Holding

Entry 19 of the 1974 Regulations is a valid classification and does not contravene Articles 14 and 16 of the Constitution.

Summary

The Rajasthan State Electricity Board Accountants Association challenged Entry 19 of the 1974 Regulations, which reserved 25% of promotion vacancies for accountants holding ICWA/DCWA qualifications and required a longer seven‑year service period for those without such qualifications. The association argued that the provision violated Articles 14 and 16 of the Constitution by discriminating against accountants lacking the specified qualifications. The Supreme Court examined a line of precedents allowing classification based on educational qualifications and longer service to achieve administrative efficiency. It held that the classification was a reasonable classification with a legitimate nexus to the object of the regulations and therefore did not infringe the equality clause. The Court also declined to decide the res judicata issue, finding the writ petition maintainable, and dismissed the appeal.

Issues considered

Whether Entry 19, which reserves 25% of promotion vacancies for accountants possessing ICWA/DCWA qualifications and prescribes a longer service period for those without, violates Articles 14 and 16 of the Constitution
Whether classification based on educational qualifications and differential service requirements is a reasonable classification having nexus with administrative efficiency
Whether the writ petition is barred by the doctrine of res judicata

Legislation cited

Constitution of Indias. Article 14, s. Article 16

Subjects

service lawpromotioneducational qualificationreservation quotaequality clauseArticles 14 and 16reasonable classificationpublic service efficiencyRajasthan State Electricity Boardaccountants associationjudicial review

Judgment

A RAJASTHAN STATE ELECTRICITY BOARD ....;
ACCOUNTANTS ASSOCIATION, JAIPUR
v.
RAJASTHAN STATE ELECTRICITY BOARD AND ANR.

FEBRUARY 4, 1997
B
[S.C. AGRAWAL AND G.B. PATTANAIK, JJ.)
i;:

Service Law :

c Rajasthan State Electricity Board Officers (Recrnitment, Promotion &
Seniority) Regulations, 1974 : Schedule, Entry 19.

Promotion-Eligibility of-Educational qualifications-Classification
based on-Constitutional validity of-Held : It was pennissible to make

D
classification based on educational qualifications-ft was also pennissible to
prescribe longer length of service for those not possessing prescribed educa-
tional qualification~Entry 19 had nexus with object sought to be
- Jo.

achieved--Constitution of India 1950-Articles 14 and 16.

Entry 10 of the Schedule to the Rajasthan State Electricity Board
Officers (Recruitment, Promotion & Seniority) Regulations, 1974 related
E
to promotion to the post of Assistant Accounts Officer/Assistant Audit
Officer/Assistant Revenue Officer in the State Electricity Board. The said
Entry 19 prescribed that 75% of the vacancies to be filled by promotion on
merit basis from Accountants with at least 7 years' service and 25% of the
vacancies to be filed by promotion on merit basis out of the Accountants
F possessing an Intermediate of Cost and Works from the Institute of Cost
and Works Accountants (ICWA), Calcutta with 5 years' experience as
Accountant in the Board or graduate holding diploma in Cost and Works
(DCWA) from a University with 5 years' experience as Accountant in the
Board.
G The appellants filed a writ petition before the High Court challeng·
ing the aforesaid Entry 19 on the ground that it was violative of Articles
>r-
14 and 16 of the constitution, which was dismissal. Hence this appeal.

On behalf of the appellants it was contended that reservation of 25%
H vacancies for Accountants possessing Cost and Works qualification and
.•

868
RAJ. STAIBELECTRICITYBD.ACCOUNTANTS ASSCN. v. RAJ. STAIB ELECTRICTYBD. 869

prescription of longer length of service for those who did not possess the A-
said qualification was violative of Articles 14 and. 16 of the Constitution,
and that ICWA/DCWA qualification was not compulsory for a person to
be appointed to the post of Accounts Officer/Audit Officer/Revenue Officer
and that a person who did not possess the said qualification was also
eligible.
B
Dismissing the Appeal, this Court

HELD : 1.1. It is well settled that educational qualifications can be
made the basis for classification of employees in State service in the matter
of pay scales, promotion, etc. Provisions for giving higher pay scale to C
employees possessing higher qualifications have been held valid. Similarly
in the matter of promotion, classification on the basis of educational
qualifications so as to deny eligibility for promotion to a higher post to a11
employee possessing lesser qualification or require longer experience for
those possessing lesser qualifications has been held valid. [875-F-G]
D
State of Mysore & Anr. v. P. Narasing Rao, [1968] 1 SCC 407 and V.
Markendeya & Ors. v. State of A.P. & Ors., [1989] 3 SCC 191, relied on.

1.2. The decision in Mohammad Shujat Ali gives recognition to the
principle that difference in educational qualifications can be made up by E
longer experience. This principle was given effect to in the various
provisions which came up for consideration before this Court wherei1:1
longer experience was prescribed for employees possessing lesser
qualifications as compared to employees·possessing higher qualifications
for the purposes of promotion to higher post and such provisions were
held valid. The decision in Mohammad Shujat Ali and the subsequent F
decisions in Ravinder Kumar Shanna and Abdul Basheer do not detract
from the law laid down in Triloki Nath Khosa, Roop Chand Adlakha, P.
Murugesan, Shamkant Narayan Deshpande, Nageshwar Prasad and T.R.
Kothandaraman, wherein provisions prescribing higher experience on the
basis of difference in educational qualifications for eligibility for promo- G
tion and prescribing a quota based on qualification in the matter of
promotion to higher post have beeli upheld. [882-D-E, 884-F-G]

1.3. Entry 19 of the Schedule to the Rajas than State Electricity Board
Officer (Recruitment, Promotion & Seniority) Regulations, 1974 insofar
as it prescribes longer service of seven years for Accountants who do not H
870 SUPREME COURT REPORTS (1997] 1 S.C.R.

