Holding

Service rendered as Project Casual Labour prior to 1 January 1981 cannot be counted as qualifying service for pensionary benefits because temporary status was only conferred from that date, and the exclusion does not contravene Articles 14 and 16.

Summary

The case concerned Project Casual Labour employees of the Southern Railway who were later absorbed into regular posts and sought to have their service rendered before 1 January 1981 counted as qualifying service for pension and other retiral benefits. The Railway Board’s 1980 order allowed half of the service after attaining temporary status to be counted, but it applied only to Open Casual Labour. A scheme approved in the Inder Pal Yadav case extended temporary status to Project Casual Labour effective from 1 January 1981, with service counted only after that date. The respondents argued that excluding their earlier service violated Articles 14 and 16 of the Constitution. The Supreme Court held that the scheme conferred a new benefit from 1 January 1981 and could not be applied retrospectively; therefore, service prior to that date could not be counted, and the exclusion did not breach the equality clause. Consequently, the Court set aside Tribunal judgments that had counted the earlier service and affirmed those that denied it.

Issues considered

The applicability of the 1980 Railway Board order and the Inder Pal Yadav scheme to service rendered by Project Casual Labour before 1 January 1981 for pension qualification
Whether exclusion of such service violates Articles 14 and 16 of the Constitution
The interpretation of the Indian Railway Establishment Manual provisions on temporary status and qualifying service
The relevance of the principle laid down in D.S. Nakra v. Union of India to the present dispute

Legislation cited

Constitution of Indias. Article 14, s. Article 16

Subjects

pensionretirement benefitsproject casual labourtemporary statusequalityArticle 14Indian Railway Establishment Manualservice creditdiscriminationSupreme Court

Judgment

A UNION OF INDIA AND OTHERS
v.
K.G. RADHAKRISHNA PANICKER AND OTHERS

APRIL 28, 1998

B [S.C. AGRA WAL, S. SAG IR AHMED AND M. SRINIVASAN JJ.]

Service Law-Railway Establishment Manual, Para 250/(a)-Pension
and retrial benefits-Employees engaged as Project Casual Labour-
Absorbed on regular/temporary/permanent post-Benefit of temporary status
C coriferred on Project Casual Labour under the Scheme approved in Inder Pal
Yadav's case for the first time-Vide Order dated 14.10.1980, half of services
rendered after attaining temporaJy status to b'e counted w.e.f 01.01.1981 on
the basis of scheme for pensionary benefits-Held, counted for purpose of
retiral benefits-Constitution of India, 1950-Articles 14 and 16.
D . The Railway Board by order dated October 14, 1980 made provision for
Casual Labour that the period of service after attainment of temporary status
on completion of 120 days of continuous service should be counted as
qualifying service for pensionary benefits. The Project Casual Labour
approached this court by way of a Writ Petition, on being left out from the
E ambit of the said order. Thereafter during the pendency of this case, the
Railway Ministry framed a scheme making provision for the grant of
temporary status to the Project Casual Labour on completion of 360 days of
continuous service. Subsequently this court approved the said scheme in
!nder Pal Yadav's Case but modified the date 01.01.1984 in para 5.l(a)(I) to
01.01.1981 giving direction that it must be implemented by re-casting the
F stages consistent with the change in the date as directed.

The respondents joined the Southern Railway, Madras as Project Casual
Labour 011 different dates during year 1954 to 1973 and were regularly
absorbed in class IV service from 1962 to 1982 having put in 5-14 years of
G service as Casual Labour. Thereafter, the respondents pleaded before the
Railway Authority that they were entitled to be treated as 'Temporary
Railway employees' after continuous service of six months as and the entire
period of their service as Casual Labour should be counted for the purpose
of retiral benefi.ts. However, the Railway administration rejected the claim
of respondents and held that the service as Causal Labour prior to
H Ol.IOI.1981 could not be counted for pensionary benefits. Aggrieved by the
38
U.0.1. v. K.G. RADHAKRISHNA PANICKER 39
decision of Railways Authority, respondents approached the tribunal. The A
tribunal allowed the application relying on D.S. Nakara 's Case. However,
contrary view was taken by the tribunal on other applications.

