State cannot evade liability for employee salary arrears by raising factual pleas previously found to be false.

Six Class-III and Class-IV employees (Respondents 10-15) of Uttar Koyal High School, Mandal, Latehar, filed a writ petition seeking arrears of salary and pay revision benefits for the period between 01.01.1999 and 2007.

The school was under the control of the State of Bihar during this period, before the State of Jharkhand assumed responsibility in 2007.

The State of Bihar contested the claim, primarily arguing that the school was closed or non-functional during the relevant period as per a letter dated 24.03.2000.

A learned Single Judge allowed the writ petition on 02.04.2024, directing Bihar to release the payments with 6% interest.

The State of Bihar appealed this decision.

1. Whether the school in question was operational between 01.01.1999 and 2007, thereby making the State of Bihar liable for the employees' salaries.

2. Whether the appellants could raise new pleas regarding the regularisation status of the employees for the first time in the Letters Patent Appeal (LPA).

The Court applied the principle of "as is where is" regarding the division of liabilities between successor states following reorganization, establishing that the State of Bihar remained liable for salaries during the period the school was under its direct control and supervision prior to 2007.

Factual pleas not raised before the Single Judge—specifically that employees were daily wagers—cannot be entertained at the appellate stage without following the proper procedure for rectification of the record.

The Court rejected Bihar's factual contention that the school was closed, noting that the Single Judge had conducted an exhaustive inquiry. Evidence from the Bihar School Examination Board confirmed students appeared for exams from the school throughout the disputed period, proving it was functional.

The Court noted that the State of Jharkhand’s Principal Secretary (Water Resources) provided an inquiry report confirming the school's operations, which the court found credible.

Regarding the new plea that the employees were "daily wagers," the Court observed this was not raised in the original writ proceedings and appeared to be a "desperate attempt to prolong the misery" of retired, ailing employees.

The Court emphasized that in a Welfare State, the government should not use frivolous litigation to deprive low-income (Class-III and IV) employees of their earned benefits.

The Court held that the State of Bihar is solely responsible for the salary arrears and interest for the period 1999–2007.

The Appellant was directed to release all dues within four weeks or deposit the amount in Court.

The Court warned that failure to comply might result in personal liability for the responsible officials regarding interest payments in pending contempt proceedings.