PSU, Public Sector Bank and Autonomous Body Employees: Service Cases Outside CAT

CAT or the High Court: the first question in every PSU case

Central government civil employees, and Delhi government employees, take service disputes to the Central Administrative Tribunal. Employees of corporations, societies and authorities owned or controlled by the government go to CAT only if the Central Government has issued a notification under Section 14(2) of the Administrative Tribunals Act 1985 applying the Act to that body. Many bodies have been notified over the years; staff of Kendriya Vidyalaya Sangathan, CSIR laboratories and ICAR institutes, for example, file before CAT. Most central PSUs, public sector banks and a large number of autonomous institutions have not been notified.

Where there is no notification, CAT has no jurisdiction, and the remedy is a writ petition under Article 226 in the High Court. The answer is rarely obvious from the organisation's name, because a society under one ministry may be notified while a similar society under another is not. We check the notification position for the specific body before drafting, since a petition filed in the wrong forum is returned and the months lost cannot be recovered.

If your organisation is notified and CAT has already decided your case, the remedy is a writ against the CAT order before a Division Bench of the High Court, explained on our page on challenging a CAT order in the Delhi High Court. The working of CAT itself is covered in detail on our sister site catlawyer.in. Personnel of the BSF, CRPF, CISF, ITBP and SSB are outside CAT altogether and come directly to the High Court, as our page on CAPF service matters explains.

Who usually comes to the High Court, and who goes elsewhere

• Officers of central PSUs. Executives and officers of Maharatna, Navratna and other central public sector enterprises whose employer is not notified under Section 14(2) come to the High Court by writ.
• Public sector bank officers. Officers of nationalised banks and of the State Bank of India challenge disciplinary penalties, promotion and pension decisions by writ.
• Delhi government corporations and boards. Staff of Delhi government undertakings and statutory bodies that are not notified follow the same writ route.
• Autonomous bodies and central universities. Teaching and non-teaching staff of central universities, and of societies and institutes that remain un-notified, file writs.
• Workmen. Employees who are workmen under labour law usually raise an industrial dispute before the conciliation officer and the Industrial Tribunal, rather than filing a writ.
• Notified bodies. Staff of organisations notified under Section 14(2) go to CAT first, and come to the High Court only against CAT's order.
• Privatised companies. Once a PSU is sold and government control ends, writs against it generally stop being maintainable, as explained below.

Is your employer "State"? Why it matters for a writ

A writ lies against the State and its instrumentalities, which Article 12 defines broadly. The Supreme Court laid down the tests in Ajay Hasia v. Khalid Mujib Sehravardi (1981) and refined them in Pradeep Kumar Biswas v. Indian Institute of Chemical Biology (2002): whether the body is financially, functionally and administratively dominated by the government. A company in which the government holds the majority of shares and appoints the board almost always qualifies. So does a body created by statute.

The position changes when control goes. In R.S. Madireddy v. Union of India (2024), the Supreme Court held that after Air India was disinvested to a private buyer it was no longer "State" and pending writs by its employees could not continue in that form; the employees were left to other remedies. The same reasoning applies to other privatised undertakings. Joint ventures and subsidiaries need a closer look: a subsidiary that is a government company may still be State, while a joint venture with a private majority usually is not.

Even where the employer is not State, a writ may still lie for a specific public duty, but ordinary service contract disputes with a private company go to the civil court or the labour forum. Our guide on whether a writ can be filed against a private company discusses that line.

Officers and workmen: writ or industrial dispute

Many PSU employees are "workmen" in labour law terms: operators, technicians, clerks, drivers and other staff who do not hold managerial or administrative posts. Supervisory staff above a wage ceiling and officers in management cadres are not. Since 21 November 2025 the Industrial Relations Code 2020 has replaced the Industrial Disputes Act 1947, though disputes that arose earlier may still be governed by the old Act in some respects; check the transitional provisions for your case.

