High Courts Can't Enquire Into Pay Parity Claims While Exercising Writ Jurisdiction: Madras High Court

The bench of Justice SM Subramaniam and Justice C Kumarappan noted that when the state had issued clear directives that its prior approval was necessary for upgrading the pay scale of workers of Arasu Rubber Corporation, a public sector undertaking of the Tamil Nadu government, the court could not rule otherwise.

“Since the directives of the Government will prevail over and Government has not granted any approval in the present case, the benefit cannot be extended in a routine manner. High Court in exercise of powers of judicial review cannot conduct an enquiry in respect of pay parity,” the court said.

The court was hearing a writ appeal filed by the State of Tamil Nadu against the order of a single judge wherein the court had held that the workers of the Corporation would be entitled to get pay equal to that of a lineman working in the Government of Tamil Nadu department. The writ court had relied on Rule 34 of the Arasu Rubber Corporation Rules, which stated that pay and allowances would be paid to corporation employees at the rates applicable to State Government employees from time to time.

The State argued that even though Rule 34 provides for pay parity, government approval was mandatory. In the present case, the State argued that no prior approval was sought and thus, the workers of the corporation were not entitled to the pay and allowances as applicable to the employees of the state government.

The State also submitted Government Letters which state that no government order applicable to government employees shall be adopted by PSUs/Statutory Boards without the prior approval of the Government unless such extension has been explicitly notified. The state thus argued that, as per the Government Order, the benefit could not be routinely extended and prior approval of the Government was to be obtained.

The employee, on the other hand, argued that when the service rules had already stated that the pay and allowances would be paid to the corporation on par with state employees, the employee was entitled for equivalent scale of pay and no prior approval was required.

The court noted that as per Rule 7 of the corporation, the directives issued by the Government of Tamil Nadu were to prevail over the Rules. Thus, the court observed that the directives issued by the government through government orders would prevail over the rules.

The court noted that when the government's directives had unambiguously stated that prior approval was necessary to extend the benefit of government employee to the employees of the corporation, the said directive was binding on the Board and would prevail over the rules. The court thus observed that the order of the writ court was against the rules of the corporation and the directives issued by the state government.

The court also noted that the concept of equal pay for equal work would not be applicable in the present case as the employees working in the public sector undertakings were not similarly placed as the employees working in the government department.

Thus, the court allowed the appeal and set aside the order of the single judge.

Counsel for Appellant: Mr. P. Muthukumar, AAG Assisted by Mr. R. Mugunthan

Counsel for Respondent: Mr. M. Ravi

Case Title: State of Tamil Nadu and another v. V Shunmugam

Citation: 2026 LiveLaw (Mad) 103

Case No: W.A.No.1804 of 2023