Union Of India And Others vs S.V.Nagarajan
2008 Latest Caselaw 1294 Del

*                     HIGH COURT OF DELHI : NEW DELHI

                  Judgment reserved on: 25.10.2007
+                 Judgment delivered on: 08.08.2008

%                         W.P. (C) No.4460/2002

        Union of India and others               ...Petitioner
                         Through:      Mr.Arvind Sharma, Advocate

                                     versus

       S.V.Nagarajan                             ...Respondent
                          Through:     Mr. O.P. Gehlaut, Advocate


CORAM:

HON'BLE MR. JUSTICE A.K.SIKRI
HON'BLE MR. JUSTICE VIPIN SANGHI

1. Whether the Reporters of local papers may
   be allowed to see the judgment?

2. To be referred to Reporter or not?                    Yes

3. Whether the judgment should be reported               Yes
   in the Digest?


VIPIN SANGHI, J.

1. This writ petition has been filed by the Union of India,

challenging the validity of the order dated 01.05.2002, passed by the

Central Administrative Tribunal, Principal Bench, New Delhi, (in short

"the Tribunal"), allowing the OA No.2388/2001 filed by the respondent

herein Shri S.V. Nagarajan, whereby the Tribunal has held that the

respondent is entitled to the benefit of the upgraded scale of

Rs.22400-24500, retrospectively w.e.f. 1.1.1996, in terms of para 4(a)

of the Official Memorandum (O.M.) dated 30.06.1999 bearing

No.6/1/98-ICI issued by the Department of Expenditure, Ministry of

WP(C) No.4460/2002 page 1 of 20 Finance, Government of India. As to what this O.M. states would

become clear a little later.

2. Briefly stated, the facts of the case are that the respondent

was appointed as Joint Director in the Indian Cost Accounts Service

(ICAS) w.e.f. 04.09.1982. Thereafter, Sh. M.L. Mehta and Sh. J.K. Puri,

were appointed as Dy. Directors (Cost) in the said service. Admittedly,

the respondent was senior to both Sh. M.L. Mehta and Sh. J.K. Puri.

The respondent was appointed to the Senior Administrative Grade

(SAG) of Advisor (Cost) in the pay scale of Rs.5900-6700 w.e.f.

21.07.1989 and thereafter, as Member (Finance) w.e.f. 31.03.1994 in

the Bureau of Industrial Cost and Prices, Ministry of Industry (herein

referred to as BICP). On 1.1.1996, all of them were holding the

substantive post of Advisor(Cost). The respondent retired from service

on 31.01.1998, on attaining the age of superannuation.

3. On the recommendations of the Fifth Central Pay

Commission (FCPC) being accepted, petitioner upgraded one of the

posts of Advisor (Cost) to that of Additional Chief Advisor (ACA) and

revised its pay scale from Rs.18400-22400 to Rs.22400-24500. This

upgradation was notified vide notification dated 30.6.1999 bearing

No.6/1/98-ICI issued by the Department of Expenditure, Ministry of

Finance, Government of India. The petitioner, in pursuance of the said

OM, fixed the pay of Sh. M.L. Mehta at Rs.22400/- w.e.f. 01.01.1996 to

30.4.1996 (the date of his superannuation) and of Sh. J.K. Puri also at

Rs.22400/- w.e.f. 16.09.1996, respectively, with retrospective effect

WP(C) No.4460/2002 page 2 of 20 vide notifications dated 27.7.1999 (and corrigendum dated 4.8.1999),

and dated 23.7.1999 respectively. Therefore, both Shri M.L. Mehta and

Shri J.K. Puri were given the upgraded pay scale of Rs.22400-24500

admissible for the post of ACA.

4. Encouraged by the aforesaid act of the petitioner, the

respondent filed OA No.1671/2001 claiming that he being senior to

both Shri M.L. Mehta and Shri J.K. Puri in the grade of Advisor (Cost), it

is he who should have been given the grade of ACA with effect from

1.1.1996 till the date of his superannuation i.e. 31.1.1998. The said

O.A. was disposed of by the Tribunal vide order dated 11.07.2001 with

a direction to the petitioner herein to dispose of the representations of

the respondent by passing a speaking and reasoned order and

communicating the same to the respondent, within one month.

