Court Emphasizes Government Directives Over Corporation Service Rules in Pay Scale Matters
In a significant ruling, the Madras High Court has set aside a writ order that previously granted pay equivalence to employees of Arasu Rubber Corporation Limited with their counterparts in the Tamil Nadu government. The court emphasized that government directives take precedence over the corporation's service rules, particularly regarding pay revisions.
The case stemmed from a writ petition filed by V. Shunmugam, an employee of Arasu Rubber Corporation, seeking pay parity with linemen in the Tamil Nadu government. The writ court had initially ruled in favor of Shunmugam, granting the pay scale applicable to government employees. However, the State of Tamil Nadu, represented by the Environment and Forests Department, along with Arasu Rubber Corporation, challenged this decision, citing the necessity of government approval for such pay revisions.
The bench, comprising Justices S.M. Subramaniam and C. Kumarappan, highlighted Rule 7 of the Arasu Rubber Corporation Service Rules, which mandates that any directives from the government of Tamil Nadu shall prevail over the corporation's internal rules. The court noted that the writ court's order was erroneous as it did not take into account the government's explicit directives requiring prior approval for pay revisions.
The judgment also addressed the broader issue of 'Equal Pay for Equal Work,' clarifying that this principle does not apply between employees of public sector undertakings and government departments due to distinct service rules.
The court's decision underscores the importance of adhering to government directives in matters involving public sector undertakings, particularly in financial and policy decisions.
Bottom Line:
The directives issued by the Government of Tamil Nadu to Arasu Rubber Corporation Limited, a Public Sector Undertaking, will prevail over its Service Rules, as per Rule 7 of Arasu Rubber Corporation Service Rules. Prior approval from the Government is mandatory for revising or extending the scale of pay on par with State Government employees.
Statutory provision(s): Rule 7 of Arasu Rubber Corporation Limited Service Rules, Rule 34 of Arasu Rubber Corporation Limited Service Rules.
State of Tamil Nadu v. V.Shunmugam, (Madras)(DB) : Law Finder Doc id # 2863594
