Holding

The amendment is a reasonable exercise of the State's statutory authority and does not contravene Articles 14 or 16 of the Constitution.

Summary

The State of Orissa, exercising powers under Rule 7(1) of the Orissa Industries Service Rules, 1985, merged various categories of posts into Industries Promotion Officers (IPOs) and later amended the rule to delete the pay‑scale restriction, thereby making all IPOs eligible for promotion to Class‑II posts. The Industrial Supervisors challenged this amendment, alleging violation of Articles 14 and 16 of the Constitution because it equated officers of different pay grades and reduced their promotion prospects. The Orissa Administrative Tribunal rejected the challenge, and the appellants appealed to the Supreme Court. The Court held that the amendment was a reasonable exercise of statutory power aimed at achieving substantial justice among the categories and did not infringe the equality provisions. Consequently, the appeal was dismissed.

Issues considered

Whether the State's amendment of Rule 7(1) of the Orissa Industries Service Rules, which expanded promotion eligibility to all IPOs, violates Articles 14 and 16 of the Constitution.
Whether the enlargement of the promotion pool for IPOs unjustly diminishes the promotion chances of Industrial Supervisors.

Legislation cited

Constitution of Indias. Article 14, s. Article 16

Subjects

Service lawPromotion eligibilityEquality clauseArticles 14 and 16Rule 7(1)Orissa Industries Service RulesAdministrative TribunalMerger of posts

Judgment

SHYAMA CHARAN DASH AND ORS. A
v.
STATE OF ORIS SA AND ANR.

MARCH 11, 2003

[DORAISWAMY RAJU AND D.M. DHARMADHIKARI, JJ.] B
•
Service Law:

Orissa Industries Service Rules, 1985; Rule 7(1) with amendments:
Issuance of notification by State Government merging certain categories of C
posts as Industries Promotion Officers equivalent to Industrial Supervisors-
Deletion by amendment the provision ofpay scale rendering officers working
in the lower scale ofpay to be eligible for promotion-Challenge to--Rejected
by the Administrative Tribunal on the ground that the merger order remained
unchallenged-Thus, on ground of equity IPOs. have been treated on par with D
Industrial Supervisors irrespective of having different scale ofpay-On appeal,
Held: Since State Government issued merger notification and effected
amendments in the promotion rules with the object to do substantial justice to
all categories of posts equated for the purpose of Rule 7, the Government
acted reasonably-Such acts of the Government in pursuance of its policy and
in exercise of its statutory power could not be challenged merely on the E
ground thai due to enlargement of chance of promotion of one category of
officers, chance of other category officers in the same feeder cadre become
· diminished.

State of Orissa, in exercise of its powers under Rule 7(1) of the Orissa
Industries Service Rules, issued a notification merging certain categories F
of posts into viz. the Industries Promotion Officers equivalent to Industrial
Supervisors and later by amending Rule 7(1) it deleted the provision of
requisite scale of pay of officers in the feeder cadre. Thereby some of the
ineligible officers in the feeder cadre became eligible for promotion. The
amendments to the rule was challenged by the appellant-Supervisors which G
was rejected by the Administrative Tribunal. Hence the present appeal.

It was contended for the appellants that the Government could not
equate unequals by making IPOs working in the different grades with
different pay .scale, on par with Industrial Supervisors working at higher
899 H
900 SUPREME COURT REPORTS (2003] 2 S.C.R.

A grade with higher pay scale; and that prospects of promotion of Industrial
Supervisors would be denied by such acts of the Government and would
be violative of Articles 14 and 16 of the Constitution of India.

