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REPORTABLE  

IN THE SUPREME COURT OF INDIA  

CIVIL APPELLATE JURISDICTION   

CIVIL  APPEAL NOS.6491-6492  OF  2014    Coal India Ltd. & Anr.         …..Appellant(s)          

:Versus:    

Navin Kumar Singh          ....Respondent(s)    

J U D G M E N T  

A.M. Khanwilkar, J.  

1. These appeals emanate from the judgment and order  

dated 20th May, 2010 passed by the Division Bench of the  

High Court of Jharkhand at Ranchi in L.P.A. No.546 of 2003  

and order dated 11th December, 2013 passed in Civil Review  

No. 68 of 2011, whereby the High Court upheld the decision of  

the Single Judge, with minor modifications and declared that  

the past service of the respondent in the previous company of  

the appellant could not be forfeited for all purposes in the

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event of an inter-company transfer on personal grounds at his  

request and dismissed the review petition against the said  

judgment on the ground of unexplained delay.  

 2. The respondent, a graduate in Chemical Engineering,  

was appointed on 27th June, 1990 in E-2 Grade and joined the  

same on 4th August, 1990 in Dankuni Coal Complex (for short  

„DCC‟), of the appellant company. On a request made by the  

respondent, the Personnel Manager of the appellant company  

issued a transfer order being No.C-5A(iii)/51434(Trans)/199  

dated 23rd April, 1991 transferring the respondent from DCC  

to Central Mine Planning and Design Institute Limited (for  

short „CMPDIL‟),  a subsidiary of the appellant company, in  

his existing capacity i.e. E-2 Grade. The transfer notice made  

it clear that since the transfer had been made at the instance  

of the respondent himself, his seniority in the E-2 Grade  

would be reckoned from the date he joined the new  

organisation, CMPDIL. Accordingly, the respondent joined  

CMPDIL on 15th May, 1991. The prevailing policy for  

determination of seniority of executives on inter-company

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transfers at the time of the joining of the respondent, was as  

follows:  

“11. Determination of seniority of executives in E-1 to E-4  grades on inter-company transfers  

This issue has two aspects:  (a) Inter-company transfer effected on    administrative  grounds:-  

(b) Inter-company transfer effected at the request of the  executive concerned on personal grounds.  

According to the existing system, the officers in E-1 to  

E-4 grades belong to the respective company cadres on as- in-where-is basis. Their career growth upto E-5 grade is  

within the company. When an executive in these grades  moves from one company to the other, he gets absorbed in  the appropriate cadre of that company.  

 11.1 The Committee recommends that:  

(i) When an inter company transfer is   effected on  administrative grounds the seniority of the executive  shall be fixed in the company to which he is  

transferred taking into account his date of entry into  the grade.  (ii) When the inter-company transfer is effected on  

personal grounds at the request of the executive  concerned, his seniority in the company to which he is  

transferred, shall be fixed as if he entered the grade on  the date of his assumption of charge in the new  company. In other words, such executive will lose his  

past seniority in the grade.”    

This policy was further clarified by way of an Office  

Memorandum dated 5th June, 1985, issued by the General  

Manager (Personnel) which read as follows:  

 “Under the present policy of the company, when the inter-

company transfer is effected on personal grounds at the  request of the executive concerned, his her seniority in the  company to which he/she is transferred, is fixed as if he/she

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entered the grade on the date of his/her assumption of  charge in the new company and the executive loses his/her  

past seniority in the grade. An issue has been raised whether  in such cases the period of service in a grade put in by the  

executive in the previous company will also count towards  eligibility for promotion or not.   2.  In this connection, it is clarified that while the name of  

the officer transferred on request will be placed at the bottom  of the seniority list in his/her grade in the new company  when the officer immediately senior to his/her in the new  

company becomes eligible for promotion, say after one year,  the transferee will also become eligible for consideration for  

promotion provided he/she put in the minimum prescribed  grade in the previous company. However, if the Officer  immediately senior to the transferee in the new company has  

put in less than the minimum prescribed period of service,  say six months, in the grade the transferor becomes eligible  

for promotion even though the transferee might have put in  more than the requisite service in the grade prior to his/her  transfer.   

3.  Pending cases may be disposed of on the basis of the  above clarification. However, past cases will not be re- opened.   

This issues with the approval of Competent Authority.”    