For workmen, the usual route for termination, retrenchment or unfair labour practice is an industrial dispute: conciliation, then reference or application to the Industrial Tribunal. For central PSUs and banks, the appropriate government is the Central Government, and the tribunals in Delhi are the Central Government Industrial Tribunals. The High Court does not ordinarily entertain a writ by a workman where this machinery is available and adequate, though it hears writs against the tribunal's award.

Officers have no such forum. Their remedy, after the departmental appeal or review under the organisation's conduct, discipline and appeal rules, is the writ petition. Getting the classification right at the outset matters. An assistant manager who is in fact doing clerical work may be a workman, and a senior technician with supervisory duties may not; the label in the appointment letter is not decisive.

Suspension, charge-sheet, inquiry and penalty

Every PSU and bank has its own conduct, discipline and appeal rules, or standing orders for workmen, modelled broadly on the central civil services rules. A major penalty, such as removal, dismissal, compulsory retirement or reduction to a lower scale, needs a charge-sheet with specific allegations, a list of documents and witnesses, an inquiry where the employee can cross-examine witnesses and lead evidence, an inquiry report, and a final order by the competent disciplinary authority. An appeal lies to the appellate authority named in the rules, usually within 45 days or another period they fix.

Courts look for specific defects. Was the inquiry report given to the employee before the penalty, as Managing Director, ECIL v. B. Karunakar (1993) requires? Did the disciplinary authority disagree with an inquiry officer's finding of innocence without first telling the employee why? Were the documents relied upon actually supplied? Was the penalty imposed by an authority below the appointing authority? Was the punishment so disproportionate that it shocks the conscience? Courts do not reassess the evidence as an appeal court would, but these defects regularly lead to penalties being set aside, sometimes with liberty to hold a fresh inquiry from the stage of the defect.

On suspension, the Supreme Court said in Ajay Kumar Choudhary v. Union of India (2015) that suspension should not ordinarily continue beyond three months if a charge-sheet has not been served, and that if one is served, extension needs a reasoned order. Long suspensions with reduced subsistence allowance are among the cases where a writ brings quick relief. When Advocate B.K. Singh opens a PSU disciplinary file, he lays out the charge-sheet, the inquiry report and the penalty order side by side, because the gap between what was charged and what was finally punished is often where the case lies.

Promotion, seniority, sealed cover and vigilance clearance

Promotion disputes in PSUs usually turn on the DPC's assessment, the benchmark grading in APARs, and the vigilance status of the employee on the date of the DPC. The Supreme Court held in Dev Dutt v. Union of India (2008) that APAR entries must be communicated so the employee can represent against them, and an uncommunicated below-benchmark grading used to deny promotion is open to challenge.

The sealed cover procedure allows the DPC's recommendation for an officer facing proceedings to be kept sealed until the proceedings end. In Union of India v. K.V. Jankiraman (1991), the Supreme Court held that it can be used only once a charge-sheet has been issued or a criminal case is pending in court. A vague vigilance inquiry, a preliminary investigation or a pending complaint is not enough. PSUs sometimes deny vigilance clearance on far less, and that is a common basis for a writ. If the officer is exonerated, the cover is opened and promotion is given from the original date, usually with arrears.

Seniority disputes, particularly between direct recruits and promotees or after mergers of cadres or banks, depend on the recruitment and promotion rules and the seniority policy of the organisation. Delay hurts here more than anywhere: courts are unwilling to unsettle a seniority list that has stood unchallenged for years and on which others have been promoted.

Pay, pay revision and recovery of excess payments

Pay in central PSUs is revised on the basis of the Department of Public Enterprises' guidelines, subject to each company's capacity to pay, and bank pay through industry-level settlements. Disputes arise over fixation on promotion, stepping up to match a junior, allowances, performance-related pay and the date of effect of a revision. Many are resolved through representations once the employee points to the exact guideline being misapplied.

Recovery of excess pay is a frequent writ. In State of Punjab v. Rafiq Masih (2015), the Supreme Court held that recovery is impermissible from Class III and Class IV employees, from retired employees or those due to retire within a year, where the excess was paid for more than five years, and in some other cases where recovery would be harsh, provided the employee was not at fault. Recovery is permissible where the employee gave an undertaking to refund at the time of fixation, though even then it must follow notice.