In appeal before this court, the appellants contended that the previous
service rendered as Casual Labour prior to 01.01.1981 would not.be taken
into consideration for the purpose of calculating qualifying service. B
The respondents contended that having continuously worked as casual
labour without any break followed by regularisation their entire service as
casual labour should be counted for the purpose of retiral benefits and that
in any event at least half of their service as casual labour after the initial C
period of six months should be taken into account as qualifying service for
retiral benefits.

Dismissing the appeal, this Court

HELD : The Judgment of the Tribunal is set aside, as well as the
judgment in which the said judgment has been followed holding that the D
service rendered as Project Casual Labour by employees who were absorbed
on regular permanent/temporary posts prior to 1.1.1918 should not be counted
for the purpose of retirai benefits. The judgment in which the Tribunal has
taken contrary view is affirmed. [49-FJ
E
lnder Pal Yadav & Ors. Etc. v. Union of India & Ors. Etc., (1985) 3
SCR 837; explained.

D.S. Nakra v. Union of India, (1983) 2 SCR 165, distinguished.

Ram Kumar & Ors. v. U.O.l. & Ors., [1988) 2SCR138; Krishna Kumar F
:..., v. U.O.l. (1990) 4 SCC 207; State of West Bengalv. Ratan Behari Dev, [1993)
4 SCC 62 and State of Rajasthan v. Sevanivatra Karamchari Hitkari Samit1;
' [1995) 2 sec 117, cited.

CIVIL APPELLATE JURISDICTION : Civil Appeal Nos. 4643 of
1992 Etc. G

From the Judgment of Order dated 8.2.91 of the Central Administrative
Tribunal, at Madras in O.A. No. 485 of 1989.

P.P. Malhotra, N.N. Goswami and S. Sivasubramaniam, Hemant Sham1a,
Barish Chandra, S. Wasim A. Qadri, Rajiv Nanda, Y.P. Mahajan, A.D.N. Rao, H
40 SUPREME COURT REPORTS (1998) 3 S.C.R.

A Ms. Indira Sawhney, Arvind Kumar Shanna, Ms. Sushma Suri, Ashok Srivastav,
P.V.M. Reddy, R. Ayyam Perumal, Ms. Chandan Ramamurthi, Ajit Pudussery,
K.R. Rajasekaran and Ms. K. Sarda Devi for the appearing parties.

The Judgment of the Court was delivered by

B S. C. AGRAWAL, J. Special leave granted in the Special Leave Petitions.

These appeals raise the question whether employees who were initially
engaged as project Casual Labour by the Railway Administration and were
subsequently absorbed on a regular temporary/pennanent post are entitled to
have the services rendered as Project Casual Labour prior to 1.1.1981 counted
C as part of qualifying service for the purpose of pension and other retiral
benefits.

In sub-para (a) of Para 2501 of the Indian Railway Establishment Manual
(hereinafter referred to as 'the Manual'], as it stood at the relevant time, the
expression 'Casual Labour' was defined in these tenns :-
D
"Casual labour refers to labour whose employment is seasonal,
intennittent, sporadic or extends over short periods. Labour of this
kind is normally recruited from the nearest available source. It is not
liable to transfer, and the conditions applicable to pennanent and
temporary staff do not apply to such labour."
E
In sub-para (b) of Para 2501 of the Manual casual labour wad divided
into three categories, namely, (i) staff paid from contingencies except those
retained for more than six months continuously, known as Open Casual
Labour; (ii) labour on projects, im;spective of duration, known as Project
Casual Labour; and (iii) seasonal labour who are sanctioned for specific works
F of less than six months duration. Persons falling in category (i) who continued
to do the same work or other work of the same type for more than six months
without a break were to be treated as temporary after the expiry of the period
of six months of continuous employment. The said period of six months was
subsequently reduced to 120 days. Since the period of service of such casual
G about, after their attaining temporary status on completion of 120 days of
continuous service, was not counted a qualifying service for pensionary
benefits and there was a demand for counting of that period of service for
that purpose, the Railway Board, by order dated October 14, 1980, took the
following decision :-

