Holding

The seniority of the merged Telex Operators is to be fixed under the executive instruction and Clause H(iii) of the 1975 Regulations, placing them below regular AG‑II staff, and the Commission’s promotions were lawful and not arbitrary.

Summary

The Supreme Court examined the merger of Telex Operators into the Assistant Grade‑II (AG‑II) cadre of the Oil and Natural Gas Commission (ONGC) and the consequent seniority and promotion issues. The Telex Operators were redesignated as AG‑II employees on 25 April 1980 and placed en bloc below regular AG‑II staff, with their seniority fixed according to the executive instruction and Clause H(iii) of the 1975 Regulations. The Commission promoted Telex Operators under the 12‑year and 18‑year policies and, to maintain parity, also promoted regular AG‑II employees in the Central and Headquarters regions, but not those in the Western region where the Telex Operators refused promotion. The petitioners from the Western region challenged these promotions, and the Gujarat High Court quashed them and ordered a consolidated, centralised list of all regions. The Supreme Court held that the seniority placement and the Commission’s promotions were lawful, not arbitrary, and that the High Court exceeded its jurisdiction by directing a conversion of the regional cadre to a centralised one. Consequently, the Court set aside the High Court judgment, restored the promotions, and dismissed the writ petition.

Issues considered

The seniority of Telex Operators after their redesignation into the AG‑II cadre.
Whether regular AG‑II employees can be promoted under the 12‑year and 18‑year policies when junior Telex Operators have been promoted, potentially prejudicing senior employees.
Whether the High Court could direct the conversion of the regional AG‑II cadre into a centralised cadre and require a consolidated list for promotions.
Whether the Commission’s actions in fixing seniority and granting promotions were arbitrary or unreasonable.

Legislation cited

Constitution of Indias. Article 32
Oil and Natural Gas Commission Act, 1959s. 32

Subjects

senioritycadre mergerpromotion policy12‑year policy18‑year policynext below rulearbitrarinesscentralisationOil and Natural Gas Commissionservice law

Judgment

A R.K. SETHI AND ANOTHER ETC.
v.
OIL AND NATURAL GAS COMMISSION

JANUARY 28, 1997

B
[S.C. AGRAWAL AND FAIZAN UDDIN, JJ)

Se1Vice Law : Oil and Natural Gas Commission Act, 1959-Section
32/0il and Natural Gas Commission (Tem1s and conditions of appointment
i11 se1vice)Regulation 1975--Clause H(iii), B(iii)b Oil and Natural Gas Com-
C mission Recruitment and Promotion Regulatio11, 1980 a11d Executive Instmc-
tio11s dated Ap1il 25, 198o--Para 5(iii), (viiij-fi'ixation of inter se se11iority
consequent upon merger of Telex operators with the cadre of Assista11t Grade
11 (AG 1/)-Telex operators were placed enbloc below AG-IE-But were of
fered promotio11al benefit under 12 years and 18 years policies, promoting
D them as AG-I and then as Superintendent-Same benefit offered to AG-I!
Officers-Held: Not arbitrary-Not unreasonable-In consonance with 'Next
below mle' of se1Vice jwispmdence-Seniority of the Telex Operators has to
be detem1i11ed by provisions of Clause H(iii) of 1975 Regulations and not by
Clause B(iii)(b)-AG-ll officers of westem Region could not be so promoted
E as the Telex operators in that region did not accept such promotion-171e
Commission not bound to promote them merely because AG-II employees
of the other two regions were so promoted-Steps taken by Commission per-
missible in law-High Court's direction to convert A G-1/ from regional to
central cadre and to prepare a consolidated list of all regions for the purpose
of promotion-Not justified as the decision of the Commissio.•1 does not suffer
F from any vice of arbitrariness.

In the Oil and Natnral Gas Commission, recruitment and promotion
upto a certain level is on regional basis and thereafter it is centralised. In
the personal and Administrative Discipline, appointment and promotion
G to the posts of Assistant Grade-III, Assistant Grade-II and Assistant
Grade-I are made on regional basis and appointment and promotion to
the higher posts of Superintendent and above are made on centralised
basis.

