State Cannot Selectively Enforce Arrears-Denial Clauses Against Employees Occupying Unequal Bargaining Power

The 44 applicants were Daily Rated Workers/Helpers in the Wildlife Protection Department of Jammu Kashmir whose cases were cleared for regularization under SRO 64 of 1994 via Government Order No. 439-FST of 2002.

The order contained a restrictive stipulation denying arrears of salary from the date of clearance by the Empowered Committee, stating salary would only be paid from the date of the regularization order.

The applicants contended that the government had released such arrears for similarly situated employees in other divisions by treating such restrictive clauses as deleted ab initio.

Despite internal departmental communications seeking details to work out their arrears in 2008 and 2010, the applicants' claim was ultimately rejected on February 24, 2015, on grounds of delay and Rule 2.40 of the J Financial Code.

1. Whether the applicants are entitled to arrears of salary from the date of clearance by the Empowered Committee on the basis of parity with similarly situated employees.

2. Whether the claim for arrears for services rendered constitutes a legal right under Articles 14 and 21 of the Constitution that cannot be defeated by discriminatory application of rules.

3. Whether the restrictive stipulation in the regularization order is enforceable given the unequal bargaining power between the parties.

4. Whether the claim is barred by delay, laches, or Rule 2.40 of the JK Financial Code.

Mandate of Article 14 of the Constitution of India regarding equality before the law and the prohibition of arbitrary state action.

Article 21, establishing that salary for work performed is a legal right linked to the right to livelihood.

Doctrine from Central Inland Water Transport Corporation Ltd. v. Brojo Nath Ganguly (1986) holding that unfair or unconscionable service stipulations imposed by an employer with superior bargaining power are unenforceable.

The doctrine of "recurring and continuing cause of action" for salary-related claims to address the plea of limitation.

The respondents' denial of arrears was arbitrary because the government had already set a precedent by deleting identical restrictive clauses for other employees via multiple Government Orders between 2006 and 2013.

This selective application of policy violated Article 14 as there was no "intelligible differentia" to treat the applicants differently.

The Tribunal found that the applicants, as Daily Rated Workers, had no meaningful choice but to accept the terms, thus falling under the protection of the Brojo Nath Ganguly principle against unconscionable contracts.

The Tribunal rejected the defense of "delay and laches," noting that the department itself kept the claim alive by processing representations and seeking data as late as 2010.

Since the claim pertained to salary for services admittedly rendered, it constituted a continuing cause of action.

The invocation of Rule 2.40 of the Financial Code was deemed "misconceived" and "hostile discrimination" since it was not applied to the other sets of employees who received arrears.

The respondents were directed to reconsider the applicants' claim for arrears from the date of their clearance by the Empowered Committee in light of the principles of parity and constitutional fairness within eight weeks.