THE DIRECTOR, DIRECTORATE OF ENFORCEMENT & ANR.versusK. SUDHEESH KUMAR & ORS.

720            SUPREME COURT
                         [2022]REPORTS
                                2 S.C.R. 720              [2022] 2 S.C.R.


A     THE DIRECTOR, DIRECTORATE OF ENFORCEMENT & ANR.
                                       v.
                      K. SUDHEESH KUMAR & ORS.
                         (Civil Appeal No. 442 of 2022)
B                            JANUARY 28, 2022
                [M. R. SHAH AND SANJIV KHANNA, JJ.]
            Service Law – MACP Scheme – Claim of grade pay of
      Rs.6600/- – Clause 8.1 of the scheme provides that the grade pay
      of Rs.5400 in PB-2 and Rs.5400 in PB-3 shall be treated as separate
C
      grade pays for the purpose of grant of upgradations under MACP
      Scheme – However, the respondents (in PB-2) were granted grade
      pay of Rs.6600 for PB-3 under MACP Scheme by the High Court –
      High Court observed that the next promotional post carries a grade
      pay of Rs.6600, when the third financial upgradation is due to an
D     employee, it has to be of the next promotional post in the hierarchy
      as per the Recruitment Rules – On appeal, held: It was specifically
      observed and held by the Supreme Court in the case of M.V. Mohanan
      Nair that MACP has nothing to do with the next promotional post
      and what the employee would be entitled would be the immediate
      next higher grade pay in the hierarchy of the recommended revised
E
      pay bands and grade pay as given in the CCS (Revised Pay) Rules,
      2008 – As per clause 8.1 of the MACP scheme grade pay of PB-2
      and PB-3 would be Rs.5400/- – The High Court has committed a
      grave error in allowing the grade pay of Rs.6600, the grade pay
      which was available to the next promotional post – Therefore,
F     judgment and the order passed by the High Court set aside –
      Respondents entitled to the next grade pay of Rs.5400 as per clause
      8.1 – CCS (Revised Pay) Rules, 2008.
            Allowing the appeal, this Court
            HELD: 1. At the outset it is required to be noted that the
G     issue involved in the present appeal is as such squarely covered
      by the decision of this Court in the case of M.V. Mohanan Nair.
      By detailed judgment and order this Court has interpreted the
      very MACP Scheme and it is observed and held that under the
      MACP Scheme employees are entitled to the immediate next
H
                                      720
THE DIRECTOR, DIRECTORATE OF ENFORCEMENT & ANR. v. K.                  721
               SUDHEESH KUMAR & ORS.

higher grade pay as given in Section 1, Part A of the First Schedule   A
of the CCS (Revised Pay) Rules, 2008. It is specifically observed
and held by this Court in the aforesaid decision that MACP has
nothing to do with the next promotional post and what the
employee would be entitled would be the immediate next higher
grade pay in the hierarchy of the recommended revised pay bands
                                                                       B
and grade pay as given in the CCS (Revised Pay) Rules, 2008.
As per clause 8.1 of the MACP Scheme ‘consequently upon the
implementation of Sixth CPC’s recommendations, grade pay of
PB-2 and PB-3 would be Rs.5400. It specifically provides that
the grade pay of Rs.5400 in PB-2 and Rs.5400 in PB-3 shall be
treated as separate grade pays for the purpose of grant of             C
upgradations under the MACP Scheme’. Therefore, respondent
Nos.1 & 2 as PB-2 shall be entitled to the next grade pay of
Rs.5400 as per clause 8.1 and as per Section 1, Part A of the First
Schedule of the CCS (Revised Pay) Rules, 2008. The High Court
has allowed the grade pay of Rs.6600 by considering the next
                                                                       D
promotion post of Assistant Director i.e., Deputy Director which
carries a grade pay of Rs.6600. However, the aforesaid
interpretation would be contrary to the MACP Scheme. On
considering the relevant clauses of the MACP Scheme, it appears
that the MACP Scheme envisages placement in the immediate
next higher grade pay in the hierarchy of the recommended              E
revised pay bands and grade pay as given in Section 1, Part A of
the First Schedule of the CCS (Revised Pay) Rules, 2008. Thus,
the High Court has committed a grave error in allowing the grade
pay of Rs.6600 the grade pay which was available to the next
promotional post as Deputy Director. Respondent Nos.1 & 2 as
                                                                       F
per PB-2 were entitled to the grade pay of Rs.5400 as PB- 3 as
per clause 8.1. [Para 7][726-C-H; 727-A]
       2. By the impugned judgment and order and while granting
grade pay of Rs.6600 to respondent Nos.1 & 2 virtually, the High
Court has modified the MACP Scheme which has been framed
by the Government on the recommendations of the expert body            G
like the pay commission and its recommendations for the MACP
Scheme. As observed and held by this Court in the case of M.V.