Telex Operators in the Oil and Natural Gas Commission were
H merged and redesignated as Assistant Grade-II by executive instructions
616
R.K. SETIII v. O.N.G.C. 617
... > dated 25th April, 1980. As a result of the merger, the Telex Operators were A
placed enbloc below the Assistant Grade-II employees in each region. But
they were given promotional benefit under 12 years and 18 years polices.
On the basis of 12 years policy the Telex Operators in the Central and Head
Quarter regions were promoted as Assistant Grade-I with effect from May
17, 1980 and on the basis of 18 years policy they were further promoteci as
Superintendent with effect from April 1, 1982. The same benefit was ex- B
tended to the regular employees of these two regions and as such they were
-. also promoted by order dated February 2, 1984. The employees of the
Western Region could not be promoted as the Telex Operators in the region
did not accept such promotions. The employees of the Western region filed
, a writ petitio~ in the High Court challenging the order of promotion dated c
February 2, 1984 and asking for retrospective promotion along with the
promotees of the other two regions. The High Court allowed the petition
and quashed the promotions of the respondents who were made parties in
the writ petition and also stayed further promotions till a consolidated list
of all regions was prepared. Against tlie order of the High Court the present
appeals are filed by the affected employees and the Commission. The Writ D
-<
Petition is filed by two of the affected employees of the Headquarter region
whose promotions were revoked by the Commission pursuant to the order
:::'
of the High Court.

Allowing the appeals and the Writ Petiton, this Court
E
HELD : 1.1. The Telex Operators are rightly placed en bloc below the
regular employees in Assistant Grade-II cadre at the time of merger of the
cadre of Telex Operators .in the cadre of Assistant Grade-II by Executive
Instructions dated April 25, 1980. The earlier service of the Telex
Operators at a lower pay scale before merger could not be equated with F
the service of the regular Assistant Grade-II employees at a higher pay
scale. Therefore, they were rightly placed junior to the regular employees
of Assistant Grade-II cadre on merger. [628-D, BJ
::.".<
1.2. The seniority of the Telex Operators in the cadre of Assistant
Grade-II will be governed by the provisions contained in paragraph 1 (viii) G
of the Executive Instruction of April 25, 1980 which lays down the prin-
-I
cipals of fixation of inter se seniority consequent to merger of two
~
-; categories. It is specifed in these provisions that for the purpose of
1' promotion to the next higher scale, inter se seniority of the employees
considered for promotion will be fixed on the basis of length of service put H
618 SUPREME COURT REPORTS (1997] 1 S.C.R.
A in by the individual in the respective pay scale with those in higher
erstwhile scale, being treated as senior to those in lower erstwhile scale,
enbloc. This principle is in consonance with the principle laid down in
Clause H(iii) of the Principles of se!liority prescribed under Regulation 19
of 1975 Regulations. This provision deals with the absorption of the
B employees in the cadre to which they are temporarily transferred and lays
down that their seniority will be counted only from the date of their
transfer to that cadre. The merger of the cadre of Telex Operator had been
brought about by transfer of Telex Operators to the cadre of Assistant
Grade-II and their absorption in the sa1d cadre. Their seniority, therefore, .
will have to be determined in accordance with Clause H(iii). [627-E-F]
c
2. The Commission was justified in promoting the regular employees
in Assistant Grade-II cadre, when the Telex Operators junior to them were
promoted. The Next below rule' in service jurisprudence seeks to ensure
that if a junior employee is promoted without considering his senior then
D the senior employee can claim the right to be considered for such promo-
tion with effect from the date on which the junior was so promoted. The
'
action of the commission in extending the benefit of promotion to regular '
employees in Assistant Grade-II cadre as Assistant Grade-I with, effect
from the date the Telex Operators were so promoted on account of 12 years
policy and further promotion from Assistant Grade-I to Superintendent
E under the 18 years policy, being in consonance with this principle cannot,
therefore, be held to be arbitrary and unreasonable. [628-E]

3. Regular employees in Assistant Grade-II cadre in the Western
region could claim promotion as Assistant Grade-I and further promotion
F from Assistant Grade-I to the post of Superintendent from a date earlier
than April 1, 1982 only if a Telex Operator junior to them had been so
promoted at an earlier date. Since no Telex Operator Junior to the regular
employees in Assistant Grade-II cadre in the western region was so
promoted from a date earlier than April 1, 1982, the Assistant Grade-II
employees of that region could not claim a right to be promoted with effect
G from an earlier date. [630-C-E]

4. The High Court erred in directing that Assistant Grade-II cadre
should be converted from ·a re::r,ional cadre to centralized cadre and a
consolidated list be prepared of all regions and promotions should be
H made on that basis. It is for the Commission to decide how to organize
)...-

R.K SE1HI v. O.N.G.C. (S.CAGRAWAL, J.] 619
.. )
the administrative services in order to achieve efficiency in the ad- A
_.. ministration. The Commission has taken .a decision that cadres upto
Assistant Grade-I should be maintained in regional level. There is
nothing to show that the laid decision of the Commission suffers from
any vice of arbitrariness. [630-F-G]
B
CIVIL ORIGINAL/APPELLATE JURISDICTION : Writ Petition
(C) No. 870 of 1986 Etc.
)'

Under Article 32 of the Constitution of India.

