THE DIRECTOR (ADMN. AND HR) KPTCL & ORS. versus C.P. MUNDINAMANI & ORS.

Citation: [2023] 3 S.C.R. 332 · Decided: 11-04-2023 · Supreme Court of India · Bench: M.R. SHAH · Disposal: Dismissed

Judgment (excerpt)

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SUPREME COURT REPORTS
[2023] 3 S.C.R.
[2023] 3 S.C.R. 332
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THE DIRECTOR (ADMN. AND HR) KPTCL & ORS.
v.
C.P. MUNDINAMANI & ORS.
(Civil Appeal No. 2471 of 2023)
APRIL 11, 2023
[M. R. SHAH AND C. T. RAVIKUMAR, JJ.]
Karnataka Electricity Board Employees Service Regulations,
1997 – Regulation 40(1) – As per Regulation 40(1) an increment
accrues from the day following that on which it is earned –
Appellant-KTCL denied the annual increment to the respondents-
respective employees on the ground that the day on which the
increment accrued, the respondents were not in service – Whether
an employee who has earned the annual increment is entitled to the
same despite the fact that he has retired on the very next day of
earning the increment – Held: Merely because, the government
servant has retired on the very next day, he cannot be denied the
annual increment which he has earned – In the instant case, the
word “accrue” should be understood liberally and would mean
payable on the succeeding day – Any contrary view would lead to
arbitrariness and unreasonableness and denying a government
servant legitimate one annual increment though he is entitled to for
rendering the services over a year with good behaviour and
efficiently and therefore, such a narrow interpretation should be
avoided.
Dismissing the appeal, the Court
HELD: 1. The submission on behalf of the appellants that
as the increment has accrued on the next day on which it is earned
and therefore, even in a case where an employee has earned the
increment one day prior to his retirement but he is not in service
the day on which the increment is accrued is concerned, while
considering the aforesaid issue, the object and purpose of grant
of annual increment is required to be considered. A government
servant is granted the annual increment on the basis of his good
conduct while rendering one year service. Increments are given
annually to officers with good conduct unless such increments
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are withheld as a measure of punishment or linked with efficiency.
Therefore, the increment is earned for rendering service with
good conduct in a year/specified period. Therefore, the moment
a government servant has rendered service for a specified period
with good conduct, in a time scale, he is entitled to the annual
increment and it can be said that he has earned the annual
increment or rendering the specified period of service with good
conduct. Therefore, as such, he is entitled to the benefit of the
annual increment on the eventuality of having served for a
specified period (one year) with good conduct efficiently. Merely
because, the government servant has retired on the very next
day, how can he be denied the annual increment which he has
earned and/or is entitled to for rendering the service with good
conduct and efficiently in the preceding one year. [Para 6.5][339-
F-H; 340-A-C]
2. To interpret Regulation 40(1) of the Regulations in the
manner in which the appellants have understood and/or
interpretated would lead to arbitrariness and denying a
government servant the benefit of annual increment which he
has already earned while rendering specified period of service
with good conduct and efficiently in the last preceding year. It
would be punishing a person for no fault of him. As observed
hereinabove, the increment can be withheld only by way of
punishment or he has not performed the duty efficiently. Any
interpretation arbitrariness which and/or would lead to
unreasonableness should be avoided. If the interpretation as
suggested on behalf of the appellants and the view taken by the
Full Bench of the Andhra Pradesh High Court is accepted, in
that case it would tantamount to denying a government servant
the annual increment which he has earned for the services he
has rendered over a year subject to his good behaviour. The
entitlement to receive increment therefore crystallises when the
government servant completes requisite length of service with
good conduct and becomes payable on the succeeding day. In
the present case the word “accrue” should be understood liberally
and would mean payable on the succeeding day. Any contrary
view would lead to arbitrariness and unreasonableness and
denying a government servant legitimate one annual increment
THE DIRECTOR (ADMN. AND HR) KPTCL & ORS. v. C.P.
MUNDINAMANI & ORS.
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SUPREME COURT REPORTS
[2023] 3 S.C.R.
though he is entitled to for rendering the services over a year
with good b

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