                                                                       H
722           SUPREME COURT REPORTS                     [2022] 2 S.C.R.


A     Mohanan Nair the ACP which is now superseded by MACP
      Scheme is a matter of Government policy and interfering with
      the recommendations of the expert body like the pay commission
      and its recommendations for the MACP Scheme would have
      serious impact on the public exchequer. It is further observed
      that the recommendations of the pay commission for the MACP
B
      Scheme have been accepted by the Government and
      implemented. It is further observed that therefore the High Court
      has no jurisdiction to interfere with the Government policies in
      the form of MACP Scheme which was after accepting the Sixth
      Central Pay Commission. In view of the above and for the reasons
C     stated above and the binding decision of this Court in the case of
      M.V. Mohanan Nair, the impugned judgment and order passed
      by the High Court granting grade pay of Rs.6600 to respondent
      Nos.1& 2 is unsustainable and deserves to be quashed and set
      aside. Therefore, so long as Clause 8.1 and the grade pay
      mentioned as per Section 1, Part A of the First Schedule of the
D
      CCS (Revised Pay) Rules, 2008 stands, the employee shall be
      entitled to the grade pay accordingly. Therefore, if any of the
      employees is aggrieved by Clause 8.1 and if in his opinion, there
      is any anomaly the same has to be challenged by the aggrieved
      employee, which can be considered in accordance with law and on
E     its own merits. However, as the same is not under challenge, this
      Court has to go by the MACP Scheme as it is. [Para 8][727-A-G]
           Union of India and others Vs M.V. Mohanan Nair (2020)
           5 SCC 421 – relied on.
           State of Rajasthan Vs. Mahesh Kumar Sharma (2011)
F          4 SCC 257 : [2011] 3 SCR 489 – referred to.
           National Council of Educational Research & Training
           Anr. vs. Anita Gupta & Anr 2016 SCC OnLine Del 4720
           – referred to.

G                           Case Law Reference
      (2020) 5 SCC 421              relied on              Para 4
      [2011] 3 SCR 489              referred to            Para 5.3


H
THE DIRECTOR, DIRECTORATE OF ENFORCEMENT & ANR. v. K.                       723
               SUDHEESH KUMAR & ORS.

        CIVIL APPELLATE JURISDICTION: Civil Appeal No. 442 of               A
2022.
      From the Judgment and Order dated 23.10.2019 of the High Court
of Kerala at Ernakulam in O.P. (CAT). No.171 of 2019.
       Ms. Madhavi Goradia Divan, ASG, Ashok Panigrahi, B. K. Satija,
Zoheb Hossain, Manan Popli, M. K. Maroria, B. Krishna Prasad, Advs.         B
for the Appellants.
      Mathai Paikaday, Sr. Adv., Sunil Roy, Amit Singh, Alexander M.
Paikaday, Advs. for the Respondents.
        The Judgment of the Court was delivered by                          C
        M. R. SHAH, J.
       1. Feeling aggrieved and dissatisfied with the impugned judgment
and order dated 23.10.2019passed by the High Court of Kerala at
Ernakulam in OP (CAT) No.171 of 2019, by which the High Court has
allowed the said original petition (OP) and set aside the order passed by   D
the learned Central Administrative Tribunal, Ernakulam Bench and has
declared that respondent Nos.1 & 2 herein – original petitioners are
entitled to grade pay of Rs.6600/- on their third financialupgradation as
per the Modified Assured Career Progression (MACP) Scheme and
they be paid the pension accordingly with effect from April, 2015, the
                                                                            E
Director, Directorate of Enforcement, New Delhi and another – original
respondents before the High Court, have preferred the present appeal.
       2. That the private respondent Nos.1 & 2 herein were appointed
as Assistant Enforcement Officer (AEO) in the year 1976 and 1977,
respectively. That in the year 2009, the Government of India – Ministry
                                                                            F
of Personnel, Public Grievance and Pensions (Department of Personnel
and Training) notified the MACP Scheme for the Central Government
Civilian Employees. The Scheme further provided as per clause 8.1 (which
is relevant so far as the present matter is concerned)‘consequently upon
the implementation of Sixth CPC’s recommendations, grade pay of
Rs.5400 is now in two pay bands viz., PB-2 and PB-3. It further provided    G
that the grade pay of Rs.5400 in PB-2 and Rs.5400 in PB-3 shall be
treated as separate grade pays for the purpose of grant of upgradations
under MACP Scheme’. However, it so happened that while granting
third financial upgradation vide order dated 17.11.2009, the private
respondents herein and others were granted the grade pay of Rs.6600 for
                                                                            H
724            SUPREME COURT REPORTS                          [2022] 2 S.C.R.


