Holding

For promotional posts in the Bombay Port Trust, the reservation percentages prescribed by the Central Government (15% for SC and 7.5% for ST) apply, not the State ratio applicable at the time of initial recruitment, and the Regulations apply to all posts except those excluded under Section 24(1)(a) of the Major Port Trust Act.

Summary

The Bombay Port Trust fixed reservation percentages for promotional posts at 15% for Scheduled Castes (SC) and 7.5% for Scheduled Tribes (ST), matching the All‑India policy, whereas the State of Maharashtra prescribed 7% for SC and 9% for ST at the time of initial recruitment. The Bombay High Court held that the Trust could not depart from the State ratio for promotions and directed it to frame regulations for Class I and II posts. On appeal, the Supreme Court examined the provisions of the Major Port Trust Act, 1963 and Regulation 13 of the 1977 recruitment regulations, and held that Central Government orders on reservation apply mutatis mutandis to all appointments, including promotions, except for posts excluded under Section 24(1)(a). The Court rejected the High Court's reasoning that the State ratio must govern promotions and that non‑transferability of Class III and IV employees was relevant. It clarified that the appropriate reservation percentages for promotional posts are the Central Government’s 15% for SC and 7.5% for ST. Consequently, the Supreme Court set aside the High Court judgment and allowed the appeal, directing the Trust to follow the Central Government percentages for promotions.

Issues considered

Whether the reservation percentage applicable at the time of initial recruitment must also apply to promotional posts in the Bombay Port Trust.
Whether the Bombay Port Trust Employees (Recruitment, Seniority and Promotion) Regulations, 1977 apply to Class I and Class II posts.
Whether the non‑transferability of Class III and Class IV employees is a relevant factor in determining reservation policy.
What percentage of reservation for SC and ST should be applied to promotional posts – the State ratio or the Central Government/All‑India ratio.

Legislation cited

Bombay Port Trust Employees (Recruitment, Seniority and Promotion) Regulations, 1977s. 13
Major Port Trust Act, 1963s. 126, s. 24(1)(a), s. 28

Subjects

reservationpromotionScheduled CastesScheduled TribesMajor Port Trust Actemployment lawaffirmative actioncentral government ordersnon‑transferabilityclass Iclass IIclass IIIclass IV

Judgment

SMT. SWAT! AND ORS. A
v.
SH. DAMODAR ANANT KARANDIKAR AND ORS.

MAY 8, 1996

[A.M. AHMADI, C.J. AND B.L. HANSARIA, JJ.] B

Se1Vice Law :

Bombay Port Trust Employees (Recruitment, Seniority and Promotion)
Regulations, 1977: Regulation 13 and Explanatory Memorandum, Para 2. C
Reservation in Promotion-Class Ill and IV posts-Percentage.of-SC and
ST employees-Initial recruitment-Fixed as 7% for SC and 9% for
ST-Held : percentage of reservation for SC and ST in Class Ill and IV
promotional posts was 15% and 7 112% respectively and not that which
applied at the time of initial recruitme/ll-Major P01t Trust Act, 1963,
S.24(1)(a)-Brochure on "Rese1Vation for Scheduled Castes, Scheduled D
Tribes in Se1vices'~ Ch. 2, para 2.1 (ii) & (iii) and Appendix 3.

Pro1notion--Orders of Central Govemnient for reservation for SC and
ST in promotional post;~Applicability of-Held: applicable not only for class
Ill and IV posts but also to class I and II posts-non-transferability of class E
III and IV employees-Not a relevant consideration for applying the State
ratio for reservation to these employees.

Promotion-Reservation for SC and ST-Percentage of-Tests to deter-
mine-Held: should be detennined by taking a general view and not what was
due lo SC and ST separately or segment-wis<>---flence, 15% and 7-112% F
quota for SC and ST respectively compared to 7% and 9% did not amount
lo injustice to ST.

The percentage of resen-ation for initial recruitment in the Port
Trust as fixed by the State Government was 7% for Scheduled Castes and G
9% for Scheduled Tribes. However, the Port Trust fixed the percentage of
resen-ation for promotional posts as 15% for Scheduled Castes and 7-1/2%
for Scheduled Tribes which was the same as the All-India percentage.

The respondent filed a petition in the High Court challenging the
aforesaid resen-ation policy. The High Court allowed the petition holding H
553
554 SUPREME COURT REPORTS f1996J SUPP. 2 S.C.R.

A that it was not open to the Port Trust to depart from the percentage of
reservation applicable at the tin1e of initial a11puintn1ent while considering
the reservation ratio in the pro1notional posts. Being aggrieved, the appel-
lants preferred the present appeal.

