Revised Pay Scales Granted Notionally from 1996 and Actually from 2004 for Similarly Situated Revenue Officers

The eight applicants, retired Inspectors and Superintendents of the Customs and Central Excise Department, challenged orders that implemented the 5th Pay Commission's revised pay scales (Rs. 6500-10500 for Inspectors and Rs. 7500-12000 for Superintendents) effective from 21.04.2004 instead of 01.01.1996

While the Central Board of Direct Taxes (CBDT) had granted notional fixation from 1996 to its employees following a Special Anomaly Committee report, the Central Board of Indirect Taxes & Customs (CBIC) denied the same to the applicants via a speaking order dated 12.08.2025

The respondents argued the claim was barred by limitation under Section 21 of the Administrative Tribunals Act, 1985, and that the applicants were "fence-sitters"

1. Whether the revised pay scales should be implemented notionally from 01.01.1996 (date of 5th CPC implementation) instead of 21.04.2004 to maintain parity with similarly situated employees

2. Whether the Original Application is barred by limitation and the doctrine of "fence-sitters"

3. Whether judicial precedents granting this relief constitute judgments in rem or in personam

The Tribunal applied Article 14 of the Constitution regarding the right to equality and the principle that similarly situated employees must be treated alike

The Tribunal mitigated limitation using the principle of "recurring cause of action" in pay fixation matters as seen in Union of India v. Tarsem Singh (implied) and Lt. Col Suprita Chandel v. Union of India

State of Karnataka v. C. Lalitha, establishing that service jurisprudence requires uniform treatment of similarly placed persons

Decisions of the Hyderabad Bench (OA 1089/2019) and Telangana High Court (WP 10490/2024), which affirmed that CBDT and CBIC employees under the Department of Revenue must be treated parity

The Tribunal reasoned that since the CBDT and CBIC both function under the Department of Revenue, the recommendations of the Special Anomaly Committee (constituted via the Kolkata High Court's directions) must apply to the entire Department to avoid discrimination

The court rejected the "fence-sitter" argument, noting that pay fixation is a continuous wrong and that the Special Anomaly Committee only finalized its report in September 2023, providing a fresh context for the claim

The Tribunal observed that the respondents had already implemented similar orders for over 1,500 employees across various Benches.

It held that once the Hon’ble Supreme Court affirmed the grant of notional fixation from 1996 in similar SLPs, the judgment became in rem, and the Department cannot unilaterally treat such binding precedents as in personam to deny relief to the applicants

The applicants are entitled to the revised pay scales notionally from 01.01.1996 and on an actual monetary basis from 21.04.2004. The respondents were directed to refix the applicants' pay accordingly and grant consequential pensionary benefits within two months; no order as to costs was made.