A     PB-3 under MACP Scheme, though as per clause 8.1 PB-3 carried the
      grade pay of Rs.5400. However, on the objection being raised by the
      Audit Department their grade pays(GP) of Rs.6600 in PB-3 was modified/
      corrected as GP of Rs.5400 as per clause 8.1. Therefore, respondent
      Nos.1 and 2 herein approached the Central Administrative Tribunal,
      Ernakulam Bench and prayed to continue the GP of Rs.6600 as per the
B
      earlier order dated 17.11.2009 and not to make any recovery. A decision
      of the Madras High Court was pressed into service by which a similar
      order of withdrawing the GP of Rs.6600 and to grant GP Of Rs.5400 for
      PB-3 was set aside. On relying upon the clause 8.1 of the MACP Scheme
      by which the implementation of Sixth CPC’s recommendations, grade
C     pay of Rs.5400 was in two pay bands i.e., PB-2 and PB-3 and for grant
      of upgradation under MACP Scheme they shall be treated as separate
      grade pays, the learned Tribunal dismissed the original application (OA).
             3. Feeling aggrieved and dissatisfied with the judgment and order
      passed by the Central Administrative Tribunal dismissing the said OA,
D     respondent Nos.1 & 2 herein preferred the original petition before the
      High Court. By the impugned judgment and order and ignoring clause
      8.1 of the MACP Scheme the High Court has allowed the saidpetition
      by observing that the next promotion post of Assistant Director which is
      in the PB-3 would be that of Deputy Director which carries a grade pay
      of Rs.6600, when the third financial upgradation is due to an employee,
E     it has to be of the next promotional post in the hierarchy as per the
      Recruitment Rules. Feeling aggrieved and dissatisfied with the impugned
      judgment and order passed by the High Court, the department has
      preferred the present appeal.
            4. Ms. Madhavi Divan, learned ASG appearing on behalf of the
F     appellants has vehemently submitted that the impugned judgment and
      order passed by the High Court is just contrary to the decision of the
      Delhi High Court in the case of National Council of Educational
      Research & Training & Anr. Vs. Anita Gupta & Anr. 2016 SCC
      OnLine Del 4720 as well as to the decision of this Court in the case of
G     Union of India and others Vs. M.V. Mohanan Nair (2020) 5 SCC
      421.
              4.1 It is submitted that on interpretation of very MACP Scheme,
      it is observed and held by this Court that the employees are entitled to
      the grade pay as provided under the MACP Scheme which has been
H     framed on the recommendations of the pay commission.It is submitted
THE DIRECTOR, DIRECTORATE OF ENFORCEMENT & ANR. v. K.                        725
        SUDHEESH KUMAR & ORS. [M. R. SHAH, J.]