 3. The respondent claims that in September 1993, the  

appellant company held its departmental promotion committee  

after which several employees were promoted from the E-2  

Grade to the E-3 Grade but the respondent was overlooked for  

promotion. The reason given to the respondent was that his  

transfer to CMPDIL was done at his own request and his  

promotion would be considered only after he completed 3

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(three) years of work experience at CMPDIL, which was the  

requisite period for promotion from E-2 to E-3.  

 4. Subsequently, the respondent was promoted to the „E-3‟  

Grade vide order dated 12th December, 1994, which also  

mentioned that his seniority would be decided separately,  

since he had been promoted under the cluster concept in the  

centralised cadre. This order was modified on 2nd January,  

1995 to change his designation to Executive Engineer  

(Chemical).   

 5. Post-promotion, the respondent challenged the  

appellant‟s decision to exclude his work experience at DCC  

(i.e. 4th August, 1990 to 14th May, 1991) while considering his  

eligibility for promotion, by filing a writ petition being CWJC  

No.2074/1997 before the High Court of Jharkhand praying for  

grant of notional seniority to him to the post of Executive  

Engineer (Chemical) in the E-3 Grade with effect from 12th  

November, 1993. The Single Judge disposed of the writ  

petition vide order dated 18th November, 1998, by merely  

directing the appellant company to consider the representation

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of the respondent within 3 (three) months from the date of the  

order.   

 6. Thereafter, the Chief General Manager (Personnel) of the  

appellant company, after considering the respondent‟s  

representation, issued an order on 16th February, 1999,  

rejecting the same inter alia on the ground that the applicable  

policy at the time of considering the respondent‟s seniority was  

that an employee would lose his past seniority in his existing  

Grade in the event of an inter-company transfer, if the request  

for transfer was made by the employee himself and further, as  

per the office memorandum of 5th June, 1985, since there was  

no senior executive above the respondent‟s Grade, the  

question of the application of the said office memorandum did  

not arise. The said order reads thus:  

“Shri Singh was transferred from Dankuni Coal Complex,  Dankuni (West Bengal) to CMPDIL, Ranchi vide Order No.:C-

5A(iii)51434(Trans)/109 dated 23rd April 1991 on his own  request. In terms of policy followed prior to 1st April 1993  (i.e. the date from which the career growth of all executives  

was centralized at CIL level), one had to lose his past  seniority in his existing grade in the event of his transfer  

from one company to another on “request basis”. This policy  was followed very strictly without any exception.   The Office Memorandum dated 5th June 1985 only  

clarifies with regard to procedure to be followed for

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consideration of such transferred executive, when his  immediate senior executive in the transferee company is  

considered for promotion. In the case of Shri Singh since  there was no senior executive above him the question of  

application of the above O.M. dated 5th June 1985 could not  arise. Moreover, Shri Singh having not been completed the  requisite period in the transferee company was not eligible  

for consideration of his promotion as the period of service  rendered in the previous company can not be taken into  consideration for the purpose of eligibility for promotion.   

In the premises, I am of the view that there is not  merit in the representation of Shri Singh (the petitioner) and  

his request for the grant of Notional Seniority is rejected.”    

7. Aggrieved by the aforementioned decision, the respondent  

filed a fresh writ petition being CWJC No.4177 of 2000 before  

the High Court of Jharkhand, inter alia, seeking to quash the  

order dated 16th February, 1999, and praying that he may be  

granted notional  seniority with effect from 12th November,  

1993 in the E-3 Grade with all consequential benefits. This  

writ petition was allowed by the learned Single Judge vide  

order dated 20th June, 2003 who observed that although the  

respondent may have been at the top in the seniority list of  

CMPDIL when he joined in that company, at the time of  

consideration of promotion to E-3 Grade, his service at DCC  

could not be overlooked and therefore, denial of promotion to  

him in E-3 Grade at the time was incorrect and accordingly,

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the appellant company was directed to revise the date of  

promotion of the respondent.  

 8. The appellant company challenged the order of the  

learned Single Judge by way of LPA No.546/2003. Pending the  

outcome, the respondent was promoted from E-3 to E-4 Grade  

and then from E-4 to E-5 Grade. On 20th May, 2010, the  

Division Bench disposed of the appellant‟s appeal, observing  

that there was nothing in the policy to indicate that past  

service in the previous company, from which transfer has been  

sought, could be forfeited for all purposes, except that on the  

strength of that past service he would not be entitled to  

supersede the employees working in the new company in the  

grade in which he had joined.    

