Holding

Voluntary transferees cannot claim seniority in the transferee department; only eligibility is counted, making the non‑consideration for promotion lawful.

Summary

The respondents, originally appointed as Lower Division Clerks (LDCs), voluntarily transferred on compassionate grounds to another collectorate in 1992 and were placed at the bottom of the seniority list as per the Government of India's May 20, 1980 policy. Because of this low seniority they were not considered for promotion to Upper Division Clerk (UDC) in the 1997‑98 promotion cycle. They approached the Central Administrative Tribunal (CAT), which ordered that their past service be counted for eligibility and directed their promotion; the High Court upheld this order. The Union of India appealed, arguing that the policy validly deprives transferees of seniority and that eligibility and seniority are distinct concepts under the Central Excise and Land Customs Department Group C Posts Recruitment Rules, 1979. The Supreme Court held that the transferees, having voluntarily accepted the condition of being treated as new entrants for seniority, cannot claim seniority over existing employees; only eligibility is affected by past service. Consequently, the CAT and High Court orders were set aside and the appeal was allowed.

Issues considered

Whether service rendered in the parent department should be counted for seniority and promotion eligibility after a voluntary inter‑collectorate transfer on compassionate grounds.
Whether the 20 May 1980 Government instruction that transferees be placed at the bottom of the seniority list is valid and binding.
Whether the concepts of eligibility and seniority for promotion are distinct under the Group C Posts Recruitment Rules, 1979.
Whether the Central Government's power under Rule 7 to relax eligibility conditions can be interfered with by the CAT or the High Court.

Legislation cited

Central Excise and Land Customs Department Group 'C' Posts Recruitment Rules, 1979s. Rule 4, s. Rule 7
Constitution of Indias. Article 14, s. Article 16, s. Article 19, s. Article 309

Subjects

promotionseniorityinter‑collectorate transfercompassionate groundeligibilityGroup C recruitment rulesRule 7Rule 4voluntary transferservice continuity

Judgment

[2008] 13 S.C.R. 402

A UNION OF INDIA & ORS.
,, v.
DEO NARAIN & ORS.

B
(Civil Appeal No. 8017 of 2003)
SEPTEMBER 15, 2008
(C.K. THAKKER AND LOKESHWAR SINGH PANTA,
,. .
JJ.]

Service Law- Promotion - From the post of LDC to UDC
c - Non- consideration for - Of the employees transferred from
parent department to another on compassionate ground - By
not counting their past services in the parent department -
Propriety of - Held: Non-consideration of such employees !'or
promotion is not illegal or unlawful - The employees having
D
taken the transfer voluntarily foregoing their past services as
a condition therefor as per the existing rules, cannot claim
.....
seniority over the employees ir; the transferee department -
Central Excise and Land Customs Department Group C Posts
Recruitment Rules, 1979.
E Respondents joined their services as Lower Division
Clerk (LDC). Later they were transferred from their parent
department on voluntarily opting for the same in accor-
dance with the policy of lnter-Collectorate Transfers. Con-
sequently, as per rules, they were placed at the bottom of
F the seniority list in the new department, losing their se-
~ ~

niority in the parent department. In view of their low posi-
tion in the seniority list, they were not considered for pro-
motion to the post of Upper Division Clerk (UDC). They
filed applications before Central Administrative Tribunal
aggrieved by their non-consideration and non-promotion.
G
Tribunal allowing their applications directed the authori-
ties to consider the eligible applicants for the ·promotion,
by taking into account their past regular services rendered
....
in the parent department. High Court dismissed the writ
H 402
UNION OF INDIA & ORS. v. DEO NARAIN 403
+ & ORS.

petition challenging the order of the Tribunal. Hence the A
present appeal.
Allowing the appeal, the Court
HELD: 1.1 As early as in 1980, a policy decision was
~ ~
taken by the appellants that when any LDC working in B
one Collectorate seeks transfer to another Collectorate
on compassionate ground, the said action can only be
taken on the terms and conditions of the decision of the
Government of India, dated May 20, 1980. In that case, he/
she will not be entitled to get his/her service rendered in c
the former Collectorate to be counted for the purpose of
seniority and will be placed at the bottom of the list of
employee's in the transferred Collectorate. [Paras· 20 and
21] [411·8-C; 411-E]
, .. 1.2 The respondents got themselves transferred to D
new Collectoraie and they had, in consonance with the
policy decision of May 20, 1980, foregone their seniority
in the Collectorate where they were working and were
placed at the bottom of the seniority list of the new
Collectorate where they were transferred •. Hence, place- E
ment of the respondents at the bottom of the seniority list
in the transferee Collectorate was legal and valid, is well
founded and in consonance with the decision of the Cen-
. tral Government. [Para 22] [411-F-G]
....
1.3 Generally, an employee who is transferred to other F
Collectorate does not lose his/her past service for the
purpose of considering his/her eligibility. But, if such
transfer is voluntary or unilateral on condition that he/she
will be placed at the bottom of the seniority list irt the trans-
feree Department, the said condition would bind him/her G
and he/she cannot claim seniority over the employees in
Ji>·-·
the transferee Department. [Para 34] [416-F-G]
1.4 The two concepts, viz. (i) 'eligibility' and (ii) 'senior-
ity' are quite distinct, different and independent of each
H
404 SUPREME COURT REPORTS [2008] 13 S.C.R.
~

