Page 1

C.A.No.5153-5157/09

REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NOS.5153-5157 OF 2009

Secr., Govt of NCT of Delhi & Ors. …..Appellants

Versus

Grade-I DASS Officers’ Association & Ors. …..Respondents

J U D G M E N T

SHIVA KIRTI SINGH, J.

1. The Respondents in these Appeals were applicants before the Central  

Administrative  Tribunal,  Principal  Bench,  New  Delhi  (for  short,  ‘the  

Tribunal’).   They  preferred  O.A.  No.579  of  2002  against  the  Appellants  

seeking quashing of the order dated 10.8.2001 and also sought a direction to  

grant  the  scale  of  Rs.10000-325-15200/-  to  them and all  other  members  of  

Grade-I (DASS) Officers’ Association from the date they had completed 24  

years of regular service or 9.8.1999, whichever is later.

2. The aforesaid claim was founded upon the Assured Career Progression  

Scheme  (for  short,  ‘ACPS’)  introduced  w.e.f.  9.8.1999  which,  inter  alia,  

provides for benefit of second financial upgradation on completion of 24 years  

of regular service to such Central Government civilian employees who faced  

stagnation  and  had  not  been  granted  two  promotions  during  their  service  

1

Page 2

C.A.No.5153-5157/09

tenure.   The  controversy  or  the  dispute  arose  in  the  background  of  some  

relevant facts which are as follows.

3. The  Respondents  were  appointed  as  Grade-II  in  the  Delhi  

Administration Subordinate Service (for short, ‘DASS’).  They were promoted  

to the post of Grate-I between 1986 and 1989.  They had completed 24 years of  

regular  service  between  1998  and  2001  and  were  thus  eligible  for  second  

financial  upgradation  from  9.8.1999  or  date  of  completion  of  24  years  of  

service, whichever is later.  The pay scale of Grade-II of DASS was Rs.5000-

150-8000/-  and Grate-I  was in  the  pay scale  of  Rs.6500-200-10500/-.   The  

Grade-I of DASS was the feeder grade for the next promotional grade in the  

hierarchy  which  was  Grade-II  (Group  B)  under  the  Delhi  Andaman  and  

Nicobar  Island  Civil  Service   (for  short,  ‘DANICS’)  but  unfortunately  the  

Grade-II (Group B) of DANICS also had the same pay scale of Rs.6500-200-

10500/-.  Because the feeder and the promotional grades, though at two levels  

in  the hierarchy,  had the same scale  of  pay,  therefore,  a  clarification being  

Clarification 52 was issued by the Department of Personnel & Training vide  

O.M. No.35034/1/97-Estt.(D)/Vol.IV dated 18.7.2001, to the effect that since  

the feeder and promotional grades in the hierarchy were in the same scale of  

pay, the benefit of financial upgradation under the ACPS has to be allowed in  

the same scale for the reason that under the ACPS financial upgradation has to  

be  allowed  as  per  the  exiting  hierarchy.   Financial  upgradation  cannot  be  

allowed in  a  scale  higher  than  the  next  promotional  grade.   In  such cases,  

however,  as  per  Condition  No.9  of  the  ACPS  issued  vide  Department  of  

2

Page 3

C.A.No.5153-5157/09

Personnel  &  Training  O.M.  dated  10.2.2000,  pay  shall  be  fixed  under  the  

provisions of F.R.22(I)(a)(1) subject to a minimum benefit of Rs.100/-.

4. The  Respondents  found  the  benefit  under  F.R.22(I)(a)(1)  to  be  too  

meagre, therefore, they raised a demand that financial upgradation must be real  

and for that they should be granted upgradation to the scale of Rs.10000-325-

15200/- which was the pay scale for Grade-I (Group A) in the DANICS.

5. Since the normal channel of promotion for Grade-I of DASS was Grade-

II  (Group B) of  DANICS and not  the  further  higher  post  in  the  hierarchy,  

Grade-I (Group A) in DANICS, the Appellants turned down the representations  

of  the  Respondents  leading  to  O.A.No.579  of  2002  preferred  by  the  

Respondents.   In  that  O.A.,  the  Tribunal  considered  the  provisions  and  

conditions of ACPS contained in Annexure I  to the Scheme and came to a  

finding that the contention of the Respondents that irrespective of the hierarchy  

in which they are placed, they should be granted financial upgradation in the  

pay scale which is much higher than the hierarchical promotion was not an  

acceptable interpretation of the ACPS.  The Tribunal  found it  patent in the  

ACPS that the financial upgradation is to be only in the next higher grade but it  

is with a rider that such upgradation has to be in accordance with the existing  

hierarchy in a cadre without creating new posts.  The Tribunal placed strong  

reliance upon Para 7 of Annexure I to the ACPS dated 9.8.1999.  The Tribunal  

also turned down the contention that the Clarification No.52 dated 18.7.2001  

was contrary to the Scheme.

3

Page 4

C.A.No.5153-5157/09

6. Against  the judgment and order of  the Tribunal  dated 8.12.2003,  the  

Respondents preferred a review petition bearing Review Application No.49 of  

2004 which came to be dismissed by the Tribunal on 12.2.2004.  Thereafter,  

the  Respondents  filed  writ  petitions  being  C.W.P.Nos.5883-5887  of  2004  

before the High Court of Delhi which have been allowed by the judgment and  

order  under  appeal  dated  15.2.2008  giving  rise  to  the  civil  appeals  under  

consideration.  This  Court  granted interim stay and as a result,  the benefits  

accruing from the judgment under appeal have not been made available to the  

Respondents as yet.

