Pay refixation causing civil consequences cannot be ordered without notice and an opportunity of hearing.

The petitioner was appointed on compassionate grounds as an Assistant Grade-III in the Health Department.

Although he had been receiving salary with annual increments, the respondents passed an order dated 28 July 2025 withdrawing his annual increments and restoring his basic pay to the initial stage.

The petitioner challenged the order on the ground that it was passed without notice or an opportunity of hearing and resulted in recurring deductions from his salary.

The State supported the impugned order.

Whether the withdrawal of the petitioner’s annual increments and restoration of his basic pay could be ordered without issuing notice or providing an opportunity of hearing?

Whether an order reducing an employee’s basic pay and causing recurring financial loss violates the principles of natural justice?

The Court applied the principles of natural justice, particularly the rule that an administrative or service order having civil consequences cannot be passed without giving the affected employee notice and a reasonable opportunity of hearing.

Relying on Bhagwan Shukla v. Union of India, the Court held that reduction of an employee’s basic pay without notice constitutes a flagrant violation of natural justice.

It further relied on Mukund K. Pai and Others v. Punjab National Bank and Others, which held that refixation of pay resulting in reduction of salary cannot be undertaken without observance of natural justice.

The impugned order directly reduced the petitioner’s basic pay by withdrawing annual increments and restoring his pay to the initial stage.

Such reduction caused recurring financial consequences and therefore affected the petitioner’s civil rights and interests.

Since the respondents neither issued a notice nor afforded the petitioner an opportunity to explain his position before passing the order, the procedure adopted was inconsistent with the principles laid down in Bhagwan Shukla and Mukund K. Pai.

The absence of prior hearing rendered the pay-reduction order unsustainable.

The order dated 28 July 2025 was set aside, and the writ petition was allowed to that extent.

The parties were directed to bear their own costs.