that on interpreting MACP Scheme, it is specifically observed and held       A
by this Court that MACP Scheme envisages merely placement in
the immediate next higher grade pay in the hierarchy of the recommended
revised pay bands and grade pay as given in Section 1, Part A of the
First Schedule of the CCS (Revised Pay) Rules, 2008 and has nothing to
do with the next promotional post.
                                                                             B
        4.2 It is submitted that in the present case the High Court has
allowed the grade pay of Rs.6600. However, as per clause 8.1, PB-2
and PB-3 carried grade pay of Rs.5400 and it specifically provided that
the grade pay of Rs.5400 in PB-2 and grade pay of Rs.5400 in PB-3
shall be treated as separate grade pays for the purpose of grant of
upgradation under MACP Scheme. It is submitted that therefore                C
respondent Nos.1 & 2 – original petitioners as per the MACP Scheme
shall be entitled to the grade pay of Rs.5400 i.e., next grade pay for PB-
3. It is submitted that as such by the impugned judgment and order and
directing to grant grade pay of Rs.6600 the High Court has modified the
MACP Scheme and has granted the benefit of three steps upward.               D
      4.3 Making the above submissions and relying upon the aforesaid
decisions, it is prayed to allow the present appeal.
      5. The present appeal is vehemently opposed by Shri Mathai
Paikaday, learned Senior Advocate appearing on behalf of the private
respondent Nos.1 & 2 herein.                                                 E

      5.1 It is vehemently submitted by learned Senior Advocate
appearing on behalf of the private respondent Nos.1 & 2 that the
employee shall be entitled to the next higher pay and the submissions
made on behalf of the appellants that both PB-2 and PB-3 shall carry
grade pay of Rs.5400 is accepted in that case the purpose of higher-         F
grade pay shall be frustrated. It is submitted that when the next higher-
grade pay would be Rs.6600, the High Court has rightly directed to
grant grade pay of Rs.6600.
       5.2 It is submitted that it is true that the High Court has wrongly
used the word next promotion post. It is submitted that the question is      G
not of next promotional post but the question is of next higher grade pay.
       5.3 In the alternative it is prayed by the learned Senior Advocate
appearing on behalf of respondent Nos.1 & 2 and relying upon the decision
of this Court in the case of State of Rajasthan Vs. Mahesh Kumar
Sharma (2011) 4 SCC 257 that if this Court is inclined to accept the         H
726             SUPREME COURT REPORTS                            [2022] 2 S.C.R.


A     submissions made on behalf of the appellants and set aside the judgment
      and order passed by the High Court holding that respondent No.1 & 2
      shall be entitled to grade pay of Rs.5400, in that case no recovery be
      ordered as respondent Nos.1 & 2 have already retired and the difference
      would be of Rs.1200 approximately per month so far as the pension is
      concerned.
B
            6. We have heard learned counsel appearing on behalf of the
      respective parties.
             7. At the outset it is required to be noted that the issue involved in
      the present appeal is as such squarely covered by the decision of this
C     Court in the case of M.V. Mohanan Nair (supra). By detailed judgment
      and order this Court has interpreted the very MACP Scheme and it is
      observed and held that under the MACP Scheme employees are entitled
      to the immediate next higher grade pay as given in Section 1, Part A of
      the First Schedule of the CCS (Revised Pay) Rules, 2008. It is specifically
      observed and held by this Court in the aforesaid decision that MACP
D
      has nothing to do with the next promotional post andwhat the employee
      would be entitled would be the immediate next higher grade pay in
      thehierarchy of the recommended revised pay bands and grade pay as
      given in the CCS (Revised Pay) Rules, 2008. As per clause 8.1 of the
      MACP Scheme ‘consequently upon the implementation of Sixth CPC’s
E     recommendations, grade pay of PB-2 and PB-3 would be Rs.5400. It
      specifically provides that the grade pay of Rs.5400 in PB-2 and Rs.5400
      in PB-3 shall be treated as separate grade pays for the purpose of grant
      of upgradations under the MACP Scheme’. Therefore, respondent Nos.1
      &2 as PB-2 shall be entitled to the next grade pay of Rs.5400 as per
      clause 8.1 and as per Section 1, Part A of the First Schedule of the CCS
F
      (Revised Pay) Rules, 2008. The High Court has allowed the grade pay
      of Rs.6600 by considering the next promotion post of Assistant Director
      i.e., Deputy Director which carries a grade pay of Rs.6600. However,
      the aforesaid interpretation would be contrary to the MACP Scheme.
      On considering the relevant clauses of the MACP Scheme, it appears
G     that the MACP Scheme envisages placement in the immediate next higher
      grade pay in the hierarchy of the recommended revised pay bands and
      grade pay as given in Section 1, Part A of the First Schedule of the CCS
      (Revised Pay) Rules, 2008. Thus, the High Court has committed a grave
      error in allowing the grade pay of Rs.6600 - the grade pay which was
      available to the next promotional post as Deputy Director. Respondent
H
THE DIRECTOR, DIRECTORATE OF ENFORCEMENT & ANR. v. K.                        727
        SUDHEESH KUMAR & ORS. [M. R. SHAH, J.]

