Can a retired worker be refused the annual increment after regularisation because he began as a daily wager? The Supreme Court has answered no, and has ordered enhanced pension for retired Gujarat Irrigation Department workers.
Thank you for reading this post, don't forget to subscribe!
New Delhi: Setting aside a Gujarat High Court Division Bench ruling that had denied retired skilled workers of the State Irrigation Department the annual increment, the Supreme Court has held that their original engagement as daily wagers cannot justify the refusal once they were treated as permanent employees. The authorities have been told to compute and pay the enhanced pension within 30 days [Chhaganbhai Kohyabhai Pateliya and Others v. State of Gujarat and Others].
The appeals, arising out of SLP (C) No. 26129 of 2025, were allowed by a Bench of Justice Sanjay Kumar and Justice Sanjeev Sachdeva.
Why daily-wage origins did not count
The appellants had started out as daily wagers, but the Bench found that they stood converted to permanent status under the 1988 Resolution after ten years of service. That made them entitled to the increment like any regular employee. On the State’s stand, the Court held:
the contention advanced … that they were not entitled to grant of the increment … on the ground that they were daily wagers cannot be countenanced.
How the claim reached the Court
The appellants were skilled workers taken on daily wages by the Gujarat Irrigation Department, and they served for more than three decades before retiring on different dates. A Government Resolution dated October 17, 1988 treated daily wagers as permanent employees after ten years of service, and the appellants accordingly drew regular pay scales, allowances, pension and retiral benefits.
What remained in dispute was the annual increment falling due around the time of their retirement. A Single Judge of the Gujarat High Court allowed the claim, relying on the Supreme Court’s decision in C.P. Mundinamani. A Division Bench took the opposite view, reasoning that the workers’ original daily-wage status disentitled them to the increment.
Payment within 30 days
Each appellant’s case is to be examined individually by reference to the date of retirement. The amounts payable are to be calculated under clause (d) of the Court’s order dated February 20, 2025, which grants enhanced pension by including one increment for the period of three years prior to the month in which the writ petition was filed. Payment must follow within 30 days of the judgment, failing which the Court ordered:
interest thereon @ 6% p.a. shall be paid for the period thereafter till the date of payment.
All petitioners in the original Special Civil Application share the benefit, including those who did not join the appeal.
What the ruling changes
The decision reaffirms the C.P. Mundinamani line that an employee cannot lose the benefit of an increment merely because retirement follows closely after it is earned. Having itself converted long-serving daily wagers into permanent employees, the State cannot later revive the way they entered service to trim their benefits.
For retired workers who began as daily wagers, pension is to be computed on the same footing as that of other regular employees. The 30-day deadline and 6 per cent interest on default give the direction practical force.
Case Title: Chhaganbhai Kohyabhai Pateliya and Others v. State of Gujarat and Others [Civil Appeal arising out of SLP (C) No. 26129 of 2025, 2026 INSC 1088]
Bench: Justice Sanjay Kumar and Justice Sanjeev Sachdeva, Supreme Court of India
Date of Judgment: October 6, 2026
Appearances: Additional Solicitor General Archana Pathak Dave for the State; C.B. Gururaj, Pragya Smriti, Hari Abishek P. and others for the appellants.