H "As a result of representations from the recognised labour unions and
U.0.1. v. K.G. RADHAKRISHNAPANICKER[S.C. AGRAWAL,J.) 41
certain other quarters, the Ministry of Railways had been considering A
the demand that the period of service in the case of casual labour (i.e.
other than casual labour employed on projects) after their attainment
of temporary status on completion of 120 days continuous service,
should be counted as qualifying service for pensionary benefits if the
same is followed by their absorption in service as regular railway
employees. The matter has been considered in detail in consultation B
with the Ministry of Home. Affairs (Deptt. of personnel and
Administrative Reforms) and the.Ministry ofFinance. Keeping in view
the fact that the aforesaid category of employees on their attainment
of temporary status in practice enjoy more privileges as admissible to
temporary employees such as they are paid in regular scales of pay C
and also earn increments, contribute to P.F. etc. the Ministry of Railway
have decided, with the approval of the president, that the benefit of
such service rendered by them as temporary employees before they
are regularly appointed should be conceded to them as provided in
the Ministry of Finance O.M. No. Fl2 (!) - EV/768 dated 14th May,
1968. (copy enclosed for ready reference). D
The concession of counting half of the above service as qualifying
for pensionary benefits, as per the O.M. of 14th May, 1968 would be
made applicable to casual labour on the railways who have attained
temporary status. The weightage for the past service would be limited E
from 1.1.1961 in terms of conditions of the 0.M. ibid, past cases of
retirements before the date of this letter will not be re-opened.

2. Daily rated casual labour or labour employed on projects will not
however, be brought under the purview of the aforesaid orders."

Project Casual Labour were left out from the ambit of this order because F
there was no provision for grant of temporary status to project Casual Labour.
Project Casual Labour had a grievance that, though very large in number, they
had no security of service and no protection whatsoever. The said grievance
of the project Casual Labour was raised before this Court in Writ Petitions
No.s 147, 320-69, 459,4335of1985 etc. filed under Article 32 of the Constitution. G
During the pendency of the said writ petitions before this Court, the Railway
Ministry framed a scheme making provision for grant of temporary status to
project Casual Labour on completion of 360 days of continuous service. The
said scheme provided as follows:-

"5.1 As a result of such deliberations, the Ministry of Railways have H
42 SUPREME COURT REPORTS [1998] 3 S.C.R.

A now decided in principle that casual labour employed on projects (also know
as 'project casual labour') may be treated as temporary on completion of 360
days of continuous employment. The Ministry have decided further as under:

(a) These orders will cover : )

B (i) Casual labour on projects who are in service as on 1.1.84; and

(ii) Casual labour on projects who, though not in service on 1.1.84, had
been in service on Railways earlier and had already completed the above
prescribed period (360 days) of continuous employment or will complete the
said prescribed period of continuous employment on re-engagement in future.
C (A detailed letter regarding this group follows).

(b) The decision should be implemented in phases according to the
schedule given below :-

D Length of service Date from which Date by which
(i.e. continuous may be treeted as decision should be
employment). temporary implemented

(i) Those who have 1.1.1984 31.12.1984
completed five years of
E service as on I. I. 84

(ii) Those who have 1.1.1985 31.12.1985
completed three years
but less than years of
service as on 1.1.1984
F (iii) Those who have
1.1.1986 31.12.1986
completed 360 days but
less than three years of
service as on 1.1.1984
G (iv) Those who 1.1.1987 or the date on 31.12.1987
completed 360 days after which 360 days are
1.1.1984 completed whichever
is later.

By the judgment dated April 18, 1995 in lnder Pal Yadav & Ors. Etc.
H v. Union ofIndia & Ors. Etc., [1985]3 SCR 837, this Court approved the said
U.0.1. v. K.G. RADHAKRISHNA PA NICKER [S.C. AGRAWAL, J.] 43

scheme but modified the date 1.1.1984 in para 5.1 (a) (i) to 1.1.1981 and.as a A
result there was consequent re-scheduling in absorption from that date
onwards. The Court, while accepting the scheme with the modification gave
direction that it must be implemented by re-casting the stages consistent with
the change in the date is directed. As per the aforesaid scheme temporary
status was conferred on Project Casual labour with effect from the dates B
specified therein and on the basis of such temporary status they were also
extended the benefit of the order dated October 14, 1980 and the temporary
service after attaining the temporary status was counted for pension and
•
other retiral benefits.

