Retiring Employees Completing Six Months’ Service After Last Upgradation Are Entitled to Notional Increment.

The applicant, Shri Ram Meena, retired as an Ex-Chief OS from the Delhi Division of Northern Railway on June 30, 2023.

He sought the grant of one notional increment effective June 30, 2023, along with arrears from July 1, 2023.

The respondents denied the increment on the grounds that the applicant had received a financial upgradation in December 2022.

The applicant submitted a representation on April 1, 2026, which remained pending at the time of the filing of the Original Application (OA).

Whether an employee retiring on June 30th is entitled to a notional increment falling due on July 1st for the purpose of pensionary benefits, despite having received a financial upgradation within the previous six months.

The Director (Admn. and HR) KPTCL Ors. v. C.P. Mundinamani Ors. (2023), which affirms the right to a notional increment for employees completing a full year of service prior to retirement.

Department of Expenditure O.M. dated November 28, 2019, which stipulates that for upgraded scales, the next increment is permissible if six months of qualifying service have been completed.

Union of India Ors. v. Naresh Kumar Gupta (W.P.(C) No. 12216/2024, Delhi High Court), which held that departments cannot deny benefits already earned by service due to administrative rules regarding payment dates.

The Tribunal observed that the issue was prima facie covered by the aforementioned O.M. and judicial precedents.

The reasoning focused on the fact that since the applicant completed the requisite period of service (earned the increment) prior to retirement, the mere occurrence of a previous financial upgradation or the technicality of the retirement date falling one day before the increment's official "accrual" date should not result in denial.

The Tribunal noted that the applicant had completed more than the required six months of qualifying service between his December 2022 upgradation and his June 2023 retirement, satisfying the conditions set out in the 2019 O.M.

The respondents were directed to pass a reasoned and speaking order in light of the cited judicial pronouncements and Government O.M. within two months of receiving the order.

No orders were made as to costs.