , 10)

ORDER

By Dr. Chhabilendra Roul, Member (A)

1.Since common question of facts and law arises in the present OAs, they are being disposed of through common order. However, for the sake of brevity, facts of OA No.387/2024 are extracted with the consent of learned counsel for the parties.

2. The relief prayed in OA No.387/2024 reads as under:

“i) To quash and set aside impugned letter No. F.No.A26017 /65/2003-Ad.IIA dated 25.07.2023 issued by the respondent No. 3 communicating denial of effect of OM No. F.No.6/37/98-IC dtd 21/04/2004 wef 01.01.1996;

ii) May quash and set aside Annexure A-2 OM dated 21.04.2004 to the extent it grants upgraded pay scale w.e.f. 2l.04.2004.

iii) To direct the respondents to extend the benefit of judgments relied upon at Annexure A-4 Colly, A-5 & A-9 and to grant upgraded pay scale w.e.f. 01.01.1996 on actual basis since 5th CPC became operational.

iv) May pass such other order for the grant of relief to the applicants which it may deem fit in the peculiar facts and circumstances of the case.”

3. The applicant No.1, All India Association of Central Tax Gazetted Executive Officers, represents the Superintendents and promotee Group ‘A’ Executive Officers including Assistant Commissioners of Central Excise and Customs working under the Central Board of Indirect Tax and Customs (CBIC). Applicant No.358 is an Association of retired Central Excise and Customs officers including Inspectors, Superintendents and promotee Group ‘A’ Executive Officers including Assistant Commissioners of Central Excise and Customs. Applicants No.2 to 357 are the serving officials and are the members of All India Association of Central Tax Gazetted Executive Officers. Applicants No.359 to 794 are the retired officers whereas applicants No.795 to 818 are the legal representatives of the deceased officers. All the individual applicants joined as Inspectors by direct recruitment or by way of promotion in CBIC and they worked as Inspectors or Superintendents during the period from 01.01.1996 to 20.04.2004 in the pay scale of Rs.5500-9000 and/or Rs.6500-10,500 respectively. The 5th Central Pay Commission (CPC) recommended the pay scale of Rs.6500-10,500 in respect of Superintendents and Rs.5500-9000 in respect of Inspectors w.e.f. 01.01.1996. However, it recommended higher pay scales of Rs.6500-10,500 and Rs.7500-12,000 for similarly placed employees in other departments, thereby creating an anomaly and disturbing the established parity of equivalent employees posted under CBIC as well as other Ministries as mentioned therein.

4. After prolonged agitation, the respondents conceded to demand of the Association and upgraded the scale of Rs.6500-10,500 and Rs.7500-12,000 for Inspectors and Superintendents working under CBIC respectively. However, while issuing the order vide letter dated 24.04.2004, the Department of Expenditure implemented this enhanced pay scales prospectively w.e.f. 21.04.2004 instead of 01.01.1996 as it has been granted higher pay scales to equivalent cades of Inspectors and Superintendents in other departments. Similarly placed Income Tax Gazetted Officers and Association filed OA No.86/2008 before the Coordinate Bench of this Tribunal at Mumbai. The Tribunal vide order dated 17.01.2012 held that the decision of the revenue department to implement such pay scale of Superintendents and Inspectors prospectively from 01.04.2004 instead of 01.01.1996 was arbitrary and illegal. The Government of India preferred appeal against the said order of Coordinate Bench of Mumbai in WP No.9649/2012 which was dismissed by order dated 08.12.2023. Similarly, the other Income Tax Gazetted Officers Associations filed OAs before the Coordinate Bench of this Tribunal at Calcutta and Ernakulam in OA No.397/2009 and OA No.180/884/2017

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2026 Supreme(Online)(CAT) 336

CENTRAL ADMINISTRATIVE TRIBUNALChhabilendra Roul, Member (A), Rajveer Singh Verma, Member (J)All India Association of Central Tax Gazetted Executive Officers – AppellantVersusUnion of India – RespondentOA No.387/2024 | OA No.1428/2024

An anomaly in pay scales, once corrected, must be corrected from the date the anomaly arose, not prospectively from the date of the correction order.

Cases Referred (1)

CENTRAL ADMINISTRATIVE TRIBUNAL
Chhabilendra Roul, Member (A), Rajveer Singh Verma, Member (J)
All India Association of Central Tax Gazetted Executive Officers – Appellant
Versus
Union of India – Respondent
OA No.387/2024 | OA No.1428/2024