In Civil Appeal No. 4643 of 1992, which has arisen out of 0.A. No. 485 C
of 1989 filed before the Madras Bench the Central Administrative Tribunal
(hereinafter referred to as 'the Tribunal'), the respondents joins as Project
Casual Labour in the Southern Railway, Madras on different dates during the
period 1954 to 1973. They were all employed in construction works and were
Project Casual Labour. They were regularly absorbed in Class IV service on
various dates from 1962 to 1982. They had put in 5 to 14 years of service as D
casual labour before they were so absorbed. Most of them were absorbed in
1981. Their plea was that after six months of continuous service as casual
labour they were all entitled to be treated as 'temporary railway employees'
and the entire prior of their service a casual labour should be counted for the
purpose of retiral benefits. The said claim of the respondents was not accepted E
by the Railway Administration which held that service as casual labour prior
to 1.1.1981 could n~t be counted for pensionary benefits. Feeling aggrieved
by the said decision of the Railway Administration, they filed O.A. No. 485
of 1989 which was allowed by the Tribunal by judgment dated February 8,
1991. Before the Tribunal it was contended that the respondents having
4 continuously worked as casual labour without any break followed by F
regularisation their entire service as casual labour should be counted for the
purpose of retiral benefits and that in any event at least half of their service
as casual labour after the initial period of six months should be taken into
account as qualifying service for retiral benefits. It was also urged that while
granting retiral benefits not only the Open Line Casual Labour but also G
Project Casual Labour who had joined later than the respondents and had
acquired temporary status after 1.1.1981 have been given pensionary benefit
_ but the denial of similar benefit to the respondents amounted to illegal
discrimination and was violative of the provisions of Article 14. of the
Constitution. By its judgment dated February 8, 1991 the Tribunal has accepted
the said contention of the respondents and has held that unfair treatment H
44 SUPREME COURT REPORTS [1998] 3 S.C.R.

A would be meted out to the respondents if the entire period of their continuous
service as casual labour is ignored for the purpose of retiral benefits whereas
such service is taken into account in respect of the later entrants. Reliance
was placed on the decision of this Court in D. S. Nakara v. Union of India,
[1983] 2 SCR 165. It was observed that even on the basis of the instructions
B issued in 1984 and 1986 persons who had acquired temporary status in the
past in 1981 could be given such a status retrospectively and there was no
reason ~hy same conceptual benefits could not be given to the respondents
also provided they satisfied the same condition of continuous service. The
said judgment of the Tribunal has been followed by other Benches of the
Tribunal in subsequent Judgments. Civil Appeals Nos. 4643/92, 3973/94, 5531/
C 94, 9241/94, 4569-74/97 and Civil Appeals arising out of Special Leave Petitions
(C) No.s 2595/94, 13416/94, 14335/94, 8053/95, 17197/95, 1719/95, 27483/95,
12061/97 and 379/97 have been filed by the Railway Administration against
the said judgments of the Tribunal.

In its judgment dated November 30, 1994 in 0.A. No. 456 of 1993 the
D Madras Bench of the Tribunal has taken a view different from that taken in
the judgment dated February 8, 1991in0.A. No. 485of1989. In that case the
petitioners were employed as Casual Labourers in construction work in
Southern Railway on different dates during the period from 1955 to 1974 and
were absorbed on regular posts on different dates between 1962 and 1983 and
E their service as casual labour was not taken into account for the purpose of
retiral benefits. The Tribunal, while dismissing the said application, held that
in view of the scheme which was approved by this Court in lnder Pal Yadav
temporary status could be granted to Project Casual Labour only from 1.1.1981
or from the date on which 360 days of service as Project Casual Labour was
completed after 1.1.1981 whichever was later and Project Casual labour who
F had already been regularised prior to 1.1.1981 cou Id not be granted any jf,

deemed date for grant of temporary status. The earlier judgment of the Tribunal
dated February 8, 1991 in O.A. No. 485 of 1989 was held as having been given
per incurium. The same view was taken by the Madras Bench of the Tribunal
in judgment dated August 22, 1996 in O.A. No. 885 of 1996. Civil Appeals
G arising out of Special Leave Petitions (c) Nos. 26790/95 and 3423/97 have been
filed by the petitioners in 0.A. Nos. 456/93 and 885/93 against the said
judgments of the Tribunal dated November 30, 1994 and August 22, 1996.