A other. A person may be eligible, fit or qualified to be con-
sidered for promotion. It does not, however, necessarily
mean that he must be treated as having requisite 'senior-
ity' for entry in the zone of consideration. Even if he fulfils
the first requirement, but does not come within the zone of
B consideration in the light of his position and placement in
'seniority' and the second condition is not fulfilled, he can-
. ~

not claim consideration merely on the basis of his eligibil-
ity or qualification. It is only at the time when 'seniority'
cases of other employees similarly placed are considered
that his case must ~lso be considered. [Para 29] [414-C-F]
c
Union oflndia and Ors. v. C.N. Ponnappan, 1996 (1) SCC
524; Renu Mullick (Smt) v. Union of India and Anr., 1994 (1)
SCC 373; Scientific Advisor to Raksha Mantri and Anr. v. V M. ·.
Joseph, 1998 (5) sec 305 - relied on.
D C.N. Ponnappan v. Union of India, 1987 (5) ATC 766 ~ .
(Mad); K.A. Balasubramaniam v. Union of India, 1987 (4) ATC
805; S. Abdul Khayum v. Union of India 1987 (1) SLJ (CAT)
131 - referred to.
1.5 The High Court was not right in holding that there
E was no bar in considering the cases of the applicants for
promotion, on the observation that since the LDCs se-
nior to the applicants but not eligible to be appointed as
UDCs were considered, the applicants were also entitled
to be considered for promotional post of UDCs. The statu-
F tory rules empower the Central Government to relax the
provisions of the Rules. In exercise of the said power
under Rule 7 of the Rules, the Central Government relaxed
eligibility condition. Such action, therefore, cannot be held
illegal or unlawful and could not have been interfered with
by the Tribunal or by the High Court. [Paras 43 and 44]
G
[420-B; 420-C-D]
1.6 Moreover, the applicants opted for voluntary and- · - ...,....
unilateral transfer foregoing their seniority and joined the
new Collectorate with open eyes and were placed below
H all LDCs who were serving in the said Collectorate. It was,
UNION OF INDIA & ORS. v. DEO NARAIN 405
& ORS.

therefore, not open to them to make grievance if LDCs A
shown above them in the seniority list are consider.ad for
promotion to the cadre of UDC. Thus, neither law nor eq-
uity supports the so-called .~laim of the applicants. [Para
44) [420-D-E] --
-..
Case Law Reference B
1996 (1) sec 524 Relied on. Para 23
1987 (5) ATC 766 Referred to. Para 24
1987 (4) ATC 805 Referred to. Para 24
1987 (1) SLJ (CAT) 131 Referred to. Para 25
c
-
1994 (1) sec 373 Relied on . Para 29
. 1998 (5) sec 305 Relied on. Para 35
CIVILAPPELLATE JURISDCTION: Civil Appeal No. 8017 D
of 2003
From the Final Judgment and Order dated 30.1.2002 of
the High Court of Delhi at New Delhi in C.W.P. No. 6281/1999

Nagendra Rai, Ansul, Alka Sharma, Sushil Kumar, E
Vandana Mishra and 1;3. Krishna Prasad for the Appellants.

The Judgment of the Court was delivered by
- C.K. THAKKER, J. 1. The present appeal is filed by the
Union of India & Ors. against the judgment and order passed F
by the High Court of Delhi° on January 30, 2002 in Civil Writ
Petition No. 6281 of 1999. By the said judgment, the High Coun
confirmed the judgment and order dated April 30, 1999 passed
by the Central Administrative Tribunal, Delhi ('CAT' for short) in
Original Application No. 2146 of 1998. v--:'------ -
G
2. To appreciate. the issue raised in the present appeal,
. ..... few relevant facts may be noted .
3. The respondents herein (applicants before CAT) filed
Original Application against the action of the Central Excise
and Customs Department of not considering their cases for H
406 SUPREME COURT REPORTS [2008] 13 S.C.R.