A possess the additional qualifications of an Intermediate of Cost and Works
from the Institute of Cost and Works Accountants, Calcutta or a Graduate
holding a diploma in Cost and Works from a University is in consonance
with the decision in Roop Chand Adlakha, and the said Entry. 19 insofar
as it prescribes a quota of 25% of vacancies in the higher posts of Assistant
B Accounts Officer/Assistant Audit Officer/Assistant Revenue Officer for the
pU!1JOSe of promotion is in consonance with the decisions in Shamkant
Narayan Deshpande, P. Muntgesan, Nageshwar Prasad and T.R. Kothan-
daraman. [884-H, 885-A·B]

Sate of Jammu & Kashmir v. Triloki Nath Khosa & Ors., [1974) 1 SCR
C 771; Roop Chand Adlakha &. Ors. v. Delhi Development Authority & Ors.,
[1988) .Supp. 3 SCR 253; Shamkant Narayan Deshpande v. Maharashtra
Industrial Development Corporation & Anr., [1993) Supp. 2 SCC 194; P.
Murogesan & Ors. v. State of Tamil Nadu & Ors., [1993) 2 SCC 340;
Nageshwar Prasad & Ors. v. Union of India & Ors., [1995) Supp. 4 SCC 718
D and T.R. Kothandaraman & Ors. v. Tamil Nadu Water Supply & Drainage
Board & Ors., [1994) 6 SCC 282, relied on.

Mohammad ShujatAli & Ors. v, Union of India & Ors., [1975] 1 SCR
449; Punjab State Electricity Board, Patiala & Anr. v. Ravinder Kumar
Shanna & Ors., [1986) 4 SCC 617 and N. Abdul Basheer & Ors. v. KK
E Karunakaran & Ors., [1989) 3 SCR 201, referred to.

2. It is true that ICWA/DCWA qualification is not compulsory for a
person to be appointed to the post of Accounts officer/Audit Of·
fleer/Revenue Officer and a person who does not possess the said qualifica·
F tion is also eligible. But it cannot be ignored that Entry 19 of the Schedule .~
to the 1974 Regulations is not confined to the post of Accounts Officer and
it also includes the posts of Audit Officer and Revenue Officer and the
qualifications that are prescribed for direct recruitment have been
prescribed keeping in view the needs for all the three posts. On the basis
of the. qualifications prescribed in Entry 16 of the Schedule to the 1974
G Regnlations, for the purpose ofdirect recruitment to the post of Accounts
Officer/Audit Officer/Revenue Officer, it cannot be said that giving
preference in the matter of promotion to an Accountant who is an Inter·
mediate of Cost and Works from the Institute of Cost and Works, Calcutta
or a Graduate holding diploma in Cost and Works from a University has
H no relation with improving the administrative efficiency of the Services in
i- RAJ. SJ'ATEELECIRICITY BD. ACCOUNTAN'IS ASSCN. '· RAJ. STATE ELECIR!CTY BD. 871
the Board and has no nexus with the object sought to be achieved by the A
1 1974 Regulations. It cannot, therefore, be held that Entry 19 of the
I ·'!<
• Schedule to the 1974 Regulations suffers from the vice of discnmination
and is violative to of 'right to equality' guaranteed under Articles 14 and
16 of the Constitution. [886-F-H, 887-A-B]

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 7257 of B
1996.

. From the Judgment and Order dated 3.8.95 of the Rajasthan High
Court in W.P. No. 338 of 1991.

Rajinder Sachher, Sanjay Parikh and Pawan Kumar Tiwari for the c
Appellant.

S.M. Jain, Prakash Srivastava and A.P. Dhamija for the Respondent
No. 2.

Dr. A.M. Singhvi, Sushi! Kr. Jain and Pradeep Agarwal for the D
~
Respondent No. 1.
·""
The Judgment of the Court was delivered by

S.C. AGRAWAL, J.: The question that falls for consideration in this
appeal is whether Entry 19 of the Sc~edule to the Rajasthan State E
Electricity Board Officers (Recruitment, Promotion & Seniority) Regula-
tions, 1974 (hereinafter referred to as 'the 1974 Regulations') is violative
of the provisions of the Article 14 and 16 of the Constitution. The said
entry relates to promotion to the post of Asst. Accounts Officer/Asst!.
-<' Audit Officer/Asst. Revenue Officer in the Rajasthan State Electricity
Board (hereinafter referred to as 'the Board'). It prescribes that 75% of F
,. ""'
~
the vacancies shall be filled by promotion on merit basis from Accountants
with at least 7 years service as Accountant and 25% of the vacancies shall
be filled by promotion on merit basis out of the Accountants possessing an
Intermediate of Cost & Works from the Institute of Cost & Works Ac·
countants, Calcutta with five years experience as Accountant in the Board G
or a graduate holding diploma in Cost & Works form a university estab-
lished by law in India with five years as Accountant in the Board.

-":· The 1974 Regulations came into force on October 30, 1974, Prior to
the making onhe 1974 Regulations, appointment on the post of Asst.
" Accounts Officer was regulated by the Rajasthan Subordinate Accounts H
~
872 SUPREME COURT REPORTS (1997] 1 S.C.R.

A Service Rules, 1963 which had been made applicable to the Board. Under_.
the said Rules Accountants with five years experience as Accountants were .,.,..
eligible for promotion to the post of Asst. Accounts Officer. The next post
higher to the post of Assistant Accounts Officer is that of Accounts Officer
and under Entry 16 of the Schedule to the 1974 Regulations, appointment
to the said post is by direct recruitment as well as by promotion from
B amongst Assistant Accounts officers.

