Delhi High Court Allows Municipal Employees to Shift From Employees’ Provident Fund to General Provident Fund After Corporation’s Approval
Delhi High Court Allows Municipal Employees to Shift From EPF to GPF Scheme, Holds MCD Cannot Deny Benefit After Conscious Decision and Consent
Facts
The Delhi High Court was dealing with a writ petition filed by the South Delhi Municipal Corporation challenging the judgment dated 08.11.2016 passed by the Central Administrative Tribunal in OA 100/2474/2012. The respondents were appointed as Senior Operator, Fitter and Welder between 1969 and 1985 in the Engineering Department of the erstwhile SDMC and were assigned duties in Hot Mix Plants. Their services were later regularised, and they were initially covered under the Employees Provident Fund Scheme.
After the Supreme Court’s directions in M.C. Mehta v. Union of India, the functioning of Hot Mix Plants ceased. However, the Supreme Court directed that persons employed in Hot Mix Plants should not be discontinued and should be adjusted elsewhere. The respondents were accordingly shifted to various departments of the MCD.
The respondents later sought shifting from the EPF Scheme to the General Provident Fund Scheme, stating that similarly situated employees had already been allowed to shift. In a meeting held on 29.09.2009, the MCD decided that employees willing to take GPF benefits should give written consent and give up benefits received under EPF. The respondents gave their consent and agreed to return the amounts received under EPF. However, their request was rejected on the ground that there was no provision permitting shifting from EPF to GPF.
Issues
- Whether the respondents could be denied shifting from the EPF Scheme to the GPF Scheme after the MCD itself had taken a conscious decision permitting such shifting.
- Whether absence of a specific enabling provision was sufficient to reject the respondents’ request.
- Whether denial of GPF benefits to the respondents, when similarly situated employees had been granted the same benefit, violated Article 14 of the Constitution.
Petitioner’s Arguments
The SDMC argued that the respondents’ request was rightly rejected because there was no provision permitting an employee covered under the EPF Scheme to shift to the GPF Scheme.
It was submitted that the Tribunal erred in directing extension of GPF benefits merely because some similarly situated employees had earlier been granted such benefit. The petitioner sought interference with the Tribunal’s judgment under Article 226 of the Constitution.
Respondent’s Arguments
The respondents argued that the MCD had itself considered their request in its meeting dated 29.09.2009 and had taken a conscious decision permitting employees to shift from EPF to GPF, subject to written consent and return of EPF benefits.
They submitted that they had acted upon the said decision by giving their consent and agreeing to return the EPF amounts. They further pointed out that 30 similarly situated persons had already been allowed to shift from EPF to GPF, and denial of the same treatment to them would be discriminatory.
Analysis of the Law
The Court noted that if the case was merely based on the argument that some other employees had been wrongly granted a benefit, the matter may have required closer scrutiny because Article 14 does not permit negative equality. An illegal benefit granted to one person cannot become the basis for claiming the same illegal benefit by another.
However, the Court held that the present case was different. The respondents’ request had been placed before the MCD itself, and the MCD had taken a conscious decision on 29.09.2009 that employees willing to shift to GPF could do so after giving written consent and agreeing to leave EPF benefits.
The Court also noted that SDMC could not point to any express prohibition against allowing employees covered under EPF to shift to GPF. In the absence of such prohibition, and in view of the MCD’s own decision, the respondents could not be denied the benefit.
Precedent Analysis
The Tribunal had relied upon Man Singh v. State of Haryana and Rajendra Yadav v. State of Madhya Pradesh while allowing the respondents’ claim. The High Court found the reliance on Man Singh justified, observing that the Supreme Court had held that the State cannot discriminate between similarly situated persons while granting a benefit that is not prohibited by law.
The Court also distinguished the principle of negative equality. It held that this was not a case where the respondents were seeking repetition of an illegal benefit. Rather, the benefit was based on a conscious decision of the MCD, and there was no statutory bar shown against such shifting.
Court’s Reasoning
The Court held that the Tribunal’s decision did not call for interference under Article 226. The respondents had sought the benefit of GPF, the MCD had consciously permitted such shifting in its meeting dated 29.09.2009, and the respondents had conveyed their willingness in accordance with that decision.
The Court found that once the MCD itself had taken such a decision and the respondents had acted upon it, the Corporation could not later deny the benefit merely by stating that there was no provision for shifting from EPF to GPF, especially when no express prohibition was shown.
The Court therefore affirmed the Tribunal’s judgment and held that the respondents were entitled to shift to the GPF Scheme from the dates on which they conveyed their consent pursuant to the MCD meeting.
Conclusion
The Delhi High Court dismissed the writ petition filed by the South Delhi Municipal Corporation and upheld the Tribunal’s order granting the respondents the benefit of shifting from the EPF Scheme to the GPF Scheme.
The Court held that the respondents would be entitled to GPF benefits subject to returning the amounts earned under the EPF Scheme. The MCD was permitted to deduct the EPF amounts from the GPF dues and was directed to make the residual payment within six weeks.
Case Details
Case: South Delhi Municipal Corporation v. Virender Kumar & Ors.
Court: Delhi High Court
Case Number: W.P.(C) 2628/2017
Judge: Justice C. Hari Shankar and Justice Vinod Kumar
Date: 03 July 2026
Result: Writ petition dismissed; Tribunal order affirmed; respondents held entitled to shift from EPF Scheme to GPF Scheme subject to return/deduction of EPF benefits.