A promotion to the post of Upper Division Clerk ('UDC' for short)
from the post of Lower Division Clerk ('LDC' for short). Accord-
ing to the applicants, they joined service in the Office of Central
Board of Excise and Customs, Department of Revenue as
LDCs. Applicant No.1 Deo Narain joined as LDC on June 11,
a 1962(sic1982). Applicant No. 2 Bijender Singh joined on Sep-
tember 9, 1986. Applicant No. 3-Nandan Singh joined on May
5, 1988 whereas applicant No.4-Ram Kishan joined on March
17, 1987. In accordance with the policy of lnter-Collectorate
Transfers, they got themselves transferred to Meerut
c Collectorate. Consequent upon their transfer, they lost their se-
niority which they were having in the parent Department i.e. the
Department where they were serving. They were placed at the
bottom of the seniority list in the new Department at Meerut un-
der the relevant rules and policy decisibns. In view of their rela-
D tively lower position in the combined seniority list of LDCs, the
applicants and other similarly placed LDCs in the seniority list,
did not come within the zone of consideration for promotion to
the post of Upper Division Clerk (UDC) in the year 1997-98.
Hence, when the Dei:;artmental Promotion Committee (DPC)
, met for consideration of cases for promotion of LDCs as UDCs,
E in the light of position of the applicants in the combi,ned senior-
ity list, they were not included in the zone of consideration. Their
cases, therefore, were not con$idered.
4. The applicants, hence, approached the CAT by filing
F Original Application challenging the action of their non-consid-
eration and non-promotion from the post of LDC to the postof
UDC on the ground of their placement in the seniority list. They
contended that they had completed requisite service as LDC
and their cases, therefore, ought to have been considered by
G DPC. Non consideration of their service on the basis of their
position in combined seniority list was illegal, arbitrary and irra-
tional. A relief was, therefore, sought to direct the authorities to
consider the cases of the applicants for promotion to the post
of UDC from the post of LDC.
H 5. The CAT, vide its order dated April 13, 1999 allowed
UNION OF INDIA & ORS. v. DEO NARAIN 407
·~
& ORS. [C.K. THAKKER, J.]

the application, directed the au'thorities to convene DPC for the A I

year 1997 and consider the cases of the applicants as eligible
LDCs for promotion to the post of UDC in accordance with law
by taking into account their past regular service rendered as
LDCs before their transfer to Commissionerate, Meerut. It also
.. ·~
directed to take such action within a period of three months B
from the date of receipt of the copy of the order.
6. The appellants herein, being aggrieved by the said or-
der, approached the High Court by filing a writ petition which as
stated above, came to be dismissed by the High Court holding
that there was no 'merit' in the petition and the order passed c
and direction issued by the CAT could not be said to be illegal
or contrary to law.
7. The above orders are challenged by the authorities in
the present appeal.
- ~ D
· 8. On May 6, 2003, the Special Leave Petition was placed
· for admission hearing. Notice was issued. On September 22,
2003, delay was condoned and leave was granted. By an or-
der passed by a Bench headed by the Hon'ble the Chief Jus-
tice of India, the appeal was ordered to be placed for final hear- E
ing in summer vacation and that Is how the matter has been
placed before us.
9. We have heard learned counsel for the parties.
10. The learned counsel for the appellants strenuously F
contended that the CAT as also the High Court committed an
error of law in allowing the claim of the applicants and in direct-
ing the authorities to consider their cases for promotion to the
post of UDC from the post of LDC. According to the counsel,
when the applicants were transferred to another Collectorate,
G
they had foregone their seniority. It was In accordance with the
Instructions issued by the Government of.India. It was expressly
I- ....
stated that in the new Collectorate, where they were transferred,
they would be placed at the bottom of the seniority list below all
LDCs who were working at that time. With open eyes, the ap-
H
408 SUPREME COURT REPORTS [2008] 13 S.C.R.

