UNION OF INDIA AND ANR.versusG.K. VAIDYANATHAN AND ORS.

A                       UNION OF INDIA AND ANR.
                                   v.
                      G.K. VAIDYANATHAN AND ORS.

                               NOVEMBER 2, 1995
B
              (K. RAMASWAMY, B.P. JEEVAN REDDY AND
                        B.L. HANSARIA, JJ.]


          Service Law :

c         Senio1ity-Inter-se seniority of direct recruits and proniotees--Decision
    of T1ibwia/ based on concession made by direct recntits--Held : cannot be
    considered as decision on nzelits.

            The first respondent was promoted to the post of chargeman
D   Grade-I on January 5, 1981 on a regular basis. The other respondents
    were appointed as direct recruits to the said post _in December 1981.
    Recruitment to the post of chargeman Grade • I was both by promotion as
    well as by direct recruitment. When the recruitment was done through both
    the above methods, a rule of' rotation was also in vogue, the ratio between
    promotees and direct recruits was 80 : 20. The rotation rule in vogue
E   provided that out of every five vacancies, tin: first four vacancies shall be
    filled by promotees and the fifth vacancy by direct recruitment.

          For further promotion to the post of Assistant Foreman, they were
    considered on the basis of the aforesaid seniority, with the result that the
F   direct recruits, who were appointed in December 1981 came to be promoted
    to the post of Assistant Foreman earlier than the first respondent. During
    the years 1978 to 1981 both direct recruitments and promotions were being
    made in excess of the quota. In the seniority list issued in the year 1982.
    the direct recruits were shown as senior to the first respondent.

G         The first respondent filed a petition before the Central Administra·
    tive Tribunal praying for a declaration that the seniority list issued in the
    year 1982 be declared to be illegal and invalid and a further direction to
    promote him to the post of Assistant Foreman. The Tribunal allowed the
    petition upon a concession made by the direct recruits that the quota rule
H   had broken down warranting re-fixation of seniority.
                                         718
                         U.0.1. v. G.K. VAIDYANATHAN                       719

          Aggrieved by the Tribunal's judgment, the appellants have preferred     A
    the present appeal.

          On behalf of the appellants it was contended that this Court should
    decide on merits whether the quota rule had indeed broken down durh1g
    the period 1978 to 1981 de /um· the concession made on behalr of the direct
    recruits before the Tribunal.
                                                                                  B

          On behalf of the respondents it was contended that the quota rule
    had broken down and that the concession to this effect was rightly made
    before the Tribunal.
                                                                                  c
          Allowing the appeal, this Court

          HELD: I.I. The decision of the Tribunal is based upon a concession
    and cannot, therefore, be treated as a decision on merits. The said conces·
    sion made by direct recruits cannot and does not bend the appellant, which
    is equally an affected party in the matter. Even during the years 1978 to     D
    1981 • the period during which the promotees say, there was a break-down
    in the (jUota rule - both direct recruitn1ents and promotions were being
    made though it may be that promotions to the cadre were made in excess
    of the quota. The correctness of this fact is not disputed or questioned
    before this Court. Once this is so, the very theory of break-down of the      E
    quota rule falls to the ground. The factual situation concludes the issue
    against the promotees. (724-D-F]

         Direct Recntit Class fl Engineen·ng Office1:'\ Association v. State of
    Maharashtra, [1990] 2 SCC 715, cited.
                                                                                  F
         CIVIL APPELLATE JURISDICTION : Civil Appeal No. 4340 of
    1995 Etc.

          From the Judgment and Order dated 30.10.88 of the Central Ad-
    ministrative Tribunal, Addi. Bench Madras in 0.A. No. 731 of 1986.
                                                                                  G
          Wasim Qadri, P. Parmeshwaran and Ms. Sushma Suri for the Ap-
    pellants.

         M.N. Krishnamani, P.K. Singh, S. Madhusudan Babu and M.M.
    Kashyap, for the Respondent in C.A. No. 4340/95.                              H


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    720                   SUPREME COURT REPORTS [1995] SUPP. 4S.C.R.

