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008 INSC 1464
Equivalent Citations
citation codes
Case Number
Disposition
Attorney(S)
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  • Section 5, Subsection 2 of the 1983 Income Tax Act
  • restructuring (no specific act/article title or section/subsection/year provided)
  • Article 14 of the Constitution of India
  • Factories Act, 1948
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Cites
Cited by
Citation Codes
Neutral Citations
008 INSC 1464
Equivalent Citations
citation codes
Case Number
Disposition
Attorney(S)
Judges
Acts
  • Section 5, Subsection 2 of the 1983 Income Tax Act
  • restructuring (no specific act/article title or section/subsection/year provided)
  • Article 14 of the Constitution of India
  • Factories Act, 1948
Smart Summary

Factual and Procedural Background

The respondents were employed as timekeepers in the Liluah and Kancharpara Workshops of the Eastern Railway. Although timekeepers are recruited in the clerical grade, this Court’s earlier decision in Central Railway Workshop v. Vishwanath (1969) 3 SCC 95 classified them as “workers” under the Factories Act, 1948. In 1991 the Central Administrative Tribunal (CAT) held in TA No. 1585 of 1986 that Eastern Railway must treat its timekeepers as a separate cadre of workers, maintain distinct seniority lists, and grant all benefits available to workers under the Act.

Following the Fifth Central Pay Commission (V CPC), revised pay scales for clerical staff became effective from 1-1-1996. For Eastern Railway timekeepers, however, the Railway Board implemented the revision prospectively from 18-2-2000, citing a supposedly different recruitment pattern. Two original applications (OA No. 1458 of 1997 and OA No. 1254 of 2000) were filed before the CAT, which directed that the improved scales be given from 1-1-1996. The Eastern Railway’s writ petitions against these orders were dismissed by the Calcutta High Court on 20-4-2005. The Administration then appealed to the Supreme Court.

Legal Issues Presented

  1. Whether the Eastern Railway Administration could lawfully postpone implementation of the Fifth Central Pay Commission’s revised pay scales for its timekeepers to 18-2-2000 instead of 1-1-1996.
  2. Whether treating timekeepers of Eastern Railway differently from their counterparts in other Railways, allegedly on the basis of a distinct recruitment pattern, constituted a reasonable classification compliant with Article 14 of the Constitution.

Arguments of the Parties

Appellant (Eastern Railway Administration)

  • The respondents had been treated as workers under the Factories Act and enjoyed benefits such as overtime; therefore, a distinct implementation date (18-2-2000) for the V CPC scales was permissible.
  • A different recruitment pattern for timekeepers in Eastern Railway justified the differential treatment, making the classification valid and reasonable.

Respondents (Timekeepers)

  • The alleged difference in recruitment pattern did not exist; timekeepers across various workshops were similarly recruited.
  • Differential implementation of pay revision violated Article 14 because timekeepers in other workshops (e.g., Kharagpur, DLW Varanasi, CLW Chittaranjan, and Jamalpur) received the benefit from 1-1-1996.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Central Railway Workshop v. Vishwanath, (1969) 3 SCC 95; AIR 1970 SC 488 Timekeepers are “workers” within the meaning of the Factories Act, 1948. Formed the basis for treating Eastern Railway timekeepers as workers, underpinning the earlier CAT directions and negating the appellant’s attempt to classify them differently for pay-scale purposes.

Court's Reasoning and Analysis

The Supreme Court noted that the only justification advanced by the appellant before the CAT and the High Court was an alleged difference in recruitment procedure. Both fora had found this claim factually incorrect, a conclusion reinforced by the Chief Personnel Officer’s letter dated 13-7-2000 admitting no separate recruitment rules existed after 1990.

The Court emphasised that once timekeepers were uniformly classified as workers, Eastern Railway could not discriminate among them on workshop lines. The maintenance of a separate seniority list, payment of overtime, or creation of a workshop-based cadre did not constitute a rational basis for differential pay-revision dates. The Court also highlighted that timekeepers at Jamalpur Workshop—likewise treated as workers—had already received the upgraded scales from 1-1-1996, undermining the appellant’s argument.