Thereafter, the petitioner rejected the claim of the respondent vide

their order dated 29.8.2001. The stand of the petitioner was that the

orders of retrospective up-gradation in respect of Shri M.L. Mehta and

Shri J.K. Puri were issued erroneously, without following the prescribed

selection procedure and were not in accordance with para 4(b) of the

OM dated 30.06.1999, which stipulated prospective up-gradation and

the filling up of the vacancy in accordance with the selection

procedure. Accordingly, vide notification No.C-18018/12/2001-Ad.I

dated 09.08.2001, the erroneous order of up-gradation in respect of

these officers were rescinded and the officers who were advanced the

benefit of up-gradation retrospectively, were reverted to the post of

Advisor (Cost).

WP(C) No.4460/2002 page 3 of 20

5. At this stage it would be useful to extract the relevant

portion of the O.M. dated 30.6.199, the interpretation of which is called

for in the present petition:

"Based on the recommendations of the Fifth Central Pay Commission [FCPC], revised pay scales in respect of certain common categories of staff and certain specified posts in individuals ministries, departments and Union Territories were notified in Parts 'B' and 'C' of the first Schedule to the Central Civil Services (Revised Pay) Rules, 1997, promulgated in this Department's Notification No. GSR 569(E) dated September 30, 1997. This Notification did not include the higher pay scales recommended by the FCPC for certain specified posts in various Organised Group 'A' services and for Group 'A' posts in individual ministries and departments not included in any of the Organised Group 'A' Services. The recommendations in respect of these posts were to be examined separately and necessary orders issued.

2. The FCPC recommendations relating to Group 'A' posts included in the Organised Group 'A' Services have now been carefully considered. The FCPC had recommended the upgradation of certain posts in different Services identified and specified by them and their placement in higher replacement scales of pay. These recommendations cover practically all the Organised Group 'A' Services with a few exceptions. In doing so, the Commission had, Inter alia, taken into account the following factors:

(a) the acute stagnation in most of the Organised Group 'A' Services;

(b) cadre structure of different Services

(c) non-availability of adequate number of posts in higher levels;

(d) status of cadre reviews

The intention of the Commission was to ensure the upgradation of a limited number of posts at senior levels as an interim measure with the objective of improving the career prospects of the Members of these Services pending detail cadre reviews.

3. Posts in these Services covered by the FCPC recommendations may be broadly categorized as

WP(C) No.4460/2002 page 4 of 20 follows:

(a) posts which are to be placed in higher replacement pay scales, without involving the assumption of higher functional responsibilities;

(b) those which are to be encadred in one of the Organized Services and placed in higher replacement pay scales;

(c) posts for which only the normal replacement pay scales will apply but which are to be encadred in one of the Organised Services;

(d) those which are to be upgraded and placed in higher pay scales, necessitating the restructuring of cadres or redistribution of posts;

(e) posts that are to be revived or created and placed higher pay scales.

4. The President is now pleased to decide that the posts listed in Column 1 of Annexure I to this Office Memorandum may be placed in the higher revised FCPC scales of pay indicated in column 3 thereof. Placement of the posts and their incumbents in the higher replacement scales of pay now approved will be subject to the following conditions:

(a) According to the instructions issued by the Department of Personnel and Training in their O.M. Number 22011/10/84- Estt.(D) dated February 14, 1992, where the upgradation of posts involves only the placement of existing incumbents in higher replacement scales without the assumption of any higher responsibilities or changes in eligibility criteria, the suitability of the incumbents to occupy such posts in the higher pay scales is not required to be assessed afresh. They can therefore be appointed to the posts in the higher pay scales with effect from the date notified by the Government giving effect to the recommendations of the Pay Commission.

                     Accordingly,      the       applicable      higher

WP(C) No.4460/2002                                                  page 5 of 20

replacement scales of pay will be extended retrospectively w.e.f. January 1, 1996 only in respect of those posts not involving the assumption of higher responsibilities or changes in the eligibility criteria. Some illustrative examples of such posts are those of Members in the Postal Services Board, Members/ Additional Director General in the Ordinance Factories Board, General managers of Zonal Railways, Metro Railway, Railway Production Units, etc. Officers on Special Duty in newly-established Railway Zones, Principal, Railway Staff College, Director General, Research & Development under the Ministry of Railways, etc.