At the out set, it may stated that in the railways a distinction has been
made between 'temporary status' and 'temporary employment'. Open Line
Casual Labours who were treated temporary after the expiry of six months of
H continuous employment under para 250 I (b) (i) of the Manual were only
U.0.1. v. K.G. RADHAKRISHNA PANICKER[S.C.AGRAWAL,J.] 45
entitled to the rights and privileges admissible to temporary railway servants A
as laid down in Chapter XXIII of the Manual. But such temporary status did
not entitle the casual labour to the benefit of the period of service rendered
after attaining temporary status being treated as qualifying service for the
purpose of retiral benefits. For the purpose of computing the qualifying
service for retiral benefits the service aft<:r absorption on a regular temporary/ 'B
permanent post after requisite selection only could be taken into consideration.
Provision in this regard was contained in para 2511 of the Manual which
provided as follows:-

"2511. Rights and Privileges admissible to Casual Labour who are
treated as temporary after completion of six months' continuous
service :- c
(a) Casual labour treated as temporary are entitled to all the rights.
and privileges admissible to temporary railways servants as laid
down in Chapter XXIII of the Indian Railways Establishment
manual. The rights and privileges admissible to such labour also
include the benefits of the Discipline and Appeal Rules. Their D
service, prior to the date of completion of six months' continuous
service will not, however, count for any purposes like reckoning
of retirement benefits, seniority etc. such casual labourers will,
also, be allowed to carry forward the leave at their credit to the
new post on absorption in regular service. E
(b) Such casual labour who acquire temporary status, will not,
however, be brought on to the permanent establishment unless
they are selected through regular Selection Boards for Class IV
staff. They will have a prior claim over others to perm.anent
recruitment and they will be considered for regular employment F
without having to go through employment exchanges. Such of
them who join as Casual Labourers before attaining the age of
25 years may be allowed relaxation of the maximum age limit
prescribed for Class IV posts to the extent of their total service
which may be either continuous or in broken· periods.
G
(c) It is not necessary to create temporary posts to accommodate
casual labourers who acquire temporary status for the conferment
of attendant benefits like regular scales of pay, increments etc.
Service prior to absorption agains( a regular temporary/
permanent post after requisite selection will, however, not
constitute as qualifYing service for pensionary benefits. H
46 SUPREME COURT REPORTS [1998] 3 S.C.R.

A NOTE: - In case where casual labour had actually been brought over
to the regular prescribed/authorised scales of pay prior to 22nd August,
1962 on fulfilling the requisite conditions, the periods during which
they drew pay in the regular scales be taken into account for the
purpose of granting increments, even if they cannot be shown against
regular posts prior to 22nd August, 1962.: [emphasis supplied].
B
The period of service rendered after attainment of temporary status but
before absorption on regular temporary/permanent post was taken into account
for the purpose of pensionary benefits for the first time by order dated
October 14, 1980 whereby half of the period of service after attaining of -·
temporary status was to be counted for the purpose of qualifying service for
C pensionary benefits. Under Para 250 I (b )(i) of the Manual the benefit of
temporary status was available to Open the Casual Labour only and it was
not available to Project Casual Labour till the decision of this Court in Inder
Pal Yadav whereby the scheme for grant of temporary status to Project
Casual Labour was approved. Under the scheme temporary status was given
D from 1.1.1981 to those who had completed five years service as Project Casual
Labour as on 1.1.1981, those who had completed three years service as
Project Casual Labour as on 1.1.1981 were given the temporary status from
1.1.1982, those who had completed 360 days but less than three years of
service as Project Casual Labour as on l.1.1981 were given temporary status
from 1.1.1983 and those who completed 360 days as Project Casual Labour
E after 1.1.1981 were given the temporary status from 1.1.1984 or on the date
on which 360 days are completed whichever is later. Project Casual Labour
could claim the benefit of the order dated October 14, 1980 only after they
could be treated as temporary as per the scheme accepted by this Court in
case of Jnder Pal Yadav. The respondents in the appeals filed by the Railway
p Administration and the appellants in the other two appeals were employed as
Project Casual Labour. They never obtained temporary status prior to their
absorption on regular temporary/permanent post on the basis of the scheme
that was approved in Jnder Pal Yadav and, therefore, no part of their service
as project Casual Labour has been counted as qualifying service for the
purpose of pensionary benefits. Their service as Project Casual Labour Prior
G to J .1.1981 could not be treated as qualifying service for the purpose of retiral
benefits because under the scheme they could not be treated to have attained
temporary status prior to 1.1.1981.