Dismissing the appeal, th1~ Court

B HELD: 1. The challenge 1to the order of the Tribunal rejecting the
challenge made by the appellants, do not merit acceptance. Thus, no
genuine or serious objection could be either reasonably or lawfully taken
to the move to enable all the Industries Promotion Officers also becoming
eligible for promotion to Class·-11 posts. So far as Industries Promotion
C Officers among themselves am concerned, the difference in pay scale
among them is due to the differences based on the initial feeder category
pay and not due to any intrinsic obligation. As long as the IPOs, as a
category, are rendered eligible even from 1986 and that is not challenged,
the differences, if any, existing and based on the scales of pay among them,
when resolved to be done away with in the undoubted exercise of its power
D by the State, as a matter of policy, cannot be legitimately challenged by
the appellants merely because clue to the enlargement of the horizon of
consideration resulting therefrom, the chances of consideration for
promotion of Industrial Super11isors become diminished. The reasons,
which weighed with the State Government in doing so, are found to be
E genuine, real and substantive a111d meant to do substantial justice to all
categories or grade of posts equated for purposes of Rule 7 of the Rules.
The fact that in different procee·dings where claim for identical scales of
pay came to be contested by the Government or rejected by the Tribunal,
is no justification to countenance the claim of the appellants in these
proceedings inasmuch as the criteria to be applied in dealing with such
F claims are totally different or, at any rate, may be one on Iy among several
requirements to be satisfied. 190.3-A; 907-A-EI

Union of India and Ors. v. N. Y. Apte and Ors., (1995( 6 SCC 741] and
Md Usman and Ors. v. State of Andhra Pradesh and Ors., 1(1971) 2 SCC ·--
188), relied on.
G
Y. V. RangC'iah qnd Ors. etc. v. J. Sreenivasa Rao and Ors., (1983] 3
SCC 284; R.S. Ajara and Ors. v. State of Gujarat and Ors., (19971 3 SCC
641]; Chairman, Railway Board and Ors. v. C.R. Rangadhamaiah and Ors.,
(1997] 6 SCC 623; State of Rajasthan v. R. Dayal and Ors., [19971 10 SCC
H 419; SB. Mathur and Ors. v. Chief Justice of Delhi High Court and Ors.,
SHYAMACHARANDASHv. STATE [RAJU, J.) 901
[19891 Supp. 1 SCC 34 and State of Maharashtra and Anr. v. Chandrakant A
Anant Kulkarni and Ors., [1981) 4 SCC 130, distinguished.

CIVIL APPELLATE JURISDICTION : Civil Appeal No. I 787 of
1997.

From the Judgment and Order dated 26.8. I 996 of the Orissa B
Administrative Tribunal, Bhubaneshwar in 0.A. No. 777 of 1991.

A.T.M. Sampath, Rajiv S. Roy and A.C. Pradhan for P.K. Mullick, for
the Appellants.

Radha Shyain Jena fo. Respondent No. I.
c
Raj Kumar Mehta, Ms. M. Sarada and Ms. Suman Kukrety for
Respondent No. 2

The Judgment of the CJurt was delivered by

D. RAJU, J. The above appeal has been filed against the Order dated D
26.8.1996 of the Orissa Admir,istrative Tribunal, Bhubaneswar, in O.A.
No.777/91, whereunder the claim of the appellants before this Court and
some others seeking to quash the amendments introdu~ed in 1991, notified
on 24.5.1991, which had the consequence of bringing all the Industries
Promotion Officers (IPOs) within the zone of consideration for promotion to E
Class-II service and their further claim to declare that only Rs.500-930 grade
employees alone are eligible for promotion to Class-JI post and that those in
Rs.400-750 grade are ineligible to such Class-JI promotions, came to be
rejected.

Prior to coming into force of the Orissa Industries Service Rules, 1985 F
on 12.9.1985, officers of different categories in the Industries Department
under the Directorate of Industries were performing duties and functions of
the same nature •t different levels in varied fields, appointed to posts with the
different nomenclature carrying different scales of pay. Not only there seem
to have been periodical revision of scales of pay but changes in their
promotional prospects, and their status and position in the hierarchical set up G
also appears to have been made from time depending upon the exigencies of
the situation and necessities of smooth administration on the basis of
recommendations of the Pay Commissions or Committees specially constituted
for the purpose.

The Tribunal below rejected the challenge holding that the impugned H
902 SUPREME COURT REPORTS (2003] 2 S.C.R.