Appointment to the post of Accountant is governed by the RSEB
Ministerial Staff Regulations, 1962 (hereinafter referred to as 'the 1962 ~

Regulations') and in made, in a prescribed ratio, through (i) departmental
c competitive examination, (ii) promotion of Junior Accountants and Upper
Division Clerks and above, and (iii) direct recruitment (Regulation
6(1)(xii)). Rajasthan Rajya Vidyut Karmachari Federation, a registered
body of the staff employed with the Board filed a Writ Petition (D.B. Writ
Petition No. 5720 of 1990) wherein Entry 19 of the Schedule to the 1974

-
Regulations was assailed on the ground that it is violative of Articles 14
D and 16 of the Con5titution. The said Writ Petition was dismissed by a
Division Bench of the High Court by judgment dated January 3, 1991. ;..
Thereafter another Writ Petition (D.B. Civil Writ Petition No. 338/91) was
filed by the RSEB Accountants Association, appellant herein. The said
Writ Petition came up for consideration before another Division Bench of
E the High Court and the learned Judges were not in agreement with the
view taken earlier in the case of Rajasthan Rajya Vidyut Karmachari
Federation (supra) as regards the validity of Entry 19 of the Schedule to
the 1974 Regulations and by order dated February 21, 1991, the following
question was referred for consideration by a full Bench : ~

F )- t
"Whether in tlie Schedule to the Rajasthan State Electricity Board
Officers (Recruitment, Promotion and Seniority) Regulations,
1974 under Entry No. 19 providing quota of 25% for promotion
of Accountants holding the qualification of Intermediate with
ICWA or Graduate with DCWA is valid and is not violative of
G Art. 14 and 16 of the Constitution?"
,.
By judgment dated June 30, 1995, the Full Bench answered the said
question in the affirmative and held that Entry No. 19 of the 1974 Regula- ::,...
tions is notviolative of Articles 14 and 16 of the Constitution. The matter
H was thereafter again placed before a Division Bench of the High Court and
RAJ. SfAIBELECTRICITY BO. ACCOUNTAN"IS ASSCN. '·RAJ. SfA1EELECTRICJYBD. (AGARWAL,J.J873

in view of the judgment of the Full Bench, the Writ Petition filed by the A
appellant was dismissed by order dated August 3, 1995. Hence this appeal.

Dr. A.M. Singhvi, the learned senior counsel appearing for the
Board, has raised an objection that the Writ Petition filed by the appellant
was not maintainable and it was barred by the principle of res judicata. The
submission is that members of the appellant Association were also mem- B
hers of the Rajasthan Rajya Vidyut Karmachari Federation which had filed
D.B. Writ Petition No. 5720/90 and that the order dated January 3, 1991
on the said Writ Petition operates res judicata and a fresh Writ Petition
raising the same question regarding the validity of Entry 19 of the Schedule
to the 1974 Regulations could not be filed. On behalf of the appellant, it C
is, however, stated that the appellant is a separate Association and that
none of the members of the appellant was a member of the Rajasthan
Rajya Vidyut Karmachari Federation which had filed the earlier Writ
Petition and the members of the appellant are no bound by the earlier
judgment and are not precluded "from agitating the question as to the
validity of Entry 19 of the Schedule to the 1974 Regulations. Since there is D
a dispute on facts as to whether any of the members of the appellant
Association was a member of the Rajasthan Rajya Vidyut Karmachari
Federation, we do not propose to go into the objection regarding the
maintainability of the Writ Petition filed by the appellant and will deal with
the matter on merits.
E
Entry 19 of the Schedule to the 1974 Regulations provides as follows:

Method
s. Category recruitment Qualification
No.
with %age
~. (1) (2) (3) (4) F
19 ... Asst Accounts 100% by 1. 75% by promotion on merit
Pfficer/Asst. Audit selection basis from the Accountants
Officer/Asst. with at least 7 years service as
Revenue Officer Accountant in Rajasthan State
... Electricity Board. G
2. 25% by promotion on merit
basis out of Accountants
possessing
qualification/experience as
given below : H
874 SUPREME COURT REPORTS [1997] 1 S.C.R.

A (a) An Intermediate of Cost &
Works from the Institute of
Cost & Works. Calcutta with 5
years experience as
Accountant in RSEB.

B OR
A Graduate holding diploma
in Cost & Works from the
University established by law
m India with 5 years
experience as Accountant in
·C RSEB.
NOTE : In the event of non-
availability, the vacancies may
be filled in by the Accountants
under No. (1) and (2) above
D and vice-versa.

Shri Rajinder Sachher, the learned senior counsel appearing for the
appellant, has urged that in Column (4} of Entry 19 of the Schedule to the
1974 Regulations a distinction has been made between Accountants on the
E basis of the qualifications possessed by them inasmuch as an Accountant
who is an Intermediate of Cost & Works from the institute of Costs &
Works, Calcutta or is a Graduate holding diploma in Cost & Works from
a University established by law in India is eligible for promotion as Asst.
Accounts Officer/Asst. Audit Officer/Asst. Revenue Officer in the Board
if he has five years experience as Accountant in the Board while Account-
,p ants who do not possess these qualifications become eligible for promotion
only after seven years service as Accountant in the Board. It has also been
submitted that reservation of 25% of vacancies for Accountants possessing
the qualifications referred to above results in hostile discrimination against
Accountants who do not possess those qualifications. In this context, the
G learned counsel has pointed out that all Accountants in the Board, ir~ ...
respective of their qualifications, are discharging the same functions and
are similarly situate and that Entry 19 of the Schedule to the 1974 Regula-
tions in so far as it makes a distinction in the matter of eligibility on the
basis of qualification and prescribing a quota of 25% posts for Accountants
H possessing the prescribed qualifications is violative of the right to equality
I
RAJ. SfATE ELECTRICITY BD. ACCOUNTANTS ASSCN. v. RAJ. SfATEELECTRICIYBD. (AGARWAl.;J.)875

guaranteed under Articles 14 and 16 of the Constitution. The learned A
counsel has placed reliance on the decisions of this Court in Mohammad
Shujat Ali & Ors. Etc. v. Union of India & Ors. Etc., [1975] 1 SCR 449;
Punjab State Electricity Board Patiala & Anr. v. Ravinder Kumar Shanna &
Ors., [1986] 4 SCC 617; N. Abdul Basheer & Ors. Etc. v. KK Karnnakaran
& Ors., [1989] 3 SCR 201. B