A plicants accepted the said condition and joined the new
Collectorate at Meerut. It was thereafter not open to the appli-
cants to.challenge the said action. Again, there was gross de-
lay and laches on the part of applicants in challenging such ac-
tion. They were transferred in 1992. The Departmental Promo-
B tion Committee (DPC) considered the cases of LDCs for pro- ~ •
motion as UDCs in 1997. Till then, applicants did not take any
action. They filed Original Application in September, 1998. There-
fore, even on the ground of delay, the CAT ought not to have en-
tertained the application and ought to have dismissed it.
C 11. According to the counsel, even on merits, the appli-
cants had no case. According to the counsel, what weighed
with the CAT as also the High Court was that in accordance
with law, past services of applicants could not be ignored. The
counsel submitted that, to that extent, the applicants were right
D and the CAT and the High Court had not committed any mis-
take in treating applicants as eligible and qualified for consid-
eration to the post of UDC from the post of LDC. According to
the counsel, however, the CAT and the High Court went wrong
in equating eligibility with seniority. Two things, namely, (i) eli-
E gibility, and (ii) seniority are quite different and distinct. Even if
an employee is eligible and qualified, it does not necessarily
mean that his case must be considered irrespective of his po-
sition in the seniority list. Fixation or retention of seniority de-
pends upon the provisions of the Act, Rules or Administrative
F Instructions in force. In the case on hand, it was provided that
on transfer from one Collectorate to another Collectorate, such
transferee employees would retain their requisite service as
experience for the purpose of consideration of eligibility and
qualification. But it was specifically stated that in the new Di-
rectorate, they will be placed at the bottom and below all exist-
G ing LDCs. The counsel stated that for considering cases of eli-
gible LDCs as UDCs, there is a zone of consideration and keep-
ing In view lower position of applicants who were transferees,
they did not come within the said zone and hence their cases
could not be considered. The said action was, according to the
H
UNION OF INDIA & ORS. v. DEO NARAIN 409
~ & ORS. [C.K. THAKKER, J.]
•
counsel, perfectly legal and wholly justified and the CAT and the A
-High Court were wrong in granting relief to the applicants. The
order passed by the CAT and confirmed by the High Court,
therefore, deserves to be set aside.

..... 12. The learned counsel for the contesting respondents, on
the other hand, supported the order passed by the CAT and con- B
firmed by the High Court. It was submitted that once it is said that
the transferee LDCs would not lose their past service, neces-
sary corollary would be that they would be treated as appointed
as LDCs the date they joined service and thereafter it was not
open to the authorities to ignore their claim on the ground that c
their placement was at the bottom of the seniority list of the
Collectorate where they were transferred and placed below other
LDCs since they had foregone their seniority. Such an action,
according to the counsel, is arbitrary, irrational, discriminatory
~ ~
and violative under Articles 14 and 16 of the Constitution. It is D
also unreasonable and infringing Article 19 of the Constitution.
The counsel also submitted that when the applicants were other-
wise eligible and qualified, no power of relaxation of eligibility
could have been exercised by the Government in favour of ineli-
gible LDCs. The CAT and the High Court were, therefore, justi- E
tied in granting the relief and no interference is called for in exer-
cise of discretionary jurisdiction under Article 136 of the Consti-
tution. A prayer is, therefore, made to dismiss the appeal.
13. Having given our anxious consideration to the rival con-
tentions of the parties, in our opinion, the appeal deserves to F
be allowed.
14. In exercise of powers conferred under the proviso to
Article 309 of the Constitution, the President of India framed
rules regulating the method of recruitment to Group C posts In
G
the Central Excise and Land Customs Department known as
"the Central Excise and Land Customs Department Group C
~ .,. .Posts Recruitment Rules, 1979". Procedure of recruitment, age
limit, qualifications, relaxation, etc. have also been l~id down in
the Rules. Appointment as Upper Division Clerk (UDC) is to be
H
410 SUPREME COURT REPORTS [2008] 13 S.C.R.

A made, inter alia, on promotion from the post of Lower Division
Clerk (LDC) with seven years experience.
15. Note' to the Rules reads as under:
"If a junior person is considered for promotion on the basis
B of his completing the prescribed qualifying period of ...
service in that grade, all persons senior to him in the grade
shall also be considered for promotion notwithstanding
that they may not have rendered the prescribed qualifying
period of service in that grade but have completed
successfully the prescribed period of probation".
c
16. The Rules also provide for Departmental Promotion Com-
mittee (DPC) and consideration of cases of eligible candidates.
17. By a communication dated May 20, 1980, the Govern-
ment of India, Central Board of Excise and Customs informed all
D Collectors of Central Excise for consideration of cases of trans- ~

feree employees. It was stated that transfer of all Group 'C' offic-
ers from one Collectorate to another Collectorate having sepa-
rate cadres were allowed on compassionate ground with. the
approval of the Commissioner subject to certain conditions. It
E was then stated that requests received for inter-Collectorate trans-
fers from Group 'C' officers on genuine compassionate grounds
can be considered on merits. It was also expressly provided that
such transfers wherever considered necessary, should be ef-
fected on the conditions laid down in the said letter.
F 18. Condition (ii) which is relevant for the purpose of
present controversy, reads as under:
(ii) The transferee will not be entitled to count the service
rendered by him in the former Collectorate for the
purpose of seniority in the new charge. In other
G words, he will be treated as a new entrant in the
Collectorate to which he is transferred and will be
placed at the bottom of the list of the temporary "'!' •
employees of the concerned cadre in the new charge.
(emphasis supplied)
H
UNION OF INDIA & ORS. v. DEO NARAIN 411
& ORS. [C.K. THAKKER, J.]