Jf Ram Kumar & Ors. v. Union of India & Ors., [1988] 2 SCR 138, the
petitioners were engaged on terms of casual labour for periods varying between
H I 0 to 16 years in the Construction Department of the Signal Unit in the
U.0.1. v. K.G. RADHAKRISHNAPANICKER [S.C. AGRA WAL,J.] 47
Northern Railway. They had not been treated as temporary servants and they A
approached this Court by filing writ petitions under Article 32 of the
Constitution wherein their grievance was that the Railway Administration had
applied discriminatory rates of wages and they prayed for a direction to treat
them at par with maintenance workers and also brought absorption in the
regular cadre in the permanent category. This Court, while rejecting the B
submission urge on behalf of the petitioners that they should be treated at
par with Open Line Casual Labours, observed:-"

Admittedly the petitioners have put in more than 360 days of service.
Though counsel for the petitioners had pointed out that the Administration
was requiring continuous service for purpose of eligibility, learned Additional C
Solicitor General on instructions obtained from the Railway Officers present
in Court during arguments were clarified that continuity is not insisted upon
and though there is break in such continuity the previous service is also
taken into account. Learned Additional Solicitor General has made n categorical
statement before us that once temporary status is acquired, casual employees
of both categories stand at par. Keeping the prevailing practice in the Railway D
in view, it is difficult for us to obliterate the distinction between the two
categories of employees .till temporary status is acquired." [p. 141] It was
further stated:-

" It is stand of the learned Additional Solicitor General that no
pensionary benefits are admissible even to temporary railway servants E
and, therefore, that retiral advantage is not available to casual labour
acquiring temporary status. We have been shown the different
provisions in the Railway Establishment Manual as also the different
orders and directions issued by the Administration. We agree with
the learned Additional solicitor General that retiral benefit of pension
is not admissible to either category of employees." [ p. 144] F
Ms. Chandan Ramamurthi, the learned counsel for the appellants in Civil
Appeal arising out of special Leave Petition (c) No. 26790 of 1995, has
submitted that before the decision for this Court in Inder Pal Yadav project
C3.sual Labour were treated as temporary after completion of 120 days but
after the approval of the scheme in Inder Pal Yadav they became entitled to G
be treated as temporary on the completion of 360 days continuous employment
and she has invited our attention to the following passage in Ram Kumar:-

"Learned Additional Solicitor General states that petitioners are project
employees and do not belong to the open line. According to him
employees in the open line acquire temporary status on completion of H
48 SUPREME COURT REPORTS [1998] 3 S.C.R