D.K. Garg for the Petitioner/Appellant in C.A. No. 525/87. c
Ashwini Kumar, R.S. Suri, S.C. Patel (NP) for the Respondent WP
No. 870/86 &, Appellant in C.A. No. 525/87.

The Judgment of the Court was delivered by
D
S.C. AGRAWAL, J. : These appeals and the writ petition raise
common questions relating to seniority in the cadre of Assistant Grade-II
(for short 'AG-II') and promotion to the higher posts of Assistant Grade-I
~' (for short 'AG-I') and Superintendent in the Oil and Natural Gas Com-
mission (hereinafter referred to as 'the Commission').
E
In the Commission recruitment and promotion up to a certain level
is on regional basis and thereafter it is centralised. In the Personnel and
Administration (P & A) Discipline appointment and promotion to the
posts of Assistant Grade-III (for short 'AG- III'), AG-II and AG-I are
made on re!iional basis arid appointment and promotion to the higher posts
of Superintendent and above are made on centralised basis. There was F
separate seniority in the cadre of AG-III, AG-II and AG-I for each region ·
while in the higher cadres it was on all India basis. We are concerned with
the Central, Western and Headquarters regions. In early 1960s the Com-
mission felt the need of Telex Operators and employees working as AG-III
were picked up to work as Telex Operators. With effect from April 1, 1969
G
a separate cadre of Telex Operators having separate seniority was created.
,.. The Telex Operators were earlier having a pay scale which was higher than
-; that of AG-III but lower than that of AG-II. With effect from April 1, 1979
the Telex Operators as well as AG-H were placed at the same pay scale
of Rs. 430-880. The Telex Operators did not have any promotional channel.
Under the Recruitment and Promotion Regulations, 1980 (hereinafter H
620 SUPREME COURT REPORTS [1997] 1 S.C.R.
A referred ta 'IS 'the 1980 Regulations'), which came into force on April 24,
1980, the designations of many posts under the Recruitment and Promotion
Regulations, 1974 were changed. The 1980 Regulations did not contain the
post of Telex Operator. In order to implement the 1980 Regulations
executive instructions were issued vide office order No. 2(22)/80-RP-I
dated April 25, 1980 (hereinafter referred to as 'the Executive
t
B Instructions') with regard to placement at appropriate level and other
connected matters for different categories of employees. In paragraph 5 of
the said order fitment principles for categories in other disciplines were
set out. S11b-paragraph (iii) of the said paragraph related to Telex
Operators and it read as under :
c "(iii) Telex Operator - Rs. 370-700 (Rs. 430-880).

All existing employees in the category of Telex Operator will be
redesignated as Assistant Grade-II in the pay scale of Rs. 370-700
(Rs. 430-880). Total service rendered by the employee in the pay
scale of Rs. 360-640 and Rs. 370-700 (Rs. 430-880) will be counted
D
· for purpose of promotion to the pay scale of Rs. 470-~80 (Rs .
. 530-1060)".

In paragraph 1 of the said order general instructions were given in
respect of all the categories of employees. Sub-paragraph (viii) of para-
E graph 1 related to fixation of inter se seniority consequent upon merger of
two categories. It contained the following provision :

"(viii) Fixation of inter se seniority consequent upon. merger· of two
categories :

F Where under R & P Regulations, 1980, two or more categories
have been merged, for purposes of promotions to the next higher
pay scale, inter se seniority of the employees considered for promo-
tion will be fixed on the basis of length of service put in by the
individual in the respective pay scale with those in the higher
erstwhile scale, being treated as senior to those in the lower
G
erstwhile scale, enbloc. Existing interse seniority will not be dis-
turbed." . ·

As a result of the merger of the cadre of Telex Operators with AG-II
the Telex Operators in each region were placed enbloc below AG-II in the
H said region. On April 25, 1980 an office order No. 2/24/80-RP-I was issu~d to
R.K SETHI v. O.N.G.C. [S.CAGRAWAL, J.J 621