On behalf of the Board, it has been submitted by Dr. Singhvi that for
the purpose of promotion it is permissible to make a classification on the
basis of qualifications and that the provisions contained in Entry 19 of the
Schedule to the 1974 Regulations prescribing lesser experience of five years
service as ·Accountant in respect of Accountants possessing higher · C
qualifications and higher experience of seven years service for the purpose
of eligibility for promotion in respect of Accountants who do not possess
such qualifications and prescribing a quota of 25% for Accountants pos-
sessing those qualifications do not offend the 'right to equality' guaranteed
under Articles 14 and 16 of the Constitution. Reliance has been placed on D
the decision of this Court in State of Jammu and Kashmir v. Triloki Nath
Khosa & Ors., [1974] 1 SCR 771; Roop Chand Adlakha & Ors. v. Delhi
Development Authority & Ors., [1988] Supp. 3 SCR 253; Shamkant Narayan
Deshpande v. Maharashtra Industrial Development Corporation & Anr.,
[1993] Supp. 2 SCC 194; P. Murngesan & ors. v. State of Tamil Nadu & Ors.,
[1993] 2 SCC 340; Nageshwar Prasad & Ors. v. Union of India & Ors., [1995] E
Supp. 4 SCC 718 and T.R. Kothandaraman & Ors. v. Tamil Nadu Water
Supply & Drainage Board & Ors., [1994] 6 SCC 282.

As per the decisions of this Court the position is well settled that
educational qualifications can be made the basis for classification of F
employees in State service in the matter of pay scales, promotion, etc.
Provision for giving higher pay scale to employees possessing higher
qualifications have been upheld as valid by this Court. (See : State of
Mysore & Anr. v. P. Narasing Rao, [1968] 1 SCR 407 and V. Markendeya
& Ors. v. State of Andhra Pradesh & Ors., [1989] 3 SCC 191). Similarly in
the matter of promotion classification on the basis of educational qualifica- G
tions so as to deny eligibility for promotion to a higher post to an employee
possessing lesser qualification or require longer experience for those pos-
sessing lesser qualifications has been upheld as valid by this Court.

In Triloki Nath Khosa (supra), this Court has upheld the provisions H
~

876 SUPREME COURT REPORTS [1997] 1 S.C.R.

A of the Jaminu & Kashmir Engineering (Gazetted) Service Recruitment.. ,..,..
Rules, 1970 whereby eligibility for promotion to the post of Executi~e
Engineers was confined to Assistant Engineers who possessed a degree m
Engineering and Assistant Engineers; who were diploma-holders, were
ineligible for such promotion. The said provision was upheld on the ground
that it was made with a view to achieving administrative efficiency in the
B engineering service. On behalf of the diploma-holder Assistant Engineers
it was urged that degree-holders (direct recruits) and diploma- holders
(promotees), having been appointed as Assistant Engineers on equal terms
they constitute an integrated class and for purposes of promotion they
cannot be classified on the basis of educational. qualifications. Rejecting
c ·.the said contention it was held that though persons appointed directly and
by promotion were integrated into a common class of Assistant Engineers,
they could, for purposes of promotion to the cadre of Executive Engineers,
be classified on the basis of educational qualifications.

In Roop Chand Adlakha (supra) under the relevant rules Junior
D Engineers were eligible for promotion to the post of Assistant Engineers. .,..,..
Amongst Junior Engineers there were graduates in Engineering as well as
diploma-holders. 50% of the posts of Assistant Engineers were required
"' -
to be filled by promotion and 50% by direct recruitment. Out of the 50%
posts required to be filled by promotion, half (25%) were to be filled from
. c'
E amongst degree-holder Junior Engineers having three years service ex-
pericnce and the other half from amongst diploma-holder Junior Engineers
having eight years service experience. Similarly for promotion to the post
of Executive Engineer a degree-holder Assistant Engineer was eligible for
promotion after eight years service experience as Assistant Engineer while
F a diploma-holder Assistant Engineer was so eligible after 10 years service >-
as Assistant Engineer. Upholding the validity of the said provisions this
Court has held :

"The inherent distinction between a person with a Degree and one
who is merely Diploma-Holder is much too obvious. But the
G question that falls for consideration, in the context such as the
present one,. is whether the differences have a reasonable relation
to the nature of the office to which the promotion is contemplated.
~
The idea of equality in the matter of promotion can be predicated
only when the candidates for promotion are drawn from the same
H source. If the differences in the qualification has a reasonable
RAJ. SfATEELECTR!ClfX BD. ACCOUNTANTS ASSCN. '·RAJ. SfATEELECTRICTYiiD. [AGARWAL,J.]877

relation to the nature of duties and responsibilities, that go with A
arid are attendant upon the promotional-post, the more ad-

- vantageous treatment of those who possess higher technical
qualifications can be legitimised on the doctrine of classification.
There may, conceivably, be cases where the differences in the
educational qualifications may not be sufficient to give any B
preferential treatment to one class of candidates as against
another. Whether the classification is reasonable or not must,
therefore, necessarily depend upon facts of each case and the
circumstance obtaining at the relevant time. When the state makes
a classification between two sources, unless .the vice of the clas-
sification is writ large on the face of it, the person assailing the C
classification must show that it is unreasonable and violative of
Article 14."

