Erroneous promotions granted under withdrawn unauthorized instructions confer no vested right to continuation.

The applicants, initially appointed as Tax Assistants and subsequently promoted as Senior Tax Assistants after qualifying the departmental examination, were promoted to the post of Inspector of Central Excise/Customs by Order No. 36/2017 dated 18.04.2017, pursuant to a DPC held on 13.04.2017.

The promotions were based on the Board’s letter dated 23.02.2017, which directed application of the Inspector Recruitment Rules, 2002 to Senior Tax Assistants completing the prescribed service as on 01.04.2017.

After the Board withdrew that communication on 01.07.2019 on the ground that it had been issued unauthorisedly, a Review DPC was conducted.

By Order No. 78/2019 dated 01.10.2019, the applicants’ promotions were withdrawn and their reversion was ordered, except in respect of 35 officers protected by an interim order of the Madras High Court.

The applicants challenged the withdrawal and reversion, alleging violation of natural justice, retrospective application of later Recruitment Rules, legitimate expectation, and discriminatory treatment.

The respondents contended that the promotions were erroneous because the applicable statutory Recruitment Rules had already superseded the 2002 Rules and that corrective action pursuant to the Review DPC was legally necessary.

Whether the applicants could claim a vested or indefeasible right to continue as Inspectors where their promotions were granted on the basis of a subsequently withdrawn and allegedly unauthorised Board communication?

Whether the withdrawal of the applicants’ promotions and their consequential reversion, without individual show-cause notices or a prior hearing, was legally invalid for violation of natural justice?

Whether the Review DPC and reversion were required to be undertaken with reference to the Recruitment Rules applicable to the relevant vacancy years, rather than the superseded 2002 Rules?

Whether the applicants were entitled to retain the salary and other monetary benefits received while they actually worked in the promotional post?

The Tribunal applied the statutory Recruitment Rules governing the posts of Senior Tax Assistant/Executive Assistant and Inspector, including the Inspector Recruitment Rules, 2002, the Executive Assistant Recruitment Rules, 2015, and the Inspector Recruitment Rules notified on 26.12.2016, holding that eligibility for promotion must conform to the Recruitment Rules applicable to the relevant vacancy and service period.

It relied principally on Shri Indusekharan K. v. Department of Revenue, O.A. No. 170/00771/2019, CAT Bengaluru, decided on 13.12.2019, for the rule that an erroneous promotion granted by mistake may be corrected through a Review DPC and consequential reversion, although salary and monetary benefits already received for actual service in the promotional post ordinarily should not be recovered.

The Tribunal further applied the principle that an erroneous promotion cannot create a vested right to continue contrary to statutory Recruitment Rules, while recognising that recovery of benefits already received is distinct from correction of the erroneous promotion.

The Tribunal found the controversy substantially identical to that decided in Indusekharan K., because the applicants’ promotions rested on the Board’s letter dated 23.02.2017, which had subsequently been withdrawn as unauthorised, followed by a direction to conduct Review DPCs under the applicable Recruitment Rules and DoP&T guidelines.

Since the new Inspector Recruitment Rules had already been notified on 26.12.2016, the applicants could not insist upon continuation of promotions made by applying the superseded 2002 Rules merely because they had served as Inspectors for some time.

The Tribunal rejected the natural-justice challenge on the basis that the impugned action was corrective, intended to bring the promotions into conformity with the governing statutory rules, and did not confer an indefeasible right on ineligible employees.

However, following Indusekharan K., it distinguished between correction of the promotional status and recovery of remuneration: the applicants had actually discharged duties in the higher post, and therefore the benefits already received were not recoverable.

The applicants were, however, not required to refund the salary or other monetary benefits received for the period during which they had actually worked in the promotional post.

The pending miscellaneous application was disposed of, with no order as to costs.