Rajnish R. Vyas, J.

1. Heard learned counsels for the both the parties.

2. The present writ petition is preferred by the petitioners who are the employees of Manganese Ore (India) Limited (for short, “MOIL”) who claim that they are entitled for pay as made applicable to other Central Public Sector Enterprises (CPSEs), out of which, MOIL is one. The prayers are also made in this petition that the pay anomaly of the petitioners’ pay vis-a-vis Executives of other Central Public Sector Undertakings (CPSUs) under the Ministry of Steel such as SAIL, KIOCL, NMDC etc. amounts to discrimination and thus violates Article 14 of the Constitution of India. The other consequential prayers are also made including a request to set aside the Minutes of Meeting held by the Board of Directors of MOIL on 27/09/2023. Various other prayers for direction to pay arrears of salary after upgradation of pay scales from 1/1/2017 are made.

3. In short, what lies at the heart of the petition is the issue regarding grant of pay parity.

Case of petitioners:-

4. The respondent no. 3 - MOIL is a Central Public Center Undertakings, and according to the petitioners, at present, the Government of India holds 53.84% shares while the Government of Maharashtra and Government of Madhya Pradesh hold 5.11% and 5.40% shares respectively. The remaining 35.65% shares are held by the Public.

5. Initially, the 1st Pay Revision Commission was made applicable to the employees of MOIL, base of which, was a report of the Commission under Chairmanship of Justice S. Mohan for recommendation of revision of pay and allowances for board level and below board level employees working in CPSUs. On 30/8/2000, respondent no. 1 had communicated its no objection to respondent no. 3 to implement the said pay scale. Although it was approved by respondent starting with EO Grade in pay scale of 6550-200-11350 and onwards, respondent no. 3 applied the pay scale of 6550-200-11350 to employees in E1 Grade. Consequently, all the employees falling in Grade E0 to E9 were placed in lesser pay scale as compared to employees of other CPSUs falling in the same grade. The last revision of scale of pay for board level and below board level employees as well as non-unionized supervisors in CPSEs was made effective from 1/1/1997 for a period of 10 years.

6. The revision of second pay was done as per the recommendation given by the Commission established under the Chairmanship of Justice M. Jagannadha Rao, Retired Judge of the Hon’ble Apex Court and vide Office Memorandum dated 26/11/2008 submitted by the respondent no. 2, the respondent no. 3 issued Office Order dated 22/10/2009, by which, pay scale of below board level employees was revised.

7. It is the case of the petitioners that they had made several representations to the respondent authorities requesting to extend the same pay scale at par with employees of other CPSUs. The petitioners in order to justify their claim also requested the respondent authorities to look into the law laid down in a similar situation by the Karnataka High Court in Writ Petition No. 50434/2004 and by the Calcutta High Court in Writ Petition No. 12360/2008.

8. After submitting more than 5 representations, on 3/8/2017, respondent no. 2 - Ministry of Heavy Industries and Public Enterprises issued Office Memorandum informing that the last pay revision was made effective from 1/1/2007 for a period of 10 years and as the next pay revision became due, the Government of India had set up 3rd Pay Revision Commission under the Chairmanship of Justice Satish Chandra. On the basis of Office Memorandum dated 3/8/2017, Scheduled ‘A’ companies under Ministry of Steel issued Office Orders revising the pay scales and implementing directives of the Government of India.

9. It is the case of the petitioners that the MOIL Employees Association sought assistance of Shri V. Venkataram, Retired HOD (Personnel) WCL to consider the pay scales of different Public Sector Undertakings and submit a report, which was submitted accordingly. We would like to state that this report can be called as a private report. It is in this background, the petitioners submit that though MOIL is Scheduled ‘A’ company, it is treating its employees with discrimination whereas other Scheduled ‘A’ companies are giving much better pay than the MOIL.

