Union Of India (Uoi) And Ors. vs C.A.T. And Ors. on 10 September, 2003

    Union Of India (Uoi) And Ors. vs C.A.T. And Ors. on 10/9/2003

JUDGMENT

   N.N. Mathur, J.

   1. In this group of writ petitions filed by the Railway Administration the
question of wide ramification arises for consideration is as to whether an
employee who was not promoted earlier due to administrative lapse, on his
retrospective notional promotion to higher post subsequently w.e.f. the date of
his juniors have been promoted would be entitled to the arrears of pay and
allowances with retrospective date.

   2. Para 228 of the Indian Railway Establishment Manual provides that when a
particular person does not work on a particular post, he cannot be granted the
actual arrears of pay on the particular post as he has not discharged the duties
on that post. The said Para is held to be invalid and violative of Article 14 &
16 of the Constitution of India by a Full Bench decision of the Central
Administrative Tribunal dated 11.2.2002. It is held therein that an employee who
was not promoted earlier due to administrative lapse, on his retrospective
notional promotion to higher post subsequently w.e.f. the date his juniors have
been promoted would be entitled to the arrears of pay and allowances with
retrospective date. The reasoning given by the Full Bench of the Tribunal find
place in Para 6 of the judgment, which is extracted as follows:-

     "Aforesaid decision of the Karnataka High Court is binding upon us. Besides
it, the provisions of para-228 of IREM (Vol. I) have also been declared invalid
by the Full Bench (supra). Moreover, even on first principle, we find no
justification in denying the employees pay and allowances for the period when
they had been prevented from working not on account of any fault of theirs but
on account of the fault of the management. Had they not been prevented from
working by the management, they would have definitely worked, in which case they
would have been entitled to pay and allowances. If they have prevented on
account of the fault of the management, we find no justification in denying them
the pay and allowances."

   The decision of the Karnataka High Court on which the Tribunal has placed
reliance has been referred in Para 3 of the judgment, which is extracted as
follows:-

     "The Karnataka High Court in the case of Saikh Mehboob v. Railway Board and
Ors., 1982(1) SLR 455, has observed, thus:

     "3.........

     2. .....The staff who have lost promotion on account of administrative
errors should on promotion be assigned correct seniority vis-a-vis their juniors
already promoted, irrespective of the date of promotion. Pay in the higher grade
on promotion may be fixed proforma at the stage which the employee would have
reached if he was promoted at the proper time. The enhanced pay may be allowed
from the date of actual promotion. No arrears on this account shall be payable,
as he did not actually shoulder the duties and responsibilities of the higher
grade posts.

     4. The last portion of the above circular states that even if a civil
servant was denied promotion at proper time, he was not entitled to arrears of
salary on the ground that he did not shoulder the duties and responsibilities of
the higher post. In my view, the denial of arrears of salary to the petitioner
cannot be supported. The petitioner had a right to be considered for promotion
on the dates when it was due in view of the right to equal opportunity in
matters relating to employment guaranteed under Cause (1) of Article 16 of the
Constitution. The said valuable rights guaranteed by the Constitution cannot be
denied in the first instance and thereby deny the civil servant the opportunity
to render service in the higher post and subsequently make it a ground for
justifying the arrears of salary even after according retrospective promotion,
at some point of time later. The giving effect to the circular as against the
petitioner having regarding to the facts and circumstances of the case, would
amount to violation of the fundamental rights guaranteed to the petitioner under
Article 14 read with Clause (1) of Article 16 of the Constitution."

   3. We have heard Mr. J.P. Joshi, Mr. Kamal Dave and Mr. Manoj Bhandari
learned counsel for the petitioners in support of the contention to the effect
that a person who does not discharge duties of the higher post is not entitled
for any arrears of salary as he did not discharge the duties and worked on that
particular post, in other words the application on the principle of "no work no
pay". On the other hand Mr. S.K. Malik, Mr. S.L. Jain and Mr. Daya Ram learned
counsel for the respondents have supported the view of the Tribunal. Before
proceeding to deal with the rival contentions, it would be convenient to read
Para 228 IREM as follows:-

     "228. Erroneous Promotions.-(I) Sometimes due to administrative errors,
staff are over-looked for promotion to higher grade could either be on account
of wrong assignment of relative seniority of the eligible staff or full facts
not being placed before the competent authority at the time of ordering
promotion or some other reasons. Broadly, loss of seniority due to the
administrative errors can be of two typed:-

     (i) Where a person has not been promoted at all because of administrative
error, and

     (ii) Where as person has been promoted but not on the date from which he
would not have been promoted but for the administrative error.

     Each such case should be dealt with on its merits. The staff who have lost
promotion on account of administrative error should on promotion be assigned
correct seniority vis-a-vis their juniors already promoted, irrespective of the
date of promotion, Pay in the higher grade on promotion may be fixed proforma at
the proper time. The enhanced pay may be allowed from the date of actual
promotion. No arrears on this account shall be payable as he did not actually
shoulder the duties and responsibilities of the higher posts."

