Full Judgment Text
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 3311 OF 2008
[Arising out of SLP (C) No.12451 of 2006]
Chief Engineer / Operation
Dakshini Haryana Bijli Vitran Nigam Ltd. & Anr. …..Appellants
Versus
Mauj Khan & Ors. …..Respondents
J U D G M E N T
S.B. Sinha, J.
1. Leave granted.
2. Interpretation of a rule governing the conditions of service of the
employees of the appellant-Corporation, is the question involved in this
th
appeal which arises out of a judgment and order dated 28 October 2005
passed by a learned Single Judge of the High Court of Punjab & Haryana at
Chandigarh.
The basic fact involved in the matter is not in dispute.
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3. Respondent No.1 was appointed directly in the cadre of Upper
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Division Clerk (U.D.C.) on 06 May 1975. The terms and conditions of the
said offer of appointment in the scale of Rs.150-8-166/10-216/230-10-300
were :
“3. It should be noted that the first two years of
your service in the Board will be treated as
probationary period for the purpose of D.A.
Examination which you will be required to pass
within two years of your joining this Department.
4. You will be considered for confirmation
against permanent vacant post after you have
completed two years probationary period and
passed the Departmental Accounts Examination.
5. The failure to clear the examination within
five successive chances held immediately after six
months of your joining the service of the Board,
may involve the loss of your appointment.”
4. Indisputably, the respondent never appeared in the Departmental
Examination. The rules prescribed for appearance at the Departmental
Examinations are contained in the Manual of Orders of the Haryana State
Electricity Board, of which the appellant-Corporation was a constituent
before its bifurcation. Clause 13 thereof reads as under :
“ 13. Confirmation, grant of Annual Increment,
Retention in Service, Promotion etc. :-
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(i) Promotion. A junior clerk, a Meter Clerk or
a Cashier in the Scale of Rs.50-3-8-/4-100 (or such
other scale for such posts as may be hereafter
introduced or substituted for the scale of Rs.50-3-
80/4-100) shall not be appointed to a post carrying
a scale higher than that of the junior Clerk, Meter
Clerk or Cashier, until and unless he has passed the
examination in papers I to IV. The maximum
number of chances allowed to take the
examination in one’s service is fixed as five.
Note :- Those Junior Clerks, Meter Clerks or
Cashiers who have already passed in papers III and
IV of the examination according to the old rules
will have to appear in papers I and II of these
Rules only in order to qualify themselves for the
promotion to the grade of a Senior Clerk.
(ii) Confirmation :- A Senior clerk if he has been
directly recruited as such, will not be appointed in
a substantive capacity in his post unless he has
passed the examination in papers I to IV. If he
fails to pass the examination in papers I to IV
within three years of his appointment in the
Branch, his increments falling due after the first
two increments from his first appointment, will be
withheld until he passes the examination and will
not be granted with retrospective effect on his
passing the examination. On passing the
examination he will with effect from the date
following that on which the examination ended, be
entitled to the date of pay which would have been
admissible to him had his increment not been
withheld for his failure to pass the examination.
The failure of the senior clerk to pass the
examination in five successive examinations held
immediately after the expiry of six months from
the date of his first appointment may involve the
loss of his appointment”
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5. Indisputably, inter alia , on the premise that he had not passed the
Departmental Examination and thus was not entitled to obtain the benefit of
the increment, the same was not granted. Indisputably again, the services of
the respondent no.1 were not confirmed.
6. The Haryana State Electricity Board issued a circular letter pursuant
whereto all the employees were to be granted the benefit of additional
increment on completion of 8/18 years of regular satisfactory service and
higher standard pay scale on completion of 10/20 years or more regular
satisfactory service and promotion to the next higher post.
7. As all these benefits were denied to the respondent no.1, he filed a suit
before the Civil Judge, Gurgaon which was marked as Civil Suit No.464 of
1999 for declaration with consequential relief of mandatory injunction. The
learned trial Judge, while declining the relief of grant of increments in the
scale of pay, opined that failure to appear in the Departmental Accounts
Examination would not stand in the way of the plaintiff from obtaining the
benefit of additional increment and/or higher scale of pay stating :
“16. The only stand taken by defendants in
declining the above said benefits to plaintiff is that
he has not passed the Departmental Accounts
Examination. In my considered opinion, said
ground taken by defendants is that without any
basis in as much as grant of additional increments
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on completion of 8/18 years of service and grant of
higher standard pay scale on completion of 10/20
years or more of regular service is not subject to
the passing of Departmental Accounts
Examination. Ld. Law Officer appearing for
defendants could not quote any provision of law
which require UDCs to clear said examination for
the purpose of grant of above said benefits. Even
in the rules of 1952 of anywhere also, there is no
provision regarding requirement of passing of
Departmental Examination for availing the above
said benefits. With regard to grant of additional
increments and higher standard pay scale, the
relevant documents which have been placed on file
are Ex.PW1/8, Ex.PW1/11 and Ex.PW1/12.