19. In para 3 it wps stated; A
"A written undertaking to abide by the requisite terms and
conditions may be obtained from the employees seeking
transfers before the transfers are actually effected".
'
,· .. 20. It is thus clear that as early as in 1980, a policy decision B
was taken by the appellants that in certain circumstances, LDCs
could be transferred from one Collectorate to another Collectorate
purely on compassionate grounds. But, it was also provided that
such transferee would not be entitled to count the service ren-
dered by him/her in the former Collectorate for the purpose of c
seniority in the new Collectorate. In other words, such transferee
would be treated as new entrant in the Collectorate in which he/
she is transferred and will be placed at the bottom of the list of
temporary employees of the cadre in the new charge.

.. 21. From the above policy decision, it is abundantly clear D
and there is no doubt whatsoever that when any LDC working
in one Collectorate seeks transfer. to another Collectorate on
compassionate ground, the said action can only be taken on
the terms and conditions of the decision of the Government of
India, dated May 20, 1980. In that case, he/she will not be.en- E
titled to get his/her service rendered in the former Collectorate
to be counted for the purpose of seniority and will be placed at
the bottom of the list of employees in the transferred Collectorate.

_,,_ 22. It is an admitted fact that in 1992, the applicants got them-
selves transferred to Meerut and they had, in consonance with the F
policy decision of May 20, 1980, foregone their seniority in the
Collectorate where they were working and were placed at the bot-
tom of the sen'iority list of the Mee rut Collectorate where they were
transferred. In view of the above fact and legal position, in our opin-
ion, the contention of the appellants that placement of the respon- G
dents at the bottom of the seniority list in the transferee Collectorate
was legal and valid is well founded and in consonance with the
decision of the Central Government. There was no infirmity in the
said order and it ought not to have been disturbed.
H
412 SUPREME COURT REPORTS [2008] 13 S.C.R.

A 23. The CAT, however, allowed the Original Application
relying upon a decision of this Court in Union of India & Ors. v.
C.N. Ponnappan, (1996) 1SCC524. In Ponnappan, the ques-
tion before this Court was whether an employee who was trans-
ferred from one Unit to another Unit on compassionate ground
B and as a result thereof has been placed at the bottom of the .. ·,

seniority list, could have his service in the earlier Unit from where
he had been transferred, counted as experience for the pur-
pose of promotion in the Unit where he was transferred.
24. This Court noted that there was cleavage of opinion
c amongst Benches of Central Administrative Tribunal (CAT) on the
question. Whereas, the Madras Bench in C.N. Ponnappan v. Union
of India, (1987) 5 ATC 766 (Mad) had taken the view that though
on transfer on compassionate grounds, the employee would lose
his seniority and would be placed at the bottom of the seniority list
D at the transferred place, for the purpose of promotion, his earlier
service in the Unit from where he was transferred, would not be
wiped out and the said service would be treated as 'experience'
for eligibility for promotion and if he is found eligible. then his case
for promotion has to oe considered on the basis of seniority 'at the
E transferred place·. [See also K.A. Balasubramaniam v. Union of
India, (1987) 4 ATC 805 (Mad) (FB)].
25. The Bangalore Bench of the CAT, on the other hand, in
S. Abdul Khayum v. Union of India, (1987) 1 SLJ (CAT) 131
(Bang) did not agree with the above view of Madras Bench and
F held that an employee who was transferred on compassionate
ground and was placed at the bottom of the seniority list at the
place where he was transferred, could not have his earlier ser-
vice at the place from where he was transferred, counted as
'experience' for the purpose of eligibility for promotion.
G
26. This Court considered conflicting views and held that
the service rendered by an employee at one place could not be
ignored or not counted for the purpose of promotion to another
Unit even if such transfer is made on compassionate ground.
He can be placed at the bottom of the seniority at the trans-
H
UNION OF INDIA & ORS. v. DEO NARAIN 413
& ORS. [C.K. THAKKER, J.]

