A Velayuthamv.The State of Tamil Nadu & Ors

Supreme Court Restores Regularization from Date of Eligibility, Holds G.O. Cannot Be Read Down to Deny Benefits

Case Snapshot

Case Name: A. Velayutham v. The State of Tamil Nadu & Ors.

Citation: 2026 INSC 801

Bench: Justice Dipankar Datta & Justice Sheel Nagu

Date of Judgment: July 28, 2026

Area of Law: Service Law, Regularization, Constitutional Law

The Judgment in One Line

Daily wage employee appointed through employment exchange must be regularized from completion of ten years, not from later G.O. date, to avoid discrimination.

Why This Judgment Matters

This judgment clarifies that regularization benefits announced by government policy take effect from the date the employee became eligible, not from the date of the enabling order. The Supreme Court restored the Single Judge's order, holding that the Division Bench erred in applying a Full Bench decision meant for illegal appointments to a validly appointed employee. The judgment reinforces that the State cannot discriminate between similarly situated employees—if one employee receives retrospective regularization, all must receive the same benefit. It also rejects reliance on a subsequent G.O. issued during litigation to deny accrued rights.

Background

The appellant was appointed as a "daily wages watchman" on August 26, 1992, through the local employment exchange, after participating in a selection process. G.O. No. 22 dated February 28, 2006 directed regularization of daily wage employees who had completed ten years of service as on January 1, 2006. Despite being eligible, the appellant was regularized only on September 17, 2010, through G.O. No. 187, which restricted regularization from the date of the order.

The appellant filed a writ petition. The Single Judge allowed it, directing regularization from the date of completion of ten years with arrears, relying on similar cases where coordinate Benches had granted such relief. The Division Bench reversed this, applying the Full Bench decision in S. Dhanasekaran, which held that regularization schemes take effect from the date of the enabling G.O. The appellant appealed to the Supreme Court.

Issues Before the Court

1. Whether the appellant is entitled to regularisation from the date of completion of ten years of service (August 26, 2002) or only from the date of G.O. No. 187 (September 17, 2010).

2. Whether G.O. No. 74 dated June 27, 2013, which was issued during the pendency of the litigation, affects the appellant's entitlement.

3. Whether the Full Bench decision in S. Dhanasekaran applies to the appellant's case.

What Did the Supreme Court Hold?

The Supreme Court allowed the appeal and restored the Single Judge's order. The Court's reasoning was detailed:

G.O. No. 22 is Unambiguous: The Court held that G.O. No. 22 expressly states that daily wage employees who completed ten years of service as on January 1, 2006, be regularized. The date of eligibility was fixed, and there was no ambiguity. The State's argument that regularization could only be from the date of the G.O. was rejected.

S. Dhanasekaran Distinguished: The Full Bench decision in S. Dhanasekaran dealt with daily-wage engagements lacking statutory sanction—"backdoor entries" that bypassed recruitment rules. The appellant was appointed through the employment exchange after a selection process against a sanctioned post. Therefore, the Full Bench's ratio did not apply. The State cannot use a rule meant for illegal appointments to deny rights to a validly appointed employee.

G.O. No. 74 Not Applicable: G.O. No. 74 was issued on June 27, 2013, after the appellant's writ petition was allowed by the Single Judge (July 2, 2012). It was also issued after the appellant's regularization (September 17, 2010). A later G.O. cannot defeat rights already accrued. Further, G.O. No. 74 was issued to regulate services of employees yet to be regularized, not those already regularized.

State Cannot Discriminate: The Court noted that similar employees had been granted regularization from the date of completion of ten years, and those orders were upheld. The State cannot pick and choose—giving one employee only prospective absorption and others retrospective regularization. This violates Article 14.

No Ambiguity in "Full Time": The Court disagreed with the reading of the words "full time" in G.O. No. 22, as adopted in Singamuthu. The appellant was not a part-time employee but was appointed as a daily wages watchman through a selection process. The G.O. applies to all daily wage employees, regardless of whether they worked full-time or part-time.

Division Bench Erred: The Division Bench erred in interfering with the Single Judge's well-reasoned order. The Single Judge had relied on several coordinate Bench judgments that were not disturbed by the Supreme Court. There was no valid reason for reversal.

Key Legal Principles

1. Regularization from date of eligibility — when a policy fixes a cut-off date for eligibility, regularization must take effect from that date, not from the date of the enabling order.

