Senior Employee Cannot Be Paid Less Than Junior Despite Correction of Erroneous Pay Fixation

The applicant, a retired Chief DTI/Optg. Planning Cell, challenged an order dated 24.01.2024 issued shortly before his retirement on 31.10.2023.

Upon review of his service records, the respondents determined that the applicant was erroneously granted an annual increment in 1996.

This error allegedly perpetuated throughout his career, leading to a final basic pay of Rs. 87,700/- instead of the "correct" Rs. 85,100/-.

Consequently, the respondents refixed his pay downward and sought recovery of the overpayment from his retiral benefits.

The applicant contended that the reduction was illegal, violated principles of natural justice, and resulted in a situation where he (the senior) would draw less pay than his junior, Sri Rama Ranjan Mohanty.

1. Whether the respondents were legally permitted to refix the applicant’s pay downward at the fag end of his career due to an alleged error occurring 27 years prior.

2. Whether the principle of "stepping up" of pay could be applied for the applicant to maintain parity with his junior, Sri Rama Ranjan Mohanty.

3. Whether the recovery of overpayment from the applicant’s DCRG was sustainable in law.

Note-2, Para-7 of the Railway Board's Gazette Notification dated 08.10.1997 (RBE No. 133/97), which regulates the option for increments during pay revision.

Para 7(1) of Note (6) of the Railway Service (RP) Rules, 1997, regarding the "stepping up" of pay to remove anomalies between seniors and juniors.

Supreme Court precedents in Gurcharan Singh Grewal v. Punjab State Electricity Board (2009) 3 SCC 94 and UOI v. P. Jagdish (1997) 3 SCC 176, which established the binding principle that a senior cannot be paid a lesser salary than a junior in the same cadre.

The Tribunal found that while the technical application of the Railway Service Rules might suggest the original increment in 1996 was erroneous, the resulting reduction of pay created a legal anomaly where the applicant would draw less than his junior.

Although the respondents argued that the "stepping up" rule did not strictly apply because the applicant and his junior drew the same pay before 01.01.1996, the Tribunal held that Constitutional principles and Supreme Court mandates take precedence over narrow rule interpretations.

Applying the ratio of Gurcharan Singh Grewal, the Tribunal reasoned that even if incremental benefits differ, the "senior-drawing-less-than-junior" anomaly is an illegality that must be rectified.

Furthermore, it noted that pay reduction and recovery at the "fag end" of a career, where the employee was not responsible for the miscalculation, is legally impermissible.

The respondents were directed to: (i) restore the applicant’s last pay to Rs. 87,700/-, (ii) fix his pension and related dues based on said pay, and (iii) refund the amount recovered from his DCRG within 120 days.

The prayer to quash the RTI response letter [A/10] was denied as it fell outside the Tribunal's jurisdiction.