Right to Correct Pay Fixation Following Promotion is a Continuing Cause of Action Admitting Belated Option Exercise

The applicant, initially appointed as an Auditor in 1988, was promoted to Section Officer (Accounts) via an order dated 14.09.2004.

While the order required the exercise of a pay fixation option within one month of promotion, it granted the promotion retrospectively effective from 30.07.2004.

This meant the stipulated one-month window had technically expired before the order was even issued.

The applicant submitted his option on 20.12.2004 to fix his pay from the date of his next increment (01.01.2005) rather than the date of promotion.

The respondents rejected this on 13.04.2005, citing the delay beyond one month.

Despite numerous representations and a 2017 internal communication from the PCDA (BR) admitting the promotion order "was not in order," the respondents failed to re-fix the pay.

1. Whether the applicant is entitled to re-fixation of pay based on his option dated 20.12.2004, given that the promotion order was issued after the expiry of the one-month deadline for exercising said option.

2. Whether the claim for re-fixation of pay is barred by limitation or constitutes a continuous cause of action.

Fundamental Rule (FR) 22(I)(a)(1), which allows a promoted government servant to exercise an option within one month to have their pay fixed either from the date of promotion or from the date of their next increment in the lower grade.

Regarding the limitation period for pay claims, the court relied on the precedent of M.R. Gupta v. Union of India (1995), which established that the right to receive the correct salary in accordance with rules is a recurring right, and improper pay fixation constitutes a continuous cause of action.

The court found that the respondents' insistence on the one-month deadline was arbitrary and stemmed from administrative error. Since the promotion order was published on 14.09.2004 but backdated to 30.07.2004, it was physically impossible for the applicant to exercise his option within one month of the promotion date.

The court noted that even the respondents’ higher headquarters (PCDA BR) had acknowledged in 2017 that the original order was "not in order" and required review.

Applying the M.R. Gupta principle, the court rejected any plea of delay, noting that the error resulted in a monthly financial loss to the applicant, which would further adversely impact his pensionary benefits.

The court concluded that the applicant cannot be made to suffer for the respondents' procedural laches.

The respondents were directed to: (a) re-fix the pay in the grade of Section Officer (A); (b) grant all consequential benefits, including monetary arrears; and (c) complete this exercise within three months of the order.