A         The Judgment of the Court was delivered by

          B.P. JEEVAN REDDY, J. Leave granted in Special Leave Petition
    (C) No. 3930 of 1988.

          A common question arises in these two appeals. Civil Appeal No.
B 4340 of 1995 is preferred by the Union of lndia against the decision of the
    Central Administrative Tribunal (Madras Bench) in Original Application
    No. 731 of 1981 whereas Civil Appeal arising from Special Leave Petition
    (C) No. 3930 of 1988 is preferred against an order of the Central Ad-
    ministrative Tribunal (Bangalore Bench) in Original Application No. 380
c   of 1987 as well as the order dismissing a review application filed by the
    appellants. The dispute is between direct recruits and promotees and it
    relates to .determination of the seniority as between them in the post of
    Chargeman Grade-I in the Ministry of Defence, Department of Defence
    Production.

D         Recruitment to the post of Chargeman Grade-I was both by promo-
    tion as well as by direct recruitment. Until 1979, the ratio between
    promotees and direct recruits was 2/3 : 1/3. From March 3, 1979, it was
    changed to 80 : 20 and with effect from June 26, 1985 the channel of direct
    recruitment has been closed altogether; the only method of recruitment is
E   promotion from the post of Chargeman Grade-LI. When the recruitment
    was done through both the above methods, a rule of rotation was also in
    vogue. In asmuch as we are concerned in these appeals only with the period
    during which the ratio of 80 : 20 was in vogue, it is sufficient to notice that
    the rotation rule in vogue provided that out of every five vacancies, the first
    four vacancies shall be filled by promotees and the fifth vacancy by direct
F   recruitment.


          In Civil Appeal No. 4340 of 1995, the facts are the following: the first
    respondent herein (the petitioner before the Madras Tribunal) was
    promoted to the post of Chargeman Grade-I on January 5, 1981 on a
G regular basis. The Respondent Nos. 3 to 15 in the Original Application
    (who are respondent Nos. 2 to 13 in this appeal one of them does not
    appear to have been impleaded as a respondent in this appeal) were
    appointed as direct recruits to the said post in December 1981. In the
    seniority list issued in the year 1982, while the third respondent in the
    Original Application was shown at SI. No. 37, the petitioner in the Original
H   Application (First respondent in this appeal) was shown at SL No. 141. The·
        U.U.L v. G.K. VAIDY AN ATHAN [B.P. JEEY AN REDDY, J.]           721

other respondents (direct recruits) were also shown as seniors to the first A
respondent. For further promotion to the post of Assistant Foreman, they
were considered on the basis of the aforesaid seniority, with the result that
the direct recruits, who were appointed in December 1981 came to be
promoted lo the post of Assistant Foreman earlier than the first respon-
dent. Thereupon, the first respondent approached the Central Administra-
tive Tribunal (Madras Bench) by way of Original Application No. 731 of B
1986 praying for a declaration that the seniority lcsts i~sued in the years
1982, 1983 and 1985 in respect of Chargemen Grade-I 11c declared to be
illegal and invalid and a further direction to promote him (petitioner in the
said Original Application) to the post of Assistant Foreman with effect
from July 9, 1984, the date on which the second respondent was promoted
to that post. His submission was that inasmuch as there was a break-down
                                                                               c
of the quota rule during the relevant years, the rule of rotation cannot be
followed and hence the direct recruits appointed later cannot be made
senior to him purporting it to follow the rule or rotation. He submitted
further that the injustice inherent in following the rule of rotation inspite
of break-down in the quota rule has been recognised by the Central D
Government which has issued a new set of principles in Office Memoran-
dum dated February 7, 1976. If the principle of the said Office Memoran-
dum is applied to the parties herein, the petitioner in the Original
Application (first respondent in this appeal) is entitled to be treated as
senior to Respondent Nos. 3 to 15 (direct recruits) in the Original Applica-
ti on.                                                                        E