Allowing the appeal, this Court
B
HELD: 1. The High Court erred in holding that the percentage of
reservation for Scheduled Castes and Scheduled Tribes applicable at the
time of initial appointment also applied lo promotional posts. So far as
direct recruitment in Class Ill and Class IV posts is concerned, the policy
C of the Central Government itself, as mentioned in Para 2.1 (ii) of Chapter
2 of the brochure on •Reservation for Scheduled Castes and Scheduled
Tribes in Services', is that the percentage shall be as shown in Appendix
3, which generally would be in portion to the population of Scheduled
Castes and the Scheduled Tribes in the respective States(ferritories. But
qua the posts to be lilied by promotion, what has been stated in sub-para
D (iii) is that the percentage shall be 15 for Scheduled Castes and 7-1/2 for
Scheduled Tribes. This clearly shows that what is required to be kept in
mind at the time of initial recruitment is not required to be adopted for
promotion. [557-E-G)

Indra Sawhney v. Union of India, [1992] Supp. 3 SCC 217, referred
E
to.

2.1. Orders issued by the Central Government regarding the reser-
vation to posts under it in favour of Scheduled Castes and Scheduled
Tribes are to apply, with appropriate changes, to all appointments to be
F made by the Port Trust. However, the High Court erred in holding that
the Bombay Port Trust Employees (Recruitment, Seniority and Promo-
tion) Regulations, 1977 applied to recruitment to Class lil and IV posts.
Para 2 of the suh-rrgulations styled as l'vlen1orandun1 explanatory of the
Rrgulations, has spcl'ifically stated that the regulaliuns apply to all posts,
G except those covered hy Section 24 (I) (a) ol' the Major Port Trust Act, 1963
i.e., the posts of Heads of Departments and posts the maximum of the pay
scale of which exceeds Rs. 2,000. [557-B-D)

2.2. The High Court has given another reason to accept the State
ratio-the same is non-transferability of Class Ill and Class IV employees,
H because of which their's was taken as "a local cadre". This is not a relevant
SWATI v. D.K. KARANDIKAR [HANSARIA,J.] 555

consideration \\'llile deciding about the contours of reservation policy. A
Further, it seems that even Class I and Class II employees of the Bombay
Port Trust are not transferable. [558-C-D]

2.3. Acceptance of reservation of 7% for Scheduled Castes and 9% for
Scheduled Tribes would cause injustice to the members of the Scheduled
Castes, because as against 15% r!!servation as per All-India policy, this B
percentage would be 7 to gci by the State ratio. In a matter like one at hand,
I a general view is required to be taken, and not what is due to Scheduled
Tribes or to Scheduled Castes separately or segment-wise. [558-A·B]

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 1794 of
• 1989.
c
From the Judgment and Order dated 29.8.88 of the Bombay High
Court in W.P. No. 1098 of 1982.

M.K. Banerjee, Attorney General, Venugopal Reddy, Mrs. Niloufer D
Bhagwat, Ms. Gunwant Dara, P. Gaur, Jitendra Sharma, Kailash Vasdev,
T. Sridharan, T.A. Khan and P. Parmeswaran for the appearing parties.
' The Judgment of the Court was delivered by

HANSARIA, J. The short point which we arc called upon to decide E
in this appeal is relatable to the percentage of reservation for the members
of Scheduled Castes/Scheduled Tribes in the promotional posts of Bombay
Port Trust. Though the point is short, it is undoubtedly important.

2. There is no dispute regarding the applicability of the policy of
reservation even in promotional posts. This is so because of the view taken F
by the majority in the nine-Judge Bench decision of this Court in Indra
Sawhney's case, commonly known as Manda! Conunission's case, 1992
(Supp) 3 SCC 217. The only question is regarding the extent of reservation;
the period of reservation shall, of course, be as indicated by the majority
in Manda! case.
G
3. The aforesaid question was agitated before the High Court of
Judicature at Bombay, illler a/ia, by the Bombay Port Trust non-Scheduled
Castes/Scheduled Tribes Employees Association. Its case was that the
percentage of reservation in promotion was _required to be as at the time
of initial recruitment, for which purpose the population of the Scheduled~ H
556 SUPREME COURT REPORTS [1996] SUPP. 2 S.C.R.

A Castes/Scheduled Tribes in the State of Maharashtra was required to be
taken note of. To put it differently, it was contended that the percentage
of reservation could not be as fixed by the Union of India which, al the
relevant time, was 15% for the "Scheduled Castes and 7-1/2 per cent for
Scheduled Tribes. As against this, the percentage of reservation as fixed by
the Slate of Maharashtra then was 7% for Scheduled Castes and 9% for
B Scheduled Tribes. The Association also made a gdevance about non-fram-
ing of any regulation qua Class I and Class II employees by the Port Trust
of Bombay.

4. The High Court accepted the case of the Association and directed
C the Board of Trustees of the Port of Bombay lo frame necessary regulation
for Class-I and Class-II employees. It also took the view that as the Port
Trust had been following the reservation policy, alongwith the ratio as fixed
by the Slate Government, at the time of initial appointment, it was not open
to the Port Trust to depart from the same while considering the reservation
ratio in the promotional posts. The Court further observed that by follow-
D ing All-India percentage, the Port Trust was definitely doing injustice to
the Scheduled Tribes inasmuch as the reservation ratio for Scheduled
Tribes as per All-India policy was 7-1/2% while this percentage was 9 in
the State of Maharashtra.