ferred place, but the experience obtained by him of rendering A
service in the first Department could not be ignored and must
be considered as experience for promotion "in the new Unit also.
27. In para 4, the Court stated;
~. "4. The service rendered by an employee at the place from B
where he was transferred on compassionate grounds is
regular service. It is no different from the service rendered
at the place where he is transferred. Both the periods are
'..J -- •
taken into account for the purpose of leave and retiral
benefits. The fact that as a result of transfer he is placed at c.
the bottom of the seniority list at the place of transfer does
not wipe out his service at the place from where he was
transferred. The said service, being regular service in the
grade, has to taken into account as part of his experience
for the purpose of eligibility for promotion and it cannot be
. ignored only on the ground that.it was not rendered at the
D
place where he has been transferred. In our opinion, the
Tribunal has rightly held that the service held at the place
from where the employee has been transferred has to be
counted as experience for the purpose of eligibility for
promotion at the place where he has been transferred'. E
(emphasis supplied)
28. We are unable to understand how the CAT read this
judgment as giving benefit of seniority to the transferred em-
_...
ployee in the transferee Department over the employees who F
were very much there. In our c:;onsidered opinion, the direction
in the judgment is abundantly clear which draws distinction be-
tween 'experience' on the one hand and 'seniority' on the other
hand. What was held in Ponnappan by this Court was that if an
employee is transferred from one Department to another De- G
partment on compassionate ground, he would be placed at the
bottom of the seniority in the transferee Department. Hence, at
·. " the time of his transfer in the transferee Department, all em-
ployees in the same cadre who were very much serving at that
time would be shown above such transferee employee and in H
414 SUPREME COURT REPORTS (2008] 13 S.C.R.
•
A such combined seniority list, the transferred employee would be
shown as ;unior most. The only thing which this Court said and
with respect, rightly is that such employee who had already worked
in a particular cadre and gained experience, will not lose past
service and experience for the purpose of considering eligibility
B when his case comes up for consideration for further promotion.
2~. In our judgment, the ratio laid down by this Court in
Ponnappan clearly lays down the principle formulated in the
Government of India's letter dated May 20, 1980 as also in a
subsequent communication, dated May 23, 1997 issued by the
C Ministry of Finance, Department of Revenue. Even otherwise,
in our considered opinion, the two concepts, viz. (i) 'eligibility'
and (ii) 'seniority' are q•Jite distinct, different and independent
of each other. A person may be eligible, fit or qualified to be
considered for promotion. It does not, however, necessarily
D mean that he must be treated.as having requisite 'seniority' for
entry in the zone of consideration. Even if he fulfils the first re-
quirement, but does not come within the zone of consideration
in the light of his position and placement in 'seniority' and the
second conditions is not fulfilled, he cannot claim consideration
E merely on the basis of his eligibility or qualification. It is only at
the time when 'seniority' cases of other employees similarly
placed are considered that his case must also be considered.
The CAT, in our view, therefore, was not right in applying
Ponnappan and in granting relief to the applicants. There is no
F doubt in our mind that it says to the contrary.
30. Our attention was also invited to Renu Mullick (Smt) v.
Union of India & Anr., (1994) 1 SCC 373. In Renu Mullick, the
appellant was appointed as LDC in Central Excise and Cus-
toms, New Delhi on December 17, 1974. She was promoted as
G UDC on May 10, 1985. Then, on her own request, she was trans-
ferred to the Central Excise Collectorate, Allahabad where she
joined on August 4, 1987. She gave an undertaking that on uni-
lateral transfer, her seniority may be "fixed below the last tempo-
rary UDC in the Allahabad Collectorate" i.e. she might be "treated
H as a fresh entrant in the cadre of UDC", at Allahabad.
UNION OF INDIA & ORS. v. DEO NARAIN. 415
+ & ORS. [C.K. THAKKER, J.]

31. In 1991, she was initially promoted as Inspector but A
later on reverted on the ground that.she-did not fulfill the eligibil-
ity conditions laid down in Rule 4 for the recruitment which re-
quired experience of a particular period. According to the De-
partment, since she was considered as fresh entrant, she had
-y .. not completed the requisite service and having necessary ex- B
perience and was, therefore, not eligible for promotion to the
post of Inspector.
32. This Court held that the Department was not right. Ac-
cording to the Court, even if the employee sought unilateral trans-
fer by agreeing to be placed at the bottom of seniority list in the c
transferee Department, it would not wipe out the services ren-
dered by such employee. In other words, according to this Court,
an employee who is e>therwise eligible, would not become in-
eligible, merely oriihe ground of voluntary or unilateral transfer.
D
~
-<I 33. The Court stated;
"10. \fl/e are of the view that the Tribunal fell into patent
error in dismissing the application of the appellant. A bare
reading of para 2 (ii) of the executive instructions dated
May 20, 1980 shows that the transferee is not entitled to E
count the service rendered by him/her in the former
collectorat~ for the purpose of seniority in the new charge.
The later part of that para cannot be read differently. The
transferee is to be treated as a new entrant in the
collectorateto.which he is transferred for the purpose of F
seniority. It means that the appellant would come up for
consideration for promotion as per her turn in the seniority
list in the transferee unit and only if she has put in two
years' service in the category of UDC. But when she is so
considered, her past service in the previous collectorate
G
cannot be ignored for the purposes of determining her
eligibility as per Rule 4 aforesaid. Her seniority in the
I
previous collectorate is taken away for the purpose of
- 't-
counting her seniority in the new charge but that has no
relevance for judging her eligibility for promotion under
H
416 SUPREME COURT REPORTS [2008] 13 S.C.R.
-I

