2026 Supreme(Online)(CAT) 6242

CENTRAL ADMINISTRATIVE TRIBUNAL
3212/2021
T.A./2752/2021

Headnote:(A) Constitution of India - Articles 14, 16, and 21 - Claim for arrears of salary - Regularization of daily-rated workers - Principle of equal treatment and parity - State obligation to act fairly and non-arbitrarily. (Para 19)

(B) Service Law - Regularization - SRO 64 of 1994 - Empowered Committee clearance - Arrears of salary from date of clearance - Restrictive stipulation denying arrears - Government Order No. 439-FST of 2002 - Subsequent Government Orders (No. 346-FST of 2006, No. 569-FST of 2007, No. 468-FST of 2009, No. 65-FST of 2013) deleting such stipulations ab initio for similarly situated employees - Selective application of policy and unequal treatment violates Articles 14 and 16. (Paras 2-4, 16-19)

(C) Evidence - Admissions - Respondents did not dispute issuance of Government Orders granting benefit to similarly situated employees nor denied that identical treatment was extended - Failure to demonstrate that employees of other departments were denied benefit on grounds of delay or Rule 2.40 - Such silence strengthens claim of discrimination. (Para 17)

(D) Contract Law - Unequal bargaining power - Unconscionable stipulations - Central Inland Water Transport Corporation Ltd. v. Brojo Nath Ganguly (1986 SCC (3) 156) - Unfair and unconscionable stipulations imposed by an employer on an employee in a position of unequal bargaining power cannot be enforced - Daily-rated workers had no meaningful choice but to accept restrictive terms - Acceptance cannot be treated as conscious waiver of constitutional rights. (Paras 8, 23-24) (E) Limitation - Delay and laches - Rule 2.40 of the J&K Financial Code - Claim for salary is a continuing cause of action - Mere delay cannot defeat a claim for salary for services rendered - Departmental processing of claim over years estops respondents from raising delay - Selective invocation of Rule 2.40 against applicants while not applying it to others is hostile discrimination. (Paras 27-35)

Facts of the case:
The applicants were daily-rated workers/helpers in the respondent department. Their cases were cleared by the Empowered Committee for regularization under SRO 64 of 1994. They were regularized vide Government Order No. 439-FST of 2002 dated 08.11.2002, but a stipulation in that order denied arrears of salary from the date of clearance, stating that salary would be paid only from the date of the regularization order. Subsequently, the Government issued several orders (Government Order No. 346-FST of 2006, Government Order No. 569-FST of 2007, Government Order No. 468-FST of 2009, Government Order No. 65-FST of 2013) granting arrears from the date of clearance to similarly situated employees, treating the earlier restrictive stipulations as deleted ab initio. The applicants made representations, and the department sought their details for working out arrears via communications dated 04.04.2008 and 23.02.2010. However, the claim was rejected citing delay and Rule 2.40 of the J&K Financial Code, prompting this petition.

Findings of Court:
The selective application of Government Orders and differential treatment among identically situated employees cannot withstand Article 14. The State is obligated to act fairly and non-arbitrarily. Denial of identical treatment without any rational basis is arbitrary and discriminatory. (Para 19) The claim for salary for work performed is intrinsically connected with the right to livelihood under Article 21 and is not a bounty. (Paras 20-21) The restrictive stipulation is unconscionable under the Brojo Nath Ganguly principle, as the applicants had no meaningful choice. (Paras 23-24) The respondents' reliance on delay and laches is unsustainable because: (a) the applicants continuously pursued their claim, (b) the department itself processed the matter, (c) the claim is recurring, and (d) a fresh cause of action accrued when others were granted relief. (Paras 27-33) Selective invocation of Rule 2.40 further reinforces hostile discrimination. (Para 35)

Issues: Whether the applicants are entitled to arrears of salary from the date of clearance by the Empowered Committee on the principle of parity and equal treatment, despite a restrictive stipulation in the regularization order, when similarly situated employees were granted such benefit after identical stipulations were treated as deleted.

Ratio Decidendi: The court held that the respondents' action of selectively denying arrears to the applicants while granting them to similarly situated employees, based on a stipulation that was treated as deleted ab initio in other cases, is arbitrary and violates Articles 14 and 21. The stipulation, being unconscionable and imposed on employees with unequal bargaining power, cannot be enforced to defeat a legitimate claim for salary for services rendered, particularly when the State itself has consistently granted similar relief to others.

Result: Transfer Application allowed. Impugned communication quashed. Respondents directed to reconsider the claim in light of specified Government Orders, principles of equality, and the Brojo Nath Ganguly judgment, and to pass a reasoned order within eight weeks. Consequential benefits to be released if applicants are found similarly situated. (Paras 38-41)