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Employee can’t suffer for employer’s lapse, says HC; grants GPF benefits to PEOSU engineer

Justice Harpreet Singh Brar quashes corporation’s rejection, rules ad-hoc appointee became automatic member of superior pension scheme upon regularisation.

4 min readChandigarhFeb 17, 2026 06:24 PM IST

Employee can't suffer for employer's lapse, legal story

The continued CPF deductions were termed an “administrative lapse” by the Corporation, for which the employee could not be penalised. (Image generated using Google Gemini)

In a significant ruling clarifying pension rights for employees regularised soon after the introduction of new retirement schemes, the Punjab and Haryana High Court has directed the PEPSU Road Transport Corporation (PRTC) to treat a long-serving Junior Engineer as a member of the more beneficial General Provident Fund (GPF) scheme under the 1992 Regulations.

Justice Harpreet Singh Brar allowed the writ petition filed by Jatinder Pal Singh Grewal, quashing the Corporation’s 2021 rejection of his claim and ordering full GPF benefits with retrospective effect.

The case

Grewal was first engaged as Junior Engineer (Civil) on an ad-hoc basis on January 16, 1992, with successive 89-day extensions. While he was still serving in that capacity, the PEPSU Road Transport Corporation Employees Pension/Gratuity and General Provident Fund Regulations, 1992, came into force on June 15, 1992.

On December 28, 1992, he received a fresh regular appointment order with six months’ probation, and his services were formally regularised with effect from June 28, 1993. Despite this, the Corporation continued deducting contributions under the older Contributory Provident Fund (CPF) scheme for nearly three decades.

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In 2019, Grewal began making representations. A committee was formed, but on June 22, 2021, it recommended against shifting him to GPF, citing continuous CPF deductions since 1992. The Corporation issued the impugned rejection letter on October 19, 2021. Grewal then moved the High Court seeking to quash the letter and committee report, along with a direction to treat him as a GPF member “for all intents and purposes”.

Arguments

Senior Advocate Sumeet Mahajan argued that Grewal’s regular appointment came after the 1992 Regulations had taken effect. He therefore fell under Clause 3(1)(i), which applies automatically to employees “appointed on or after the date of issue of Regulations on whole-time and regular basis”.

As Grewal was not a regular employee on June 15, 1992, there was “no requirement or occasion” for him to exercise an option under Clause 3(1)(ii) or Clause 4, which apply only to those already working on a regular basis before the cut-off date.

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The continued CPF deductions were termed an “administrative lapse” by the Corporation, for which the employee could not be penalised. RTI replies and a comparative chart showed that other employees regularised after June 15, 1992, were granted GPF benefits. Even some pre-1992 regular employees who never opted were extended the scheme.

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Court’s reasoning

Justice Brar held that the Regulations must be “harmoniously construed”. Clause 3(2) excludes work-charged, contractual and non-regular employees. Thus, “working immediately before the date of issue of Regulations” in Clause 3(1)(ii) refers to those working on a whole-time and regular basis before that date.

On June 15, 1992, Grewal was still an ad-hoc employee and therefore outside the scheme. His status changed only with the fresh regular appointment on December 28, 1992, which described him as “a new entrant in the service of the PRTC for all intents and purposes”.

The court ruled that since his regularisation occurred after the Regulations were in force, he was automatically covered under Clause 3(1)(i), and no option was required.

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Relying on the Supreme Court’s 2023 judgment in Calcutta State Transport Corporation v. Ashit Chakraborty, the court observed that employees cannot be made to suffer for the employer’s fault. The plea of discrimination was upheld, as similarly placed employees had been granted GPF benefits.

The verdict

The court quashed the October 19, 2021, rejection letter and the June 22, 2021, committee report. The Corporation must now treat Grewal as a GPF member under the 1992 Regulations for all purposes.

He has been directed to refund the employer’s CPF contribution within three months of receiving the certified copy of the order, without any interest liability.

Manraj Grewal Sharma

Manraj Grewal Sharma is a senior journalist and the Resident Editor of The Indian Express in Chandigarh, where she leads the newspaper’s coverage of north India’s most politically and institutionally significant regions. From Punjab and Haryana to Himachal Pradesh and the Union Territory of Chandigarh, she oversees reporting at the intersection of governance, law, politics and society. She also reports on the diaspora, especially in Canada and the US. With a career spanning journalism across several countries, academia and international development, Manraj brings a rare depth of perspective to regional reporting. She is widely regarded as a leading chronicler of Punjab’s contemporary history and socio-political evolution, particularly its long shadow of militancy, federal tensions and identity politics. Her book, Dreams after Darkness, remains a definitive account of the militancy years and their enduring aftermath. Professional Background & Expertise A gold medalist in mass communication and a post-graduate in English literature, Manraj has a multifaceted career spanning journalism, academia, and international development. She was also awarded a fellowship by National Foundation of India and did several in-depth pieces on Manipur. Internationally, she has reported from Israel, US, UK, Myanmar, and Mauritius Her key focus areas include: Regional Politics, History, Agriculture, Diaspora, and Security. Of late, she has started focusing on Legal & Judicial Affairs: Much of her recent work involves reporting on high-stakes cases in the Punjab and Haryana High Court, ranging from environmental policy to civil rights. International Consulting: She previously served as a consulting editor for the Asia Pacific Adaptation Network and a publishing consultant for the Asian Development Bank (ADB) in Manila. Academia: For five years, she was the managing editor of Gender, Technology and Development, a peer-reviewed international journal at the Asian Institute of Technology, Bangkok. Recent Notable Articles (Late 2025) Her recent reportage focuses heavily on judicial interventions and regional governance: 1. Environment & Governance "‘NGT can’t test legality of policy’: HC hears challenge to Punjab’s ‘Green Habitat’ plan" (Dec 22, 2025): Covering a critical legal battle over whether the National Green Tribunal has the authority to strike down a state policy regularizing farmhouses on delisted forest land. "High court pulls up Punjab poll panel over audio clip probe" (Dec 10, 2025): Reporting on judicial concerns regarding the transparency and fairness of local body elections. 2. Legal Rights & Social Welfare "HC issues notice to Punjab, Haryana over delay in building old age homes" (Dec 22, 2025): Reporting on a contempt petition against top officials for failing to establish government-run homes for the elderly as promised in 2019. "Victims can appeal acquittals in sessions court without seeking special leave" (Dec 19, 2025): Highlighting a significant procedural shift in criminal law following a Supreme Court ruling. "HC upholds benefits for Punjab FCI officer acquitted in 20-year-old bribery case" (Dec 19, 2025): A report on the concept of "honourable acquittal" and its impact on employee benefits. 3. Human Rights & Identity "As Punjab denies parole to MP Amritpal Singh, HC asks it to submit ‘foundational material’" (Dec 1, 2025): Covering the legal proceedings regarding the radical preacher and sitting MP's request to attend Parliament. "Protecting life paramount: HC backs Muslim woman in live-in after verbal divorce" (Nov 6, 2025): Analyzing judicial protections for personal liberty in the context of traditional practices. Signature Beats Manraj is recognized for her ability to decode complex judicial rulings and relate them to the everyday lives of citizens. Whether it is a 30-year-old land battle in Fazilka or the political implications of Kangana Ranaut’s candidacy in Mandi, her writing provides deep historical and regional context. Contact @grewal_sharma on X manrajgrewalsharma on Instagram ... Read More

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