Finding the purported classification neither factually tenable nor constitutionally permissible, the Court held that denying the respondents parity offended Article 14. Accordingly, the impugned Railway Board circulars dated 18-2-2000 and 28-7-2000 could not stand.

Holding and Implications

Appeals dismissed with costs assessed at Rs 25,000.

Immediate Effect: The respondents are entitled to the Fifth Central Pay Commission pay scales with effect from 1-1-1996, along with all consequential arrears and benefits.

Broader Implications: The decision affirms that administrative classifications must be grounded in actual, demonstrable differences; mere assertion of a distinct recruitment pattern is insufficient. It reinforces equal-treatment principles under Article 14 for similarly situated employees across different units of the same employer.

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    Union Of India And Others v. Satya Brata Chowdhury And Others

    S.B Sinha, J.— Leave granted.

    2. Eastern Railway Administration of the Union of India is before us, aggrieved by and dissatisfied with a judgment and order dated 20-4-2005 passed by a Division Bench of the Calcutta High Court in WPCTs Nos. 365 and 840 of 2004 dismissing the writ petitions filed by the appellants from the judgments and orders dated 3-6-2004 passed by the Central Administrative Tribunal in Original Application No. 1254 of 2000 and 10-2-2004 passed by the Tribunal in Original Application No. 1458 of 1997.

    3. The short question which arose for consideration before the Tribunal and consequently before the High Court, was whether the recommendations of the Fifth Central Pay Commission could have been extended in favour of the respondents herein with effect from 18-2-2000 in stead and in place of 1-10-1996; and whether their claim for fixation of pay scale with effect from 1-1-1996 was justified.

    4. The respondents were appointed as timekeepers in different workshops belonging to the Eastern Railway Administration. Other Railway Administrations also have similar workshops. Timekeepers, although are recruited in the clerical grade, in view of this Court's decision in Central Railway Workshop v. Vishwanath (1969) 3 SCC 95, AIR 1970 SC 488 are to be treated as workers under the Factories Act, 1948. The respondents appointed as timekeepers at Liluah and Kancharpara Workshops were, however, being treated as clerical grade employees.

    5. Indisputably, the workers concerned filed an original application before the Central Administrative Tribunal, Calcutta Bench, which was marked as TA No. 1585 of 1996, praying, inter alia, for the following reliefs:

    “(i) That a separate cadre and a separate seniority list for the timekeepers of the Liluah Workshop be maintained and the timekeepers should not be transferred to the post of clerks.
    (ii) For rescinding and revoking the order dated 14-7-1985 (Annexure B to the petition) for transferring Petitioners 1, 2 and 11 from Time Office to clerical side.
    (iii) To pass an order of injunction restraining the respondents from transferring Petitioners 1, 2 and 11 from Time Office to the clerical side.”

    It was allowed, opining:

    “We find that no records of Kharagpur Workshop, S.E Railway, Diesel Locomotive Workshop, Varanasi or CLW as stated in the reply were produced during hearing to demolish the case of the applicants that the timekeepers are treated as a distinct cadre with separate seniority, promotion and transfer lists. In view of the admission made by the official respondents in this respect in the unreported judgment of this Tribunal, mentioned above, that except in Eastern Railway, timekeepers are treated as a separate cadre, there could be no doubt about the authenticity of the statements made by the applicants in this petition on this point. Annexure B to the reply whereby the respondents wanted to establish that Applicants 1, 3, 4, 7, 8 and 11 refused to be timekeepers on 26-8-1984 has no legal consequence in view of the decision of the Supreme Court referred to above, holding that the nature of the duties discharged by the timekeepers bring them within the purview of ‘worker’ under the Factories Act, 1948. Under the circumstances, the alleged refusal cannot change the legal position.
    We are bound by the decision of the Supreme Court and the judgment of our Bench dated 11-5-1990. In view of the findings of the Supreme Court that timekeepers are ‘workers’ within the meaning of the Factories Act, 1948 for all practical purposes, the authorities of Eastern Railway are not permitted to treat the timekeepers in the manner they have been treating them.”