Perusal of said documents shows that an employee
is entitled to additional increments and higher
standard pay scale on completion of regular
satisfactory service as defined in the policy of the
Government.
In this situation, it was argued by ld. Law
Officer that since plaintiff did not clear the
Departmental Accounts Examination, therefore, as
per the terms and conditions of offer of
appointment, he shall be deemed to be on
probation till the time he clears the Departmental
Examination and as such, he cannot be said to be
confirmed as UDC. Thus, above service benefits
as claimed shall not be admissible in favour of
plaintiff.
There is no merit in this contention in as
much as the service of plaintiff were not dispensed
with by defendants on the ground of his non-
passing the Departmental Accounts Examination.
He has been continuing in the services of
department for the last more than 29 years and as
such, notwithstanding the non-passing of
Departmental Accounts Examination, he shall be
deemed to have been confirmed in the post of
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UDC. Thus, plaintiff is entitled to be considered
for the benefit of additional increments, higher
standard pay scale and promotion.
17. On the same reasons, plaintiff is also entitled
to be considered for promotion to the next higher
post as there is no embargo against promotion of
plaintiff for not passing the Departmental
Accounts Examination. An employee is to be
promoted to next higher post taking into
consideration the length of service, his
performance and act and conduct in the post he is
working just prior to promotion.”
8. On the aforementioned finding, it was directed :
“18. In the facts and circumstances of present
case, no direction can be issued to defendants for
giving the above said benefits to plaintiff straight
away. Rather in my opinion, plaintiff is entitled
to be considered for the said benefits because
before conferment of above benefits in favour of
plaintiff, defendants would be required to see as
to whether plaintiff has regular satisfactory
service to his credit as per the policy of State
Govt. and whether he is fit for promotion.
However, it is made clear here that while
considering the entitlement of plaintiff to above
said benefits, defendants shall not take non-
passing of Departmental Accounts Examination
as a ground to reject the claim of plaintiff for
above said benefits.”
9. Both the parties preferred appeals thereagainst. By a judgment and
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order dated 30 October 2004, the learned Additional District Judge,
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Gurgaon, dismissed both the appeals. A second appeal preferred
thereagainst by the appellants has been dismissed by the High Court by
reason of the impugned judgment.
10. Mr. Arvind Nayar, learned counsel appearing on behalf of the
appellants would submit :-
(i) Having regard to the stipulations contained in the offer of
appointment, respondent no.1 was not entitled either to
increment or to confirmation in service or promotion to the next
higher post; and
(ii) Thus, period of probation would be deemed to have been
extended as respondent no.1 was not entitled to any increment
in the scale of pay and thus having not put in a regular service
was also not entitled to the benefit of additional increment on
completion of 8/18 years of regular satisfactory service or
higher standard pay scale on completion of 10/20 years of
regular satisfactory service and promotion to next higher post.
11. Mr. B.K. Satija, learned counsel appearing on behalf of the respondent
no.1, on the other hand, would urge that failure of the senior clerk to pass the
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examination would not debar him from obtaining the benefit of the policy
decision adopted by the Haryana State Electricity Board in regard to
obtaining additional increment and/or higher scale of pay on completion of
8/18 years of regular satisfactory service and/or higher standard pay scale on
completion of 10/20 years or more of regular satisfactory service.
12. Our attention has also been drawn to a clarification issued by the State
Government in respect of the following question:
“21. Employees who were not being 21. Yes, the benefit of
promoted to the next higher posts due higher standard pay
to not qualifying prescribed test or non scales is to be
given
possession of essential qualifications in such like cases.”
for promotion to the next post, whether
benefit of Higher standard pay scale is to
be given to such employee or not?
The said clarification has been accepted by the Haryana State
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Electricity Board by issuance of Circular No.117 dated 26 February 1996.
It was urged that the learned trial Judge as also the appellate court
having directed consideration of the grant of benefit of the said circulars
only, this Court, keeping in view the fact that the respondent no.1 had been
in service of the appellant-Corporation for a period of more than 33 years,
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should not exercise its discretionary jurisdiction under Article 136 of the
Constitution of India.
13. Respondent no.1 was appointed directly to the post of officiating
Upper Division Clerk on a salary of Rs.150/- per month in the scale of pay
of Rs.150-8-166/10-216/230-10-300. Indisputably, he was put on probation
for a period of two years. The said probationary period was fixed for the
purpose of passing the Departmental Accounts Examination.
