1 115 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH HARYANA STATE AGRICULTURAL MARKETING BOARD RAJ PAL SINGH CORAM: HON'BLE MR. JUSTICE Present: Mr. Mr. Ravi Kapoor, Advocate for the respondent HARKESH MANUJA, 1. Present Regular Second Appeal has been preferred by the Haryana State Agricultural Marketing Board (for brevity "the Board") assailing the judgment and decree dated 18.01.2010 passed by the learned Additional District Judge, Panchkula whereby Civil Ap of 2009 filed by the Board came to be dismissed and Civil Appeal No.41 of 2009 preferred by Raj Pal Singh{ the learned Trial Court (hereinafter referred to as 'the plaintiff’)} allowed by enhancing Court from 10% per annum to 12% per annum, while maintaining the decree granting stepping Plaintiff has also preferred Cross interest to 18% per annum. 2. Brief facts necessary for adjudication of present appeal are that plaintiff-Raj Pal Singh joined the service of the Board as Fee Collector On 03.01.1973. One Raghbir Parshad subsequently got RSA-2234-2010 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH RSA-2234-2010 Date of Decision: July 07, 2026 HARYANA STATE AGRICULTURAL MARKETING BOARD Versus RAJ PAL SINGH HON'BLE MR. JUSTICE HARKESH MANUJA Mr. Ramesh Hooda, Advocate for the appellant. Mr. Ravi Kapoor, Advocate for the respondent **** HARKESH MANUJA, J. (ORAL) Present Regular Second Appeal has been preferred by the Haryana State Agricultural Marketing Board (for brevity "the Board") assailing the judgment and decree dated 18.01.2010 passed by the learned Additional District Judge, Panchkula whereby Civil Ap of 2009 filed by the Board came to be dismissed and Civil Appeal No.41 of 2009 preferred by Raj Pal Singh{respondent herein and plaintiff before the learned Trial Court (hereinafter referred to as 'the plaintiff’)} allowed by enhancing the rate of interest awarded by the learned Trial Court from 10% per annum to 12% per annum, while maintaining the decree granting stepping-up of pay and all consequential benefits. Plaintiff has also preferred Cross-Objections praying for enhancement of interest to 18% per annum. Brief facts necessary for adjudication of present appeal are Raj Pal Singh joined the service of the Board as Fee Collector On 03.01.1973. One Raghbir Parshad subsequently got 2010 WITH XOBJS-18-C-2010 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH 2010 WITH XOBJS-18-C-2010 Date of Decision: July 07, 2026 HARYANA STATE AGRICULTURAL MARKETING BOARD ...Appellant ........Respondent HARKESH MANUJA Ramesh Hooda, Advocate for the appellant. Mr. Ravi Kapoor, Advocate for the respondent. Present Regular Second Appeal has been preferred by the Haryana State Agricultural Marketing Board (for brevity "the Board") assailing the judgment and decree dated 18.01.2010 passed by the learned Additional District Judge, Panchkula whereby Civil Appeal No.19 of 2009 filed by the Board came to be dismissed and Civil Appeal No.41 respondent herein and plaintiff before the learned Trial Court (hereinafter referred to as 'the plaintiff’)}was partly the rate of interest awarded by the learned Trial Court from 10% per annum to 12% per annum, while maintaining the up of pay and all consequential benefits. Objections praying for enhancement of Brief facts necessary for adjudication of present appeal are Raj Pal Singh joined the service of the Board as Fee Collector On 03.01.1973. One Raghbir Parshad subsequently got 2010 Date of Decision: July 07, 2026 Present Regular Second Appeal has been preferred by the Haryana State Agricultural Marketing Board (for brevity "the Board") assailing the judgment and decree dated 18.01.2010 passed by the peal No.19 of 2009 filed by the Board came to be dismissed and Civil Appeal No.41 respondent herein and plaintiff before was partly the rate of interest awarded by the learned Trial Court from 10% per annum to 12% per annum, while maintaining the up of pay and all consequential benefits. Objections praying for enhancement of Brief facts necessary for adjudication of present appeal are Raj Pal Singh joined the service of the Board as Fee Collector On 03.01.1973. One Raghbir Parshad subsequently got TEJWINDER SINGH 2026.07.10 15:15 I agree to specified portions of this document 2 RSA-2234-2010 WITH XOBJS-18-C-2010 appointed on 10.10.1974. At the time of revision of pay scales on 01.04.1979, plaintiff’s pay was revised to Rs. 540/- which was initially higher than that of Raghbir Parshad i.e. Rs.525/. However, owing to implementation of judicial directions in terms of Civil Court decree dated 29.04.1998 in favour of certain employees, the pay of Raghbir Parshad came to be stepped up to Rs.640/-. Consequently, despite being junior, Raghbir Parshad started