The Madhya Pradesh High Court, in a landmark ruling, directed the State to provide annual increments along with arrears and interest to retired employees whose retirement dates fell on either 30th June or 31st December. The bench, comprising Chief Justice Suresh Kumar Kait and Justice Vivek Jain, delivered this judgment in response to multiple writ petitions filed by retired employees seeking their due annual increments before superannuation.
Background
The petitioners, all retired employees or legal heirs, argued that although they had completed a full year of service before retirement, they were denied their annual increment, typically granted on 1st July or 1st January. The State had withheld the increment based on the technicality of their retirement dates, impacting their pensionary benefits. The petitioners contended that under established law, completing one year of service entitles an employee to an increment, and the State’s refusal was unjust.
Arguments Presented
The petitioners based their argument on the Supreme Court’s ruling in HR KPTCL v. C.P. Mundinamani (2023 SCC OnLine SC 401), which clearly stated that a government servant becomes entitled to an increment upon completing one year of service with good conduct, making it payable the following day. Additionally, they cited a Madhya Pradesh Finance Department circular dated 15.03.2024, which directed that annual increments be granted to employees who retired on 30th June or 31st December, provided the increment became due the next day.
The State, through its counsel, acknowledged that the petitioners had completed one year of service but argued that the issue was under review and needed further scrutiny.
Court’s Reasoning
The court sided with the petitioners, referring to the Supreme Court’s ruling in Mundinamani, which clarified that an employee’s retirement should not prevent them from receiving an increment that is rightfully due for a full year of service. It emphasized that denying the increment also adversely affects pension benefits, which are linked to increments.
The court also referenced Rushibhai Jagdishchandra Pathak v. Bhavnagar Municipal Corporation (2022 SCC OnLine SC 641), noting that while delayed petitions limit arrears to three years, timely petitions like those of the petitioners are entitled to full arrears from the increment’s due date. Further citing the Supreme Court’s order in Union of India & Anr. v. M. Siddaraj (06.09.2024), the court reinforced that the petitioners were legally entitled to receive the due increment with arrears.
Court’s Directions
In its ruling, the court ordered the State to grant the petitioners their annual increments effective either from 1st July or 1st January, depending on their retirement dates. Additionally, the State was instructed to pay arrears with interest at 7% per annum, effective from 1st May 2023. The court mandated that the payments be processed within six weeks, ensuring compliance with the Supreme Court’s directives in M. Siddaraj.
Conclusion
This ruling underscores the importance of adhering to legal precedents when addressing pension-related grievances, especially when an employee’s entitlement to increments is at stake. The judgment will have significant implications for retired government employees in similar situations, ensuring they receive the benefits they are rightfully owed.