make provision for promotion on time bound basis (hereinafter referred to A
as 'the 12 years Policy'). In the said order it was stated that for employees
in Class III and IV equivalent, every employee will have at least two
promotions, if otherwise suitable, and that in order to achieve this in the
scale of pay between Rs. 230-308 (old) (290-400 (revised) to Rs. 650-1200
in each cadre of discipline number of higher posts will be operated in the B
next promotional step in the pattern of a selection grade if required and
that employees in the scale of Rs. 370-700 (old) (Rs. 430-880 (revised) who
have completed 12 years' service in the concerned region would be
qualified for consideration for promotion to the scale of Rs. 470-880 (old)
(Rs. 530-1060 (revised) and their fitness for promotion would be judged C
on the basis of procedure laid down for departmental promotion. By Office
Memorandum No. 2(50)/80-RP-I dated May 27, 1982 the Commission
'adopted a policy whereunder, as a special one time exception, all Class III
employees who, as on April 1, 1982, had put in at least 18 years' service in
the present grade and in the grade innnediately below in Class III post were D
to be considered by appropriate DPCs for promotion from April 1, 1982 by
suitable upgradation of posts, provided they had spend ~t least three years
in their present grade and provided further that they had not been super-
seded on grounds of merit for promotion earlier. This concession was not
to be given for the purpose of promotion of such of Class III employees who
had already been promoted as Class III officers. It was found that certain E
senior employees were left out of consideration for promotion because they
did not fulfil conditions Nos. (i) and (ii) of the Office Memorandum dated
May 27, 1982 aforementioned while their juniors had been promoted be-
cause they fulfilled those criteria and, therefore, by Office memorandum
No. 2(50)/80-RP-I dated February 3, 1983 it was decided that such senior F
employees would be considered for promotion and, if found suitable, would
be promoted with effect from April 1, 1982. By another Office Memoran-
dum No. 2(50)/80-RP-I dated February 3, 1983 it was decided that, as a
special one time exception, all Class lil employees who, as on April 1, 1982,
had put in at least 18 years' service in the present grade immediately below G
in Clause III posts would be considered for promotion by an appropriate
DPC by suitable upgradation of posts and, if they were found suitable for
such a promotion, the promotions will be with effect from April 1, 1982.
The aforementioned Office Memoranda dated May 27, 1982 and February
. , 3, 1983 will hereinafter be collectively referred to as 'the 18 years Policy'. H
SUPREME COURT REPORTS
-~
622 (1997] 1 S.C.R.
A On the basis of the 12 years Policy the Telex Operators in the Central and
Headquarters regions who had been placed in the cadre of AG-II as a
result of the Executive instructions regarding fitment of existing employees
and who had completed 12 years service were promoted as AG-I with
effect from May 17, 1980. Thereafter, on the basis of the 18 years Policy,
B the Telex Operators, who had completed 18 years' service, were promoted
as Superintendent with effect from April 1, 1982. Regular employees who
were functioning as AG-II prior to the merger of the cadre of Telex
Operators in the care of AG-II and who were senior to the Telex
Operators were, however, promoted as AG-I with effect from April 1,
1982. Since ·they were senior to the Telex Operators who had been
c promoted as AG-I earlier to them, by order dated February 2, 1984, the
regular employees in AG-II cadre in Central an Headquarters regions
were also promoted as AG-I with effect from the same date (May 17, 1980)
on which date the Telex Operators junior to them had been promoted as
AG-I although those regular employees in AG-II cadre did not have 12
D years' service to their credit and did not fulfil the criterion laid down in
the 12 years Policy. Those regular employees in AG-II cadre who were
thus promoted as AG-I with effect from May 17, 1980 were also given the
benefit of the 18 years Policy and were promoted as Superintendent (P &
A) with effect from April 1, 1982 by order dated February 2, 1984, for the
E reason that Telex Operators junior to them in the cadre of AG-II had been
promoted as Superintendent with effect from April 1, 1982. Such promo-
tions of regular employees in AG-II cadre as AG-I with effect from May
17, 1980 and as Superintendent with effect from Aprill, 1982 could not be
given effect to in the Western region for the reason that the Telex
F Operators in the Western region, who were offered promotion as AG-I,
did not accept such promotion and since no Telex Operator junior to
regular employees in AG-II cadre was promoted as AG-I with effect from
a date earlier than April 1, 1982 no regular employee in AG- II cadre in
the Western region was promoted as AG-I with effect from a from a date
G earlier than April 1, 1982 and for the same reason they could not be
promoted as Superintendent with effect from April 1, 1982.

