Holding

A 40% pass mark must be required separately for both written and oral (interview) examinations, and 50% of the one‑third quota vacancies up to 31 December 1989 shall be filled from the existing panel with the remainder filled by fresh recruitment before 30 September 1990.

Summary

The Employees State Insurance Corporation (ESIC) prepared a panel to recruit Insurance Inspectors through a written test and interview, but did not prescribe a pass mark for the interview and applied a 40% cut‑off. Unsuccessful candidates challenged the rejection, while successful candidates sought appointment orders, leading to a dispute before the Central Administrative Tribunal (CAT). The CAT directed that a fresh select list be prepared based on total marks, disregarding any interview qualifying mark. On appeal, the Supreme Court examined whether an interview requires a separate qualifying threshold and whether 40% is a reasonable benchmark in the absence of a statutory prescription. The Court held that a 40% pass mark should be required separately for both written and oral examinations. It further directed that 50% of the one‑third quota vacancies existing up to 31 December 1989 be filled from the 1984 panel, after accounting for 116 appointments already made, and that the remaining vacancies be filled by a fresh recruitment examination before 30 September 1990. The appeal was allowed in part and the matters were disposed.

Issues considered

Whether an interview component in ESIC recruitment requires a prescribed qualifying pass mark when none is stipulated in the notification.
Whether a 40% cut‑off for the interview is a reasonable standard in the absence of explicit statutory guidance.
Whether vacancies should be filled from the existing panel or through a fresh recruitment examination.
Interpretation of Sections 2‑A, 17(2) and 97(1)(2)(xx) of the Employees State Insurance Act, 1948 concerning recruitment procedures.

Legislation cited

Employees' State Insurance Act, 1948s. 17(2), s. 2-A, s. 97(1), s. 97(1)(2)(xx)

Subjects

recruitmentinterview pass markEmployees State Insurance Actselection processvacancy fillingCentral Administrative Tribunalappointmentqualifying markspaneldirect recruitment

Judgment

MANJEET SINGH, UDC AND ORS. ETC. A
v.
EMPLOYEES STATE INSURANCE CORPN. AND ANR. ETC.

MARCH 22, 1990

[RANGANATH MISRA, M.M. PUNCHHI AND B
K. RAMASWAMY, JJ.]

Employees State Insurance Act, 1948: Sections 2-A, 17(2) and
J- 97( 1)(2)(xx).

Employees State Insurance Corporation-Insurance Inspector- C
Recruitn;ientJJf-Written Test and Interview-No pass marks prescribed
for interview-Selection made on the basis of 40% marks in the
;iJlterview held reasonable.

Service Law-Post_Filling ·up of vacancies-2/3 by promotion
and 1/3 by direct recruitment-Panel-Direct Recruit quota partially D
.filled-Filling of accumulated vacancies from out of old penal-
Desirability of.

The respondent Corporation prepared a panel for the post of
Insurance Inspector, for filling up the direct-recruit quota, on the basis
of written test and interview_ In the absence of prescribed marks for the E
interview-40% was made as basic limit for selection.

The unsuccessful candidates challenged their rejection before the
Central Administrative Tribunal contending that the ·selection based on
40% marks in the interview was unjustified. Petitions were also filed by
the successful candidates seeking directions to the respondent Corpora- F
tion to issue appointments pursuant to the panel prepared.

The tribunal directed that a fresh select list be prepared for filling
up the remaining vacancies on the basis of the total marks obtained in
the written examination and interview, in disregard of the qualifying
marks of the interview. Hence this appeal. The successful candidates G
also filed a Writ Petition contending that they were entitled to appoint-
ment order since there was no indication of the expiry of the panel.

Allowing the appeal in part and disposing of the matter, this
Court,
H

119
120 SUPREME COURT REPORTS I 1990] 2 S.C.R.