 9. Aggrieved, the appellant has approached this Court by  

way of special leave, asserting that the claim of the respondent  

is  in the teeth of the policy under which  he  was   transferred  

to  CMPDIL  at his  request  and  that  the Office  

Memorandum dated 5th June, 1985 had no application to the  

fact situation of the present case. Resultantly, the learned

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Single Judge as well as the Division Bench committed  

manifest error in granting relief to the respondent. The  

respondent, on the other hand, has supported the reasons  

recorded by the learned Single Judge and the Division Bench.  

It is submitted that the High Court noted the distinction  

between the matter of seniority and that of the length of  

service. The policy invoked by the appellant merely governs the  

matter of seniority and does not affect the length of service as  

such. Reliance has been placed on the decisions of this Court  

in Union of India and Ors. Vs. C.N. Ponnappan1 and  

Scientific Advisor to Raksha Mantri and Anr. Vs. V.M.  

Joseph2.  It is submitted that the appeals are devoid of merit  

and ought to be dismissed.   

 10. We have heard Mr. Anip Sachthey, learned counsel for  

the appellants and Mr. Manish Kumar Saran, learned counsel  

for the respondent.   

                                                           1   (1996) 1 SCC 524  

2   (1998) 5 SCC 305

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11. The indisputable position emerging from the chronology  

of events, is that the respondent was appointed on 27th June,  

1990 in E-2 Grade in DCC and joined that post on 4th August,  

1990. He requested for a transfer from DCC to CMPDIL, which  

is a subsidiary of the appellant company. That request was  

considered favourably as a result of which the respondent  

joined CMPDIL in existing E-2 Grade, pursuant to Office Order  

dated 23rd April, 1991. The said Office Order reads thus:  

“COAL INDIA LIMITED  

“COAL BHAWAN”  

10-NETAJI SUBHAS ROAD, CALCUTTA-700001  

No.C-5A(iii)/51434 (Trans)/199 Dated: 23.04.1991  

O R D E R  

Shri Navin Kumar Singh, Chemical Engineer in E-2  

grade presently posted at Dankuni Coal Complex is hereby  

transferred in his existing capacity/grade to Central Mine  

Planning & Design Institute Limited, till further orders.  

2. On being released from Dankuni Coal Complex, Shri  

Singh will report to Director –in –Charge, CMPDI, Ranchi, for  

further assignment in that company.   

3. Since the transfer is being made at his own request  

Shri Singh will not be entitled to any transfer TA/Settling in  

Allowance etc. and his seniority in E-2 grade as Chemical  

Engineer will be reckoned from the date he joins in CMPDI.   

4. This issues with the approval of Competent Authority.   

Sd/-  

(A.K. Mukherjee)  

Personnel Manager (EE)”

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12. Indeed, the office order makes it amply clear that the  

seniority of the respondent will be reckoned from the date he  

joins CMPDIL. It is also seen that when the respondent joined  

CMPDIL on 15th May, 1991, there was no senior person  

working in E-2 Grade. The question is: whether the policy  

regarding the determination of inter-se seniority of the  

executives on inter-company transfers would come in the way  

of the respondent for reckoning his eligibility for promotion to  

the higher Grade i.e. E-3 Grade, whilst in the new transferred  

company (CMPDIL)? As the respondent was initially appointed  

in E-2 Grade on 4th August, 1990 in DCC on completion of 3  

years in September, 1993,  he acquired the requisite eligibility   

for being considered for promotion to the next grade i.e. E-3  

Grade. However, the department did not consider the  

respondent‟s case for promotion to E-3 Grade in the  

departmental promotional committee held at the relevant time.  

Instead, he was considered and promoted to E-3 Grade only in  

December, 1994.  

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13. On a fair reading of clause 11 of the policy, there is  

nothing to indicate that the transferee would lose his past  

service rendered in the parent company for all purposes. The  

policy of forfeiture of seniority in the parent company,  

however, is limited to the executives who seek inter-company  

transfer on personal grounds. That is to ensure that no  

prejudice is caused to the executives already working in the  

transferred company. For that reason, the seniority of the  

executives seeking inter-company transfer on personal request  

is fixed as if he had entered the concerned Grade on the date  

of assumption of charge in the transferred company. It has  

been made explicitly clear that the executive seeking inter-

company transfer on personal grounds will lose his past  

seniority in the Grade. No more and no less.   