Respondents Nos. 4 to 8 in Civil Appeal No. 527 of 1987 (hereinafter
referred to as 'the petitioners') were regular employees in AG-II ~re in
the Western region who were promoted as AG-I with effect from April 1,
H 1982 but did not get promotion as AG-I with effect from May 17, 1980 and
R.K SETIU V. 0.N.G.C. [S.C.AGRAWAL, J.] 623
as Superintendent with effect from April 1, 1982 as granted to regular A
employees in AG- II cadre in the Central and Headquarters regions. Since
seniority in the cadre of AG-I has a bearing on promotion to the higher
post of Superintendent which is a centralised cadre the petitioners, feeling
aggrieved by their non-promotion as AG-I with effect from May 17, 1980,
filed a Writ Petition (Special Civil Application No. 4811 of 1984) in the B
Gujarat High Court wherein they sought a writ in the nature of mandamus
or any other appropriate writ, order or direction directing the Commission
to give retrospective promotion to them on the post of AG-I with effect
from May 17, 1980 and on the post of Superintendent (P & A) with effect
from April 1, 1982 on the same lines as applied to AG-II of Central
region/Headquarters region who were also promoted initially as AG-I with C
effect from April 1, 1982 and alternatively they prayed for quashing of the
. order dated February 2, 1984 for promotion of regular employees in AG-II
cadre in Central and Headquarters regions and/or adjusting the promo-
tions of the petitioners in accordance with the correct principle of seniority
and correct application of promotion policy to the petitioners. The said D
Writ Petition of the petitioners has been allowed by the High Court by the
impugned judgment dated December 23, 1985. The High Court has held
that promotions that were granted to the regular employees in AG-II cadre
in the Central and Headquarters regions were not in accordance with law
but since the persons who are likely to be effected had not been joined as
parties the relief could only be granted as against the parties who were on E
record. The High Court has, therefore, set aside the orders of promotion
of respondents Nos. 4, 5, 7, 8 and 9 in the Writ Petition Respondents No.
9. 10, 12, 13 and 14 in Civil Appeal No. 525 of 1987). The High Court has,
however, directed that if the said respondents are entitled for promotion
on account of their original seniority as AG-II, they will be entitled for the p
promotion, if available. The High Court has also restrained the Commis-
sion from granting further promotion to the then regular employees in the
cadre of AG-II on April 25, 1980 of the .Central and Headquarters regions
on the basis of their higher promotion, i.e., being senior to the Telex
.Operators on that date till a consoliated list of all regions is prepared in
accordance with law and they are found eligible for promotion in the light G
of the observations made in the judgment.

R.K. Sethi and B.P. Arya were regular employees in the cadre of
AG-II in the Headquarters region, They were promoted as AG-I with
effect from May 17, 1980 and as Superintendent (P & A) with effect from H
(

624 SUPREME COURT REPORTS
~
[1997] 1 S. C.R.

A April 1, 1982 respectively on the basis of promotions given to the Telex •
·Operators in that region. Even though their promotions were not quashed
by the impugned judgment of the High Court but in order to give effect to
the said decision the Commission has passed orders dated May 21, 1986 ,..
revoking their promotion as AG-I with effect from May 17, 1980 and as
Superintendent (P & A) with effect from April 1, 1982. They have filed
"""
B Civil Appeal No. 525 of 1987 to challenge the said judgment of the High
Court. They have also filed Writ Petition No. 870 of 1986 under Article 32
of the Constitution wherein they have challenged the correctness of the
~
said judgment and have prayed for quashing of the order ·dated May 21,
1986 passed by the Commission on the basis of the impugned judgment of
c the Gujarat High Court. Civil Appeal No. 527 of 1987 has been filed by
the Commission against the judgment of the High Court.

· The High Court has dealt with the matter by posing the following
two questions :

D (1) What should be the seniority of the Telex Operators when they
are redesignated? \o-

(2) If the Telex Operators are placed below the regular AG-II,
can the regular AG-II in the Central and Headquarters region be
promoted under the policies of 12 years and 18 years so as to
E
prejudice the chances of promotion to the petitioners?

While Dealing with the first question, the High Court has observed
that it the Telex Operators are placed below the existing regular employees
it will amount to wiping out their service completely. The High Court has
F considered the principles of seniority contained in Annexure II to the •-
O.N.G.C. (Terms and Conditions of Appointment and Service) Regula-
tions, 1975 (hereinafter referred to as 'the 1975 Regulations') more par-
ticularly clauses B and H of the said principles. The High Court has held
that clause H could not be applied and that the Telex Operators must be
either continued as a separate cadre or merged with the original cadre by ·~
G length of service in accordance with the principles contained in clause B.