    6. The Tribunal, on the basis of the said findings, issued the following directions:

    “On careful consideration of the facts and circumstances of this case and the submissions of the counsel for the parties to the proceeding, we quash the order of transfer dated 14-7-1985 of Applicants 1, 2 and 11. We also direct the official respondents herein to treat the timekeepers in the Eastern Railway, Liluah Workshop or elsewhere in a similar manner as is being done by Kharagpur Workshop, S.E Railway, Diesel Locomotive Workshop, Varanasi and CLW as a separate cadre regarding seniority, confirmation, promotion and transfer, etc. and allow them all other benefits admissible to them under the Factories Act, 1948 and all these must be finalised and our direction be implemented within six months from the date of communication of this order.”

    7. The Tribunal furthermore observed:

    “The Eastern Railway, being one of the biggest employers, we hope that this decision will be treated as passed on a representative suit and the directions given in this application be made available to the timekeepers who are similarly circumstanced but are not parties to this proceeding. The Railway, as a model employer, will try to prevent the timekeepers from coming to this Tribunal for obtaining similar reliefs repeatedly and thereby prevent wasting public money in fighting out futile litigations. The country is passing through serious economic crisis and all unnecessary and useless expenses should be prevented by taking reasonable steps whenever necessary.”

    8. Indisputably, pursuant to or in furtherance of the said observations, options were obtained from them as to whether they would continue as clerical grade staff or workmen. They were treated to be workers under the Factories Act. A separate seniority list was started to be maintained. A different cadre was created. By an order dated 28-10-1991, it was directed:

    “The existing staff of Mechanical/Electrical Department attached to Time Office should be treated as one unit and in one seniority group. If anyone of the Time Office staff except the petitioners desires to get merged with clerical group of staff on their own volition in writing, there should be no cause for rejection.”

    9. Indisputably, the Central Government constituted the Fifth Pay Revision Committee. It made its recommendations. The said recommendations were enforced as regards clerical staff with effect from 1-1-1996. By an office order dated 18-2-2000, the Railway Board directed implementation of the said revised pay with effect from 18-2-2000, in the case of the respondents, stating:

    “… The Ministry have noted that the pattern of recruitment of timekeepers in Eastern Railway differs from the pattern prevalent elsewhere. Timekeepers being a common category existing in various Railways and production units, it has been decided that the recruitment pattern, including recruitment qualifications, etc. for induction as timekeepers at various levels in Eastern Railway should fall in line with the practice prevailing in other Railways and production units.
    2. The Ministry of Railways, with the approval of the President, have accordingly decided as under:
    (i) Induction at the level of Junior Timekeepers should continue in accordance with the existing pattern, which includes direct recruitment through RRBs to the extent of 66% from amongst candidates possessing qualification of matriculation;
    (ii) Induction at the level of Senior Timekeepers should henceforth take place in accordance with the existing pattern for Senior Clerks, which would include direct recruitment through RRBs, to the extent of 20% from amongst candidates possessing qualification of graduation and 13½% through limited departmental competitive examination held by RRBs from amongst serving staff in the grade of Rs 3050-4590; and
    (iii) The following pay scales should be allotted to the timekeeping staff of Eastern Railway:
    Sl. No. Designation Existing pay scale (Rs) Improved pay scale (Rs) 1. Junior Timekeeper 3050-4580 3050-4590 2. Senior Timekeeper 4000-6000 4500-7000”

    10. By another letter dated 28-7-2000, it was furthermore directed by the Railway Board:

    “However, with a view to standardising the cadre structure at least for the future, since the change in recruitment pattern could take place only prospectively in Eastern Railway, the benefit of the improved pay structure has been permitted with prospective effect only.”

