Upgraded Pay Scales for Revenue Officers Entitled to Notional Fixation w.e.f. 01.01.1996 as Judgment in Rem

The five applicants, serving as Inspectors/Preventive Officers/Examiners and later promoted as Superintendents/Appraisers in the Central Tax and Customs Department (CBIC), sought retrospective pay scales recommended by the 5th Central Pay Commission (CPC).

While the 5th CPC came into effect on 01.01.1996, the revised scales of Rs. 6500–10500 (Inspectors) and Rs. 7500–12000 (Superintendents) were implemented only from 21.04.2004 via Office Memorandums dated 21.04.2004 and 11.05.2004.

A speaking order dated 12.08.2025 rejected the applicants' request for notional fixation from 01.01.1996.

The applicants argued that similarly situated employees in the CBDT and other CBIC branches had already received this benefit following litigation in the Chandigarh, Hyderabad, and Kolkata Benches of the Tribunal.

The respondents opposed the claim on grounds of limitation (delay and laches) and the "fence-sitter" doctrine.

1. Whether the applicants are entitled to the benefit of notional fixation of pay with effect from 01.01.1996 to bring them on par with similarly situated employees.

2. Whether the Original Application is barred by limitation and laches under Section 21 of the Administrative Tribunals Act, 1985.

3. Whether the judicial pronouncements granting revised pay scales operate in rem or in personam.

Article 14 of the Constitution regarding the right to equality and the principle of uniform treatment for similarly situated employees.

The principle established in State of Karnataka v. C. Lalitha that service jurisprudence requires equal treatment for all similarly situated persons regardless of whether they were parties to the original litigation.

The "recurring cause of action" principle for pay fixation as per K.C. Sharma v. Union of India.

The precedent set by the Hon’ble Telangana High Court in W.P. No. 10490/2024, holding that the Department of Revenue must apply Special Anomaly Committee recommendations uniformly.

The Tribunal rejected the respondents' plea of limitation, noting that pay fixation constitutes a recurring cause of action and that the applicants approached the forum following the Special Anomaly Committee’s report in September 2023.

The Court observed that once the CBDT (under the same Ministry of Finance) implemented the 01.01.1996 notional fixation based on the Kolkata High Court’s directions, there was no justification for CBIC to deny the same to its officers.

The Tribunal reasoned that the earlier successful litigations (e.g., Hyderabad OA 1089/2019) were judgments in rem because they addressed a systemic policy anomaly affecting an entire class of employees.

The Tribunal emphasized that a "model employer" should not penalize employees for not litigating earlier when the legal principle has already been settled and concluded that the cut-off date of 21.04.2004 for the revised scale was arbitrary when the 5th CPC’s implementation date was 01.01.1996.

The Court directed the respondents to refix the applicants’ pay in accordance with the CCS (Revised Pay) Rules, 1997, granting the upgraded scales notionally from 01.01.1996 and providing actual monetary arrears from 21.04.2004.

The respondents were ordered to complete the fixation and calculate consequential benefits (including pensionary benefits) within two months with no order as to costs.