(b) Implementation of the FCPC recommendations relating to posts which are to be upgraded and placed in higher pay scales will, however, necessitate the redistribution of posts presently in lower pay scales in the recommended higher scales, involving restructuring of the cadres. Besides, incumbents of posts in identical scales of pay being interchangeable, it is not unlikely that juniors may be presently occupying posts that are to be placed in higher scales of pay in terms of the FCPC recommendations. The recommended higher pay scales cannot therefore be extended in situ to the present incumbents of such posts without duly observing the prescribed selection processes. In the circumstances, upgradation of posts involving the redistribution of posts or cadre restructuring will be effective only prospectively. Eligible officers will also be placed in the higher scales of pay only on completion of the formalities prescribed by the Department of Personnel and Training for appointments to posts in the applicable higher replacement pay scales and on their fulfilling the prescribed residency requirements. Financial benefits will consequently accrue to those appointed against these posts only from the date(s) that they are so appointed on observance of the prescribed selection processes. "

WP(C) No.4460/2002 page 6 of 20 "ANNEXURE-I TO DEPARTMENT OF EXPENDITURE O.M NO.6/1/98-IC-I DATED JUNE 30, 1999

DETAILS OF POSTS IN ORGANISED GROUP `A' SERVICES WHICH ARE TO BE PLACED IN HIGHER SCALES OF PAY ON ACCEPTANCE OF THE RECOMMENDTIOINS OF THE 5TH CENTRAL PAY COMMISSION.

Particulars of Posts Pre-Revised Revised Paragraph No. Scale Scale in Report

Rs. Rs.

A. CENTRAL CIVIL SERVICES (GROUP `A')

1. INDIAN CIVIL ACCOUNTS SERVICE

xx xx xx xx xx xx xx xx

2. INDIAN COST ACCOUNTS SERVICE

Chief Advisor(Cost) 7300-7600 Cost Accounts Branch, Department of Expenditure (22400-24500) 26000(Fixed) 48.44

Advisor (Cost), Cost Accounts Branch 5900-6700 (To be upgraded as Additional Chief Advisor) (18400-22400) 22400-24500 48.46(i)"

6. From the aforesaid, it is, therefore, evident that if the

upgradation for a post involves only the placement of the existing

incumbents in higher replacement scales without assumption of any

higher responsibilities or change in eligibility criteria, there is no need

for a fresh assessment of the suitability of the incumbents to place

them in the upgraded post and such an upgradation would be given

retrospective effect i.e. w.e.f. January 1, 1996. However, where the

upgradation of a post necessitates redistribution of posts presently in

lower pay scales in the recommended higher scales, and involve

restructuring of the cadre and assumption of higher responsibilities in

the upgraded post, or a change in the eligibility criteria in respect of

the upgraded post, in such situations the upgradation cannot be

granted in situ to the present incumbents without duly observing the

prescribed selection process and the upgradation of posts is to be only

WP(C) No.4460/2002 page 7 of 20 prospective. The issue therefore that arises for consideration is

whether the upgradation of one post of Advisor (Cost) to the post of

ACA in the Cost Accounts Branch falls under para 4(a) or within para

4(b) of the aforesaid OM.

7. The case of the respondent was that the up-gradation in

question did not involve any redistribution of posts and restructuring of

the cadre, as a specific post of Advisor (cost) in the Cost Accounts

Branch had been upgraded, and the discretion for deciding upon the

up-gradation of any of the three posts was not left to the petitioners.

The senior most Advisor (Cost) automatically stood upgraded as ACA

with effect from 1.1.1996. The scale of the upgraded post also already

existed, in that the scale of pay which was earlier prescribed for the

Chief Advisor (Cost) was now given to the ACA. It was argued that the

upgradation of one post of ACA did not involve the assumption of

higher responsibilities by the incumbent who was upgraded as ACA, as

the duties and responsibilities remain the same. Hence, it was

contended that the said up-gradation was covered under para 4(a)

and not under para 4(b) of the OM dated 30.06.99. Thus, the

respondent claimed to be entitled to promotion to the grade of ACA

with retrospective effect.

