The court ruled that public sector pay revisions depend on financial viability, with no absolute right to retrospective pay adjustments for employees of financially troubled companies.

JUDGMENT

[WP(C) Nos.4669/2023, 8386/2023, 12197/2023, 14042/2023, 16113/2023, 16819/2023, 19278/2023, 26612/2023]

The petitioners in these writ petitions are all retired employees who were working with the Fertilizers and Chemicals Travancore Limited (FACT) – a Government of India enterprise. The petitioners contend that pay revision in the public sector undertakings like the FACT were being implemented once in ten years and as regards the FACT, it was implemented last during 2007. Therefore, the petitioners state that pay revision was due during 2017 and the Department of Public Enterprises issued a Government Order dated 03.08.2017 providing for pay revision to be implemented in the Central Public Sector Undertakings. The petitioners state that though the pay revision pursuant to the afore Government Order was due with effect from 01.01.2017, the FACT did not implement the same immediately and it is only pursuant to the pay revision order dated 27.12.2022 that the revision was implemented, however only with a prospective operation. In such circumstances, the petitioners are before this Court essentially seeking a direction to the FACT to disburse the arrears of pay and other consequential benefits for the period from 01.01.2017 to the respective dates of retirement of the petitioners concerned. They have also sought for a direction to the 4^th respondent to implement the pay revision pursuant to the proceedings dated 27.12.2022 with effect from 01.01.2017 in which event all the petitioners would also be entitled for the afore benefits, since in between 01.01.2017 to 31.03.2022, the petitioners have retired.

2. I have heard Sri. Babu M, Sri. Brijesh Mohan, Sri. Muhammad Al Rafi S, learned counsel for the petitioners, Sri. Jai Mohan, learned counsel for FACT, Sri. John Mani and Sri. S. Prasanth, learned counsel for EPFO.

3. The petitioners contend with reference to Ext.P1 Office memorandum dated 03.08.2017 that the pay revision ought to have been with effect from 01.01.2017. The learned counsel Sri. Babu M would contend with reference to the Clauses governing fitment benefits that if the FACT had any reservations with reference to the implementation, the Company ought to have implemented the pay revision by making proportionate reduction as prescribed under Caluse 3(ii). Sri. Brijesh Mohan, learned counsel for some of the petitioners would contend with reference to Clause 18 that the revised pay scale ought to have been mandatorily made effective from 01.01.2017 and even according to the Government, this prescription was not applicable only as regards Paragraph 8 and 10 of Ext.P1. Therefore, according to him it was mandatory for the Company to have acted on the basis of Ext.P1 and to have carried out pay revision from 01.01.2007.

4. Sri. Jay Mohan, on behalf of the Company would seek to rely on judgments of the Apex Court as well as the Delhi High Court to contend that Ext.P1 was only a guideline and therefore the company was justified in implementing the same during the year 2022, with only prospective operations. He would also contend with reference to Clause 18 of Ext.P1 that a procedural aspect has alone been recorded thereunder and therefore, the petitioners cannot seek to claim any retrospective operation. He would further state that with reference to Clause 3 of Ext.P1, ultimately the public sector undertaking had a leeway with reference to their financial position and therefore, the ultimate decision taken in 2022 cannot be subject to judicial review.

5. I have considered the rival contentions as well as the connected records.

6. The Apex Court in Punjab State Cooperative Milk Producers Federation Limited a