drawing higher basic pay than the plaintiff.It was further pleaded that the Board itself had extended similar stepping-up benefits to another employee-Zile Singh. Feeling aggrieved, plaintiff filed a representation dated 27.10.2001 (Ex.P1) before the Board seeking appropriate relief. Plaintiff, thereafter, served a legal notice dated 21.07.2005 (Ex.P2) to the Chief Administrator of the Board under Section 31 of the Punjab Agricultural Produce Markets Act, 1961 before instituting the suit, narrating his appointment, seniority, the anomaly created in pay fixation and re-fixation of pay at par with his junior along with all consequential benefits. Subsequently, the plaintiff instituted Civil Suit No.371 of 2005 before learned Civil Judge (Junior Division), Panchkula seeking a declaration that he was entitled to have his pay stepped up and re-fixed with effect from 09.08.1979 at par with his junior together with all consequential monetary benefits.The Board while filing a detailed written statement, submitted in its defence that the plaintiff could not claim parity as Raghbir Parshad had obtained benefit pursuant to some litigation. Secondly, it was pleaded that the suit was hopelessly barred by limitation. 3. Upon consideration of the pleadings, the learned trial Court framed the following 8 issues: TEJWINDER SINGH 2026.07.10 15:15 I agree to specified portions of this document 3 RSA-2234-2010 WITH XOBJS-18-C-2010 “1. Whether the plaintiff is entitled to get his pay stepped up and refixed from year to year w.e.f. 09.08.1979 at par with the pay allowed to his junior Shri Raghbir Parshad, M.S., Market Committee, Narnaul, along with interest @18% per annum from the due date till the date of payment? OPP 2. If Issue No.1 is proved, whether the plaintiff is entitled to a decree of declaration? OPP 3. Whether the plaintiff is estopped from filing the suit by his own act and conduct? OPD 4. Whether the suit is not maintainable? OPD 5. Whether the suit is barred by limitation? OPD 6. Whether the Civil Court has no jurisdiction to entertain and try the present suit? OPD 7. Whether the suit is premature? OPD 8. Relief.” 4. The parties thereafter adduced oral as well as documentary evidence. The plaintiff examined himself as PW1 and proved the relevant service record, seniority and various orders issued by the Board showing that juniors had been granted stepping-up of pay by way of adducing evidence in the form of his affidavit Ex.PW-A with special emphasis on the fact that Shri Raghbir Parshad, admittedly junior to the plaintiff, was drawing higher pay solely because his pay had earlier been stepped up. 5. S.D.C. from the Office of Board appeared as DW-1, who tendered his affidavit Ex.DW1/A and reiterated the stand taken in the written statement. However, during his cross-examination, DW-1 made material admissions which substantially supported the plaintiff's case. 6. After appreciating the evidence, the learned Trial Court decreed the suit. The learned Trial Court, upon appreciation of the oral and documentary evidence, answered Issues No.1 and 2 in favour of the plaintiff. Learned counsel appearing for the defendant did not press TEJWINDER SINGH 2026.07.10 15:15 I agree to specified portions of this document 4 RSA-2234-2010 WITH XOBJS-18-C-2010 Issues No.3 to 7 during the course of final arguments and, accordingly, the said issues were treated as given up. The Trial Court recorded a categorical finding that plaintiff is entitled to step up of his pay at par with RaghubirParshad and he is also entitled to all benefits of service and arrears along with interest @ 10% per annum. 7. Aggrieved by the decree, the Board preferred Civil Appeal No.19 of 2009 and plaintiff also filed Civil Appeal No.41 of 2009, confined only to enhancement of the rate of interest from 10% to 18%.The learned Additional District Judge (hereinafter referred to as ‘first Appellate Court’) disposed of both appeals by a common judgment dated 18.01.2010. 8. The first appellate Court affirmed every material finding recorded by the Trial Court regarding entitlement to stepping-up of pay and dismissed the appeal filed by the Board.However, while allowing the plaintiff's appeal partly, the first Appellate Court enhanced the rate of interest from 10% per annum to 12% per annum. Aggrieved thereby, the Board instituted the present Regular Second Appeal. 