A Rule 4 which is a statutory rule. The eligibility for promotion
has to be, determined with reference to Rule 4 alone,
which prescribes the criteria for eligibility. There is no other
way of reading the instructions aforementioned. If the
instructions are read the way the Tribunal has done, it may
B be open to challenge on the ground of arbitrariness. ~~

11. The provisions of the rules reproduced above lay down
that a UDC with five years service or UDC with thirteen
years of total service as UDC and LDC taken together
subject to the condition that he should have put in a minimum
c of two years of service in the grade of UDC, is eligible to
be considered for promotion to the post of Inspector. The
rule nowhere lays down than five years or thirteen years
have to be spent in one collectorate. There is no indication,
whatsoever, in the rule that the service period of five years
D and thirteen years is not applicable to an officer who has
been transferred from one collectorate to another on his "
own request. On the plain language of the rule the appellant,
having served the department for more than five years as
UDC and also having completed thirteen years composite
E service as UDC and LDC including two years minimum
service as UDC, was eligible to be considered for promotion
to the post of Inspector. The Tribunal failed to appreciate
the elementary rules of interpretation and fell into patent
error in non-suiting the appellant".
F 34. In our opinion, Renu Mullick also supports the view .. ,

which we are inclined to take, namely, that an employee who is
transferred to other Collectorate does not lose his/her past ser-
vice for the purpose of considering his/her eligibility. But, if such
transfer is voluntary or unilateral on condition that he/she will be
G placed at the bottom of the seniority list in the transferee Depart-
ment, the said condition would bind him/her and he/she cannot
claim seniority over the employees in the transferee Department.
,,,,... --.,>-
35. Finally, in Scientific Advisor to Raksha Mantri & Anr.
v. VM. Joseph, (1998) 5 SCC 305, again, a similar view has
H
UNION OF INDIA & ORS. v. DEO NARAIN 417
& ORS. [C.K. THAKKER, J.]

been taken by this Court. It was held that if the eligibility condi- A
tion requires certain length of service, service rendered in an-
other organization before unilateral transfer at own request can-
not be counted for the purpose of seniority But it must be counted
for determining eligibility for promotion.
36. Referring to and relying on Ponnappan, this Court 8
stated;
"From the facts set out above, it will be seen that promotion
was denied to the respondent on the post of Senior Store
Keeper on the ground that he had completed three years c
of regular service as Store keeper on 7th June, 1980 and
therefore, he could not be promoted earlier than 1980. In
coming to this conclusion, the appellants excluded the period
of service rendered by the respondent in the Central
Ordnance Depot, Pune, as a Store Keeper for the period
0
from 27th April, 1971 to 6th June, 1977. The appellants
contended that, since the respondent had been transferred
on compassionate ground, on his own request to the post
of Store Keeper at Cochin and was placed at th~ bottom
of the Seniority list, the period of three years of regular
service can be treated to commence only from the date on E
which he was transferred to Cochin. This is obviously
fallacious inasmuch as the respondent had already acquired
the status of a permanent employee at Pune where he had
rendered more than three years of service as a Store Keeper.
Even if an employee is transferred at his own request, from F
one place to another, on the same post, the period of service
rendered by him at the earlier place where he held a
permanent post and had acquired permanent status, cannot
be excluded from consideration for determining his eligibility
for promotion, though he may have been placed at the bottom B
of the seniority list at the transferred place. Eligibility for
promotion cannot be confused with seniority as they are
..,. two different and distinct factors''.

(emphasis supplied) H
418 SUPREME COURT REPORTS [2008] 13 S.C.R.