8. On the other hand, according to the petitioners, Vide OM

dated 30th June 1999 issued in pursuance of the recommendations of

the FCPC, one out of three posts of Advisor(Cost) in ICAS was upgraded

as Additional Chief Advisor in the pay scale of Rs.22,400-24,500/- in

WP(C) No.4460/2002 page 8 of 20 Cost Account Branch. Since only one of the three posts had to be

upgraded, thus the up-gradation of the post involved re-distribution of

posts and cadre restructuring and such cases were governed by para

4(b) of the O.M. dated 30.6.1999 and the up-gradation could only be

effective prospectively. Further, it was averred that the upgraded post

is at the level of Additional Secretary and involves assumption of

higher responsibilities including the cadre administration of the Indian

Cost Accounts Service, administration of the Cost Accounts Branch and

looking after the duties of the Chief Advisor (Cost) in his absence.

Hence, the placement for the said post could only be prospective after

observing the procedure prescribed by the Department of the

Personnel & Training (DOP&T), in accordance with the instructions

contained in para 4(b) of the O.M. dated 30.06.99. The higher post of

ACA was not intended to be filled up by merely on the basis of seniority

from amongst the Advisor (Cost), and even a junior could be appointed

to the said post in supersession of a Senior Advisor (Cost).

9. It was further averred on behalf of the Petitioners that since

the respondent went on deputation pursuant to an advertisement and

his due selection to a higher post in BICP, and was functioning as

member (Finance) BICP w.e.f. 31.3.94 till the date of his retirement i.e.

31.1.1998, Sh. M.L.Mehta, the senior most officer, who was holding the

post of Advisor(Cost) as on 1.1.96 was erroneously granted the scale of

pay of ACA retrospectively, without following the prescribed procedure

under para 4(b) of the said OM dated 30.6.1999. Similarly, Shri J.K. Puri

was also given the same benefit by treating the case as falling under

WP(C) No.4460/2002 page 9 of 20 para 4(a) of the O.M. dated 30.6.1999. Thereafter, the matter was

examined and considered carefully by the Department and it was

found that the aforesaid orders of retrospective up-gradation in respect

of these two officers were issued erroneously without following the

procedure, and the same was not in accordance with para 4(b) of the

O.M. date 30.06.99 which stipulated prospective up-gradation in

accordance with the selection procedure. Thus, Vide Notification No. C-

18018/12/2001-Ad.I dt. 9.8.2001, the erroneous orders of up-gradation

were rescinded and the officers who were extended the benefit of the

up-gradation were reverted to the post of Advisor(Cost).

10. The Tribunal, by its impugned order allowed the original

application filed by the respondent and the reasons given by the

Traibunal are the following:

(i) The petitioners herein had admitted that the

respondent/applicant was the senior-most Adviser(Cost) and that

the orders of upgradation in respect of S/Sh.Mehta and Puri were

erroneously issued.

(ii) The notifications dated 27.7.1999 and 23.7.1999 giving

retrospective effect to upgradation in respect of S/Sh. Mehta and

Puri were rescinded and withdrawn only on 9.8.2001. i.e after a

lapse of more than two years - that too after directions were

given by the Tribunal in OA No.1671/2001 filed by the

applicant/respondent herein.

(iii) When one post of Adviser(Cost) in the pay scale of Rs.18,400-

WP(C) No.4460/2002 page 10 of 20 22400 was upgraded as ACA in the pay scale of Rs.22,400-25500

on 30.6.1999, no recruitment rules for the post of ACA were in

existence.

(iv)From the conduct of the petitioner herein in giving retrospective

upgradation to S/Shri Mehta & Puri, it appears that the

petitioners had taken a decision that the suitability of the

incumbents to occupy such post in the higher pay scale is

not required to be assessed afresh. It is for this reason that

S/Shri Mehta and Puri were upgraded to the post of ACA w.e.f.

1.1.1996 and 16.9.1996 respectively as per procedure laid down

in para 4(a) of the O.M dated 30.6.1999;

(v) The applicant/respondent herein had made a representation to

the petitioner on 18.8.1999 i.e. immediately after the

upgradation of S/Shri Mehta & Puri to the post of ACA in July

1999 pointing out that he was the senior most Adviser (Cost) and

that he ought to have given the higher pay scale of ACA

w.e.f.1.1.1996. If the said post were not to be filled under

para 4(a) of the O.M dated 30.6.1999, the petitioner

would have immediately reverted S/Shri Mehta and Puri

to SAG and considered all the eligible officers including

the applicant for promotion to the upgraded post under

para 4(b) of the O.M. dated 30.6.1999. The reversion of

S/Shri Mehta and Puri was done only after the judgment and

order dated 11.7.2001 of the Tribunal vide notification dated

9.8.2001.