    11. We may also, at this stage, place on record, a letter of the Chief Personnel Officer of the Eastern Railway dated 13-7-2000 wherein it was stated that no such recruitment rules were framed by the Eastern Railway Administration, stating:

    “Would you please connect this Railway's letters of even number dated 28-4-2000 and 8-6-2000 wherein it was requested to examine the issue related to the date of effect of the upgraded pay scale of timekeeping staff of this Railway. After collecting information from various Zonal Railways/production units it is understood that the upgraded pay scale of timekeeping category (where exists) were introduced w.e.f 1-1-1996 in all Zonal Railways/production units except Eastern Railway wherein instructions were issued by the Railway Board that the same order will be effective from the date of issue of modified recruitment rules in line with ministerial staff.
    In Eastern Railway no separate recruitment rule was framed after the order of the Hon'ble CAT/Cal on May 1990 for treating the timekeepers a separate entity as workers within the meaning of the Factories Act, since there was no intake for filling up the vacancy of timekeepers after May 1990, but before that the timekeepers of this Railway were recruited from the same panel prepared for clerks i.e their recruitment rule was same as that of the clerks.”

    12. The legality and/or validity of the decision of the Railway Board was the subject-matter of the original application filed by the respondents. Indisputably, the only contention raised in support of the said decisions by the appellant was that the recruitment pattern for the post of timekeeper in Eastern Railway was different.

    13. Pranab Kumar Chakraborty and others filed an original application before the Tribunal which was marked as OA No. 1458 of 1997. The said application was disposed of by the Tribunal, holding:

    “We have gone through the said communication dated 28-7-2000, which has been received from the Railway Board. In this there is indication that the recruitment pattern was changed, but it is not the case. In subsequent rule, depriving or denying the applicants from getting the pay scales with effect from 1-1-1996 was hampered by this change. For the time being we are not inclined to go into the change in the policy stand which may affect the equation of a particular group or grade with the corresponding ministerial staff, which is an internal matter to be sorted out. However, to the extent the benefits have been extended to the timekeeper grades of the Eastern Railway, the same should be equitably applicable with effect from 1-1-1996 as the case is in respect of awarding the scales under V CPC. We, therefore, partially allow this OA to the extent that the benefit should be awarded with effect from 1-1-1996 to the present applicants only within 3 months from the date of communication of the order with arrears.”

    14. Satya Brata Chowdhary and 70 others thereafter filed another original application before the Tribunal which was marked as OA No. 1254 of 2000. By a judgment and order dated 3-6-2004, the question, as to whether the Eastern Railway Administration was justified in its stand not to treat the respondents similarly in the matter of grant of benefit of revision in the pay scales was answered, stating:

    “We have gone through the said communication dated 18-2-2000 (Annexure A-11) as well as dated 28-7-2000 (Annexure A-18), which was received from the Railway Board. In the abovesaid letter of the Railway Board dated 28-7-2000, it has been indicated that pattern of recruitment of the timekeepers in Eastern Railway differs from the pattern prevalent in other Railways. Accordingly, treatment of this order in Eastern Railway has to be essentially different from that of the other Railways. But a bare perusal of the record clearly indicates that actually it is not so.”

    It was directed:

    “In view of above, the Railway Board's circular dated 18-2-2000 (Annexure A-11) and order dated 28-7-2000 (Annexure A-10) are quashed/set aside. The extent of the benefit which has been extended to CLW, Chittaranjan (Annexure A-14) w.e.f 1-1-1996 and also the letter of the Chief Personnel Officer (Admn.) dated 13-7-2000 Grades of S.E Railway as well as DLW, Varanasi and CLW, Chittaranjan should also be extended in favour of the applicants which are also similarly situated persons and working as timekeepers in the Liluah Workshop of Eastern Railway. The respondent authorities, more particularly, Respondents 5 and 6 are directed to fix the pay scale of the applicants as per Fifth Pay Commission's recommendation for the post of timekeeping cadre w.e.f 1-1-1996 instead of 18-2-2000 and extend all consequential financial and other benefits in favour of the applicants within a period of three months from the date of communication of this order along with arrears. It is made clear that we are not inclined to say anything as to the payment of interest.”