A 37. The CAT in para 4 of the judgment, observed as un-
der;
"4. The respondents in their reply have submitted that the
-
.·I
applicants have been transferred from other depa'itments
to the Central Excise, Commissionerate, Meerut on Inter
B Department transfer basis in 1992. They have relied on ,,.. '

th~ir Ministry's instructions dated 20.5.1980 and have
submitted that the applicants have lost their seniority in
the parent department in the grade of their inter
departmental transfer from other Commissionerates to
c the Central Excise, Commissionerate, Meerut and have
been placed at the bottom of the seniority list of the LDCs
of Combined Central Excise Commissionerate, Kanpur/
Allahabad/Meerut. They have stated that the applicants
have worked as LDCs between four to eight years prior
D to joining in Meerut Commissionerate. As they are placed
· at bottom in the Seniority list of LDCs they have submitted • ~

that the applicants have no claim over and above the
officials senior to th'em and they will be duly considered as
and when their turn comes for promotion as per their
E seniority in the combined cadre of Allahabad/Kanpur/
Meerut Commissionerate".
38. The CAT then concluded;
"In the result, this application is allowed with the directions
F to the respondents to convene review DPC for the year ;. .
1997, and consider the eligible LDCs for promotion to the
post of UDCs in accordance with the principles laid down
by the Supreme Court by taking into consideration the
period of their past regular service rendered as LDCs
before their transfer to another Commissionerate. In the
G
circumstances, any relaxation of the Rules to consider the
senior persons who do not have the eligibility conditions
of seven years as laid down in the relevant recruitment ~ ...
·-
Rules cannot be resorted to by the respondents when
there are sufficient number of other persons who may be
H
UNION OF INDIA & ORS. v. DEO NARAIN 419
t & ORS. [C.K. THAKKER, J.]

junior but, however, fulfill the eligibility conditions prescribed A
in the Rules. This action shall be taken within three months
from the date of receipt of a copy of this order. No order
as to costs":

,' 4
39. As already discussed hereinabove, in our opinion, the
CAT was not right in allowing the application and issuing direc- B
tions to the Department.
40. When the appellants herein approached the High Court,
the High Court observed;
"The fact of the matter is not in dispute. In the year 1992, c
the respondents joined the offices of the petitioners as
lower division clerks on different dates in 1992 on inter-
departmental transfers. Admittedly, in terms of the existent
rules, consequent upon their transfer, they had foregone
· 1heir respective seniority in their departments and they D -,
~

'" . were placed at the bottom of the seniority list. On or about
23rd May 1997, the Ministry of Finance, Department of
Reven.ue issued instructions to all Commissionrates under
the Central Board of Excise and Customs that an officer
on transfer form one Commissionerate to another would E
be entitled to get the benefit of his past service for the
purpose of promotion although his seniority shall be retained
at the bottom of the transferred Commissionerate".

,. {emphasis supplied)
F
41. Referring to Renu Mullick, the High Court observed
that "it is not in dispute that the persons on voluntary transfer,
would lose their seniority but the same by itself would not mean
that their entire past service is wiped off. For the purpose of
consideration of their cases for promotion, their past service is
G
required to be taken into consideration".
'<

42. We are in agreement with the High Court. Renu Mullick
- 'y
and other cases referred to by us, clearly lay down the above
proposition of law that even if the transfer is voluntary and uni-
H
420 SUPREME COURT REPORTS (2008) 13 S.C.R.

A lateral, services rendered by an employee would not be wiped
off for considering eligibility for promotion to the higher cadre.
43. The High Court then proceeded to observe that there
was no bar in considering the cases of the applicants for pro-
motion. The Court observed that though there were LDCs who ,. ~

B were senior to the applicants but they were not eligible to be
appointed as UDCs and hence, the applicants were entitled to
be considered for promotional post of UDCs.
44. In our considered opinion, there the High Court was
c not right. The statutory rules referred to above, empower the
Central Government to ielax the provisions oftbe Rules. In ex-
ercise of the said power under Rule 7 of the Rules, the Central
Government reiaxed eligibility condition. Such action, therefore,
cannot be held illegal or unlawful and could not have been inter-
fered with by the CAT or by the High Court. Moreover, the appli-
D • ~

cants opted for voluntary and unilateral transfer foregoing their
seniority and joined Meerut Collectorate with open eyes and
were placed below all LDCs who were serving in the said
Collectorate. It was, therefore, not open to them to make griev-
ance if LDCs shown above them in the seniority list are consid-
E ered for promotion to the cadre of UDC. Thus, neither law nor
equity supports the so-called claim of the applicants.
45. For the foregoing reasons, the appeal is allowed. The
order passed by the CAT on April 13, 1999 in O.A. No. 2146 of
.
F 1998 titled Deo Narain & Ors. v. Union of India & Ors. and >-
confirmed by the High Court on January 30, 2002 in C.W.P. No.
6281 of 1999 titled Union of India v. Deo Narain & Ors. is set
aside and the original application filed by the applicants-respon-
dents herein is ordered to be dismissed.
G 46. On the facts and in the circumstances of the case, how-
ever, there shall be no order as to costs. ,....

47. Ordered accordingly.
. ~

K.K.T. Appeal allowed.
H