As regards the second question, the High Court was of the view that
merely because the Telex Operators had got the benefit of promotion ...
policy which was in relaxation of the statutory regulations it could not be
H said that the persons who are above the Telex Operators in the seniority
R.K. SETIII v. O.N.G.C. (S.C.AGRAWAL, J.] 625
in the cadre of AG-II could also get the same benefit. In view of the High A
Court, the employees who are qualified under the 12 years Policy had to
stand in the queue for promotion under the sta\utory regulations and their
seniority could not help them and it could help them only in respect of the
vacancies which were to be filled in by regular promotion. According to
the High Court, the 18 years Policy for stagnation relief could not be made B
available to a person who has not stagnated at all and that by resorting to
this type of promotion policy the Commission had committed an error
prejudicial to the petitioners who were also borne on the cadre of AG-II
and were aspiring for promotion to the post of Superintendent and have
longer experience than the regular employees of Central and Headquarters
regions. The High Court has also observed that if the Telex Operators in C
the Western region have refused to avail under the 12 years Policy and
under the 18 years Policy, the right of the regular employees in AG-II cadre
could not be whittled down and the fortuitous circumstance that some
persons refuse promotion should not come in the way of the rightful ,
/ .
~- claimants and that, if the Commission intends to give promotions to the I)
regular employees of AG-II in other regions, it should consider the case
of the persons in the Western region also on the basis that the petitioners
were senior to the Telex Operators in the lower cadre and were entitled
to further promotions in the same way as their counter parts in other
regions.
E
We may, at this stage, refer to the relevant provisions of the Prin-
ciples of Seniority laid down as per Regulation 19 of the 1975 Regulations:

"PRINCIPLES OF SENIORITY.

j
The following principles will be followed for regulating the F
seniority of the employees in the Oil and Natural Gas Commission:

B. Departmental Promotees :

(i) x x x x
G
(ii) x x x x

(iii) Where promotions to a grade are made either from inore than
one grade or from the same grade divided into different cadres on
regional project or Directorate basis, eligible persons shall be
placed in separate lists in order of their inter se seniority in the H
626 SUPREME COURT REPORTS [1997] 1 S.C.R.

A respective grades or cadres.
•
(a) xx xx
I

(b) If, however, the promotion is to be made on the basis of
seniority-cum-fitness i.e. seniority subject to the rejection of
B unfit, the Departmental Promotion Committee shall place the
candidates from the various lists into one "consolidated
seniority list" based on the total length of service rendered in
that grade or cad re and make recommendations for promo-
tion on the basis of this "consolidated list". The inter se
seniority of the candidates in their respective lists will not be
c disturbed in the 'consolidated list".•

H. Fixation of seniority on absorption of employees from one cadre
to another.

D The fixation criteria shall be taken into account in fixing seniority of
employees absorbed in a cadre other than the one to which they belong :

(i) The Commission will be free to transfer employees from oµe
cadre to another temporarily on administrative grounds, e.g., trans-
fer of work, non-availability of suitable men.
E
(ii) Such employees will retain their lien and seniority in the parent
·co.dres and will have no right for absorption in the cadres to which
they are transferred temporarily.

(iii) If, as a very special case, they are to be considered for
F absorption in the cadres to which they are temporarily transferred, ..
their seniority will count only from the date of their transfer to the
cadre in which they are actually working (at the time qf their
absorption is considered) so as not to prejudice the right and
seniority of the personnel already recruited or promoted to these
cadres; even those recruited and promoted to these cadres on the
G
·day the personnel from other cadres are transferred will all rank
senior to the personnel transferred from the other cadres."