5. The appellants, who are members of the reserved categories, have
E challenged the legality of the aforesaid view taken by the High Court in
this appeal by special leave.

6. We may first advert to the statutory provisions holding the field
These are to be found in sections 28 and 126 of the Major Port Trust Act,
1963, hereinafter the Act. Section 28 has conferred the power of making
F regulation on a Board, which, as defined in the Act, means the Board of
Trustees. Section 126 has conferred the power of making the first regula-
tion on the Central Government, notwithstanding anything contained in the
Act. In exercise of this power, the Central Government made the first
regulation styled as The Bombay Port Trust Employees (Recruitment,
G Seniority and Promotion) Regulations, 1977 for short, the Regulations.
Regulation 13 deals with the question of reservation and is in the following
language. ·

"(a) Orders issued by the Central Government from time to
time for the reservation of appointments, whether by direct recruit-
H ment or promotion, to posts under the Central Government in
SWAT! v. D.K. KARANDIKAR [HANSARJA, J.] 557

favour of Scheduled Castes and Scheduled Tribes shall apply A
mutatis mutandis to all appointments covered by these regulations.

(b) • • * * * • • *"

7. The aforesaid regulation has left nothing to doubt that the orders
B
issued by the Central Government regarding the reservation to posts under
it in favour of Sdiedulcd Castes and Scheduled Tribes are to apply, with
appropriate changes, to all appointments lo be made by the Port Trust.
The High Court, however, thought, and with respect wrongly, that the
regulations apply to recruitment to Class III and IV posts, because of which
a direction was given to make regulations for Class I and Class II posts. c
This, however, is not so, as would appear from the sub-regulation of the
Board styled as Memorandum explanatory of the Regulations, which is a

-
part of the Volume containing the Regulations. Para 2 of this Memoran-
dum has specifically stated that the regulations apply to all posts, except
those covered by section 24 (l)(a) of the Act i.e., the posts of Heads of D
. Departments and posts the maximum of the pay scale of which exceeds Rs.
2,000 .

. 8. the graver error committed by the High Court lies in holding that
what applies qua initial appointment has to apply to promotion also. This
view is not sustainable for the reason that insofar as direct recruitment in E
Class III and Class IV posts is concerned, the policy of the Central
Goverlirneni ·itself, of •which mention, has been made in Para 2.1 (ii) of
Chapter 2 of t~e hrochur_e cin. 'Reservation for Scheduled· Castes and
· Seheduled tribes in Services', is that the percentage shall be as shown in
Appendix 3, which generally would be in proportion to the population of F
Scheduled Castes cand the Scheduled Tribes in th.e respective States{fer-
rifories. But qua the posts to be filled by promotion, what has been stated
. in sub-para (iii) is that the percentage shall be 15 for Scheduled Castes and
7-1J2 for Scheduled Tribes. This clearly shows that what is required to be
kept in .mind at the tilfie of initial recruitment is not required to be adopted
for .Promotion. It would .be apposite to mention that the percentage of G
.. reservation is varied by the Central Govern.men! itself depending upon the
· pciplllation li.gilre of thdisted categories, as wollld appear from the Office
Memoranda of 12th March, _1973 and 24th May, 1985 issued by the Depart-
ment of Personnel and Administrative Reforms, copies of which are at
pages 19 to 21 of the Volume containing the documents filed on behalf of H
558 SUPREME COURT REPORTS [1996] SUPP. 2 S.C.R.

A respondent Nos. 1 and 2.
9. As to the observation by the High Court regarding injustice to the
Scheduled Tribes, may we stale that acceptance of the percentage as
required by the impugned judgment, would cause injustice to the members
of the Scheduled Castes, because as against 15% reservation as per All-
B India policy, this percentage would be 7 to go by the Stale ratio. According
to us, in a matter like one at hand, a general view is required lo be taken,
and not what is due to scheduled Tribes or to scheduled Castes separately
or segment - wise.

10. The High Court has given another reason lo accept the State
C ratio-the same is non-transferability of Class III and Class IV employees,
because of which their's was taken as "as local cadre". This is not a relevant
consideration while deciding about the contours of reservation policy.
Further, it seems that even Class l and Class II employees of the Bombay
Port Trust are not transferable. -
D
11. We, therefore, hold that the impugned judgment suffers from
legal infirmity inasmuch as it violates what has been pro,1ded in Resolution
13 of the regulations and it has also misconceived the reservation policy of
the Central Government. So, we set aside the judgment and require the
Bombay Port of Trust to act, while filling up promotional posts, a' per the
E percentage of reservation fixed by the Central Government for posts nnder
it, which ratio, as already indicated, was 15% for Scheduled Castes and
7-1/2% for Scheduled Tribes at the relevant time.

12. On the facts and circumstances of the case, we leave the parties
to bear their own costs throughout.
F
V.S.S. Appeal allowed.