PSUs sometimes start deducting from salary or pension without any notice. Ask for the calculation and the order in writing, and reply. A deduction from pension made without a hearing, years after the fixation, is usually the strongest kind of recovery case.

Retirement dues: gratuity, leave encashment, provident fund and pension

Gratuity, earned leave encashment and provident fund are among the most common reasons retired PSU and bank employees approach the High Court. The Supreme Court held in State of Jharkhand v. Jitendra Kumar Srivastava (2013) that pension and gratuity are not bounties but property, and cannot be withheld or reduced without authority of law. Where the organisation's rules allow gratuity to be withheld pending disciplinary proceedings, it may be kept back only while proceedings are actually pending and only as the rules permit; once they end, it must be paid, with interest if the delay was unjustified. With a retiree, Advocate B.K. Singh first compares the date the charge-sheet was served with the date of retirement, because proceedings started after retirement are often limited by the rules in what they can do.

Gratuity was governed by the Payment of Gratuity Act 1972, with claims before the Controlling Authority under the Ministry of Labour. From 21 November 2025, the Code on Social Security 2020 has taken over that field, with similar authorities. Where a PSU's own gratuity rules are more favourable, the employee gets the benefit of the better provision. A retiree may choose between the statutory authority and a writ depending on what is in dispute: a simple calculation claim may be quicker before the authority, while a withholding linked to a disciplinary case usually needs a writ.

Most central PSUs now run defined contribution superannuation schemes rather than government-style pensions, and banks have their own pension regulations. Disputes about eligibility, the option to switch schemes, commutation and family pension are decided on the specific scheme documents, so bring the scheme and every circular you received about it.

Contract, ad hoc and outsourced staff

Many people do the work of permanent employees for years under contract, through an agency, or on ad hoc appointments renewed every few months. The Supreme Court's Constitution Bench in Secretary, State of Karnataka v. Umadevi (2006) held that people appointed outside a regular selection process have no right to regularisation, while allowing a one-time exception for those who had worked ten years in sanctioned posts without court orders. That decision still governs, though later Supreme Court rulings have criticised the long-term use of temporary labels for work that is plainly permanent.

What contract employees can more often secure is equal pay for equal work where they do identical duties, protection against arbitrary termination in the middle of a contract, consideration under the organisation's own regularisation schemes, and relief where an outsourcing arrangement is a sham designed to avoid direct employment. The last point is decided on evidence of who actually supervises and pays the worker, and may belong before the labour forum rather than the High Court.

The Supreme Court struck down "hire and fire" clauses allowing termination of permanent employees by mere notice in Central Inland Water Transport Corporation v. Brojo Nath Ganguly (1986) and, in a case from Delhi, in Delhi Transport Corporation v. DTC Mazdoor Congress (1990). Those principles still protect regular PSU employees against termination without cause or inquiry.

Which High Court: Delhi or the state where you are posted

A large number of central PSUs and public sector banks have their registered or corporate offices in New Delhi, many at the SCOPE Complex on Lodhi Road and around Bhikaji Cama Place, and several ministries that control them sit here too. Where the impugned order was passed in Delhi, such as a penalty by a director at the corporate office, or a rejection of appeal by the board, the Delhi High Court has jurisdiction under Article 226(2) even if the employee is posted at a plant in Odisha or a refinery in Gujarat.

The High Court of the state where the employee is posted may also have jurisdiction, because part of the cause of action arises there. Courts apply forum conveniens: if the inquiry was held, the witnesses are and the employee works at a site in another state, and the only Delhi link is the head office, the Delhi High Court may suggest the local High Court. Employees posted in Delhi, and those whose case turns on a policy or decision taken at the Delhi head office, are on firm ground here.

A single judge decides the writ petition. A Letters Patent appeal lies to a Division Bench, generally within 30 days, and a special leave petition to the Supreme Court after that. If the organisation does not comply with a final order, a contempt petition can be filed within one year.