9. While issuing notice of motion on 28.06.2010, Co-ordinate Bench of this Court granted an interim order directing that recovery of arrears beyond thirty eight months and interest beyond 10% would remain stayed. Subsequently, while admitting the appeal on 11.05.2011, the Co-ordinate Bench framed a substantial question of law relating to entitlement of the plaintiff to pay fixation from 09.08.1979 despite institution of the suit in the year 2005 and directed that recovery of arrears for the period beyond three years and two months prior to TEJWINDER SINGH 2026.07.10 15:15 I agree to specified portions of this document 5 RSA-2234-2010 WITH XOBJS-18-C-2010 institution of the suit shall remain stayed pending final adjudication. The Court framed the following substantial question of law: “Whether the plaintiff/respondent can be held entitled to get his pay stepped up and refixedw.e.f. 09.08.1979 at par with the pay allowed to his juniors including Raghbir Parshad and others, having filed the suit only on 03.10.2005, for a period beyond three years and two months prior to the date of filing of the suit?” 10. Learned counsel appearing on behalf of the appellant-Board contended that both the Courts below committed a patent error in decreeing the suit. It is submitted that the plaintiff sought re-fixation of pay from 09.08.1979 but instituted the suit only on 03.10.2005. The cause of action, if any, had accrued decades earlier and the suit was barred by limitation. It was argued that Raghbir Parshad obtained stepping-up pursuant to specific judicial orders. The plaintiff could not derive any automatic right therefrom. It was further argued that the first appellate Court erred in enhancing the rate of interest to 12% per annum. 11. On the other hand, learned counsel for the respondent submitted that the dispute concerns incorrect pay fixation, which constitutes a continuing wrong. Every month the respondent continued to receive salary on an erroneous basic pay and, therefore, every month's payment furnished a recurring cause of action. It is contended that the concurrent findings recorded by both Courts below are pure findings of fact based upon documentary evidence and call for no interference in second appeal. The respondent further supported its cross-objections seeking enhancement of interest to 18% per annum. 12. While dealing with the Regular Second Appeal, concurrent findings of fact cannot ordinarily be disturbed unless shown to be TEJWINDER SINGH 2026.07.10 15:15 I agree to specified portions of this document 6 RSA-2234-2010 WITH XOBJS-18-C-2010 perverse, based on no evidence, or arrived at by ignoring material evidence. Therefore, concurrent findings recorded by the Courts below regarding the plaintiff's seniority, the anomaly in pay, and the grant of stepping-up to juniors cannot be reopened unless demonstrated to be manifestly perverse. The Board has been unable to point out any such perversity. Both Courts below have concurrently found that the plaintiff was senior to Raghbir Parshad who eventually began drawing higher pay and the Board itself granted stepping-up to similarly situated employees. These findings are based upon documentary evidence such as Service Books, Appointment Letters , Gradation List, orders of stepping up proved on record as Ex.P4 to P13.No material has been shown before this Court demonstrating that these findings suffer from perversity or that any admissible evidence was ignored. Consequently, this Court finds no ground to interfere with the concurrent factual findings. 13. According to the appellant-Board, the plaintiff sought stepping-up from 09.08.1979 but instituted the suit only on 03.10.2005. Therefore, the entire claim deserves dismissal. Learned first appellate Court has relied upon judgment of Hon’ble the Supreme Court in M.R. Gupta v. Union of India, 1996 (1) SCT 8 (SC), wherein it was held that where the grievance relates to incorrect fixation of pay, the wrong continues every time salary is paid on an erroneous basis. Consequently, each successive payment furnishes a recurring cause of action. The Court held that although arrears may be regulated by limitation, the right to seek correction of pay fixation is not extinguished merely because the original order was passed long earlier. Gainful reference can also be made to another judgment of Hon’ble the Supreme Court in Union of TEJWINDER SINGH 2026.07.10 15:15 I agree to specified portions of this document 7 RSA-2234-2010 WITH XOBJS-18-C-2010 India v. Tarsem Singh, (2008) 8 SCC 648 where the principle was explained further. The Court observed that service-related claims ordinarily should not be entertained after long delay; however, an exception exists where the grievance pertains to a continuing wrong, such as incorrect pay fixation or pension. In such cases, although stale monetary claims may be restricted, the Court is not precluded from directing correction of the underlying pay fixation. 