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Karnataka Power Transmission Corporation Limited & Ors. vs Sri. B.G. Manamohana Priyanka & Ors.

Civil Appeal · 2023 INSC 456Decided 28 Apr 2023
Civil Appeal No. 2702 of 2023
M.R. Shah · C.T. Ravikumar · J.B. Pardiwala as the co-judge

Background

The respondents were appointed as Assistant Executive Engineers (Electrical) in the Karnataka Power Transmission Corporation in 2007. The Corporation had issued orders revising pay scales retroactively from 2003, including a 10% increase plus a further conditional 2% increase tied to employee performance targets. Because the respondents joined only in 2007, the Corporation denied them the extra 2% hike, leading them to file a writ petition. The Single Judge and, on appeal, the Division Bench of the Karnataka High Court both ruled in the employees' favour, directing the 12% (10+2%) revision to apply from their date of appointment, with interest.

Decision Breakdown

The Supreme Court agreed that the respondents were entitled to the additional 2% pay revision in principle, rejecting the Corporation's argument that only employees in service before 2003 qualified. However, the Court held that the lower courts erred in directing the 2% benefit to apply automatically from the date of appointment, because the governing order made this additional increase conditional on employees meeting specific performance targets assessed through periodic appraisals (starting April 2009). The appeal was therefore partly allowed: the employees remain entitled to the 2% increase, but only subject to actually meeting the performance conditions laid down in the 2008 order, not as an automatic entitlement from their joining date.

Lesson Learnt

A pay revision benefit that is expressly made conditional on meeting performance targets cannot be treated as an automatic entitlement effective from an employee's date of appointment; courts will enforce the underlying conditions attached to service benefits even while recognizing the employee's basic entitlement to them.

Official source (sci.gov.in)View Judgment (PDF)

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