A notification was not vitiated on account of any ma/afide exercise of power
and that despite the fact the posts of Sub-Assistant Registrar was a promotional
post for Block Level Extension Officers, having regard to the similarity in
the nature of their functions, the cadre of IPOs came to be formed by merging
and redesignating them both SAR, Industries and BLEO, Industries as
B Industries Promotion Officers. Reliance was placed in this regard on the
decision of the Government made on 27.5.1980 - a conscious decision to
merge them into one as IPOs though with a classification among them as
Seniors and Juniors depending upon differences in the scales of their pay
which was necessitated for the reason that the merged posts were carrying
different scales of pay, initially. Reference also seems to have been made to
C the subsequent decision on 17.2. I982 to do away with the said difference and
the abolition of the selection grade in respect of all cadres of posts in the
State, resulting in denial of the only avenue of promotion to IPOs in the
grade of Rs.400-750. Support was drawn by the Tribunal for its conclusions
also from the fact that the Government Orders dated 11.6.1986 declaring I 7
posts equivalent to that of Industrial Supervisors remained unchallenged and
D that really the equities stood adjusted in providing promotional opportunities
to the cadre of IPOs, irrespective of the scales of pay, on par with Industrial
Supervisors.

Shri A. T.M. Sampath, learned counsel appearing for the appellants,
E sought to assail the decision of the Tribunal mainly on the ground that the
Government could not have attempted to equate unequals by making eligible
all grades of IPOs de hors the intrinsic differences in their scales of pay and
placing them on par with Industrial Supervisors, who were of higher grade
with higher scales of pay. It was also contended that by throwing open the
avenues of promotion to Class-II posts to IPOs, who are in large numbers
F treating them· on par wit.h Industrial Supervisors with comparatively small
numerical strength, the prospects of promotion of the Industrial Supervisors
have been completely denied with slender or even no chances during their
tenure of office. In order to highlight the grievance of the appellants, the
learned counsel vehemently contended that the experience gained by JPOs in
the lower grade of posts cannot be treated on par with those service of
G Industrial Supervisors in higher grades for purposes of further promotion to
Class-II posts and this anomaly brought about by the amendment with effect
from 24.5.1991 works great hardship and constitutes gross violation of Articles
14 and 16 of the Constitution of India. Shri R.K. Mehta, appearing for the
non-official respondent and Shri R.S. Jena for the State, adopted the reasons
H assigned by the Tribunal in their support and contended that they are quite
-- SHY AMA CHARAN DASH v. STATE (RAJU, J.) 903

in accordance with law and do not call for any interference. We have carefully A
considered the submissions of the learned counsel appearing on either side
and, in our view, the challenge to the order of the Tribunal rejecting the
challenge made by the appellants, do not merit our acceptance.

It is appropriate at this stage to make reference to some of the decisions
relied upon by the learned coµnsel on either side. Y V.Rangaiah and Ors., etc. B
v. J. Sreenivasa Rao and Ors., [1983] 3 SCC 284 being a case where not only
there was omission to prepare the promotion panel in time as per rules then
in force but the arr.ended rules dispensed with the original provision for
considering LDCs along with UDCs for promotion, adversely affecting their
promotional prospects, has no application to the case on hand. The decision C
in R.S. Ajara and Ors. v. State of Gujarat and Ors., [1997] 3 SCC 641 lays •
down that the benefit that has accrued or crystallized l!nder the existing rules
cannot be taken away by an amendment with retrospective effect. In
Chairman, Railway Board and Ors. v. C.R. Rangadhamaiah and Ors., [I 997]
6 SCC 623, a Constitution Bench of this Court held that a rule which operates
··in futuro so as to govern future rights of those already in service cannot be D
assailed on the ground of retrospectivity as being violative of Articles 14 and
I 6 of the Constitution of India, but a rule which seeks to reverse from an
anterior date, a benefit which has been granted or availed, e.g., promotion or
pay scale, can be assailed as being violative of Articles 14 and 16 to the extent
it operates retrospectively. This observation came to b.! made in the context E
of a challenge to the notification, which, by the language employed therein,
applied to the detriment of the pensionary rights of those who had already
retired and no longer in service and deprived the retired persons of their
entitlement to be reckoned as on the date of retirement, when they acquired
a right to a particular pension, as per rules in force on the date of their
retirement. State of Rajasthan v. R. Dayal and Ors., [1997] 10 SCC 419 is a F
case wherein this Court held that the mere fact that a person was empanelled
for promotion. does not entitle him for valid appointment if by the time the
vacancies for his appointment actually arose, the eligibility criteria was altered
by the amendment to the rules, emphasizing the position. that the preparation
of the panel alone does not freeze the criteria to be satisfied in respect of the
subsequent vacancies arising thereafter, so as to dispense with the need to G
satisfy the requirements of rules, which came into force thereafter by way of
amendment. Those observations qmnot be drawn out of their context to be
extended to the case on hand which should be guided by the fact that the
amendments in this case never had any effect of rendering ineligible an
already eligible person. A mere enlargement of the area or zone of consideration H
904 SUPREME COURT REPORTS (2003) 2 S.C.R.