10. The petitioners submitted that w.e.f. 28/1/2014, MOIL is upgraded to status of Schedule ‘A’ company while pay scales of Board Level Employees have been upgraded and brought at par with pay scales of Board Level Employees in other CPSUs but employees insofar as below board level are concerned, their pay scales have not been upgraded.

11. The petitioners through their counsel submitted that the financial position of the MOIL is better and it has been making a reasonable profit straight from 2015-16, 2002, 2019-20. The petitioners contend that improper fixation of pay scale reduces the status of the petitioners and further mars the possibilities of advancement such as posting in other CPSUs.

12. The petitioners further submitted that on 6/5/2014, 299th meeting of the Board of Directors of MOIL was held, in which, it was informed that upon upgradation of the MOIL as a Schedule ‘A’ company, pay scales of CMD and Functional Directors need to be upgraded. It was mentioned that in line with other Schedule ‘A’ PSUs, under the Ministry of Steel, pay scales of executives of MOIL also need to be rationalized/revised.

13. The Board of respondent no. 3 granted approval to the CMD to revise the pay scale of CMD and Functional Directors but insofar as below board level Executives are concerned, the Board granted approval to rationalization of pay scales of respondent no. 3 - MOIL’s Executives in line with pay scales of other Schedule ‘A’ CPSEs under Ministry of Steel.

14. It is the case of the petitioners that there is absolutely no reason to discriminate between CMD and Functional Directors on the one hand and the Executives on the other. According to the petitioners, as per the settled position, the additional financial impact due to implementation of pay revision should not be more than 20% of average profit before tax (PBT) of last 3 financial years. Accordingly, the petitioners on the aforesaid line submit that in case of respondent no. 3 - MOIL, 20% of the PBT comes to Rs. 92.18 Crore whereas actual implication is Rs. 20.80 Crore which is about 2.78% of the average PBT of last 3 financial years.

15. As the matter proceeded and new developments surfaced, by way of amendment, further pleadings and prayers were incorporated. As per the order dated 2/9/2024 and 4/12/2024, the prayers were amended and request was made to set aside the Minutes of 353rd Meeting of the Board of Directors of respondent no. 3 - MOIL held on 27/9/2023.

16. At this juncture, it is necessary to mention here that this Court vide its order dated 3/4/2023 recorded statement of learned counsel for the respondent(s) that within six months, every attempt would be made to redress the grievance of the petitioners as reflected in prayer clauses (iii) & (iv). The said prayer Clauses (iii) and (iv) are reproduced as under:-

                   "iii. Direct Respondent No.3 to remove the anomaly in pay scales provides to Executives of Respondent No.3 in Grade EO to E-9 and bring it at per with the pay scales offered by other Central Public Sector Undertakings under the Respondent No. 1 Ministry of Steel, w.e.f. 01/01/2017;

                   iv. Direct the Respondent No.1 Ministry to Steel to grant approval to up gradation of pay scale of the executives of the Respondent No. 3 and to bring it at par with the pay scales offered by other Central Public Sector Undertakings under the Respondent No. 1 Ministry of Steel, w.e.f. 01/01/2017".

17. It is in pursuance with this order that the meeting dated 27/9/2023, which can called as 353rd meeting, was conducted by the MOIL.

18. The learned counsel for the petitioners in order to allege discrimination puts Steel Authority of India Limited, MECON, KIOCL and respondent no. 3 - MOIL in homogeneous group and submits that the pay scale of MOIL be at par with other CPSEs.

Case of Respondents:-

19. Per contra, the learned counsel for respondent no. 3- MOIL has denied the case of the petitioners and submitted that all CPSEs cannot be looked from one angle and cannot be called as homogeneous group. He submitted that initially the challenge in the petition was pertaining to 3rd pay revision, wherein the pay scale at par with all CPSEs was claimed and thereafter, by way of amendment, it was contended that there could be no discrimination amongst Schedule ‘A’ CPSEs.