(p. 263)
D
It was further observed :

"If Diploma-Holders - of course on the justification of the job-re-
quirements and in the interest of maintaining a certain quality of
technical expertise in the cadre-could validly be excluded from the E
eligibility for promotion to the higher cadre, it does not necessarily
follow as. an inevitable corollary that the choice of the recruitment
policy is limited only in two choices, namely, either to consider
the111 "eligible" or "not eligible". State consistent with the require-
ments of the promotional-posts and in the interest of the efficiency
of the service, is .not precluded from conferring eligibility on F
Diploma- Holders conditioning it by other requirements which
may, as here, include certain quantum of service-experience. In the
present case, eligibility-determination was made by a cumulative-
criterion of a certain educational qualification plus a particular
quantum of service experience. It cannot, in our opinion, be said, G
as postulated by the High Court, that the choice of the State was
either to recognise Diploma-Holders as "eligible" for promotion or
wholly exclude them as "not- eligible". If the educational qualifica-
tion by itself was recognised as conferring eligibility for promotion,
then, the super-imposition of further conditions such as a par- /H
878 SUPREME COURT REPORTS [1997] 1 S.C.R.
A ticular period of service, selectively, on the Diploma-Holders alone
to their disadvantage might become discriminatory. This does not
prevent the Stat() from formulating a policy which prescribes as an
essential part of the conditions for the very eligibility that the
candidates must have a particular qualification plus a stipulated
--
B quantum of service-experience." (pp. 268-269)

In Shamkant Narayan Deshpande (supra) promotion of EXecutive
Engineers to the post of Superintending Engineer was on the basis of a
quota whereunder 75% posts were reserved for degree-holders and 25%
posts for diploma-holders. It was contended that no classification could be
C made among Executive Engineers on the basis of their educational
qualifications for the purpose of promotion to the post of Superintending
Engineer since they belong to the same cadre of Executive Engineers and
do the same work and a common seniority list was being maintained. The
said contention was, however, rejected on the basis of the decision in
D Triloki Nath Khosa (supra).

R. Murngesan v. State of Tamil Nadu (supra) related to promotion to
the post of Assistant Executive Engineer. Diploma-holders (Junior En-
-
gineers) as well as degree-holders (Assistant Engineers) were eligible for ·
E such promotion. For diploma-holders to become eligible for promotion 10
years service was required and for degree-holders the period of service ·
required was five years. The promotion was to be made in the ratio 3 : 1,
for degree-holders and diploma-holders. The said provisions were upheld.
It was contended that since a longer qualifying period of service was
prescribed for diploma-holder they and been equated with degree-holders
F · and thereafter no distinction could be made between then by prescribing
the quota amongst the two categories for the purpose of promotion.
Rejecting· the paid contention it was observed that it the distinction in the
matter of longer qualifying period of service is not discrimination it was
difficult to see how and why another distinction in the matter of quota
G rule was discriminatory. It was stated :

"Suppose, if these two requirements (i.e., longer qualifying service
and quota rule) had been introduced at the same time, there could
have been no room for the present argument. The rule would have
H been good. How does it becomes bad, if they are introduced at
RAJ. STAIBELECTRIJ:;ITY BD. ACCOUNTANTS ASSCN. v. RAJ. STAIB ELECTRICTYBD. [AGARWAL,J.)87!)

different times? Both relate to their eligibility and chances of A
promotion."

(p. 354)

In Nageshwar Prasad v. Union of India (supra) there was. a quota of
50 :50 for promotion to the post of Assistant Engineer and different B
periods of service experience were prescribed for diploma-holders and
~ degree-holders. The Central Administrative Tribunal, while upholding the
difference in the experience criteria, had struck down the quota· rule
whereunder promotion of diploma-holders was limited to 50%. The said
decision of the Tribunal was reversed by this Court on the view that the C
decisiorrwas clearly inconsistent with the ratio of the decisions of this Court
is Roop Chand Adlakha (supra) and P. Murugesan v. State of Tamil Nadu
(supra). It was observed : ·

"The prescription of the quota rule is obviously to ensure that in
the immediate promotion cadre there is a fair mix of both degree- D
holders and diploma-holders because the vertical movement from
that stage and upwards in the hierarchy is restricted to degree-
holders and if they are not available in sufficient number in the
feeding channel the said channel would be virtually dry and suffi-
cient number of degree-holders would not be available for promo- E
tion to the next higher cadre. The efficacy of diploma-holders has
been recognised up to a particular stage in the hierarchy and
thereafter it is realised that for manning higher posts a degree in
Engineering is a must. We, therefore, do not see how prescription
of the 50 per cent ql!-ota is in any manner arbitrary." F

(p. 721)

