Deputationists cannot claim parity with embassy personnel’s Foreign Allowance absent identical service rules or governing entitlement.

The Petitioners, employees of various Central and State Government departments, electricity boards and public-sector undertakings, were deputed to the Tala Hydro Electric Project Authority in Bhutan pursuant to the India–Bhutan Agreement dated 5 March 1996.

Their appointment letters provided that their service conditions would be governed by the terms prescribed in the Ministry of External Affairs’ letter dated 8 November 1977, as amended from time to time.

Under those terms, the Petitioners received Bhutan Compensatory Allowance (“BCA”), whereas employees of the Embassy of India in Bhutan received Foreign Allowance.

Although Foreign Allowance was revised periodically after 1997, no corresponding revision was made to BCA.

The Government subsequently granted ad hoc increases of 25% from 1 January 2001 and 11% from 1 April 2005.

The Petitioners sought revision of BCA at par with Foreign Allowance, relying principally on Article 14 of the Constitution and the decision in Captain Gurdev Singh v. Union of India.

Their representations were not accepted, and the Ministry directed them to approach the Tala Hydro Electric Project Authority, which stated that the matter had to be decided by the Ministry.

The Union of India contended that Embassy personnel and project deputationists constituted distinct categories governed by different service rules and performing different functions.

Whether the Petitioners, who were deputed to the Tala Hydro Electric Project in Bhutan and entitled to BCA under their deputation terms, were entitled to claim parity with the Foreign Allowance payable to Embassy personnel in Bhutan?

Whether the non-revision of BCA, despite periodic revisions of Foreign Allowance, was arbitrary or discriminatory and violated Article 14 of the Constitution?

Whether the Petitioners could rely on legitimate expectation or the earlier decision in Captain Gurdev Singh to claim the revised allowance?

Article 14 prohibits unequal treatment between persons similarly situated but permits reasonable classification founded on an intelligible differentia having a rational nexus with the object of the classification.

Service benefits are governed by the applicable service rules and terms of appointment; employees belonging to distinct services or categories, performing different functions and governed by different conditions, cannot claim parity merely because they work in the same place or receive allowances with similar purposes.

The Court relied on the Ministry of External Affairs’ letter dated 8 November 1977, which governed the Petitioners’ BCA, and distinguished the Foreign Allowance governed by the rules applicable to Embassy personnel.

It applied the Supreme Court’s decision in Union of India v. Captain Gurdev Singh, (2019) 14 SCC 289, which recognised that similarly purposed allowances need not be identical where the concerned categories have different service conditions and facilities.

The principle in Union of India v. Munshi Ram, 2022 SCC OnLine SC 1493—that similarly situated employees cannot be discriminated against in service benefits—was held applicable only where the employees belong to the same class.

Legitimate expectation must also be consistent with the governing rules and cannot override the accepted terms of appointment.

The Court held that the Petitioners’ entitlement arose from the specific deputation terms and the 1977 Ministry of External Affairs circular, which prescribed BCA, while Embassy personnel were governed by a separate service framework and received Foreign Allowance.

The two categories differed in their appointments, duties, service rules and available facilities; therefore, the fact that both allowances served broadly to compensate for conditions abroad did not establish legal parity.

The earlier similarity between the two allowances up to 1997 was regarded as incidental and did not create a vested right to identical future revisions.

The ad hoc increases granted to BCA in 2000 and 2005 further demonstrated that the Government had separately considered and revised the allowance applicable to deputationists.

Since the Petitioners and Embassy personnel were not similarly situated, the differential treatment had a reasonable basis and did not violate Article 14.

It held that they had no enforceable legal right to BCA at par with the Foreign Allowance payable to Embassy personnel because the two categories were governed by different service conditions and rules.

The reliance on Captain Gurdev Singh was misplaced since that decision had been set aside by the Supreme Court, and the principles in Munshi Ram and legitimate expectation were inapplicable.

The writ petition was accordingly dismissed, with pending applications, if any, disposed of.