The laws and rules that decide PSU service cases

How a PSU service case moves, step by step

1. Use the internal remedy first

   File the departmental appeal, review or representation within the time the rules allow, setting out every ground. Courts usually expect this step, and our guide on why writs are dismissed for an alternative remedy explains the exceptions, such as orders passed without jurisdiction or in plain breach of natural justice.

2. Gather the file

   Ask in writing for the inquiry proceedings, the documents relied upon, the DPC minutes or your APARs. If they are refused, an RTI application to the public information officer of the PSU usually produces most of them.

3. Check forum and limitation

   Confirm that the organisation is not notified under CAT, decide which High Court to approach, and note the dates. There is no fixed limitation for writs, but unexplained delay of more than a few months weakens a service case.

4. Draft and file the writ petition

   The petition sets out your service history, the rule breached, the defects in the proceedings and the relief: quashing of the penalty, reinstatement, promotion from a date, release of dues with interest. It is filed online with an affidavit and documents, and served on the organisation's panel counsel.

5. First hearing

   The court may issue notice and ask for a counter affidavit. Interim relief, such as a stay of recovery or a direction to pay subsistence allowance at a proper rate, is possible where the case is strong on its face; a stay of dismissal pending decision is rare.

6. Pleadings and final hearing

   The organisation files its reply with the official record, you file a rejoinder, and the case is argued. The court may set aside the order, remand for a fresh decision from the stage of the defect, or direct payment.

7. Implementation

   Send the judgment to the competent authority with a request for compliance within the time fixed. If the organisation appeals, the LPA is heard by a Division Bench; if it simply does not comply, contempt follows.

PSU service writs: typical time and costs

We do not quote fee amounts on this site. Fees are discussed at the first meeting and agreed in writing, stage by stage; our page on process and fees explains how.

Documents to bring

Mistakes that weaken PSU service cases

• Skipping the departmental appeal. Filing a writ straight against the penalty order, without the appeal the rules provide, often leads to the petition being disposed of with a direction to appeal.
• A thin appeal. Grounds not raised in the appeal can still be argued in a writ, but the appellate authority's silence on a point you never raised is no defect.
• Not attending the inquiry. Staying away in protest gives the organisation an ex parte inquiry that is hard to fault on procedure.
• Waiting years. A penalty or seniority list challenged five years later is often refused for delay alone, however good the merits.
• Filing in CAT without checking. If the organisation is not notified, CAT will return the case, and the time spent there does not help on delay in the High Court.
• Accepting dues without protest. If a reduced gratuity or arrears are paid, accept them under written protest so the balance can still be claimed.

Selection and appointment disputes

Disputes before you join, such as eligibility in a PSU recruitment, results of a written test, rejection at document verification or an offer withdrawn after a police verification report, are recruitment cases. They follow similar writ principles but different timing, because a selection list moves quickly and the court often needs to protect a post before it is filled. Our page on recruitment and selection disputes covers those. Compassionate appointment for the family of an employee who died in service falls in between, and turns on the organisation's scheme in force on the date of death.

Employees on deputation from a PSU to a ministry, or from a ministry to a PSU, should check which service rules govern the dispute. A deputationist's lien, repatriation and pay protection often depend on the parent organisation's rules, and that in turn may decide whether the case goes to CAT or the High Court.

What to do this week

Find the time limit for your appeal or review under the conduct and discipline rules and file within it, even if briefly, adding grounds later if the rules allow. Write to the HR or personnel department for any documents you do not have. Check whether your organisation is notified under Section 14(2) of the Administrative Tribunals Act; if you are unsure, we can check it. Make a one-page note of your service history and the dates of every order. If you are about to retire with a disciplinary case pending, act before the retirement date, because the rules on proceedings against retired employees often differ.

Our general page on writ petitions in the Delhi High Court explains the wider process, and the guide on how long a writ petition takes gives realistic time frames. Employees posted outside Delhi can consult online. For advice on your service papers or updates on the law, contact Advocate B.K. Singh.