A by enabling some more category of posts also to be considered for promotion,
if at all could be claimed to have merely affected chances of promotion only
and not either right to be considered for promotion or deprive any vested or
accrued rights, in law. In SB. Mathur and Ors. v. Chief Justice of Delhi High
Court and Ors., (1989) Supp. 1 SCC 34, this Court held that an eligibility
criterion is distinct from the zone of consideration. In State of Maharashtra
B and Anr. v. Chandrakant Anant Kulkarni and Ors., (1981] 4 SCC 130, this
Court observed that mere chances of promotion are not conditions of service,
and the fact that there was reduction in the chances of promotion did not
tantamount to a change in the conditions of service while reiterating the
settled principle that ii right to be considered for promotion is a term of
C service, but mere reduction in chances of promotion are not.

The grievance sought to be made as to the equation of posts for
purposes of further avenues of promotion or the right and powers of the State
to do so also, does not merit our acceptance, in the peculiar facts and
circumstances of the case as well, besides the relevant principles of law
D governing the same. This Court in SB. Mathur's case (supra) observed as
follows:-

"I I. The first submission of Mr. Thakur, learned counsel for the
petitioners is that there is a violation of Article 14 of the Constitution
in treating the posts of Superintendents, Court Masters or Readers
E and f>rivate Secretaries to the Judges as equal status posts. It was
urged by him that the sources of recruitment to these posts were not
identical and so also the qualification required for appointments to
these posts. He also pointed out that the duties of the inc um bents of
these posts were different. It was submitted by him that in treating
these posts as equal status posts unequals were treated equally and
F
hence the rule of equality was violated. In appreciating this submission,
it must be borne in mind that it is an accepted principle that where
there is an employer who has a large number of employees in his
service performing diverse duties, he must enjoy a certain measure of
discretion in treating different categories o,f his employees as holding
G equal status posts or equated posts, as questions of promotion or
transfer of employees inter se will necessarily arise for the purpose
of maintaining the efficiency of the organ1zation. There is, therefore,
nothing inherently wrong in an employer ' treating certain posts as
equated posts or equal status posts provided that, in doing so, he
exercises his discretion reasonably and does not violate the principles
H
-·
SHY AMA CHARAN DASH v. STA TE [RAJU, J.] 905

-- of equality enshrined in Articles 14 and 16 of the Constitution. It is A
also clear that for treating certain posts as equated posts or equal
status posts, it is not necessary that the holders of these posts must
perform completely the same functions or that the sources of
recruitment to the posts must be the same nor is it essential that
qualifications for appointments to the posts must be identical. All that B
is reasonably required is that there must not be such difference in the
pay scales or qualifications of the incumbents of the posts concerned
or in their duties or responsibilities or regarding any other relevant
factor that it would be unjust to treat the posts alike or, in other
words, that posts having substantially higher pay scales or status in
service or carrying substantially heavier responsibilities and duties or C
otherwise distinctly superior are not equated with posts carrying
much lower pay scales or substantially lower responsibilities and
duties or enjoying much lower status in service."

In Union of India and Ors. v. N. Y. Apte and Ors., [1998] 6 SCC 741, this
court observed that the matter of equation of posts is entirely within the D
)•
domain of the rule-making authority and unless the rule is shown to be wholly
unreasonable and irrational, the Court will not interfere with the same. In Md.
Usman and Ors. v. State of Andhra Pradesh and Ors., [1971] 2 SCC 188, this
Court, while repelling a challenge based on equality clause, observed as
hereunder:-
E
"5. On the other hand it was argued on behalf of the contesting
respondents that before considering the vires of Rule 5, we must first
ascertain the reason behind the rule to find out whether in fact there
is discrimination. The contesting respondents do not deny that the
position of an U.D.C. is superior to that of a L.D.C. But according to F
them it became necessary for the State to pool together U.D.Cs. as
well as th_e L.D.Cs. for the purpose of recruitment in question for the
following reasons.