In T.R. Kothandaraman v. Tamil Nadu Water Supply & Drainage
Board (supra), this Court has upheld the proviso to Regulation 19{2){b) of
the Tamil Nadu Water Supply and Drainage Board Service Regulations, G
1972 which permitted diploma-holder Assistant Engineers to become
eligible for the promotion to the post of Executive Engineer only if they
were to have exceptional merit in work and otherwise the diploma-holder
was not eligible for such promotion. The said provision was upheld as valid
in view of the law laid down in Triloki Nath Khosa (supra). In the said case H
880 SUPREME COURT REPORTS [1997] 1 S.C.R.
A the Court has also upheld the provisions of Rule 2(b) of the Special Rules
for. Tamil Nadu Agricultural Engineering Service which prescribed the
ratio of 3 : 2 for degree-holder Assistant Engineers and diploma-holder
Assistant Engineers for promotion to the post of Executive Engineer. It
was held that higher educational qualification has relevance insofar as the
B holding of the higher promotional post is concerned in view of the nature
of the functions and duties attached to that post and that the classification
had nexus with the object to be achieved. It was observed that the
preference given to the degree-holders would give fillip to the desire to
receive higher education. ·

c Reference may now be made to the decisions on which reliance has
been placed by Shri Sachher. In Shujat Ali (supra) in the matter of
promotion of Supervisors as Assistant Engineers preferential treatment
was given to graduate Supervisors over non-graduate Supervisors. Initially
two out of every three vacancies, (and after the amendment, three out of
D every four vacancies) in the post of Assistant Engineer were reserved for
promotion of graduate Supervisors. The said preferential treatment for
graduate Supervisors was assailed on the ground that it was unreasonable
and violative of Articles 14 an 16 of the Constitution. The said provision
was upheld by this Court for the reason that the differentiation between
E the graduate and non- graduate Supervisors had always been there in the
Engineering Service in the erstwhile Hyderabad State as well as in Andhra
Pradesh State and that graduate Supcuvisors had always been treated as a
distinct and separate class from non-graduate Supervisors and that they
had never been integrated into one class. The Court has, however, dealt
p with the question whether such a preferential treatment on the basis of
e_ducational qualification would be in consonance with the 'right to equality'
g~aranteed under Articles 14· and 16 of the Constitution. It has been
observed that though educational qualifications have been recognised as
forming a valid basis for classification, but it cannot be laid down as an
invariable rule that whenever any classification is made on the basis of ..
G variant educational qualifications, such classification must be held to be
valid irrespective of the nature and purpose of the classification or the
quality and extent of the difference in the educational qualifications and
that the test of reasonable classification has to be applied in such case on
its peculiar facts and circumstances. Referring to the decision in Triloki
H Nath Khosa (supra), it was said :
-
RAJ. STATE ELECTRICITY BO. ACCOUNTANTS ASSCN. v. RAJ. STATE ELECTRICTYBD. [AGARWAL, J.]881

"1t way be perfectly legitimate for the administration to say that A
having regard to the nature of the functions and duties attached
to the post, for the purpose of achieving efficiency in public service,
only degree-holders in engineering shall be eligible for promotion
and not diploma or certificate holders ....... But where graduates
and non-graduates are both regarded as fit and, therefore, eligible
for promotion, it is difficult to see how, consistently with the claim B
for equal opportunity, any differentiation can be made between
them by laying down a quota of promotion for each and giving
preferential treatment to graduates over non-graduates in the
matter of fixation of such quota. The result of fixation of quota of
promotion for each of the two categories of Supervisors would be C
that when a vacancy arises in the post of Assistant Engineer, which
according to the quota is reserved for graduate Supervisors, a
non-graduate Supervisor cannot be promoted to that vacancy, even
if he is senior to all other graduate Supervisors and more suitable
than thex. His opportunity for promotion would be limited only to
vacancies available for non-graduate Supervisors. That would D
clearly amount to denial of equal opportunity to him."

(p. 480)

Shri Sachher has placed strong reliance on the above quoted obser-
vations in Mohammad Shujat Ali {supra). These observations have, how- E
ever, to be read in the context of the facts of that case where graduate as
well as non-graduate Supervisors were both equally eligible for promotion
to the post of Assistant Engineer. This is evident from the question which
was post by the Court in the following words :

"I am senior to the graduate Supervisor who is intended to be F
promoted. I am more suitable than he is. It is no doubt true that
I am a non-graduate, but my not being a graduate has not been
branded as a disqualification. I am regarded fit for promotion and,
like the graduate Supervisor, I am equally eligible for being
promoted. My technical equipment supplemented by experience G
is considered adequate for discharging the functions of Assistant
Engineer. Then why am lbeing denied the opportunity for promo-
tion and the graduate Supervisor is preferred?" (emphasis sup-
plied)

(p. 480) H
882 SUPREME COURT REPORTS [1997] 1 S.C.R.

A While saying that "there can be no satisfactory answer to this ques-
tion" the Court has proceeded to hold :

"It is of the essence of equal opportunity for such persons with
humble and depressing backgrounds that they should have oppor-
tunity, through experience or self-study, to level up with their more
B fortunate colleagues who, by reason of favourable circumstances,
could obtain the benefits of higher education, and if they prove
themselves fit and more suitable than others, why should they be
denied an opportunity to be promoted in a vacancy on the ground
that vacancy belongs to Supervisors possessing higher educational
c qualification."

(p. 480)

The decision in Mohammad ShujatAli (supra) thus gives recognition
to the principle that difference in educational qualifications can be made
D up by longer experience. This principle was given effect to in the various
provisions which came up for consideration before this Court in the case
referred to earlier wherein longer experience was prescribed for employees
possessing lesser qualifications as compared to employees possessing
higher qualifications for the purpose of promotion to higher post and such
E provisions were upheld as valid.

In Roop Chand Adlakha (supra) this Court has taken note of the
observations. in Mohammad Shujat Ali (supra) on which the reliance has
been placed by Shri Sachher and has observed :

F "Shujat Ali's case itself recognised the permissibility and validity
of such classification if the nature of the functions and duties
attached to the promotional-posts are such as to justify the clas-
sification in the interest of efficiency in public service; but where
both graduates and non-graduates were regarded as equally fit and
eligible for promotion, the denial of promotion to a person other-
G wise eligible and due for promotion on the basis of a quota was
not justified. In Shujat Ali's case the infirmity of the differential
treatment stemmed from the fundamental basis that, at that point
both Graduates and Diploma-holders were equally eligible but the
Rule operated to deny promotion to a Diploma-Holder on the
H basis of a quota. The observations in that case pertained to a stage
RAJ. SfATBELECTRICITY BO.ACCOUNTANTS ASSCN. v. RAJ. SfATEELECTRICTYBD. (AGARWAI., J.]883

which arose after the equality of eligibility for promotion between A
the two classes of persons had been recognised."