      The learned counsel appearing for Respondent Nos. 3 to 15 in the
Original Application (direct recruits) conceded before the Tribunal that
the quota rule has broken down warranting re-fixation of seniority. The
stand taken by the learned counsel for the direct recruits may better be set   F
out in the words of the Tribunal itself :


        "The learned counsel for the respondents conceded that it had
        broken down, warranting a refixation of seniority. He stated that
        since the Direct Recruits were fitted in slots earmarked for them G
        even though they were appointed very much later than the
        promotees and this led to their becoming senior to the promotees,
        he would concede the first prayer of the applicant in regard to his
        seniority. In view of that we direct the !st and 2nd respondents lo
        refix the applicant's seniority as Chargeman Grade I in the light
        of the guidelines given by the Department of Personnel & Training H
    722                   SUPREME COURT REPORTS [1995] SUPP. 4 S.C.R.

A            in their O.M. dated ·7-2-1986. Even though that O.M. would have
             effect only prospectively, the principle laid down therein is a
             principle of law which has to be applied in cases like this where
             seniority is challenged on the ground that constitutional provisions
             have been violated because of the application of rota rule when
             quota rule has already broken."
B
           In view of the said concession - (the judgment of the Tribunal does
    not show whether any counter was filed by the Union of India, and if so,
    what was its purport) - the Tribunal directed that the petitioner before it
    is entitled to be treated as senior to the respondents-direct recruits therein
    and that he is also "entitled to be considered for promotion as Assistant
c   Foreman when the third respondent was considered for that post". The
    Union of India has come up in appeal against the said decision.

          Identical dispute between the same parties was also raised before the
    Bangalore Tribunal with this difference. The Original Application before
D   the Bangalore Tribunal was filed by an Association of the promotees and
    the promotees (Petitioner No.1 and Petitioner Nos. 2 to 39 respectively)
    claiming seniority over the respondents-direct recruits. The direct recruits
    were impleaded as Respondent Nos. 4 to 19 who included Respondent
    Nos. 3 to 15 before the Madras Tribunal. The basis of the claim was
    identical, viz., the break-down of the quota rule. The direct recruits
E
    remained ex-parte but Union of India contested the promotees' case. The
    Bangalore Tribunal looked into the relevant records and found as follows:

            "On an examination of the records, we notice that there was a
            deviation or departure in adhering to the quotas prescribed for
F           direct recruitment and promotion in the Calendar years from 1978
            to 1981 reckoning each year as on unit. In all these years, the posts
            in the cadre of CG! were filed in from two sources, viz., direct
            recruitment and promotions. Strange enough, ·during these years,
            promotion to the cadre were in excess of direct recruitment. This
             then is the factual position revealed from the records."
G
          T}Je Tribunal accordingly found that it was not a case of break- down
    of quota rule but a case of mere departure or deviation in certain years. It
    rejected the promotees' case that there has been a break-down of the quota
    rule. The claim of the promotees for seniority was accordingly rejected.
H   The Tribunal also rejected the promotees' challenge to the Office
            U.O.l. v. G.K. VAIDYANATHAN [B.P.JEEVAN REDDY,J.)              723

    Men:iorandum dated February 7, 1986 insofar as it stated that the principle   A
    evolved therein shall have only prospective operation and that seniority
    alrea,<ly determined in acrnrdance with the existing principles on the date
    of issue of the said Office Memorandum will not be re-opened. The
    decision of the Bangalore Tribunal was rendered on October 20, 1987.