WP(C) No.4460/2002 page 11 of 20

(vi)The newly created post of ACA is in the rank of Additional

Secretary to the Government of India and "the approval for

appointing S/Shri Mehta and Puri to this post must have

been taken at the highest level in the government and

that too after having due consideration and consultation

with the concerned departments of the Government."

(vii) The plea of the Government that the appointment of S/Shri

Mehta and Puri were made retrospectively without following the

prescribed procedure does not stand to logic.

(viii) The petitioners, in order to justify their wrong and

arbitrary action have now decided to cancel the

appointment of S/Shri Mehta and Puri from 1996 and to

fill up the upgraded post in terms of para 4(b) of the O.M

dated 30.6.1999 and have accordingly notified the

recruitment rules for the post of ACA on 19.10.2001.

(ix) The petitioner had failed to satisfy as to whether any follow up

action had been taken to reduce the retrial benefits of S/Shri

Mehta and Puri in pursuance of the notification dated 9.8.2001.

11. The contention of the petitioner based on the decision of

the Supreme Court in ICAR & Another vs. T.K.Suryanarayan &

Ors., AIR 1997 SC 1318, that the grant of an incorrect promotion

erroneously by the department upon a misreading of the service rules

or the grant of promotion pursuant to judicial orders contrary to service

rules cannot be a ground to claim erroneous promotion by perpetrating

WP(C) No.4460/2002 page 12 of 20 infringement of statutory rules, was rejected by the Tribunal by holding

that the applicant/respondent herein is not praying for extending the

benefit of a wrong committed by the petitioners. He only wants

upgradation of his pay scale with retrospective effect from 1.1.1996 to

31.1.1998 in terms of para 4(a) of O.M dated 30.6.1999 as the same

was applicable during the relevant period.

12. The petitioner Union of India assails the impugned order of

the Tribunal on the ground that the Tribunal has proceeded on the

basis of various assumptions which have no foundation to stand on. It

is argued that the upgradation of only one of the posts of Advisor

(Cost) constitutes not a mere upgradation, but involves redistribution

and restructuring of the cadre. The number of posts of Advisor (Cost)

was reduced by one with the creation of a higher post of ACA. There

was, therefore, restructuring of the cadre. Had it been the intention to

merely upgrade the post of Advisor (Cost), all the posts would have

been upgraded and not merely one of those posts, leaving the other

posts untouched in the grade of Advisor (Cost). It is also argued that

the post of ACA has to shoulder higher responsibilities, it being a

position equivalent in rank to that of Additional Secretary in the

Government of India. It is, therefore, contended that the upgraded

post of ACA fell under para 4(b) and not para 4(a) of OM dated

30.6.1999. Counsel for the respondent has, however, supported the

decision of the Tribunal and made the same submissions as are

reflected in the impugned order.

WP(C) No.4460/2002 page 13 of 20

13. We had reserved judgment in this case on 25.10.2007 and

in W.P.(C) No.9903/2006 U.O.I. v. M.L. Mehta arising out of O.A.

No.3160/2003 on 11.10.2007. Both these matters raised the same

issues. However, erroneously, in the order dated 11.10.2007 passed in

W.P.(C) No.9903/2006 it was recorded "Dismissed. Order to be

dictated later." When this mistake was realized we placed W.P.(C)

No.9903/2006 for directions and the aforesaid order was corrected.

Further hearing took place and it was contended by learned counsel for

the respondent in this case, as well as the counsel for the respondent

in W.P.(C) No.9903/2006 that the post of Additional Chief Advisor

(Cost) being a Secretary level post, it is not possible that the

upgradation was made in the case of Sh. M.L. Mehta without the

approval of the Cabinet and, therefore, there must have been due

application of mind by the petitioner to the issue as to whether the

case is covered under para 4(a) or under para 4(b) of the O.M. dated

30.06.1999. Accordingly, we required the petitioner to produce the

original records to show the consideration of the case of Sh. M.L. Mehta

at the time of grant of the upgraded pay to him. The file has been

produced and we have perused the same. It appears from the file that

the said issue was not examined at all and the upgradation was

granted on the assumption that the post of Advisor (Cost) had been

upgraded to that of Additional Chief Advisor (Cost) in the scale of

Rs.22400/- - Rs.24500/- w.e.f. 01.01.1996.

