BSNL/MTNL Employees Absorbed From DoT Not Entitled To 7th CPC Pension Revision: Delhi High Court Sets Aside CAT Order

The Delhi High Court has held that employees of BSNL and MTNL who were permanently absorbed from the Department of Telecommunications (DoT) are not entitled to revision of pension under the recommendations of the 7th Central Pay Commission (CPC). [2026 LiveLaw (Del) 620]Setting aside a batch of orders passed by the Central Administrative Tribunal (CAT), a Division Bench of Justices C. Hari Shankar and Om Prakash Shukla held that once government employees are permanently absorbed in BSNL/MTNL, they cease to be Central Government servants and are governed by the Pay Revision Committee (PRC) framework applicable to Public Sector Undertakings (PSUs), and not by subsequent CPC recommendations.“Rule 37A of the CCS (Pension) Rules, 1972 prescribes special statutory framework governing erstwhile Government servants who were permanently absorbed in PSUs. Upon such absorption, the respondents ceased to be Government employees, their posts under the Government stood abolished and they were fitted under the IDA scale. Accordingly, consequent to such absorption, they shall be governed by the rules of the concerned PSU and be subjected to recommendations of the Pay Revision Committee. Hence, they cannot claim benefit of recommendations of the Central Pay Commission,” it said.The Court was dealing with writ petitions filed by the Centre challenging CAT's directions to revise the pension of BSNL/MTNL combined service pensioners with effect from January 1, 2017 by applying the fitment formula under the 7th CPC. CAT had held that the pensioners were entitled to parity with Central Government pensioners despite the non-implementation of the 3rd PRC in BSNL/MTNL.The High Court however traced the statutory scheme governing the absorption of DoT employees into BSNL/MTNL under Rule 37A of the CCS (Pension) Rules and examined various Office Memoranda issued pursuant to the 6th and 7th CPCs, as well as the recommendations of the 2nd and 3rd PRCs. It noted that while certain limited pensionary benefits, such as revised pension calculation and enhanced death gratuity, had been extended to BSNL/MTNL absorbees through specific Office Memoranda, no executive instruction or statutory provision extended the benefit of 7th CPC pension revision to combined service pensioners drawing pension under the Industrial Dearness Allowance (IDA) scale.Rejecting the Tribunal's reasoning, the Bench held that BSNL/MTNL absorbees constitute a distinct class from Central Government pensioners. It observed,“Recommendations of the 7th CPC only apply to Central Government employees and absorbees of BSNL/MTNL who draw pension on pro-rata basis from the Government. The respondents do not fall under either category.”The Court emphasised that accepting the respondents' contention would disregard the clear distinction maintained throughout the statutory and administrative framework between CPC-governed Central Government employees and PRC-governed PSU employees.It concluded that there was no statutory mandate, executive direction or constitutional basis to extend the benefits of the 7th CPC to BSNL/MTNL combined service pensioners. As such, the Court set aside CAT orders and allowed Centre's petitions.Appearance: Mr. Kirtiman Singh, Sr. Adv. with Ms. Laavanya Kaushik, GP with Mr. Maulik Khurana, Mr. Ritik Saha and Ms. Khyaati Bansal, Advs. for Petitioners; Mr. Ankur Chhibber, Ms. Gauri Puri and Mr. Kashish Bhardwaj, Advs. for RespondentsCase title: Union Of India Through Its Secretary Department Of Telecommunication & Ors. v. All India Retired Bharat Sanchar Nigam Limited Executive Welfare Association And Ors.Citation: 2026 LiveLaw (Del) 620Case no.: W.P.(C) 4946/2024Click here to read order

BSNL/MTNL Employees Absorbed From DoT Not Entitled To 7th CPC Pension Revision: Delhi High Court Sets Aside CAT Order

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BSNL/MTNL Employees Absorbed From DoT Not Entitled To 7th CPC Pension Revision: Delhi High Court Sets Aside CAT Order

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