    As noticed hereinbefore, writ petitions preferred thereagainst by the appellant were dismissed by the High Court.

    15. The matter came up before this Court for hearing on 8-2-2008 when, inter alia, a contention was raised on behalf of the respondents that the revised pay scales of timekeepers at the Jamalpur Workshop had been implemented but the same was denied to the staff at Liluah and Kancharpara Workshops. An additional affidavit thereafter has been placed on record on behalf of the appellant to contend that the timekeepers of Jamalpur Workshop had been treated as clerical grade staff and, thus, they are not similarly situated as the respondents.

    16. The learned Additional Solicitor General Mr Amarendra Sharan, appearing for the appellant, would contend that as the respondents had been treated to be workers under the Factories Act and obtained several benefits including overtime, the appellants were entitled to implement the recommendations of the Fifth Pay Revision Commission with effect from 18-2-2000 in stead and in place of 1-1-1996. Such a classification, according to the learned counsel, being valid and reasonable, does not attract the wrath of Article 14 of the Constitution of India.

    17. Mr Gaurav Jain and Mr Shekhar Kumar, learned counsel appearing on behalf of the respondents, on the other hand, would contend that the purported classification of timekeepers in different workshops cannot be treated to be valid warranting different treatments so far as regards implementation of the recommendations of the Fifth Pay Commission are concerned.

    18. We may, at the outset, notice that the only contention raised by the appellant before the Tribunal, as also before the High Court, was that the recruitment procedure in the Eastern Railway Administration was different for the timekeepers. It has been held not to be so. The judgment of the Central Administrative Tribunal dated 5-7-1991 in TA No. 1585 of 1986 has been noticed by us. Therein, the Tribunal directed the workmen of the workshops at Liluah and elsewhere to be treated on a par with their counterparts of Kharagpur, Banaras and Chittaranjan Locomotive Workshops. It was, therefore, impermissible for the appellant to treat the workers similarly situated, differently. They were to be treated as workers under the Factories Act. Only because some overtime allowance became payable to them or a separate seniority list was maintained or a cadre for the said workers on workshop basis was constituted, the same by itself, in our opinion did not authorise the Eastern Railway Administration to discriminate the workers working in one workshop with the workers working in the other.

    19. We may also notice that letter dated 13-7-2000 issued by the Chief Personnel Manager, Eastern Railway Administration, from a perusal whereof it appears that the claim of the appellants that different recruitment rules existed for the timekeepers of different workshops within the Eastern Railway Administration, is not correct. It has also been so found by the Tribunal as also by the High Court.

    20. The contention of the learned Additional Solicitor General that the timekeepers recruited in the Liluah Workshop could be treated differently from their counterparts at Jamalpur as in the said letter they were not treated as clerical grade staff, also does not appear to be wholly correct. The appellants themselves have annexed with their affidavit a letter dated 16-6-2006 issued by the Assistant Personnel Officer, Eastern Railway, Jamalpur to the Chief Assistant Officer, Eastern Railway, Kolkata wherein it was stated:

    “As cadre/seniority of timekeeping staff is being maintained with general group clerks, as such benefit of restructuring has been given to the timekeeping staff.
    The staff posted in Time Office and working as timekeepers are governed under the Factories Act.”

    21. The timekeepers of Jamalpur Workshop, thus, have been treated as workers under the Factories Act and if they had been given the benefit of recommendations of the Fifth Pay Commission, we fail to understand why the same benefit would be denied to the respondents herein.

    22. For the reasons aforementioned, we do not find any ground to interfere with the impugned judgment and orders. The appeals are dismissed with costs. Counsel's fee assessed at Rs 25,000.

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    Union Of India And Others v. Satya Brata Chowdhury And Others
    (Dec 17, 2008)