A 120 days of service as against 180 days which was the previous
requirement. That status is acquired on completion of 360 days by
casual labour in project works as provided in the scheme formulated
under orders of this Court, though such status were acquirable by
project casual labourers on completion of 180 days of continuous
employment previously." [ p. 141]
B
In our opinion , this submission of the learned counsel is not based on
a correct reading of the judgment if Ram Kumar. In the aforequoted passage
the Court has taken note of the distinction between Open Line Casual Labour
and Project Casual Labour in the matter of grant of temporary status and has
C . pointed out that Open Line Casual Labours acquire temporary status on
completion of 120 days continuous service and earlier the said requirement
was 180 days, but such status is acquired on completion of 360 days by
casual labour in project works. The submission that prior to the acceptance
of the Scheme by this Court in !nder Pal Yadav project Casual Labour were
entitled to grant of temporary status on completion of 180 days of continuous
D service is neither borne out by para 250 I of the Manual nor by the decision
of this Court in !nder Pal Yadav. The acceptance of the contention of Ms.
Ramamurthi that earlier Project Casual Labour could be treated as temporary
after completion of 180 days of continuous service would mean that as a
result of the scheme that was accepted by this Court in Jnder Pal Yadav the
E position of prnject Casual Labour became worse than what it was prior to the
acceptance of the scheme because un,der the scheme they could be treated
as temporary only on completion of 360 days of continuous service. The
decision in !nder Pa1 Yadav does not support such a view. It must, therefore,
be held that prior to the Scheme which was accepted by this Court in the case
of Jnder Pal Yadav project Casual Labour could not claim temporary status
F and such temporary status could only be acquired by them on the basis of
the Scheme as accepted in lnder Pal Yadav.

In its judgment dated February 8, 1991 the Tribunal has held that
exclusion of period of service rendered as Project Casual Labour before they
G were regularly absorbed prior to 1.1.1981 results in such employees being
discriminated as compared to Project Casual Labour who were employed
subsequently and whose service as Project Casual Labour prior to absorption
is counted for the purposes of qualifying service. The said finding of the
Tribunal is based on the decision of this Court in D.S. Nakara. in this regard,
it may be stated that the Tribunal was in error in invoking the principle laid
H down in D.S. Nakara in the present case. The decision in D.S. Nakara has
\ ....
U.O.L v. K.G. RADHAKRISHNAPANICKER[S.C.AGRAWAL,J.] 49
been consi\lered by this Court in subsequent decisions and it has been laid A
,._ down that the principle laid down in D.S. Nakara can have application only
in those cases where there is discrimination in the matter of existing benefit
between similar set of employees and the said principle has no application
- where a new benefit is being conferred with effect from a particular date. In
such a case the conferment of the benefit with effect from a particular date
cannot be held to be violative of Article 14 of the Constitution on the basis B
that such a benefit has been conferred of certain categories of employees on
the basis of particuiar date. See: Krishena Kumar v. Union of India & Ors.,
• 1990 (4) SCC 207; State of West Bengal v. Ratan Behan· Dev, [1993] 4 SCC
62 and State of Rajasthan v. Sevanivatra Karamchari Hitkari Samiti, [1995]
2 SCC 117. In the present case, the benefit of counting of service prior to C
regular employment as qualifying service was not available to casual labour.
The said benefit was granted to Open Line Casual Labour for the first time
under order dated October 14, 1980 since, Open Line Casual Labour could be
treated as temporary on completion of six months period of continuous
service which period was subsequently reduced to 120 days under Para 250 I
(b) (i) ofthe Manual. As regards Project Casual Labour this benefit of being D
treated as temporary became available only with effect from 1.1.1981 under the
-": scheme which was accepted by this court in Jnder Pal Yadav. Before the
acceptance of that scheme the benefit of temporary status was not available
to project Casual Labour. It was thus a new benefit which was conferred on
project Casual Labour under the scheme as approved by this Court in /nder
Pal Yadav and on the basis of this new benefit project Casual Labour became E
entitled to count half of the service rendered as Project Casual Labour on the
basis of the order dated October 14, 1980 after being treated as temporary on
the basis of the scheme as accepted in Inder Pal Yadav. We are, therefore,
unable to uphold the judgment of the Tribunal dated February 8, 1991 when
it holds that service rendered as Project Casual Labour by employees who F
.... were absorbed on regular permanent/temporary posts prior to 1.1. 1981 could
not be counted for the purpose of retiral benefits and the said judgment as
well as the judgment in which the said judgment has been followed have to
be set aside. The judgements in which the Tribunal has taken a contrary view
have to be affirmed.

In the result, the appeals filed by the Railway Administration are allowed
G
and the judgments of the Tribunal impugned in these appeals are set aside.
The Appeals arising out of Special Leave Petitions (c) Nos. 26790of1995 and
3423 of 1997 filed by the employees are dismissed. No order as to costs.

N.J.