Restructuring of Salary Accepted Without Written Deferment Clauses Bars Subsequent Claims for Arrears under Evidence Act.

The Appellant/Plaintiff was employed by the Respondent Company from 1993 to 2003, reaching the position of Engineering Manager

Due to financial difficulties in FY 2002-03, the Company implemented a salary reduction on a graded scale; the Appellant’s salary was reduced by 30% (Rs. 24,000 per month) for one year

The Appellant alleged this was a "deferment" to be repaid by April 2003, along with a one-month bonus

The Respondent contended the reduction was a "restructuring" accepted by the Appellant without a promise of repayment

The Appellant resigned in December 2003 and received a full and final settlement

He filed a suit for recovery of Rs. 4,99,649 in March 2006

The trial court dismissed the suit on April 20, 2024, leading to this appeal

1. Whether the Appellant established a contractual provincial arrangement making the reduced component of his salary and a bonus legally recoverable as "deferred salary."

2. Whether the salary reduction constituted a temporary restructuring accepted by the employee rather than a legally binding deferment.

Sections 91 and 92 of the Indian Evidence Act, 1872, which exclude oral evidence when the terms of a contract have been reduced to the form of a document

The principle of Contractual Interpretation, emphasizing that internal management discussions (admissible under Section 88-A of the Evidence Act for authenticity) do not supersede formal written contracts unless they create a specific binding obligation

The precedent in M/s Aithent Technologies Pvt. Ltd. v. Archana Verma (RFA 608/2014), which rejected similar claims arising from the same restructuring exercise

The Court found that the Appellant failed to produce any written document or Board Resolution proving that the salary reduction was a deferment

Conversely, the Respondent produced a signed document (Ex. PW-1/D1) titled "re-structure" of remuneration as an "interim measure," which contained no promise of repayment

Under Sections 91 and 92 of the Evidence Act, the Appellant was barred from leading oral evidence to contradict the written terms of this restructuring letter

Furthermore, the Appellant’s separation documents in 2003, signed without protest, were silent on any outstanding arrears

Even e-mails from the CEO using the word "deferred" were deemed unilateral and insufficient to create a binding legal obligation

The Court concluded that internal discussions about bonuses or reviews for lower-salary slabs did not extend a legally enforceable right to the Appellant

The High Court upheld the Trial Court’s findings, ruling that the salary reduction was a mutually accepted restructuring and not a deferment

The Appeal (RFA 647/2024) was dismissed, and the dismissal of the suit for recovery was affirmed