On behalf of the Commission, Shri Ashwini Kumar has urged that as
a result of fitment under paragraph S(iii) of the Executive Instructions, the
H cadre of Telex Operators was merged in the existing cadre of AG-II and
R.K.SETHI v. 0.N.G.C. [S.CAGRAWAL,J.] 627
the seniority of Telex Operators had to be fixed in accordance with A
paragraph l(viii) of the Executive Instructions read with clause H(iii) of
the Principles of Seniority. We find considerable force in this contention.
As a result of the fitment policy contained in paragraph 5(iii) of the
Executive Instructions the cadres of Telex Operators had been merged in
the cadre of AG-II. The word "redesignated" in paragraph 5(iii) has to be B
read with the words "two or more categories have been merged" contained
in paragraph l(viii) and it can only be construed to mean that as a result
of redesignation there was merger of the cadre of Telex Operators into the
the cadre of AG-II. The statement in paragraph 5(iii) that the total service
rendered by the employees in the pay scale of Rs. 366-640 and Rs. 370-700
(Rs. 430-880) will be counted for the purpose of promotion to the pay scale C
of Rs. 470-880 (Rs. 530-1060) only enables the Telex Operators who have
. been merged in the cadre of AG-II to avail the period of service rendered
by them as Telex Operators for the purpose of promotion. But the seniority
in the cadre of AG-II will be governed by the provisions contained in
paragraph l(viii) which lays down the principles of fixation of inter se D
seniority cbnsequent upon merger of two categories. In paragraph l(viii)
it is sp~cified that for the purposes of promotion to the next higher scale,
inter se seniority of the employees considered for promotion will be fixed
on the basis of length of service put in by the individual in the respective
pay scale with those in higher erstwhile scale, being treated a8 senior to
those in the lower erstwhile scale, enbloc. This principle is in consonance E
with the principle laid down in clause H(iii) of the Principles of Seniority
preseribed under Regulation 19 of the 1975 Regulations. The said provision
deals with the absorption of the employees in the cadre to which they are
temporarily transferred and lays down that their seniority will be counted
only from the date of their transfer to the cadre. The merger of the cadre F
of the Telex Operator had been brought about by transfer of the Telex
Operators to the cadre of AG-II and their absorption in the said cadre.
Their seniority will, therefore, have to be determined in accordance with
clause H(iii). We are unable to appreciate how clause B(iii)(b) can be
made applicable. The said clause relates to fixation of seniority in the G
matter of departmental promotees where promotions to a grade are made
either from more than one grade or from the same grade divided into
different cadres on regional, project or directorate basis. The induction of
Telex Operators into the existing cadre of AG-II within the same region
did not involve any promotion from more than one· grade or from the same
grade divided into different cadres on regional, project or directorate basis. H
628 SUPREME COURT REPORTS [1997] 1 S.C.R. ~
A The said provision would have application in the matter or promotion of
AG-I from a regional cadre to the post of Superintendent in a centralised •
cadre. In this context, it may also be mentioned that till April 1, 1979 the
pay scale of Telex Operators were lower than those of AG-II and it was
only with effect from April 1, 1979 that both are placed on the same scale.
B The earlier service of the Telex Operators in a lower pay scale could not
be equated with the service of regular employees in AG-I cadre in a higher
pay scale. The Telex Operators were, therefore, rightly placed below the
regular employees in AG-II cadre at the time of merger of the cadre of
Telex Operators in the cadre of AG-II. The High Court, in our opinion,
was not right in holding t.hat the Commission had committed an error in
C placing the Telex Operators enbloc below regular employees in AG-II·
cadre when Telex Operators were brought in the cadre of AG-II.

Once it is held that Telex Operators have been rightly placed enbloc
below regular employees in AG-II cadre as a result of the merger of the
D said cadre in the cadre of AG-II on April 25, 1980, regular employees in
AG-II cadre who were senior to' the Telex Operators could rightly feel
aggrieved if they are denied promotion while their juniors were promoted
as AG-I. The "next below rule" in service jurisprudence seeks to ensure
that if a junior employee is given promotion without considering his senior
then the senior employee can claim the right to be considered for such
E promotion with effect from the date on which the junior was so promoted.
The action of the Commission in extending the benefit of promotion to
regular employees in AG-II cadre as AG-I with effect from the <late the
. Telex Operators were so promoted on account of the 12 years Policy, being
in. consonance with this principle, cannot, therefore, held to be arbitrary or
F unreasonable. So also the further promotion from AG-I to the post of
Superintendent (P & A) under the 18 years Policy. We are unable to
endorse the view of the High Court that since regular employees in AG-II
cadre did not fulfil the criteria laid down in those policies, they could not
be extended the benefit of the said policies. The High Court has failed to
note that when it was found that certain senior employees were left out of
G consideration for promotion because they did not fulfi~ the conditions
regarding 18 years' service contained in the Office Memorandum dated
May 27, 1982, the Commission modified the policy contained in the said
Office Memorandum by issuing Office Memorandum dated February 3,
1983 whereby it was decided that such senior employees would be con-
H sidered for promotion and, if found suitable, would be promoted with
~-
R.K RATI-Il v. 0.N.G.C. [S.C.AGRAWAL,.T.] 629
~-
effect from April 1, 1982. In view of the said modification in the 18 years A
Policy it'. cannot be said that regular employees in AG-II cadre could not
be considered for promotion since they did not fulfil the criterion of 18
years' service.·

