The Madhya Pradesh High Court has reaffirmed that discriminatory exclusion from regularisation, despite identical eligibility, constitutes a continuing wrong that generates a recurring cause of action with each salary payment. This ruling reinforces the principle that public employers cannot arbitrarily deny benefits to employees who meet the same criteria as their peers.
Background & Facts
The Dispute
The respondent, Vimal Kumar Namdeo, was employed as a daily wage worker with the Madhya Pradesh State Agricultural Marketing Board. While his juniors were regularised with effect from 20.02.2003, he was omitted from the list despite fulfilling the same service conditions. The Screening Committee cited alleged negligence in depositing Mandi Fees as the reason for his exclusion, though no formal rule or policy barred such employees from regularisation.
Procedural History
- 2003: Screening Committee excluded respondent from regularisation list citing negligence in Mandi Fee deposits
- 2008: Respondent was eventually regularised without back wages
- 2023: Respondent filed Writ Appeal No. 2362 of 2023 seeking regularisation w.e.f. 20.02.2003 and back wages
- 01.05.2025: Division Bench allowed the writ appeal, granting regularisation from 20.02.2003 and three years of back wages
- 2025: Petitioners filed Review Petition challenging the Division Bench order
Relief Sought
The petitioners sought to set aside the Division Bench’s order, arguing that the respondent had no valid cause of action since he was regularised in 2008 and had not challenged the 2003 decision earlier. They contended that no recurring cause of action existed and that the grant of back wages was unjustified.
The Legal Issue
The central question was whether the denial of regularisation to a similarly situated employee, based on an uncodified ground of negligence, constitutes a continuing wrong that gives rise to a recurring cause of action with each monthly salary payment, thereby justifying a claim for back wages even after initial regularisation.
Arguments Presented
For the Petitioner
The petitioners argued that the respondent’s claim was barred by limitation since he was regularised in 2008 and had not challenged the 2003 exclusion at the time. They relied on the principle that a cause of action must arise at the time of the alleged wrong and cannot be revived years later. They further contended that the Screening Committee’s note on negligence was a legitimate ground for exclusion, and the Division Bench erred in disregarding it without statutory backing.
For the Respondent
The respondent argued that the exclusion from the 2003 regularisation list was arbitrary and discriminatory, as no formal rule prohibited employees with pending Mandi Fee dues from being regularised. He relied on the fact that his juniors, who were similarly situated, were regularised, thereby establishing a case of unequal treatment. He further submitted that the denial of regularisation was a continuing wrong, as the financial loss persisted with every salary cycle until regularisation.
The Court's Analysis
The Court examined whether the State’s failure to regularise the respondent, while granting the same benefit to similarly placed employees, amounted to a violation of Article 14 of the Constitution. It noted that the petitioners could not point to any statutory provision, rule, or policy that made negligence in Mandi Fee deposits a disqualifying condition for regularisation.
"When tested, then a model employer cannot discriminate between same set of employees on those grounds which were not to be taken into consideration at the time of regularisation."
The Court affirmed the Division Bench’s reliance on M.R. Gupta v. Union of India and State of Karnataka v. C. Lalitha, which hold that denial of rightful benefits such as regularisation, when coupled with ongoing salary payments to similarly placed employees, constitutes a continuing wrong. Each monthly salary payment to a colleague in the same position generates a fresh cause of action for the aggrieved employee.
The Court further held that the respondent’s eventual regularisation in 2008 did not extinguish his right to claim back wages for the period of discrimination. The Division Bench’s limitation of back wages to three years prior to filing the writ petition was deemed equitable and proportionate.
The Verdict
The petitioners’ review petition was dismissed. The Court held that discriminatory exclusion from regularisation based on uncodified grounds constitutes a continuing wrong, generating a recurring cause of action with each salary cycle. The grant of back wages for three years was upheld as a just and equitable remedy.
What This Means For Similar Cases
Recurring Cause of Action Applies to Service Benefits
- Practitioners must now argue that denial of regularisation, promotion, or pay parity to similarly placed employees triggers a recurring cause of action under M.R. Gupta and C. Lalitha
- Limitation does not begin from the date of initial exclusion but from the last date of discrimination
- Claims for back wages remain maintainable even if the employee was later regularised
Model Employer Doctrine Restricts Arbitrary Discretion
- Public employers must justify differential treatment with clear, documented policy
- Unwritten grounds like "negligence" without statutory basis cannot override equality under Article 14
- Screening Committees must record reasons grounded in rules, not subjective notes
Back Wages Are Not Automatic But Must Be Equitably Awarded
- Courts may limit back wages to three years prior to filing, as done here, to balance equity and administrative finality
- Practitioners should seek back wages only for the period of actual discrimination, not entire service tenure
- The three-year cap is now a recognized benchmark in service law disputes