14. The present suit is not a simple suit for recovery of money. The primary relief claimed is a declaration that the plaintiff's pay deserved stepping-up on account of an admitted anomaly created when his junior began drawing higher basic pay. Every month's salary continued to be computed on the allegedly erroneous basic pay. Therefore, every successive salary reflected continuation of the initial error. This Court is, therefore, unable to accept the submission that the cause of action became extinct in 1979 i.e. when pay scales were revised. Rather, the incorrect fixation continued to affect the plaintiff's emoluments throughout his service. The suit, therefore, cannot be dismissed solely on the ground of delay. 15. Learned counsel for the appellant has placed considerable reliance upon the interim orders passed by this Court. Initially, while issuing notice of motion, recovery beyond thirty-eight months together with interest exceeding ten per cent was stayed. Subsequently, while admitting the appeal, this Court directed that recovery of arrears beyond three years and two months preceding institution of the suit shall remain stayed. The reliance is misconceived. An interim order passed during admission of an appeal is merely a tentative arrangement intended to TEJWINDER SINGH 2026.07.10 15:15 I agree to specified portions of this document 8 RSA-2234-2010 WITH XOBJS-18-C-2010 preserve equities pending final adjudication. It neither decides rights finally nor constitutes a reflection on the merits of the controversy. The observations made while granting interim protection are necessarily prima facie in nature. The substantial question of law itself shows that the issue of limitation was expressly kept open to be decided at the time of final adjudication. Consequently, the interim protection granted by this Court cannot be treated as an adjudication restricting the ultimate relief. It is trite that interim orders merge into the final judgment. The Court is therefore required to independently examine the issue uninfluenced by the observations made at the interlocutory stage. 16. The first appellate Court independently re-appreciated the evidence. It concurred with the findings of learned trial Court that denial of stepping-up despite admitted seniority was arbitrary. This finding is supported by documentary evidence showing that similarly situated officials had received identical benefits.No statutory rule has been produced before this Court prohibiting extension of the same benefit to the plaintiff. Nor has the appellant demonstrated that the plaintiff stood on any legally distinguishable footing. 17. Consequently, this Court finds no perversity in the conclusions recorded by the first appellate Court warranting interference in exercise of jurisdiction of this Court. 18. The substantial question of law is answered against the appellant and in favour of the respondent. It is answered and held as under: TEJWINDER SINGH 2026.07.10 15:15 I agree to specified portions of this document 9 RSA-2234-2010 WITH XOBJS-18-C-2010 1. The plaintiff's claim for stepping-up of pay arises from an alleged continuing wrong in pay fixation. 2. The suit could not be dismissed solely on the ground that the anomaly originated in 1979. 3. Both Courts below rightly held the plaintiff entitled to stepping-up of pay and consequential service benefits. 19. The respondent has filed Cross-Objections contending that the learned First Appellate Court committed an error in awarding interest only @12% per annum and that the same ought to have been enhanced to 18% per annum having regard to the prolonged deprivation of his legitimate dues. 20. Learned counsel for the respondent submitted that the appellant had unjustifiably denied the respondent the benefit of stepping- up of pay despite his admitted seniority. The respondent remained deprived of his lawful salary for several years and, therefore, interest at a higher rate ought to follow as a matter of restitution. 21. Per contra, learned counsel for the appellant argued that even the enhancement from 10% to 12% by the First Appellate Court was wholly unwarranted. It is submitted that grant of interest is governed by Section 34 of the Code of Civil Procedure and must be exercised on sound judicial principles. According to the appellant, the Trial Court had already exercised its discretion in awarding interest @10% per annum and no exceptional circumstance existed warranting enhancement. 