(pp. 265-266)

Again in P. Murugesan v. State of Tamil Nadu (supra) this Court has
taken note of the observations in Mohammad Shujat Ali (supra) and has B
observed that the said observations cannot be read in isolation nor can they
be read as running counter to the ratio of Tri/old Nath Khosa (supra).

In Punjab State Electricity Board, Patiala & Anr. Ravinder Kumar
Sharma (supra) (decided by a Two-Judge Bench) diploma- holder linemen
as well as non-diploma-holder linemen were both eligible forpromotion to C
the post of Line Superintendent and a quota of 33% was fixed for diploma-
holder linemen and 33% was fixed for non-diploma-holder linemen. In
respect of diploma-holder linemen it was prescribed that they should have
worked as linemen for three years continuously and immediately before
promotion while non-diploma-holder linemen who had passed 1-1/2 years D
T course in the Electrical Trades of Electrician/Lineman/ Wireman from
recognised Industrial Training Institutes were required to have worked for
four years as lineman continuously and immediately before promotion. The
validity of the fixation of quota in the matter of promotion of diploma-
holder and non-diploma-holder linemen to the post of Line Superintendent
was held to be violative of the equality clause contained in Articles 14 and E
16 of the Constitution on the ground that Linemen, either diploma-holders
or non-diploma-holders, were performing the same kind of work and duties
and they belong to the same cadre having a common/joint seniority list for
promotion to the post of Line Superintendent and reliance was 'placed on
the observations in Mohammad Shujat Ali (supra) on which reliance has F
been placed by Shri Sachher. No reference was ~ade to Tri/old Nath Khosa ·
(supra). In P. Murugesan v. State of Tamil Nadu (supra), (decided by a
Three-Judge Bench) while referring to the said decision in Revinder Kumar
Shanna (supra), it has been obse1ved :

·' "It is evident' that non-consideration of T.N. Khosa and other G
decisions relevant under the subject has led to the laying down of
a proposition which seems to run counter to T.N. Khosa. With
great respect to the learned Judges who decided that case, we are
unable to accept the broad proposition flowing from the case."

(p. 353) H
884 SUPREME COURT REPORTS (1997] 1 S.C.R.

A In N. Abdul Basheer v. K.K. Karnnakaran (supra) graduate as well as
non-graduate Excise Preventive Officers were eligible for promotion to the
post of Second Grade Excise Inspectors. Earlier such promotions were to
be made in the ratio of 3 : 1 between graduates and non-graduates which
ratio was subsequently reversed to 1 : 3. The fJXation of the said ratio in
the matter of promotion of graduate and non-graduate Excise Preventive
B
Officers was held by this Court to be violative of the provisions of Articles
14 and 16 of the Constitution Taking note of the history of the evolution
of the Kerala Excise and Prohibition Subordinate Service it was observed
that a consistent on coherent policy in favour of graduates was absent and
that originally more emphasis was ll!id on the induction of graduates and
C the ratio of cgraduate and non-graduate officers was maintained at 3 : 1 but
subsequently the ratio was changed inversely to 1 : 3 and more non-
graduates were inducted in the Service. The Court rejected the contention
that the ratio of 3 : 1 between graduates and non-graduates was justified
on the ground that the recognition of graduation is recognition of merit
D and that more merit in the post of Excise Inspectors would be conductive
to better a<lministrative efficiency on the view that the conditions of
employment and the incidents of service recognise no distinction between
graduate and non-graduate officers and that for all material purposes they
are effectively treated as equivalent. The said decision has, therefore, to be
considered i~ the light of its facts. It falls within the principle laid down in
E Mohammad Shujat Ali (supra) since graduates and non-graduates were
both equally eligible for promotio~ to the higher post.

·The decision in Mohammad Shujat Ali (supra) and the subsequent
decisions in Revinder Kumar Shanna (supra) and Abdul Basheer (supra)
p do not, therefore, detract from the law laid down in Triloki Nath Khosa
(supra);Roop ChandAdlakha (supra), P. Murngesan v. State of Tamil Nadu
(supra); Shamkant Narayan Deshpande (supra); Nageshwar Prasad (supra)
and T.R. Kothandaraman (supra), wherein provision prescribing higher
experience on the basis of difference in educational qualifications for
eligibility for promotion and prescribing a quota ba'sed on qualifications in
,.
G the matter of promotion to higher post have been upheld.

Entry 19 of the Schedule to the 1974 Regulations in so far as it
prescribes longer service of seven years for Accountants who do not
possess that additional qualifications of an Intermediate of Cost & Works
H from the Institute of Cost & Works Accountants of India or a Graduate
•
RAJ. SfA1E ELECIRICTIYBD. ACCOUNTANTS ASSCN. v. RAJ. SfATE ELECTRTCIYBD. (AGARWAL, J.]885

Holding a diploma in Cost & Works from a University established by law A
in India is in consonance with the decision in Roop ChandAdlakha (supra),
ancj the said entry in so far as it prescribes a quota of 25% of vacancies in
the' higher posts of Asst. Accounts Officer/Asst. Audit Officer/Asst.
Revenue Officer for the purpose of promotion is in consonance with the
decisions in Shamkant Narayan Deshpande (supra); P. Murugesan Nagesh-
B
war Prasad (supra) and T.R. Kothandaraman (supra).

