‘Can’t take U-turn after regularising’: Punjab and Haryana HC slams PUNGRAIN, orders full pay-scales to employees
Punjab and Haryana HC criticises PUNGRAIN over discriminatory denial of benefits to 2009-11 recruits, upholds a single-judge verdict in a ruling that cites Article 14 violations and improper withdrawal of rights.
File photo of the Punjab and Haryana High Court. In a setback to the Punjab State Grains Procurement Corporation Ltd (PUNGRAIN), the Punjab and Haryana High Court Wednesday dismissed all 10 connected Letters Patent Appeals (LPAs) filed by the Corporation and directed it to grant regular pay scales of Rs 10,300-34,800 + Rs 4,400 grade pay, along with all allowances and consequential benefits, to employees appointed between 2016 and 2017.
The Division Bench of Justices Anupinder Singh Grewal and Deepak Manchanda upheld the single judge’s order of August 12, 2025, in its entirety, calling the Corporation’s actions “arbitrary and discriminatory” and violative of Article 14 of the Constitution.
Case background
The dispute centres on employees recruited through a transparent advertisement process issued by PUNGRAIN between 2009 and 2011. They were issued regular appointment letters in December 2016 and January 2017, following their service on contract. The Corporation’s Board of Directors had, in resolutions dated November 25, 2011, and July 28, 2016, adopted the state’s 2011 regularisation policy and decided that employees completing three years of service would be regularised.
Despite these resolutions and regular appointment orders, PUNGRAIN withheld regular pay scales. In August 2020 and February 2021, the managing director unilaterally passed orders (without Board approval) withdrawing the benefits already extended. Aggrieved employees approached the high court through writ petitions, which were allowed by the single judge. PUNGRAIN then filed the present batch of LPAs.
PUNGRAIN argued before the Division Bench that the appointments were “illegal ab initio” for want of sanctioned posts and in violation of a 2003 government directive prohibiting engagement of regular staff. It claimed the single judge erred in treating the appointments as merely “irregular” and in applying the principle of parity.
The single judge had rejected these pleas, holding that the employees were entitled to regularisation as per the Board’s own decisions and that the Corporation could not “approbate and reprobate”.
Why PUNGRAIN lost
The Division Bench, in an 11-page judgment authored by Justice Deepak Manchanda, gave multiple-layered reasons for dismissing the appeals:
1. Discriminatory treatment violates Article 14: The high court noted that similarly situated employees appointed on April 30, 2008, were regularised on December 23, 2011, pursuant to the Board’s resolution dated November 25, 2011, and continue to enjoy regular status. The present batch was “singled out” allegedly because they approached the court.
2. Withdrawal orders legally unsustainable: The 2020 and 2021 withdrawal orders were passed by the managing director alone, without Board approval. Crucially, these orders did not mention the non-availability of sanctioned posts or the lack of financial approval. The Court held that the Corporation cannot be permitted to “present new reasons to justify its decisions” in court affidavits or arguments.
3. Corporation cannot blow hot and cold: Having itself adopted the 2011 regularisation policy through Board resolutions and issued regular appointment letters, PUNGRAIN could not later take a “complete U-turn” and deny the very benefits it had promised.
4 No justifiable reason for withdrawal: In its concluding paragraphs, the Bench stated, “We agree with the findings recorded by the learned single judge that once the services of the respondents stood regularised, the same could not have been withdrawn without any justifiable reason. More particularly, when similarly situated employees, whose services were also regularised, have not been subjected to such withdrawal, and nothing has been placed on record to rebut the plea of discrimination… the impugned action is clearly arbitrary and violative of Article 14 of the Constitution of India.”
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