G
7. On the facts before us we are unable to agree that for the purpose
of recruitment with which we are concerned herein the State should
have classified the U.D.Cs. and L..D.Cs. separately. If the State had
treated the U.D.Cs. as being superior to the L.D.Cs. for the purpose H
of that recruitment it would have resulted in a great deal of injustice
906 SUPREME COURT REPORTS (2003] 2 S.C.R.

A to a large section of the clerks. The fortuitous circumstance of an
officer in a particular district becoming an U.D.C. would have given
him ah undue advantage over his seniors who might have been as
efficient or even more efficient than himself, merely because they
chanced to serve in some other district. For the reasons mentioned
above, we do not think that in the present case the State can be said
B to have treated unequals as equals. The rule of equality is intended
to advance justice by avoiding discrimination. Jn our opinion the High
Court by overlooking the reason behind Rule 5 came to the erroneous
conclusion that the said rule violated Article 14 of the Constitution."

c ServicesSo Rule
far as the case on hand is concerned, Rule 7 of the Orissa Industries
1985, which came into force with effect from 12.9.1985 deals with
promotion to Class-II posts enumerated in Schedule B thereto, and relevant
for the purpose, reads as follows:-

"7. Promotion to Class-II.
D (I) Not more than 25% of total vacancies in Class-II of the service in
any year may be filled up by promotion from amongst non-gazetted
non-Ministerial Class-III field executive staff, namely :-

Industries Promotion Officers, Industrial Supervisors in grade pay of
Rs.500-930 or as revised from time to time and such other posts as
E may be created in the equivalent grade or declared equivalent in
status by Government from time to time having completed seven years
of service in the post or posts. The promotion quota of Industries
Promotion Officers, Industrial Supervisors shall be in a ratio according
to the strength of qualified officers in each group as may be decided
F by Government.. ............".

It is stated by all the learned counsel on either side that the percentage
of 25% mentioned in Sub-rule (1) stood altered subsequently as 50% from
August, 1995. By a Notification dated 11.6.1986, the State Government, in
exercise of its powers under Rule 7( I) of the Rules, declared about 17 categories
G of posts to be equivalent in status with that of the Industries Promotion
Officers/Industrial Supervisors for the purpose of Sub-rule (I) of Rule 7. This
Notification has not been challenged at any point of time and even in the
course of present proceedings. By the impugned amendment which came into
force from 24.5.1991, the words, abbreviation and figures, "in grade pay of Rs.
H 500-930 or as revised from time to time" were ordered to be deleted. Even de
SHY AMA CHARAN DASH v. STATE [RAJU, J.] 907

hors .the reasoning of tl1e Tribunal that those words from the inception A
qualified only the class of Industrial Supervisors, we are of the view that no
genuine or serious objection could be either reasonably or lawfully taken to
the move to enable all the Industries Promotion Officers also becoming or
rendered eligible for promotion to Class-II posts. So far as Industries Promotion
Officers among themselves are concerned, the difference in pay scale among B
them is due to the differences based on the initial feeder category pay and
not due to any intrinsic or basic differences of essential qualifications or the
nature of duties and obligations. As long as the IPOs, as a class or category,
are rendered eligible even from 1986 and that is not challenged, the differences,
if any, existing and based on the scales of pay among them, when resolved
to be done away with in the undoubted exercise of its power by the State, C
as a matter of policy, cannot be legitimately challenged by the appellants
merely because due to the enlargement of the horizon of consideration resulting
therefrom, the chances of consideration for promotion of Industrial Supervisors
become diminished. The reasons, which weighed with the State.Government
in doing so, are found to be genuine, real and substantive and meant to do
substantial justice to all categories or grade of posts equated for purposes
D'
of Rul·~ 7 of the Rules. The fact that in different proceedings where claim for
identical scales of pay came to be contested by the Government or rejected
by the Tribunal, is no justification to countenance the claim of the appellants
in these proceedings inasmuch as the criteria to be applied in dealing with
such claims are totally different or, at any rate, may be one only among several E
requirements to be satisfied. Consequently, the challenge on behalf of the
appellants has no merit whatsoever and shall stand rejected.

For all the reasons stated above, the appeal fails and shalt' stand
..
,~
dismissed. No costs.

S.K.S. Appeal dismissed.