   4. It has brought to our notice that the Ernakulum Bench of the Tribunal in
the case of M. Balakrishna Nair v. Divisional Personnel Officer took the view
that the employee will be entitled to the benefit of the salary from the date he
was granted proforma promotion and not from the actual date from which the
promotion was given. The said judgment is said to be a leading case which has
been followed at the various Bench of the Central Administrative Tribunal. The
learned counsel for the petitioners have placed before us a copy of the order of
the Apex Court, wherein the Court has clearly ruled that the Tribunal was not
right in directing the deletion of the clause prohibiting the payment of arrears
for the work actually not done by the employee. The brief order of the Apex
Court is extracted as follows:-

   ORDER

     "This appeal is directed against the order of the Central Administrative
Tribunal, Ernakulum Bench, in O.A. No. 649/90 dated 30th September, 1991. Though
the appeal challenges the order in its entirety, Mr. Goswami learned counsel for
the appellants fairly stated that the appeal is now confined only to the payment
of back-wages ordered to be given by the Tribunal.

     By the order under appeal, the Tribunal has allowed the application which
challenged the Railway Board Circular dated 15/17 September, 1964. The said
Circular stated:

     "No arrears on this account shall be payable as he did not actually
shoulder the duties and responsibilities of the higher posts."

     Consequent to the deletion of the above clause further directions were
given. Learned counsel submits that the clause, which has been directed to be
removed, is in accordance with the judgment of this Court in Virender Kumar,
General Manager, Northern Railways, New Delhi v. Avinash Chandra Chadha and Ors.
(1990) 2 SCR 769. This Court, in that case held on principle of 'no work no pay'
that the respondents will not be entitled to the higher salary as they have not
actually worked in that post. The clause, which has been directed to be deleted
by the Tribunal being in consonance with the ruling of this Court, we are of the
opinion that the Tribunal was not right in directing the deletion of that
clause. Accordingly, to that extent this appeal is allowed. The result is that
the respondents will be given deemed promotion, if any, before retirement and
also the benefit in the matter of fixing pensions. No costs."

   5. The Apex Court in Virendra Kumar, General Manager, Northern Railways, New
Delhi v. Avinash Chandra Chadha and Ors. (1), dealing with the principle of 'no
work no pay' has observed in Para 16 as follows:-

     "The respondents have not actually worked in the said posts and, therefore,
on the principle of "no work no pay" they will not be entitled to the higher
salary. Hence, we give no directions in this behalf and leave it to the
appellant to give such relief as they may deem fit."

   6. In State of Haryana and Ors. v. O.P. Gupta and Ors. (2), the Court
observed as follows:-

     "This Court in Paluru Ramkrishnaiah v. Union of India (SCR at p. 109; SCC
p.556, para 19) considered the direction issued by the High Court and upheld
that there has to be "no pay for no work", i.e., a person will not be entitled
to any pay and allowance during the period for which he did not perform the
duties of higher post, although after due consideration, he was given a proper
place in the gradation list having been deemed to be promoted to the higher post
with effect from the date his junior was promoted. He will be entitled only to
step up the scale of pay retrospectively from the deemed date but is not
entitled to the payment of arrears of the salary. The same ratio was reiterated
in Virendra Kumar, G.M., N. Rlys. v. Avinash Chandra Chadha (SCC p.482, para
16)."

   7. In the case of State of Haryana v. O.P. Gupta (supra), the Apex Court has
distinguished its earlier decision in Union of India etc. v. K.V. Jankiraman,
etc. (3), as follows:-

     "It is true, as pointed out by Shri Hooda, that in Union of India v. K.V.
Jankiraman this Court had held that where the incumbent was willing to work but
was denied the opportunity to work for no fault of his, he is entitled to the
payment of arrears of salary. That is a case where the respondent was kept under
suspension during departmental enquiry and sealed cover procedure was adopted
because of the pendency of the criminal case. When the criminal case ended in
his favour and departmental proceedings were held to be invalid, this Court held
that he was entitled to the arrears of salary. That ratio has no application to
the cases where the claims for promotion are to be considered in accordance with
the rules and the promotions are to be made pursuant thereto."

   8. As far as Karnataka High Court is concerned, a photo stat copy of order of
the Division Bench in Divisional Railway Manager and Anr. v. D.L. Deshpande and
Anr. dated 18th June, 2000 (4), has been placed before us. In the said case a
decision of the Tribunal relying on the decision of the Ernakulum Bench has been
set aside and the validity of Para 228 has been upheld.

   9. Thus, in our view a person will not be entitled to any pay or allowances
during the period for which he did not perform the duties on higher post
although after due consideration, he was given proper place in gradation list
having been deemed to be promoted to the higher post w.e.f. the date his junior
was promoted. No employee can be held to be entitled to claim any financial
benefits retrospectively. At the most he may be entitled to re-fixation of the
salary on the basis of the notional seniority granted to him in different grades
and he may also be entitled the pensionary benefits. The provisions contained in
Para 228 deny the arrears from the date of notional promotion in case where the
promotion is with-held or not granted due to administrative lapse. It is based
on principle of 'no work no pay'. The rule allows arrears from the date of
actual promotion as such it cannot be said that such a principle is arbitrary or
unreasonable. In our opinion, the view of the Full Bench of the Tribunal holding
Para 228 of IREM as invalid and violative of Articles 14 & 16 of the
Constitution of India is not correct. We hold Para 228 of IREM intra vires of
the Constitution. Each case will have to be decided on its own merit.

   10. In view of the aforesaid, all the writ petitions filed by the Union of
India are allowed and the impugned order of the Central Administrative Tribunal
in each writ petition is quashed and set aside to the extent of directing
petitioners to pay the salary from the back date. The each Original Application
shall be restored to its original number. The Tribunal is directed to give fresh
decision keeping in view that Para 228 of the IREM is intra vires of the
Constitution. Cost easy.