HELD: I. Interview has its own place in the matter of the selection
A process and the choice of the candidate. Once this is recognised, it
would he appropriate to require every candidate to pass the interview l
test and for that purpose there should be a basic limit provided. In the
absence of any prescription of qualifying marks for the interview test
the prescription of 40% as applicable for the written examination seems
to be reasonable. [IBC-D]
B
Rajesh Sood & Ors. v. Director-General, Employees State In- \
surance Corporation & Anr., decided on August 7, 198.<, approved. -~

2. 50% of the vacancies existing upto 31st December, 1989, relat-
able to the one-third quota should be filled up out of the penal after
C giving credit to aprointments already made. The remaining vacancies
should be filled up by holding of a fresh recruitment examination. The
scheme intended for recruitment should be on the basis of an examina-
tion comprising of written test and interview. In the oral examination
the pass mark shall be 40% and 40% pass marks shall be insisted separately
for the written as also the oral test for qualifying in the selection. [123B; D-E]
D
ORIGINAL JURISDICTION: Civil Writ Petition No. 226 of
1986.

(Under Article 32 of the Constitution oflndia).

E WITH

Civil Appeal No. 1263 of 1990.

From the Judgment and Order dated 28.4.1989 of the Central
.
Administrative Tribunal, Hyderabad in T .A. No. 1146 of 1986.
F
Dr. L.M. Singhvi, Dr. Gauri Shankar, C. Mukopadhya, P.N.
Misra and H.S. Parihar, for the Petitioners.

Madhava Reddy, Vivek Gambhir, S.K. Gambhir, R.D.
Upadhyaya and Surender Kamai! for the Respondents.
G
The Judgment of the Court was delivered by

RANGANATH MISRA, J. Petitioners are employees under the
State Insurance Corporation, respondent no. 1. According to the
notification dated 22nd of April, 1977, issued in exercise ot powers
H
MANJEET SINGH v. E.S.l.C. [MISRA, J.l 121

conferred bys. 97(1), (1, 2)(xxx), s. 2A ands. 17(2) of the Employees
State Insurance Act, 1948, (hereinafter referred to as 'the Act') which A
came by way of supersession of (he Employees State Insurance Corpo-
-~ ration (Recruitment) Regulations. 1965, the post of Insurance Inspec-
' tor/Manager Grade II was treated partly as selection and partly as non-
selection. There was no age limit for departmental candidates and
two-thirds of the vacancies were to be filled up promotion and one- B
third by competitive examination under the Rules. By advertisement
dated 6th August, 1983, applications were invited for filling up the
one-third vacancies by direct recruitment to the category of post of
I Insurance Inspector/Manager Grade II. The petitioners in this applica-
~·
tion under Art. 32 of the Constitution responded to the said advertise-
ment and were in due course declared as successful in the test. In
consideration of the fact that a good number of vacancies were then c
existing and in anticipation of the position that more vacancies were
about to occur, a select list was drawn up for the existing and future
vacancies. In the said select list petitioners featured at Sr. nos. 114,
116, 121, 159, 171, 172 and 188 respectively. The panel was notified
and in accordance with the practice petitioners along with other sue- D
cessful candidates were individually intimated by respondent no. 2 on
1.9.1984.

As already, indicated, the direct recruitment was on the basis of
examination and interview. The advertisement did not prescribe any
pass marks in the interview though for the written examination 40% E
·..1. was prescribed. Selection was, however, made on the basis of 40% in
the interview test and those who did not secure 40% in the interview
were not selected. Challenge was made by the unsuccessful candidates
questioning their rejection by contending that in the absence of any
prescription of pass marks for the interview test, there was no justifi-
..,
~

cation to apply the 40% basis. Writ Petitions were also filed when the F
respondents instead of appointing people from the panel of successful
candidates went on filling up existing vacancies out of the category of
promotees. Such petitions were pending before the Calcutta, Madras
and Andhra Pradesh High Courts when the Central Administrative
Tribunals came to be set up. These were transferred to the respective
Benches of the Central Administrative 'fribunals and on being clubbed G
were disposed of by a common judgment dated 28th of April, 1989, by
the Hyderabad Bench of the Central Administrative Tribunal. The
Tribunal held:
...(
"We would direct in these cases that the respondents shall
work out and estimate the vacancies available upto 20th H
122 SUPREME COURT REPORTS [ 1990] 2 S.C.R.

