RACP/MACP benefits for SPA/RIT employees require no separate Government approval when prescribed procedures are followed.

The Review Petitioner, Special Planning Authority, Bhadrak, sought review of the order dated 12 May 2025 passed in W.P.(C) No. 13324 of 2025, whereby directions had been issued concerning grant of RACP/MACP benefits to the writ petitioners.

The Authority contended that it faced difficulty in sanctioning and disbursing those benefits because Rule 12 of the Odisha Town Planning and Improvement Trust Rules, 1975 (“OTP & IT Rules”) appeared to require prior Government approval in financial matters.

It relied upon a Housing & Urban Development Department letter dated 7 March 2020, asserting that the service conditions of employees of Special Planning Authorities (“SPAs”) and Regional Improvement Trusts (“RITs”) were governed by Rule 12.

The opposite parties relied upon the H&UD Department’s earlier letter dated 27 December 2018, which clarified that prior Government approval was not required for sanction of RACP/MACP and pensionary benefits by SPAs/RITs, provided the applicable Finance Department instructions were followed.

They also relied upon the Finance Department letter dated 11 February 2026, which stated that no separate or specific Administrative Department approval was necessary for financial upgradation under RACP where the sanctioning authority acted in accordance with the relevant Finance Department resolutions and procedural requirements.

Whether the Special Planning Authority was required to obtain specific sanction or approval from the State Government before sanctioning and disbursing RACP/MACP benefits to its employees?

Whether the Finance Department letter dated 11 February 2026 applied to employees of Special Planning Authorities and Regional Improvement Trusts and warranted review of the order dated 12 May 2025?

The Court applied Rule 12 of the OTP & IT Rules, 1975, concerning Government sanction in financial matters relating to employees of SPAs/RITs.

It considered the H&UD Department letter dated 27 December 2018, which clarified that prior approval was not necessary for RACP/MACP and pensionary benefits where the applicable Finance Department instructions were followed.

The Court also applied the Finance Department letter dated 11 February 2026, read with the Finance Department resolutions dated 6 February 2013 and 13 February 2025, under which no separate or specific Administrative Department approval is required for RACP sanction when the competent appointing authority complies with the prescribed substantive and procedural requirements.

The Court held that this clarification applied to SPA/RIT employees who were entitled to service benefits at par with Government employees.

The Court reconciled the apparently conflicting departmental communications by treating the Finance Department’s letter dated 11 February 2026 as the governing and controlling clarification on sanction of RACP/MACP benefits.

Although the Review Petitioner relied on the letter dated 7 March 2020 to argue that Rule 12 required prior Government approval, the Court found that the subsequent Finance Department instruction expressly dispensed with separate Administrative Department approval where the prescribed Finance Department resolutions and procedural formalities were followed.

Since SPA/RIT employees were to receive benefits at par with Government employees, the Court held that the 11 February 2026 clarification extended to them.

Consequently, the alleged administrative difficulty did not disclose any ground for review of the earlier order; instead, the Authority was required to implement that order in accordance with the later clarification.

The review petition was therefore dismissed as devoid of merit, and the order dated 12 May 2025 in W.P.(C) No. 13324 of 2025 was left undisturbed.

The opposite parties were directed to implement that order by applying the 11 February 2026 clarification within eight weeks from communication of the judgment; the SPA was specifically directed to proceed with sanction of the benefits without seeking further Government approval.

The personal appearance of the Special Planning Authority was dispensed with.