2. Later G.O. cannot defeat accrued rights — a G.O. issued during litigation cannot be used to deny benefits already accrued.

3. S. Dhanasekaran applies only to illegal appointments — it cannot be used to deny rights to validly appointed employees.

4. No discrimination between similarly situated employees — if one employee gets retrospective regularization, all similarly placed employees must receive the same benefit.

5. Policy announced by Government is binding — the State cannot evade its own policy pronouncement.

6. Right determined by facts as on date of action — subsequent events cannot defeat a right that existed at the time of filing the petition.

Important Precedents

State of Tamil Nadu v. A. Singamuthu, 2025 SCC OnLine SC 1234

• Distinguished: the Court read the words "full time" into G.O. No. 22, but that reading is not warranted; the appellant was not a part-time employee.

S. Dhanasekaran v. Government of Tamil Nadu, 2015 SCC OnLine Mad 874 (FB)

• Distinguished: the Full Bench dealt with illegal backdoor entries; the appellant was validly appointed through the employment exchange.

Practical Impact

For advocates: This judgment is crucial for service law practitioners dealing with regularization claims. It establishes that validly appointed employees are entitled to regularization from the date of eligibility, not from the date of the enabling order. It also prevents the State from using subsequent G.O.s to defeat accrued rights.

For future litigation: The judgment reinforces that courts will not allow the State to discriminate between similarly situated employees. It also clarifies that the S. Dhanasekaran principle is limited to illegal appointments and cannot be extended to validly appointed employees.

May be cited: In any service law case where regularization is claimed by daily wage employees appointed through employment exchanges, and where the State seeks to restrict regularization to the date of the G.O.

Lawcurb Quick Insight

The Court's distinction between S. Dhanasekaran (backdoor entries) and the present case (valid appointment through employment exchange) is significant. The State's attempt to use a Full Bench decision meant for illegal appointments to deny rights to a validly appointed employee was rightly rejected.

Lawcurb Practice Note

When advising clients on regularization, emphasize the mode of initial appointment. If appointed through the employment exchange after a selection process, the S. Dhanasekaran principle does not apply. The State cannot treat such employees as "backdoor entries."

Remember This Ratio

Validly appointed daily wage employees are entitled to regularization from the date they complete the eligibility period, not from the date of the government order.

Exam Lens

Q: What is the distinction between S. Dhanasekaran and the present case? A: S. Dhanasekaran dealt with daily-wage engagements lacking statutory sanction—"backdoor entries" that bypassed recruitment rules. In the present case, the appellant was appointed through the employment exchange after a selection process against a sanctioned post. Therefore, the Full Bench decision does not apply.

Q: Can a later government order defeat rights already accrued? A: No. Rights are determined by the facts as they exist on the date the action is instituted unless the statute or equity otherwise requires. A G.O. issued after the filing of the petition, and after the employee was already regularized, cannot be used to deny benefits.

Q: What is the effect of G.O. No. 22 on daily wage employees? A: G.O. No. 22 directed that daily wage employees who completed ten years of service as on January 1, 2006, be regularized. The date of eligibility is fixed, and regularization must take effect from that date, not from the date of the G.O.

Final Outcome

• Appeal allowed — the Supreme Court set aside the Division Bench's judgment.

• Single Judge's order restored — the appellant is entitled to regularization from the date of completion of ten years of service.

• Arrears directed — the State must pay arrears of salary from the date of completion of ten years.

• G.O. No. 74 not applicable — it was issued after the appellant's writ petition was allowed and after his regularization.

• S. Dhanasekaran distinguished — the Full Bench decision applies only to illegal appointments, not to validly appointed employees.

• No discrimination — the State cannot treat the appellant differently from similarly placed employees.

• No costs — pending applications disposed of.

Lawcurb Verdict

This judgment is a significant victory for validly appointed daily wage employees seeking regularization. By restoring the Single Judge's order and rejecting the Division Bench's reliance on S. Dhanasekaran, the Supreme Court has upheld the principle that the State cannot use a rule meant for illegal appointments to deny rights to validly appointed employees. The judgment reinforces that policy announcements are binding and that the State cannot discriminate between similarly situated employees. A principled decision that protects the rights of employees who have served for decades.

This report is prepared by Lawcurb for educational and informational purposes only. It is a concise summary of the judgment and should not be construed as legal advice. Readers are encouraged to refer to the original judgment before relying on any legal proposition.