 14. Indubitably, the respondent is not claiming seniority over  

any person already working in the new company (CMPDIL)  

before the date on which he assumed charge thereat on 15th  

May, 1991. The limited claim of the respondent however, is  

that the service rendered by him in the parent unit (DCC) from

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4th August, 1990 in E-2 Grade be reckoned for the purpose of  

determining his eligibility for promotion to the post of E-3  

Grade whilst working in CMPDIL. The High Court justly  

accepted the claim of the respondent that for determination of  

his eligibility for promotion, his length of service in DCC must  

be reckoned. That cannot be confused with the issue of  

seniority in CMPDIL as they are two different and distinct  

factors. The policy in the form of clause 11 deals with the  

latter. There is no express stipulation in the policy – be it  

clause 11 or any other official document – to even remotely  

suggest that on seeking inter-company transfer on personal  

grounds, the executive concerned would lose even his past  

service rendered by him in the parent unit (DCC) for all  

purposes. In absence of such a stipulation, the claim of the  

respondent could not have been rejected by the department.  

This proposition is reinforced from the dictum in C.N.  

Ponnappan (supra), which has been noted with approval in  

V.M. Joseph (supra).  The two-Judge Bench of this Court in  

C.N. Ponnappan (supra), observed as follows:  

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“4. The service rendered by an employee at the place from  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 taken  

into account for the purpose of leave and retiral benefits. The  fact that as a result of transfer he is placed at 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 be  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 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.”  

 (emphasis supplied)  

15. This view has been restated by another two-Judge Bench  

of this Court in V.M. Joseph (supra), in paragraph 6 which  

reads as follows:   

“6. From the facts set out above, it will be seen that  promotion was denied to the respondent on the post of  

Senior Storekeeper on the ground that he had completed 3  years of regular service as Storekeeper on 7-6-1980 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 Storekeeper for the period from  27-4-1971 to 6-6-1977. The appellants contended that, since  the respondent had been transferred on compassionate  

grounds on his own request to the post of Storekeeper at  Cochin and was placed at the bottom of the seniority list, the  

period of 3 years of regular service can be treated to  commence only from the date on 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 3 years  

of service as a Storekeeper. Even if an employee is

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transferred at his own request, from 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 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)    

16. In the present case, there is no dispute that the  

respondent had rendered service in E-2 Grade on regular basis  

in DCC from where he was transferred to CMPDIL, on personal   

grounds. The service rendered by him in DCC can be and  

ought to be taken into account for all other purposes, other  

than for determination of his seniority in E-2 Grade in the new  

company i.e. CMPDIL. Indeed, his seniority in CMPDIL in E-2  

Grade will have to be reckoned from the date of his  

assumption of charge on 15th May, 1991, but that can have no  

bearing while determining his eligibility criterion of length of  

service in E-2 Grade for promotion to E-3 Grade. For  

determining the eligibility for promotion to E-3 Grade, the  

service rendered by him in DCC in E-2 Grade with effect from  

4th August, 1990, ought to be reckoned. The view so taken by

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the High Court commends to us. Hence, no fault can be found  

with the direction given by the High Court to assign notional  

date of promotion to the respondent in E-3 Grade with effect  

from 12th November, 1993.   

 17. As regards the Office Memorandum dated 5th June, 1985,  

the same does not militate against the respondent. It is a  

different matter that it addresses the difficulty expressed  

about the denial of opportunity of promotion to the executives  

who opted for inter-company transfer. On a fair reading of this  

Office Memorandum, it is discernible that the department has  

clarified the position that if the concerned executive has  

already completed service for a specified period including the  

period of service with the old company, would become entitled  

to be considered for promotion to the higher Grade. If so, not  

granting similar advantage to the executive who opted for  

inter-company transfer on personal request and who  

incidentally enters at number one position in the seniority in  

the new company would be anomalous. Concededly, what is  

affected in terms of the policy for inter-company transfer on

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personal request, is only the seniority position in the new  

(transferred) company – which would commence from the date  

of assuming office thereat. By no stretch of imagination, it can  

affect the length of service in E-2 Grade in the parent  

company.  The two being distinct factors, neither the policy  

nor the office memorandum would be any impediment for  

reckoning the period of service rendered by the respondent  

from August, 1990 in DCC, albeit a case of inter-company  

transfer on personal request.  As a result, these appeals must  

fail.   

18. Accordingly, the appeals are dismissed with no order as  

to costs.  

.………………………….CJI.        (Dipak Misra)   

…………………………..….J.                (A.M. Khanwilkar)  

…………………………..….J.               (Dr. D.Y. Chandrachud)  

New Delhi;  

September  25, 2018.