Railway Service Rules Cannot Be Imported to CPWD Merely Because Both Are ‘Industries’: Delhi High Court
Industrial Tribunal Grants CPWD Workers Regular Status After One Year; Delhi High Court Sets Aside Award for Lack of Legal Foundation
Facts
The dispute concerned CPWD workmen who had initially been engaged on a casual/daily-rated basis in various divisions and continued working for several years before eventually being regularised against sanctioned vacancies on different dates.
The workers complained that although they were subsequently regularised, their earlier daily-rated service was not being counted along with regular service for retiral and consequential benefits. They claimed continuous service under Section 25-B of the Industrial Disputes Act and argued that there had been no break between their daily-rated employment and regularisation.
They also contended that they should have been regularised after completing 240 days of service in two consecutive calendar years, and that keeping them as casual workers for several years amounted to unfair labour practice.
The dispute was referred to the Central Government Industrial Tribunal-cum-Labour Court. By an Award dated 2 January 2007, the Tribunal directed CPWD to:
- confer regular status upon the workmen after one year from initial engagement; and
- count 50% of their daily-rated service for pension and other retiral benefits.
CPWD challenged the Award before the Delhi High Court.
Issues
The central questions were whether completion of one year or 240 days of daily-rated service could confer a right to retrospective regularisation, and whether 50% of the entire pre-regularisation daily-rated service could automatically be counted for pensionary benefits.
The Court importantly treated these as two distinct questions: regularisation determines the legal character of employment, whereas pensionary credit for antecedent service depends upon the applicable pension rules, schemes or administrative instructions.
Petitioner – CPWD’s Arguments
CPWD argued that the workers were originally engaged casually without reference to sanctioned posts and without following regular recruitment rules. They were later regularised only when sanctioned vacancies became available and according to eligibility and seniority.
It submitted that completion of 240 days cannot confer a right to regularisation and that the Tribunal had no legal basis to invent a one-year benchmark for granting regular status.
CPWD relied particularly on Secretary, State of Karnataka v. Umadevi, Gangadhar Pillai v. Siemens Ltd., V. Thippa Setty and other Supreme Court decisions.
Regarding pension, CPWD argued that the 1993 Casual Labour Scheme permitted counting 50% only of service actually rendered under temporary status, not 50% of every period of casual/daily-rated service.
Respondents – Workmen’s Arguments
The workmen emphasised that they had continuously worked for CPWD for several years without any break before their eventual regularisation.
They argued that continuous service under Section 25-B of the Industrial Disputes Act, including satisfaction of the 240-day requirement, could not simply be ignored when calculating retiral benefits.
They further relied on the Government’s 1993 Temporary Status Scheme, which contemplated counting 50% of service rendered under temporary status towards retirement benefits after regularisation.
Their case before the High Court was substantially that they were not necessarily seeking retrospective seniority but recognition of the long period of actual service for retiral benefits.
Analysis of the Law
1. 240 Days Does Not Confer Regular Status
The Court relied heavily on the Constitution Bench decision in Secretary, State of Karnataka v. Umadevi (3).
It reiterated that regular recruitment through the prescribed process remains the constitutional norm in public employment and that:
“Regularization cannot be said to be a mode of recruitment.”
The Umadevi exception concerned irregular appointments of qualified persons against duly sanctioned vacant posts who had worked for ten years or more without intervention of courts or tribunals.
Here, however, the Tribunal itself found that the workers’ initial daily-rated engagements were not against sanctioned posts.
Accordingly, length of service by itself could not transform their initial engagement into regular government service.
2. Subsequent Regularisation Cannot Automatically Be Backdated
The workers had been regularised on different dates as vacancies became available.
The High Court held that this itself demonstrated that regular status was conferred upon availability of requisite posts—not merely upon completion of a particular length of casual service.
Subsequent regularisation therefore could not automatically be converted into retrospective regularisation from an earlier date unsupported by the governing rules.
Relying on Registrar General of India v. V. Thippa Setty, the Court noted that retrospective regularisation may affect seniority and the rights of employees recruited through the regular process. It therefore requires a specific legal foundation.
3. Meaning of 240 Days
The Court relied on Gangadhar Pillai v. Siemens Ltd. to hold that completing 240 days does not itself confer either regularisation or permanent status.
The 240-day concept under the Industrial Disputes Act operates primarily within the statutory framework concerning continuous service and retrenchment.
Thus:
240 days of service ≠ automatic right to regular appointment.
Even if the workers satisfied Section 25-B, an independent statutory provision, service rule or administrative scheme was necessary to confer regular status.