We also find it difficult to appreciate the view of the High Court that B
even if the Telex Operators who had been offered promotion as AG-I and
further promotion as Superintendent in the Western region had refused to
avail the same, regular employees in the AG-II cadre in the region,
including the petitioners, who were senior to them in the Western region
should have been: considered for such promotion and the failure to do so
would result ~n denial of their rights. Regular employees in AG-II cadre in C
the Western region could claim promotion as AGI from date earlier than
April 1, 1982 only if a Telex Operator junior to them had been promoted
as AG-I from an earlier date. Since no Telex Operator who was junior to
regular employees in AG-II cadre in the Western region was promoted_ as
AG-I from a date earlier than April 1, 1982, the petitioners could not claim D
a right to be prompted with effect from an earlier date. So aJso in the
matter of promotion from AG-I to the post of Superintendent because the
right to be promoted with effect from April 1, 1982 could accrue to them
·· only if a Telex Operator junior to them had been so promoted from that
date. Since no Telex Operator junior to regular employee in AG-II cadre
in the Western region was so promoted, the said advantage could not be E
extended to the petitioners. We are unable to agree with the view of the
High Court that if the petitioners cannot be given retrospective promotion
as AG-I with effect from May 17, 1980 and as Superintendent with effect
from.April 1, 1982,-the grant of such promotion to regular employees in
AG-II cadre in the Central and Headquarters regions was also irnpermis- F
sible in law. The said promotions were given to regular employees in AG-II
cadre in the Central and Headquarters regions in view of Telex Operators
junior to them having been promoted in those regions. As indicated earlier,
there was no infirmity in the said action of the Commission.

In this context, it may be mentioned -that during the course of his G
arguments, Shri Venkataramani, the learned counsel appearing for the
petitioners, stated that in the Western region the principle of "next below
rule" was not followed and that some Telex Operators who had aceepted
promotions under the 12 years Policy were granted promotion while
regular employees in AG-II cadre who were senior to them have not been H
.-(
''

630 SUPREME COURT REPORTS [1997] 1 S.C.R.
A' given promotion from the date from which such Telex Operators were so I •

promoted. Although there is nothing on the record to support the said
submission of the learned counsel, by order dated December 10, 1996, we
permitted the petitioners to file an affidavit in this regard. An affidavit
dated January 8, 1997 has been filed by Ram Chand Talreja on behalf of
B the petitioners. In the said affidavit it is stated that by order dated Decem-
ber 28, 1983 Telex Operators of Western: region were promoted as AG-I
with effect from January 1, 1983 and that the Telex Operators of Western
region have raised a dispute seeking promotion as AG-I with effect from
May 17, 1980 like their counter parts in the Central and Headquarters
regions and that the c;onciliation proceedings ended in failure and there-
C after they have filed a Writ Petition No. 2353 of 1996 in the Gujarat High·
Court which in still pending. This shows that no Telex Operator in Western
region was promoted as AG-I prior to April 1, 1982 and the question
whether they are entitled to be promoted with effect from May 17, 1980 is
pending consideration before the Gujarat High Court in Writ Petition No.
D 2353 of 1996. In case the Telex Operators of Western regio~ succeed in
their Writ Petition that is pending in the Gujarat High Court and are
promoted as AG-I with effect form May 17, 1980 or a date earlier than
April, 1, 1982, the petitioners as well as other regular employees in AG-II
cadre in the Western region can claim promotion as AG-I with effect from
E the same date and on that basis they can also claim promotion to higher
posts.

The High Court has expressed the view that the cadres in the regions
should have been integrated in a unified cadre and the seniority should
' .
p have been assigned to the Telex Operators in the integrated cadre and has
directed that a consolidated list be prepared of all regions and promotions
should be made on that basis. In other words, the High Court has directed
that AG-II cadre should be converted from a regional cadre to a
centralised cadre. Such a direction could not be given by the High Court.
It is for the Commission to decide how to organise its administrative
G services in order to achieve efficiency in the administration. The Commis-
sion had taken a decision that cadre up to AG-I should be maintained on
regional level. There is nothing to show that th<; said decision of the
Commission suffers from the vice of arbitrariness. In the circumstances the
High Court could not give a direction for the integration of the cadres in
H the regions and for preparing a consolidated list of all regions.
R.K. RATIII v. O.N.G.C. [S.C.AGRAWAL, J.] 631
For the reasons aforementioned, we are unable to uphold the im- A
pugned judgment of the High Court and the same is liable to be set aside
<;:onsequently, the orders dated May 21, 1986 passed by the Commission
revoking the promotions granted to the appellants in Civil Appeal No. 525 .
of 1987 on the basis of the impugned judgment of the High Court are also
liable to be set aside.
B
In the result, Civil Appeals Nos. 525 of 1987 and 527 of 1987 are
allowed, the judgment of the Gujarat High Court dated December 23, 1985
in Special Civil Application No. 4811 of 1984 is set aside and the said
Special Civil Application is dismissed. Writ Petition No. 870 of 1986 is also .
allowed and the orders dated May 21, 1986 are set aside. In the circumst.in~
ces there is no order as to costs.
c
H.K. Appeal and Petition allowed .

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