It has, however, been submitted that the said classification of the
Accountants on the basis of qualifications has no nexus with the object
sought to be achieved by the Regulations which is to secure efficiency in
the Service. It has been pointed out that as per the qualifications prescribed C
for appointment on the higher post of Accounts Officer under Entry 16 of
the Schedule to the 1974 Regulations it is not necessary that a person
should possess a Diploma in Cost & Works or should be a Cost & Works
Accountant of the Institute of Cost & Works Accountants of India and that
a person having Master's degree in Arts or Science or Commerce from a D
University established by law in India with a least 55% marks in the degree
as well as Master Degree examination is eligible for appointment as
Accounts Officer by direct recruitment. On behalf of the Board it has,
however, been pointed out that in the Board there are Sub-Divisional
Account/Internal Auditor/Accountant and that though all the three
categories of Accountants are in a common cadre but the Board is having E
water light compartment meaning thereby an Accountant working in .
Revenue Section continue to work in Revenue Section and an Accountant
posted in Audit Section will continue there and that when they are
promoted to the post of Assistant Accounts Officer, they are assigned
.. similar type of duties which they can discharge but a person who is holding F
ICWA or DCWA qualifications can be assigned any of the duties, whether
it relates to Audit Section or budget preparation or account compilation
and that the services of an Assistant Accounts Officer possessing higher
qualifications can be better utilised in various projects taken up by the
Board from time to time. It has also been pointed out that till July 31, 1972, G
25% Accountants in the Board were appointed from amongst persons
having ICWA or DCWA qualification and that since October 30, 1974 in
the matter of direct recruitment on the post of Accountant weightage is
given to persons possessing the qualification of DCWA. It has also been
submitted that on April 22, 1966 the Board decided that to give a filip to
all working personnel in the Board to study and equip themselves and H
886 SUPREME COURT REPORTS (1997] 1 S.C.R.
A persons qualifying the intermediate examination of the Institute of Cost &
Works Accounts of India may be offered the post of Assistant Accounts
Officer and those qualifying the final examination that of Accounts Officer
in the Board's services and that the personnel of all levels may be freely
allowed and encouraged to study for and appear in these examinations.
B With regard to the fixation of 25% quota for Accountants possessing the
additional qu_alifications referred to above it has been submitted that one
of the Unions known as Prantiya Vidyut Majdoor Federation had sub-
mitted a charter of demand as far back as on February 1, 971 wherein one ~
of the demands was that 25% posts of the Assistant Accounts Officer be
filled from the departmental graduates with Cost and Works Diploma.
c
As regards qualifications prescribed for appointment on the post of
Accounts Officer/Audit Officer(Revenue Officer in Entry 16 of the
Schedule to the 1974 Regulation' we find that in the matter of direct
recruitment against 50% of the posts persons who were eligible for promo-
D tion are Chartered Accountants (Member of the Institute of Chartered
Accounts of India): or Cost & Works Accountants of the Institute of Cost
& Works Accountants of India; or holders cif Cost & Works Diploma of
any recognised University in India with five years experience in responsible
position in Accounts Department of Public or Private Undertaking
preferably Electricity Undertakings; or S.A.S. Accountant with five years
E service as G.A.S. Accountants or degree of Master's in Arts or Science or
Commerce From University established by law in India with at least 55%
marks in degree as well as Master Degree examination. It is no doubt true
that ICWA/DCWA qualification is not compulsory for a person to be
appointed on the post of Accounts Officer/Audit Officer/Revenue Officer
F and a person who does not possess the said qualification is also eligible.
But it cannot be ignored that Entry 16 of the Schedule to the 1974
Regulations is not confined to the post of Accounts Officer and it also
includes the posts of Audit Officer and Revenue Officer and the qualifica-
tions that are prescribed for direct recruitment have been prescribed
keeping in view the needs for all the three posts. On the basis of the
G qualifications prescribed in Entry 16 of the Schedule to the 1974 Regula~
tions, for the purpose of direct recruitment to the post of Accounts
Officer/Audit Officer/Revenue Officer, it cannot be said that giving
preference in the matter of promotion to an Accountant who is an Inter-
mediate of the Cost and Works from the Institute of Cost and Works,
H Calcutta or a Graduate holding diploma in Cost and Works from a Univer-
RAJ. STAIB ELECTRICITY BD. ACCOUNTANTS ASSCN. v. RAJ. STAIB ELECTRICTY BD. (AGARWAL,J.]887

sity established by law in India has no relation with improving the ad- A
ministrative efficiency of the Services in the Board and has no nexus with
the object sought to be achieved by the 1974 Regulations. We are, there-
1 fore, unable to hold that Entry 19 of the Schedule to the 1974 Regulations
suffers from the vice of discrimination and is violative of the 'right to
equality' guaranteed under Article 14 and 6 of the Constitution. The B
contention urged by Shri Sachher is accordingly rejected.

It was contended by Shri Sachher that the facility for obtaining the
ICWNDCWA qualifications can be availed only by these Accountants who
are posted at Jaipur or Jodhpur and the same cannot be availed by
Accountants posted in outlying places. There is no merit in this contention C
because, as pointed out on behalf of the Board, the Institute of Cost &
Works Accountants of Imparts postal and oral courses and that in Rajas-
than, oral courses are available at Jaipur, Kata, Udaipur and Jodhpur and
that on the same guidelines and almost the same syllabus the various
Universities in Rajasthan are conducting the DCWA course at Jaipur,
Ajmer, Jodhpur, Bikaner, Lax:mangarh and Ganganagar. D
The appeal, therefore, fails and it is accordingly dismissed. But in the
circumstances there is not order as to costs.

v.s.s . Appeal dismissed.

.
'