22. Having considered the rival submissions, this Court is of the considered opinion that the respondent is not entitled to enhancement of TEJWINDER SINGH 2026.07.10 15:15 I agree to specified portions of this document 10 RSA-2234-2010 WITH XOBJS-18-C-2010 interest to 18% per annum. Section 34 of the Code of Civil Procedure confers discretion upon the Court to award reasonable interest having regard to the facts and circumstances of each case. Such discretion is undoubtedly judicial and not arbitrary. It is trite that interest is compensatory and not penal in nature. Unless there exists a contractual stipulation or a statutory mandate, Courts should ordinarily award a reasonable rate of interest and it should not become a source of unjust enrichment. Therefore, this Court finds that the learned Trial Court had consciously exercised its discretion and awarded interest @10% per annum on the arrears payable to the plaintiff. The learned First Appellate Court enhanced the same to 12% per annum principally on the ground that the respondent had remained deprived of his legitimate dues for a long period. However, a careful reading of the appellate judgment reveals that no independent reasons have been recorded as to why the discretion exercised by the Trial Court warranted interference. The appellate Court has not adverted to any statutory provision, contractual stipulation or prevailing commercial rates justifying enhancement. Although an appellate Court possesses the power to modify the rate of interest, such modification must be founded upon cogent reasons. A mere perception that the plaintiff has suffered delay cannot, by itself, justify enhancement, particularly where the Trial Court has already granted substantial compensatory interest. 23. It also deserves notice that the present dispute does not arise out of a commercial transaction. The claim pertains to service benefits flowing from pay fixation. The respondent has been held entitled to stepping-up of pay and all consequential monetary benefits. The object of TEJWINDER SINGH 2026.07.10 15:15 I agree to specified portions of this document 11 RSA-2234-2010 WITH XOBJS-18-C-2010 awarding interest is to compensate him for the delayed payment of those dues. In the considered view of this Court, interest @10% per annum adequately subserves that object. Consequently, the enhancement from 10% to 12% by the learned First Appellate Court cannot be sustained. 24. From the foregoing discussion, the following conclusions emerge: (i) The concurrent findings recorded by the learned Trial Court and the learned First Appellate Court regarding the respondent's seniority, the anomaly in pay fixation, and his entitlement to stepping-up of pay are pure findings of fact based upon documentary evidence. (ii) No perversity, illegality or misreading of evidence has been demonstrated so as to warrant interference by this Court. (iii) The claim pertains to incorrect pay fixation resulting in a continuing wrong affecting the respondent's monthly salary. The Courts below were justified in granting declaratory relief together with consequential service benefits. (iv) The interim orders passed by this Court during the pendency of the appeal restricting recovery beyond three years and two months and staying interest beyond 10% were purely interlocutory arrangements intended to preserve equities till final adjudication. Those orders neither determined the rights of the parties nor curtailed the jurisdiction of this Court while deciding the appeal finally. (v) The learned First Appellate Court was not justified in enhancing the rate of interest from 10% to 12% in the absence of any independent TEJWINDER SINGH 2026.07.10 15:15 I agree to specified portions of this document 12 RSA-2234-2010 WITH XOBJS-18-C-2010 reasons warranting interference with the discretion exercised by the learned Trial Court. (vi) The respondent has failed to make out any case in cross –objection, for enhancement of interest to 18% per annum. 25. Accordingly, the Regular Second Appeal is dismissed, subject to the modification indicated hereinbelow:- 26. The judgment and decree dated 23.03.2009 passed by the learned Civil Judge (Junior Division), Panchkula, as affirmed by the learned Additional District Judge, Panchkula vide judgment and decree dated 18.01.2010, holding the respondent entitled to stepping-up of pay with all consequential service and monetary benefits, are hereby affirmed. However, the modification made by the learned First Appellate Court enhancing the rate of interest from 10% per annum to 12% per annum is set aside. The award of interest made by the learned Trial Court at the rate of 10% per annum is restored. 27. The Cross-Objections preferred by the respondent seeking enhancement of interest to 18% per annum are dismissed. Pending miscellaneous applications, if any, also stand disposed of. 07.07.2026 (HARKESH MANUJA) Tejwinder JUDGE Whether speaking/reasoned Yes/No Whether reportable Yes/No . TEJWINDER SINGH 2026.07.10 15:15 I agree to specified portions of this document