Employee shift from EPF to GPF scheme is permissible if sanctioned by policy and non-prohibited by law.

The respondents were appointed to the Engineering Department of the South Delhi Municipal Corporation (SDMC) between 1969 and 1985 and were originally covered by the Employees Provident Fund (EPF) Scheme.

Following Supreme Court directions in M. C. Mehta v. Union of India, their original work units (Hot Mix Plants) ceased operations, but they were redeployed to other departments.

In a meeting dated 29 September 2009, the SDMC decided to allow employees to shift from the EPF to the General Provident Fund (GPF) Scheme subject to written consent and forfeiture of EPF benefits.

Although the respondents provided consent and 30 similarly situated employees were permitted to shift, the SDMC subsequently rejected the respondents' request, claiming there was no provision for such a transfer.

The Central Administrative Tribunal (CAT) ruled in favor of the respondents, citing a violation of Article 14 of the Constitution.

The SDMC challenged this decision before the High Court.

1. Whether the refusal to allow the respondents to shift from the EPF to the GPF Scheme, despite a prior departmental decision and the shifting of similarly situated employees, amounted to a violation of Article 14 of the Constitution.

2. Whether the absence of an express statutory provision for shifting schemes precludes the grant of such relief when a conscious administrative decision had already been taken by the employer.

The court relied on Article 14 and Article 16 of the Constitution of India concerning equality and non-discrimination.

It applied the principle established in Man Singh v. State of Haryana, which mandates that the State cannot discriminate between similarly situated persons when granting a benefit that is not prohibited by law.

It acknowledged the principle of "negative equality," noting that while an illegal benefit given to one cannot be a basis for another to claim the same, this does not apply where the benefit itself is not legally proscribed.

The Court observed that the SDMC had made a "conscious decision" in its 2009 meeting to allow the shift, provided employees gave consent and returned EPF earnings.

The petitioner (SDMC) failed to demonstrate any express legal proscription or statutory bar against transferring employees from EPF to GPF.

The Court reasoned that since the action was not prohibited by law and had already been extended to 30 other similarly situated colleagues, denying the same treatment to the respondents was discriminatory.

The Court distinguished this from "negative equality" because the initial grant of the benefit to others was based on a valid administrative decision rather than an illegality.

The Court directed the SDMC to disburse the GPF amounts within six weeks, after deducting the amounts already earned/received by the respondents under the EPF Scheme.