14. The service of the employee was to be considered for confirmation
only upon completion of the said two years’ probationary period as also
passing of the Departmental Accounts Examination. For the said purpose,
only five successive chances were required to be given to him to appear in
the examination which were to be held after six months of his joining of
service. It has not been denied or disputed that the matter relating to passing
of the examination as also the other conditions of service is governed by the
service rules. Rule 13 provides for confirmation, grant of annual increment,
retention in service, promotion etc. For the purpose of obtaining any benefit
in terms thereof, passing of the examination in papers I to IV is imperative.
Even those who had earlier appeared and passed papers III and IV of the
examination in terms of the old rules, were required to appear in papers I and
II in terms of the said rules in order to qualify themselves for promotion to
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the grade of a senior clerk. The rules further, in no uncertain terms, state
that appointment in a substantive capacity in the post held by the employee
was subject to his passing of the said examination. It was furthermore
stipulated that in the event he failed to pass the said examination within a
period of three years of his appointment in the Branch, his increments falling
due after the first two increments from his first appointment, shall be
withheld until he passed the examination. Even after passing the
examination, increment was to be granted prospectively and not
retrospectively.
It, as noticed hereinbefore, further stipulated that failure to pass the
examination would entail loss of his appointment.
15. Indisputably, the matters relating to recruitment to a post, the period
of probation, confirmation subject to passing of the Departmental
Examination are governed by the statutory rules. Only on successful
completion of the probationary period and passing of the examination, the
services of an employee could be confirmed. Unless, services of an
employee are confirmed, he could be treated to be in the regular service of
this Board.
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16. The learned trial Judge as also the appellate Court, in our opinion,
thus, have rightly held that as the respondent no.1 did not pass the
Departmental Accounts Examination, he was not entitled to be confirmed in
service. The learned Judges, however, in our opinion, committed a serious
error in opining that the circular letter relating to grant of additional
increment and/or higher standard pay scale would be applicable in the case
of the respondent no.1.
17. Although, neither the circular letter, in terms whereof the said benefits
were to be granted, was brought to our notice nor the connected rule was
placed before us, but, on a plain reading of the judgment of the learned trial
Judge as also the first Appellate Court, it is evident that the aforementioned
benefits could be conferred on the respondent no.1 only if he had completed
the period stipulated therein in regular service. Unless, the services of an
employee are confirmed so as to bring him on the cadre of regular
employees, the question of completion of 8/18 years, 10/20 years of regular
satisfactory service would not arise. In that view of the matter, it was
wholly unnecessary for the appellants to mention about the passing of the
Departmental Examination by the concerned employee for the purpose of
availing the said benefit. The purported clarification issued by the State of
Haryana to which our attention has been drawn, in our opinion, is also not
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relevant. The clarification furnished by the State Government was in
relation to those employees who were not being promoted to the next higher
post. The same must have reference to those junior clerks whose services
were confirmed but who had not been promoted to the post of U.D.C. or
higher posts. Once services are confirmed, an employee would be borne on
the regular cadre. He thus being in the regular service, satisfactory
completion of the stipulated period therein would entitle him to the benefits
thereof.
18. We, therefore, are of the opinion that the impugned judgment cannot
be sustained.
The question, however, remains that the appellants deliberately or
otherwise despite a clear provision contained in the rules did not terminate
the services of the respondent no.1. He was allowed to continue in service.
It is neither denied nor disputed that despite the fact that he did not
pass the Departmental Accounts Examination, he was otherwise a competent
officer. In fact, he has been permitted to officiate on a higher post. In a
situation of this nature, in our opinion, the appellants had a duty to give him
a warning. His case should have been treated in terms of the rules. Failure
on the part of the State to do so, in our opinion, has seriously prejudiced
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him. Had such warning being given, he could have appeared in the
examination.
It is the case of the appellants that the respondent no.1 did not appear
at the examination at all. It has been held that the respondent is not entitled
to the benefit claimed. He was bound to pass the test within the prescribed
period. On failure to pass the test, his services were liable to be terminated.
Under the Rules, he was not entitled to any warning regarding the failure to
pass the test.
However, he was allowed to continue in service and received the
salary. What is denied is only the benefit of additional increment which can
be granted on fulfilling certain conditions. In such circumstances, there may
not be justification for payment of compensation. Instead, the appellants
should be directed not to deny pensionary benefits to the respondent on the
ground that his services were not regularized/confirmed. Such direction is
necessary only if there is a move to deny pensionary benefits.
19. The appeal is allowed subject to the aforementioned order. However,
in the facts and circumstances of the case, there shall be no order as to costs.
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……………………………….J.
[S.B. Sinha]
..…………………………..…J.
[Cyriac Joseph]
New Delhi.
May 06, 2009