           When the petitioners before the Bangalore Bench came to know of
                                                                                  B
    the decision of the Madras Tribunal (which was rendered on October 30,
    1987), they applied to the Bangalore Tribunal for reviewing its judgment
    on. the basis of the decision of the Madras Tribunal. It was rejected. Both
    the aforesaid orders are challenged in the appeal arising from Special
    Leave Petition (C) No. 3930 of 1988.                                          C

          The learned counsel for the appellant-union of India in Civil Appeal
    No. 4340 of 1995 submits that in the interest of uniformity, this Court
    should decide on merits whether the quota rule had indeed broken down
    during the period 1978 to 1981 de hms the concession made on behalf of        D
    the direct recruits before the Madras Tribunal. He points out that the
    decision of the Madras Tribunal is based on a concession and that where
    on such concession was made, i.e., before the Bangalore Tribunal, it has
    been held on merits that the said rule cannot be said to have broken down.
    On merits, the learned counsel supported the reasoning and the finding
    arrived at by the Bangalore Tribunal.                                         E

          Sri Krishnamani, learned counsel appearing for the promotees, on
    the other hand, submitted that the quota rule must be held to have broken
    down in the facts and circumstances of these cases and that the concession
    to that effect was rightly made by the direct recruits before the Madras F
    Tribunal. Once the quota rule is held to have broken down, the learned
    counsel contended, the rule of rotation cannot be followed, in which event
    the principles enunciated by the Constitution Bench of this Court in Direct
    Recntit Class-II Engineering Officers Association v. State of Maharashtra,
    [1990] 2 SCC 715 should be followed. The learned counsel further sub-
    mitted that following the rule of rotation despite the break-down of the G
    quota rule results in grave discrimination and arbitrariness and that the
    said fact was recognised by the Government itself which has accordingly
    issued a fresh set of instructions in its Office Memorandum dated February
    7, 1986. Counsel submitted that ihe principles contained in the said Office
    Memorandum, being equitable and just, should be applied even for the H



-
    724                   SUPREME COURT REPORTS [1995] SUPP. 4 S.C.R.

A   period anterior lo February 7, 1986 in the interest of justice, equity and
    fairplay. He submitted that the Central Government was not justified in
    saying that the principles in the said Office Memorandum shall only have
    prospective operation which really means that the injustice perpetrated
    earlier to the said Office Memorandum was knowingly affirmed.

B          We are of the opinion that the learned Additional Solicitor General
    is right in his submission that the decision of the Madras Tribunal is based
    upon a concession and cannot, therefore, be treated as a decision on
    merits. The said concession made by direct recruits cannot and does not
    bind the Union of India, which is equally an affected party in the matter.
c No such concession was made by any of the respondents before the
    Bangalore Bench. As stated above, the direct recruits impleaded as respon-
    dents before Madras Tribunal were also impleaded as respondents before
    the Bangalore Tribunal. Moreover, the said concession is found to be
    opposed to the record, as found by the Bangalore Tribunal, which has
D recorded on a perusal of relevant records, that even during the years 1978
  . to 1981 the period during which the promotees say, there was a break-down
    in the quota rule-both direct recruitments and promotions were being
    made though it may be that promotions to the cadre were made in excess
    of the quota. The correctness of the facts recorded in Para-28 of the
    decision of the .Bangalore Tribunal is not disputed or questioned before
E us. Once this is so, the very theory of break-down of the quota rule falls to
     the ground. In such a situation, it is not necessary either to deal with the
    decisions cited by the parties on the question when. the quot& rule can be
    said to have broken down or with the question whether the principle
    contained in Office Memorandum dated February 7, 1986 can be given
    retrospective effect. The factual situation concludes the issue against the
F
    promotees.

           For the above reasons, Civil Appeal No. 4340 of 1995 is allowed and
    the Civil Appeal No. 9831of1995 arising from Special Leave Petition (C)
    No. 3930 of 1988 is dismissed. The promotccs' challenge to the seniority
G   lists prepared in the years 1982, 1983 and 1985 fails as also their challenge
    to the prOmotion of direct recruits to the post of Assistant Foreman earlier
    than the petitioners in Original Application No. 380 of 1987 on the file of
     Bangalore Tribunal. There shall be no order as to costs.

     V.S.S.                                                     Appeal allowed.