20. It is further submitted that since the year 1997 till date, three Pay Revision Orders are passed by the Government of India and perusal of orders would clarify that the pay scales of CMD and Directors of PSUs differ in Schedule ‘A’, ‘B’ ‘C’ and ‘D’ companies whereas the pay scales of E-00 to E-07 Executives below board level are common in all PSUs.

21. He contended that when a company’s schedule category changes the pay scale of CMD and Directors, is bound to change with an immediate effect. On the other hand, pay scales of below board level executives becomes due for revision after every 10 years.

22. According to the learned counsel for respondent no. 3, in the case in hand, the pay revision of executives of CPSEs was to be due for revision w.e.f. 1/1/2017 and therefore, the pay scales of Directors in MOIL was also approved in the year 2014 itself.

23. It is in the year 2014, MOIL was upgraded from Schedule ‘B’ to Schedule ‘A’ company. It is the case of respondent no. 3 - MOIL that as regards below board level executives, the management has taken all the efforts for upgradation of pay scales of executives by putting a proposal in this regard before the Board of Directors in its 299th meeting dated 6/5/2014, wherein the Board approved the proposal by passing a resolution. However, as per the communication dated 21/9/2017 of the Ministry, the issue of upgradation of pay scale was asked to be duly addressed at the time of 3rd pay revision which was due w.e.f. 1/1/2017.

24. Mr. Mardikar, learned senior counsel for respondent no. 3 in order to buttress his point submits that while implementing the 3rd pay revision, one scale upgradation was granted to all the executives. According to him, the petitioners never protested or had challenged the said proposal. He then gave illustration regarding upgradation of pay scales while implementing 3rd pay revision, which is as follows:-

                   “As per the 3rd pay revision, the corresponding pay scale of E-0 rank officer was in the pre-revised pay scale of Rs. 12600-32500 and then Rs. 30000- 120000 as per the new Pay Revision.”

25. He further submits that considering the grievance raised in respect of the petitioners, executives were given one step grade promotion. As a result, for example, the employee of E-0 scale of Rs. 12600-32500 has been fixed in the next upgraded scale of E-1 i.e. at Rs. 40000-140000 which is the corresponding pay scale of pre-revised scale of Rs. 16400-40500.

26. He submits that in such manner, all the subsequent scales are also fixed in a uniform mode and manner and therefore, the issue raised by the petitioners stands addressed. He further submitted that for extending pay scale, which other CPSEs are extending, profit cannot be a sole criteria.

27. According to him, there are approximately 50 CPSEs in India who have totally different structure and different types of liabilities and future plans. He submits that his case is not based upon any vague instance but is duly supported by data which was taken into consideration in 353rd meeting (pg.334).

28. He states that there is no question of the petitioners having legitimate expectation as all CPSEs operate in totally different areas with their own style of functioning and different policies.

29. According to the learned counsel for the respondents, the respondent no. 3 is paying benefits which are higher than what the companies with which parity is being sought are paying. The respondent no. 3 since 2017 is making payment of perks with 35% though its revenue from operation is lowest in all the Steel CPSEs.

30. He by filing the affidavit in compliance with the order dated 3/4/2023 has submitted that as regards comparison of pay scales amongst the CPSEs, it is not possible as nature of organization, manpower cost, profitability etc. varies from Company to Company like MOIL which is a Miniratna CPSEs whereas SAIL is a Maharatna and NMDC is a Navratna is Company. The manpower cost of MOIL is around 45% (being labour intensive Mining Company) of its turnover whereas in many other Steel CPSEs, this cost is less than 25%.

Discussion and Conclusion

31. In the aforesaid background, we have tested the arguments advanced by the respective counsel and also gone through the record of the case. We have also ponder upon the issue of equal pay for equal work, applicability of similar pay scale to CPSEs and the scope of this Court under Article 226 of the Constitution of India while deciding the issue.