Nos.1 & 2 as per PB-2 were entitled to the grade pay of Rs.5400 as           A
PB-3 as per clause 8.1.
       8. By the impugned judgment and order and while granting grade
pay of Rs.6600 to respondent Nos.1 & 2 virtually, the High Court has
modified the MACP Scheme which has been framed by the Government
on the recommendations of the expert body like the pay commission and        B
its recommendations for the MACP Scheme. As observed and held by
this Court in the case of M.V. Mohanan Nair (supra) the ACP which is
now superseded by MACP Scheme is a matter of Government policy
and interfering with the recommendations of the expert body like the
pay commission and its recommendations for the MACP Scheme would
have serious impact on the public exchequer. It is further observed that     C
the recommendations of the pay commission for the MACP Scheme
have been accepted by the Government and implemented. It is further
observed that therefore the High Court has no jurisdiction to interfere
with the Government policies in the form of MACP Scheme which was
after accepting the Sixth Central Pay Commission. In view of the above       D
and for the reasons stated above and the binding decision of this Court in
the case of M.V. Mohanan Nair (supra) with which we also agree, the
impugned judgment and order passed by the High Court granting grade
pay of Rs.6600 to respondent Nos.1& 2 is unsustainable and deserves
to be quashed and set aside.
                                                                             E
       However, we observe that the view which we are taking is on the
premise that neither the MACP Scheme nor Clause 8.1 is under challenge
and as per the law laid down by this Court in M.V. Mohanan Nair
(supra), an employee is entitled to the higher grade pay as provided
under MACP Scheme, more particularly, as per Section 1, Part A of the
First Schedule of the CCS (Revised Pay) Rules, 2008. Therefore, so           F
long as Clause 8.1 and the grade pay mentioned as per Section 1, Part A
of the First Schedule of the CCS (Revised Pay) Rules, 2008 stands, the
employee shall be entitled to the grade pay accordingly. Therefore, if
any of the employees is aggrieved by Clause 8.1 and if in his opinion,
there is any anomaly the same has to be challenged by the aggrieved          G
employee, which can be considered in accordance with law and on its
own merits. However, as the same is not under challenge, we have to go
by the MACP Scheme as it is.
     9. In view of the above and for the reasons stated above the
impugned judgment and order passed by the High Court is hereby               H
728              SUPREME COURT REPORTS                        [2022] 2 S.C.R.


A     quashed and set aside and the judgment and order that of the Central
      Administrative Tribunal is hereby restored. It is observed and held that
      on implementation of MACP Scheme respondent No.1 and 2 herein
      shall be entitled to the grade pay of Rs.5400 and not of Rs.6600 as
      claimed by them. Their pensions be refixed accordingly. However, it is
      observed that as respondent Nos.1 & 2 are the retired employees and
B
      till date they have received the pension considering the grade pay of
      Rs.6600 and being retired persons it will be very difficult for them to
      refund the difference in the pay pension, in the peculiar facts and
      circumstances of the case we direct that there shall be no recovery of
      the difference in the pension between the grade pay of Rs.5400 and
C     grade pay of Rs.6600 for the period prior to December, 2021. However,
      on refixation of the pension as per the present judgment and order, fixing
      their grade pay of Rs.5400 they shall be paid the pension accordingly
      from January, 2022 onwards. The present appeal is allowed accordingly,
      however, with the above observations and directions. No costs.
D
      Ankit Gyan                                                   Appeal allowed.
      (Assisted by : Rahul Rathi, LCRA)




E




F




G




H