4. Temporary Status Is Different From Regularisation
The Court closely examined the Casual Labourers (Grant of Temporary Status and Regularisation) Scheme, 1993.
Clause 4(i) contemplated temporary status for eligible casual labourers who were in employment on 10 September 1993 and had completed the prescribed continuous service—at least 240 days in a year, or 206 days for five-day offices.
Clause 5(v), separately, provided that 50% of service rendered under temporary status could be counted towards retirement benefits after regularisation.
The Court stressed that these provisions cannot be conflated.
The qualifying service necessary to become eligible for temporary status is not itself automatically the service carrying the 50% pension benefit.
5. Tribunal Could Not Apply Railway Rules to CPWD
The Tribunal had also relied upon rules applicable to Railway employees.
The High Court rejected this approach.
Merely because both Railways and CPWD qualify as an “industry” under industrial law does not mean that the service, pension and temporary-status rules applicable to one establishment can automatically be imported into another.
Similarly, Articles 12 and 39(d) could not supply the missing statutory foundation for retrospective regularisation. Equal pay principles concern wage parity and cannot themselves convert an engagement made outside the regular recruitment framework into a regular appointment.
Precedent Analysis
Secretary, State of Karnataka v. Umadevi (3), (2006) 4 SCC 1
Regularisation is not a mode of recruitment. The limited exception requires, among other things, employment against duly sanctioned vacant posts. The workers here were initially engaged when sanctioned posts were unavailable.
Gangadhar Pillai v. Siemens Ltd., (2007) 1 SCC 533
Completion of 240 days does not independently create a right to regularisation or permanent status.
Registrar General of India v. V. Thippa Setty, (1998) 8 SCC 690
Regularisation ordinarily operates prospectively. Retrospective operation requires a specific legal basis and cannot follow merely from long prior service.
Birma Devi v. Union of India
The Court distinguished this decision because those employees had actually been granted temporary status. It was relevant only to the limited proposition that where temporary status is established, the employer cannot rely upon its own failure to regularise employees to defeat consequential pensionary claims.
Bhikhani Devi v. Union of India
The Supreme Court decision also concerned workers who had actually acquired temporary status. It therefore did not resolve the present factual question concerning employees for whom formal temporary status had not necessarily been conferred.
Court’s Reasoning
The High Court held that the Tribunal committed a legal error by directing regular status after one year of daily-rated service without identifying any CPWD statute, recruitment rule, government order or binding scheme creating such a right.
Neither 240 days of service, Railway rules, Articles 12 and 39(d), nor the 1993 Scheme provided the necessary foundation.
Accordingly, the retrospective regularisation direction was set aside.
However, the Court did not hold that all pre-regularisation service must necessarily be ignored for pension.
That question was separate.
The Tribunal had erred by mechanically directing that 50% of the entire daily-rated period be counted. Under the 1993 Scheme, the benefit is specifically linked to service rendered under temporary status, requiring examination of each employee’s individual service history.
Normally, the matter would therefore have required remand for individual determination.
But the disputes had been referred in 2004, the Tribunal’s Award came in 2007, and the writ petitions had remained pending for more than 19 years. The High Court considered another round of adjudication inappropriate and moulded relief as a special, case-specific measure.
Conclusion
The Delhi High Court set aside the Tribunal’s Award but granted limited, specially moulded retiral relief.
The Court directed that:
- regularisation dates would not be backdated;
- 50% of the entire daily-rated service would not automatically count;
- workers already regularised before 10 September 1993 could not claim earlier daily-rated service merely under the 1993 Scheme;
- workers who were still casual/daily-rated on 10 September 1993 and were subsequently regularised would have their retiral benefits recomputed by taking into account 50% of service from 10 September 1993 until regularisation, to the extent reckonable under the 1993 Scheme;
- any independent claim under Rule 14 of the CCS (Pension) Rules would be examined separately according to its conditions; and
- the exercise must be completed within three months.
Crucially, the Court expressly stated that this relief was a special measure confined to these particular workmen and should not be read as creating a general entitlement for all daily-rated workers.
Case Details
Case: Director General Works, CPWD v. General Secretary, All India CPWD Employees
Court: Delhi High Court
Cases: W.P.(C) 3979/2007 & W.P.(C) 3986/2007
Judge: Justice Shail Jain
Reserved: 20 July 2026
Pronounced: 17 September 2026
Result: Tribunal Award set aside; retrospective regularisation rejected; limited recalculation of retiral benefits directed as a case-specific measure.
