Supreme Court of India

U.P. JAL NIGAM AND ORS.versusPRABHA T CHANDRA JAIN AND ORS.

Citation: 1996 INSC 158
Decided: 31 January 1996
Disposal: Dismissed
Bench: M M PUNCHHIK S PARIPOORNAN

Holding

A downgrading reflected by comparison without stating reasons cannot be sustained; the authority must record reasons and advise the employee, and such downgrading is not automatically an adverse entry requiring mandatory communication.

Summary

The Supreme Court considered a petition by U.P. Jal Nigam challenging the view that downgrading entries in an employee's annual confidential report (ACR) are adverse entries requiring mandatory communication and a representation under service rules. The High Court had held that any reduction in the rating, even without explicit adverse language, is adverse and must be communicated. The Supreme Court clarified that a mere step‑down in rating (e.g., from "very good" to "good") is not automatically adverse; however, the authority must record reasons for the downgrading in the officer's personal file and inform the employee through an advice. If the downgrading is reflected merely by comparison without stating reasons, it cannot be sustained. The Court upheld the High Court's decision and dismissed the special leave petition.

Issues considered

Whether a downgrading entry in an annual confidential report constitutes an adverse entry that must be communicated to the employee under service rules.
Whether the employer is required to record reasons for downgrading and inform the employee via advice.

Subjects

Annual Confidential ReportDowngradingAdverse entryService lawEmployee representationU.P. Jal NigamService TribunalCommunication of adverse entries

Judgment

r
A U.P. JAL NIGAM AND ORS.
v.
PRABHA T CHANDRA JAIN AND ORS.

JANUARY 31, 1996

B [M.M. PUNCHHI AND K.S. PARIPOORNAN, JJ.J

Service Law :

Annual Confidential Report~System of recording-Downgrading
C enflies in confidential rep01t~Employer U.P. Jal Nigam taking a plea that
both entries not adverse entries and hence not conununicated to the
employe<:-Plea n1111ed down by the High Cowt-On appeal held, reasons to
be recorded for downgrading and employee infonned of the charge in the fonn
of an advic<:-When downgrading is reflected by compaiison without giving
reason, it cannot be sustained.
D
CIVIL APPELLATE JURISDICTION: Special Leave Petition (C)
No. 16988 of 1995.

From the Judgment and Order dated 1.5.95 of the Allahabad High
E Court in W.P. No. 2244 (S/S) of 1994.

Rajeev Dhawan, R.B. Misra, Sudhansu, M.K. Roy and K. Misra for
the Petitioners.

S.C. Maheshwari and R.K. Jain, Ajay Bhalla, P.K. Chakraborty and
Ms. Prabha Jain for the Respondents.
F
The following Order of the Court was delivered :

What we say in this order shall not only cover the case of the first
respondent but shall also regulate the system of recording annual confiden-
G tial reports prevalent in the U.P. Jal Nigam - the first petitioner herein.

The first respondent was down graded at a certain point of time to
which the Service Tribunal gave a correction. Before the High Court, the
petitioners' plea was that down grading entries in confidential reports
cannot be termed as adverse entries so as to obligate the Nigam to
H communicate the same to the employee and attract a representation. This
-
1118
I
\
U.P. JAL NIGAM 1•. P.C. JAIN 1119

argument was turned down by the High Court, as in its view confidential A
reports, were assets of the employee, since they weigh to his advantage at
the promotional and extensional stages of service. The High Court to justify
its view has given an illustration that if an employee legitimately had earned
an 'outstanding' report in a particular year \vhich, in a succeeding one, and
without his knowledge, is reduced to the level of 'satisfactory' without any
B
communication to him, it would certainly be adverse and effect him at one
or the other stage of his career.

We need to explain these observations of the High Court. The Nigam
(
has rules, whereunder an adverse entry is required to be communicated to
the employee concerned, but not down grading of an entry. It has been c
urged on behalf of the Nigam that when the nature of the entry does not
reflect any adverseness that is not required to be communicated. As we
view it the extreme illustration given by the High Court may reflect an
adverse element compulsorily communicable, but if the graded entry is of
going a step down, like falling from 'very good' to 'good' that may not
ordinarily be an adverse entry since both are a positive !,'fading. All what D
is required by the Authority recording confidentials in the situation is to
record reasons for such down grading on the personal file of the officer
concerned, and infarm him of the change in the form of an advice. If the
variation warranted be not permissible, then the very purpose of writing
annual confidential reports would be frustrated. Having achieved an op-
E
timum level the employee on his part may slacken in his work, relaxing
secure by his one time achievement. This would be an undesirable situation.
All the same the sting of adverseness must, in all events, be not reflected
in such variations, as otherwise they shall be communicated as such. It may
be emphasised that even a positive confidential entry in a given case can
previously be adverse and to say that an adverse eniry should always be F
qualitatively damaging may not be true. In the instant case we have seen
the service record of the first respondent. No reason for the change is
mentioned. The down grading is reflected by comparison. This cannot
sustain. Having explained in this manner the case of the first respondent
and the system that should prevail in the Jal Nigam, we do not find any
difficulty in accepting the ultimate result arrived at by the High Court. G

The special leave petition is, therefore, dismissed.

G.N. Petition dismissed.

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