14. Having considered the arguments advanced on behalf of

both the parties and perused the material on record, in our view, the

WP(C) No.4460/2002 page 14 of 20 Tribunal has erred in concluding that the post of ACA is a mere

upgradation of one post of Advisor (Cost) and that the case is covered

by para 4(a) and not 4(b) of the OM dated 30.6.1999.

15. There is force in the contention of the petitioners that the

upgradation of one post of Advisor (Cost) to the post of ACA falls

within the ambit of para 4(b) of the O.M. dated 30.06.1999, as there is

"restructuring of cadre" and "assumptions of higher responsibilities" as

contemplated by para 4(b) of the said O.M. It is also important to

note that only one post was upgraded. Hence, it can not be said that

the upgradation is a mere change in nomenclature of the post. The fact

that only one post of Advisor (Cost) has been upgraded shows that one

post of Advisor (Cost) stood simultaneously abolished. This is nothing

but restructuring of the cadre. Had all the three posts of Advisor (Cost)

been upgraded there might have been some force in the respondents

submission that it is just a change of nomenclature. We have called

for the FCPC and perused Para 48.46 thereof, which deals with the

upgradation of one post of Advisor(Cost) and makes a specific

reference as to readjustment of hierarchy at the top, implying thereby,

that the post of ACA would be at a higher hierarchical level than

Advisor(cost) and thus would necessarily mean assumption of

greater/higher responsibilities. The relevant extract of the FCPC, Para

48.46 reads as follows:

WP(C) No.4460/2002 page 15 of 20 "Upgradation and encadrement of some key posts 48.46 To streamline the cost accounting work of various Departments/ Ministries of Govt. of India, officers of this service have been specifically posted and attached in ten different Departments. The Cost accounting work pertaining to the other Departments/Ministries /Undertakings is being looked after by the Cost Accounts Branch, Ministry of Finance.

We feel it appropriate to partially re-

adjust the hierarchy at the top.

This would not only help in better and systematic working of the officials but provide an umbrella for the middle level ICAS officers posted in other Departments as well. In view of the changed economic scenario, entry of multi-nationals are being proposed and made in the sectors like Railways, Telecommunications, Posts, Steel & Mines, Power, Coal Defence, Fertilizer.

There is a strong need from the national point of view to monitor the profitability aspect of such huge Investments being made in these sectors. Accordingly, we recommend the following:-

(i) Upgradation of one cadre post of Advisor (Cost), Cost Account Branch, Ministry of Finance as Addl. Chief Advisor (Cost) in the replacement scale of pay corresponding to the pre-revised scale of Rs.7300-7600.

(ii) Upgradation of the posts of Member (Finance, Bureau of Industrial Cost and Prices, Ministry of Industry in the replacement scale of pay corresponding to the pre-revised scale of Rs.7300-7600 and its encadrement in the ICAS Cadre.

(iii)................."

(Emphasis supplied)

WP(C) No.4460/2002 page 16 of 20

16. From the aforesaid, it is clear that the new post of ACA is

at a higher level than the post of Advisor (cost), as it would amount to

a partial readjustment of the hierarchy at the top and would "help in

better and systematic working of the officials". The new post of ACA is

seen as providing "an umbrella for the middle level ICAS officers

posted in other department as well." The need to create, inter alia, the

post of ACA was felt in view of the changed economic scenario and

the entry of multinationals in sectors like railways,

telecommunications, posts etc and because it was felt that there was

strong need from the national point of view to monitor the profitability

aspects of huge investments being made in these sectors. Assumption

of higher duties and responsibilities is therefore writ large from the

reasons given by the FCPC justifying the creation of, inter alia, the

post of ACA.

