In a significant ruling affecting government engineers, the Supreme Court has dismissed the Union of India’s appeal and upheld the Delhi High Court’s decision granting Non-Functional Upgradation (NFU) benefits to Junior Engineers in the Border Roads Organisation (BRO). The judgment clarifies how pay progression rules under the Seventh Central Pay Commission should be applied.
Background of the Case
The dispute began when Junior Engineers working in the BRO approached the Delhi High Court seeking NFU to Level 9 (Grade Pay ₹5,400). They argued that after completing four years in Level 8 (Grade Pay ₹4,800), they were entitled to this upgrade under Para 7.4.13(iv)(b) of the Seventh Pay Commission.
However, their claim was rejected through a communication dated 19 February 2021, which stated that such benefits were not applicable to their cadre.
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The engineers contended that they had already completed the required service period and that denying them NFU, while granting it to other cadres like Senior Private Secretaries, was discriminatory.
The Union of India opposed the claim on multiple grounds. It argued that:
- Pay Commission recommendations are advisory and do not automatically create enforceable rights.
- The benefit of NFU was meant only for officers who entered service at a higher grade pay (₹4,800).
- Junior Engineers entered service at ₹4,200 and reached ₹4,800 through career progression schemes, making them ineligible.
The government also maintained that comparisons with other cadres were misplaced due to differences in recruitment and service structures.
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The Supreme Court examined the relevant Pay Commission provisions and the reasoning adopted by the Delhi High Court.
The bench noted that the key requirement under Para 7.4.13(iv)(b) is completion of four years in Level 8, along with seniority and suitability not the entry-level pay scale.
“The insistence on entry-level grade pay… may amount to adding additional conditions,” the Court observed.
It further found that denying NFU on this basis would defeat the intent of the Pay Commission recommendations.
The Court also took note of earlier judgments where similar benefits had been upheld for employees who reached the required grade through promotion or financial upgradation.
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Importantly, the bench agreed that once employees fulfill the condition of four years in Level 8, they become eligible for NFU, regardless of how they reached that level.
The Supreme Court concluded that the denial of NFU to the Junior Engineers was not justified.
It upheld the Delhi High Court’s direction to grant the benefit of Grade Pay ₹5,400 to eligible engineers and found no valid reason to interfere with the earlier order.
Accordingly, the Civil Appeal filed by the Union of India was dismissed, with no order as to costs.
Case Details
Case Title: Union of India & Others vs Sunil Kumar Rai & Others
Case Number: Civil Appeal No. of 2026 (@ SLP (C) No. 11595 of 2023)
Judges: Justice Pankaj Mithal & Justice S.V.N. Bhatti
Decision Date: April 1, 2026