June, 1986 accurately (we have used the word 'accurately'
A
as an apprehension has been expressed that dire.ct recruits
are not getting their due since over 320 posts were filled up
between May, 1986 and December, 1988 by promotees on
ad-hoc basis or otherwise). After such estimation, the
respondents shall deduct therefrom 116 vacancies which
B have already been filled and make available the remaining
vacancies to the applicants and others who took the exami-
nation on the basis of aggregate marks, i.e. total marks
obtained in the written test and the oral interview. Such of
the applicants in all the three cases before us and heard by
us at Hyderabad, Madras and Calcutta, who come within
the zone of selection in accordance with this procedure as
c directed by us would be entitled to appointment."

The writ petition is by the successful candidates whose names
appear in the panel but who have not been given appointments. They . __,____
have contended that the respondents were entitled to the issue of
D appointment orders to them inasmuch as vacancies exist and there was
no indication that the life of the select list would expire either at the
end of one year or on the expiry of the further ex\ended period of six
months and when there has been no fresh select list as yet.·

The decision of the Central Administrative Tribunal referred to
E above has been assailed by special leave challenging the direction of
the Tribunal that the fresh select list filling up the remaining vacancies
as on 20th June, 1986, should be prepared on the basis of total marks
obtained in the written examination and interview in disregard of the
qualifying marks for the latter. We granted special leave and have
heard the writ petition and the civil appeal together:
F
As already indicated, the last list on the basis of recruitment
examination was drawn up in 1984. There have been a good number of
vacancies then existing and subsequently a number of them have arisen
as against which only 116 appointments have been made, including 16
out of the reserved categories. At one stage of the hearing we had
G indicated to Shri Madhav Reddy, appearing for the respondent-
Corporation that the existing vacancies should be filled up out of the
panel of 1984 and in answer to this suggestion, an affidavit has been
filed to say that candidates have been waiting for the holding of fresh
recruitment examination and if out of the panel of 1984 all the existing
vacancies are directed to be filled up, they would be frustrated. There
H is force in the submission. The Tribunal in its decision has indicated
MANJEET SINGH v. E.S.I.C. [MISRA, J.l '123

that even upto 20th June, 1984, there were some vacancies which were A
available to be filled up out of the panel. On account of respondents'
inaction in holding of annual recruitment examinations, vacancies
have accumulated. Keeping all these aspects in view, we direct that 50% of
the vacancies existing upto 31st of December, 1989, relatable to the
one-third quota should be filled up out of the panel after giving credit
to 116 appointments noticed by the Tribunal. The remaining vacancies B
should be filled up by holding of a fresh recruitment examination latest
before 30th of September, 1990.

'
_/r So far as the remaining question tl:tat was debated before the
Tribunal is concerned, we are of the view that the scheme intended for
recruitment should be on the basis of an exammation comprising of writ- c
ten test and interview. We agree with the submission of Shri Madhav
Reddy that interview has its own place in the matter of the selection
process and the choice of the candidate. Once this is recognised, it
would be appropriate to require every candidate to pass the interview
test and for that purpose there should be a basic limit provided. In the
absence of any prescription of qualifying marks for the interview test D
the same prescription of 40% as applicable for the written examination
seems to be reasonable. That has been the view expressed by one of us
(Punchhi, J.) in a decision (Rajesh Sood & Ors. v. Director-General,
Employees State Insurance Corporation & Anr., decided on August.7,
1985) to which our attention has been drawn. We approve of the view.
Accordingly, we modify the direction of the Administrative Tribunal E
;
-,. and hold that in the oral examination the pass mark shall be 40% and
40% pass marks shall be insisted separately for the written as also the
oral te;t for qualifying in th selection.

The appeal is partly allowed and both the matters are disposed of
by this common judgment. There shall be no order as to costs. F

T.N.A. Appeal allowet) in part.