32. We would like to state that though it is the contention of the learned counsel for the petitioners that all CPSEs formed homogeneous class but it can be said that though genus is same, species are different. Why we say so is because nature of organization, manpower cost, profitability, pay packages relating to employees welfare, working stress, in all these CPSEs are totally different. In this regard, further light can be thrown by taking into consideration data which was taken into consideration in 353rd meeting dated 27/9/2023, extract of Minutes of which is at page 334. The relevant portion (pg. 336) showing the different in structure and performance of CPSEs is in following manner, which would clearly reveal that the comparison can be made.

                   

                   

33. The extract of Minutes further shows that the respondent no. 3’s revenue from operations is lowest amongst all CPSEs and further employee cost as % of total expenses, is highest amongst in all CPSEs and in spite of it, the MOIL is paying highest perks and PRP apart from other benefits like furniture and fixtures, mobile facility, car loans, laptops, housing building loans etc. given to its executives.

34. We would like to state that we are making no attempt and testing the financial competence of CPSEs, suffice it to say that it is for the employer to take the call in view of the policies which they are intended to frame. From the record of the case, we can neither say that the pay scale of other CPSEs can be made applicable to respondent no. 3’s employees, nor say that the MOIL has, in fact, acted in an indiscriminatory manner.

35. So far as the contention of the petitioners that CMD and Board of Directors were given benefits of a decision taken in 299th meeting but below board level employees were denied the benefits, ignores the fact that those two classes cannot be put at same level.

36. As rightly submitted by the learned counsel for the petitioners that as regards below board level executives, management has taken all efforts for upgradation of pay scales by putting a proposal before the Board of Directors in its 299th meeting dated 6/5/2014, which were approved by the Board by passing a resolution, however, the Ministry had directed to decide the issue of upgradation of pay scale which was duly addressed at the time of 3rd pay revision and accordingly, it was implemented from 1/1/2017.

37. The fact that comparison with CMD and Directors who are in contractual employment and selected on a pre- decided pay scale with the approval of Appointment Committee of Cabinet (ACC) cannot be disputed. It is a question of equality amongst equal and these two classes cannot be said to be equal. It also cannot be disputed that though 299th meeting was conducted on 6/5/2014 and 319th meeting was held on 14/11/2017, the petition was filed on 3/2/2022. There are no plausible reasons coming from the petitioner’s side about the delay.

38. Even otherwise, as per the order passed by this Court on 3/4/2023, the prayer Clauses (iii) and (iv) were duly taken into consideration and answered. We do not find any reason to set aside the Minutes of 353rd meeting of Board of Directors dated 27/9/2023 (pg.334). By taking into consideration various data available, the decision was taken. The chart produced (supra) would clearly reveal that the MOIL has not acted arbitrarily.

39. The Board of Directors of MOIL consist of representatives of the Ministry of Steel, Government of India nominees, representatives of the Maharashtra Government, representatives of the Madhya Pradesh Government, so also independent representatives. No malafides are alleged against them. So far as the contention of the petitioners that their case is covered by the judgments of the Karnataka High Court and Calcutta High Court is concerned (pg.59 and 74), suffice it to say that in those cases, there were already recommendations by the concerned authorities. Here the facts are different.

40. It is necessary to mention here that in both the cases dealt with by the Karnataka High Court and Calcutta High Court, the Board of Directors had found favour and had approved the removal of anomaly in pay scales. The concerned Ministry did not decide the issue and therefore, the orders were passed. Here the Board of Directors are not supporting the case of the petitioners for their own reasons which we do not find to be erroneous.

41. In that view of the matter, we are of the view that the petition cannot be allowed as question of equal pay for equal work and pay disparity will have to be tested on the basis of classification based on criteria for better administration. Nothing has been brought on record that other CPSEs employees perform similar work, discharge similar responsibilities and have similar qualifications and therefore, the decision taken by the respondent no. 3 - MOIL cannot be faulted with.

42. In fact, respondent no. 3’s decision justifies distinct pay structure to ensure the administrative efficiency. Thus, the petition deserves to be dismissed and accordingly, the petition stands dismissed.