17. We reject the reasoning given by the Tribunal while

arriving at its impugned decision. Merely because the orders granting

upgradation to S/Shri Mehta and Puri were rescinded after about two

years and after directions had been given by the Tribunal in OA

No.1617/2001 filed by the respondent, it does not follow that the

submission of the petitioner that the post of ACA carried higher

responsibilities and required a process of selection could not be

believed. We also do not agree that the mere absence of recruitment

rules for the post of ACA on 30.6.1999, when the said post was created

upon upgradation of one post of Advisor (Cost), leads to the

WP(C) No.4460/2002 page 17 of 20 assumption that the post of ACA is a mere upgradation of one of the

post of Advisor (Cost) or that it does not tantamount to restructuring

of the cadre or that the upgraded post did not carry higher

responsibilities. There is no foundation or basis for the Tribunal to

conclude that the respondents had, while erroneously upgrading the

post held by S/Shri Mehta and Puri retrospectively, concluded that

there was no need to assess the suitability of the incumbent afresh

before upgrading them from the post of Advisor (Cost) to that of ACA.

Similarly, the observation of the Tribunal that the approval for

appointing S/Shri Mehta and Puri "must have been taken at the highest

level in the Government and that too after having due consideration

and consultation with the concerned Departments of the Government"

is also a mere assumption made by the Tribunal. Once the petitioner

had itself come out with the stand on record that the retrospective

upgradation of S/Shri Mehta and Puri was erroneous, and had further

taken corrective steps by withdrawing the benefit of upgradation given

to the said officers, it was incorrect for the Tribunal to base it

conclusions on assumptions contrary to the stand taken by the

petitioner. The observation of the Tribunal that petitioners "in order to

justify their wrong and arbitrary action have now decided to cancel

the appointment of S/Shri Mehta and Puri from 1996 and fill up the

upgraded post in terms of para 4(b) of the OM dated 30.6.1999 and

have accordingly notified the recruitment rules for the post of ACA

(Rs.22000-24500) on 19.10.2001" is too far-fetched and without any

foundation. It was not even the respondent's case that any particular

WP(C) No.4460/2002 page 18 of 20 office in the department of the petitioner was enemical towards him

and was bent upon denying the benefit claimed by the respondent. It

is also highly far-fetched for the Tribunal to conclude that to deny the

benefit claimed by the respondent, the petitioner would go to the

extent of adversely effecting the interest of two other officers who had

also retired. We disapprove of this line of reasoning adopted by the

Tribunal as the same borders on perversity. The Tribunal has

attributed motivated conduct to the petitioner in withdrawing the

benefit earlier given to S/Shri Mehta and Puri and in notifying the

recruitment rules for the post of ACA (Cost) on 19.10.2001, only with a

view to deny similar benefit to the respondent. This approach of the

Tribunal is most unfortunate and we reject the same. The Tribunal has

also fallen in error in observing that if the petitioner had not decided to

fill up the post of ACA under para 4(a) of the OM dated 30.6.1999, they

would have considered all the eligible officers including the respondent

for promotion to the upgraded post under para 4(b) of the said OM.

The Tribunal has, while making this observation, forgotten the fact in

respect of upgraded posts covered by para 4(b), there is no question of

consideration of the candidature of officers who have verified prior to

the issuance of the notification dated 30.6.1999.

18. In our view the Tribunal also erred in concluding that the

present case was not covered by the decision of the Supreme Court in

ICAR & Anr. Vs. T.K. Suryanarayan & Ors. AIR 1997 SC 3108.

Since para 4(b) of the OM dated 30.6.1999 was squarely applicable in

respect of the upgraded post of ACA, the retrospective promotion

WP(C) No.4460/2002 page 19 of 20 granted to S/Shri Mehta and Puri was erroneous and the same could

not have been the foundation of a claim by the respondent.

19. The respondent has relied on an order passed by the

Supreme Court, reported as All India Non-SC/ST Employees

Association (Railway) vs. V.K. Agarwal & Ors. 2002 SCC (L & S)

688. The said short order cannot be said to lay down any general

principle of law that in all cases of upgradation, where the total

number of posts remain the same, there is no question of restructuring

of the cadre. In fact, the aspect of assumption of higher responsibilities

has not even been addressed in the said order of the Supreme Court.

The same is therefore of no avail to the respondent.

20. For our aforesaid reasons, we set aside the order of the

Tribunal and hold that the original application filed by the respondent

was devoid of merit and liable to be dismissed. The writ petition is

accordingly allowed leaving the parties to bear their respective costs.

(VIPIN SANGHI) JUDGE

(A.K. SIKRI) JUDGE August 08, 2008 aj/as

WP(C) No.4460/2002 page 20 of 20