7. To assail the judgment of the High Court whereby the Appellants have  

been directed to consider the placement of the Respondents in the next to next  

scale  in  the  hierarchy,  i.e.,  Rs.10000-325-15200/-  by  way  of  second  

upgradation in the ACPS, learned senior advocate Mr. K. Radhakrishnan has  

highlighted the relevant facts, as noted earlier, as also various stipulations in  

the ACPS particularly Condition Nos.1, 5.1, 7, 8, 9, 10 and 12.  He has also  

distinguished the letter dated 10.2.2000 discussed in Paragraph 17 of the High  

Court judgment by showing that Doubt (1) was based upon entirely different  

fact situation and hence the clarification against that doubt is not attracted in  

the case of Respondents.  He has also assailed the adverse findings in respect of  

O.M. dated 18.7.2001 containing Clarification No.52 discussed in Paragraph 18  

of the High Court judgment.  According to him, the plea of the Appellants that  

under ACPS the Respondents cannot be placed in a scale higher than what is  

4

Page 5

C.A.No.5153-5157/09

provided for under the hierarchy to normal promotees has also been wrongly  

rejected in Paragraph 19 of the judgment.

8. It is further contention on behalf of Appellants that ACPS is a policy  

decision under which the burden of financial upgradation is continued every  

month and hence the Appellants have good reasons to prefer these appeals also  

on  the  ground  that  High  Court  should  not  have  granted  a  relief  which  

tantamounts  to  changing  the  policy  of  State.   He  placed  reliance  upon  a  

judgment by this Court in the case of Govt. of T.N. & Anr. v. S. Arumugham  

& Ors. (1998) 2 SCC 198.  That case related to promotion policy governing  

promotion  as  Deputy  Collectors  in  Tamil  Nadu  Civil  Service.  The  

Administrative Tribunal had issued certain directions to the Government for  

reframing of the Scheme in a particular manner.  Criticizing the same, it was  

held that such judicial review was not permissible when the matter related to  

policy decision of  Government.

9. To the contra, it has been submitted by Mr. T.S. Doabia, learned senior  

advocate for the Respondents that financial upgradation as contemplated by the  

ACPS is to deal with the problem of genuine stagnation in service or hardship  

faced by  the  employees  due  to  lack  of  adequate  promotional  avenues  and,  

therefore, mere grant of financial benefit of Rs.100/- cannot be equivalent of  

placement in the higher pay scale.  According to him, the grant of financial  

benefits/placement  in  the  higher  pay  scale  indicated  in  Condition  No.1  of  

Annexure I to the Scheme has rightly been interpreted by the High Court to  

mean placement in the actual higher pay scale when the pay scale of feeder  

5

Page 6

C.A.No.5153-5157/09

post  and  promotional  post  is  found  to  be  same.   According  to  him,  the  

interpretation and reliance placed upon Paragraph 7 of the conditions contained  

in Annexure I to the Scheme by the Tribunal in Paragraph 13 of its judgment is  

incorrect in view of conditions Nos.10 and 12.  He has also referred to the  

dictionary meaning of  the  word,  ‘upgrade’  by referring  to the New Shorter  

Oxford English Dictionary wherein, inter alia, ‘upgrade’ means, ‘an additional  

feature  or  enhancement’.   He  has  placed  reliance  upon  a  Division  Bench  

judgment  of  Delhi  High  Court  in  the  case  of  Union  of  India  v.  Prakash  

Chand & Ors.  132 (2006) DLT 525 and a judgment of this Court in the case  

of  Council of Scientific & Industrial Research & Anr. v. K.G.S. Bhatt &  

Anr. (1989) 4 SCC 635.  Before deciding the relevant issue in the light of rival  

submissions, it would be useful to extract the relevant conditions contained in  

Annexure I to the ACPS dated 9.8.1999, i.e., Condition Nos.1, 5.1, 7, 8, 9, 10  

(Part) and 12 :

“1. The  ACP  Scheme  envisages  merely  placement  in  the  higher pay-scale /  grant of financial benefits (through financial  upgradation)  only  to  the  Government  servant  concerned  on  personal  basis  and  shall,  therefore,  neither  amount  to  functional/regular promotion nor would require creation of new  posts for the purpose;

2. xxx xxx xxx xxx xxx

3. xxx xxx xxx xxx xxx

4. xxx xxx xxx xxx xxx

5.1 Two financial upgradations under the ACP Scheme in the  entire  Government  service  career  of  an  employee  shall  be  counted against regular promotions (including in-situ promotion  and  fast-track  promotion  availed  through  limited  departmental  competitive  examination)  availed  from  the  grade  in  which  an  

6

Page 7

C.A.No.5153-5157/09

employee was appointed as a direct recruit.  This shall mean that  two  financial  upgradations  under  the  ACP  Scheme  shall  be  available  only  if  no  regular  promotions  during  the  prescribed  periods (12 and 24 years) have been availed by an employee.  If  an  employee  has  already  got  one  regular  promotion,  he  shall  qualify for the second financial upgradation only on completion  of 24 years of regular service under the ACP Scheme.  In case  two prior promotions on regular basis have already been received  by an employee, no benefit under the ACP Scheme shall accrue  to him;

5.2 xxx xxx xxx xxx xxx

6. xxx xxx xxx xxx xxx

7. Financial upgradation under the Scheme shall be given to  the next higher grade in accordance with the existing hierarchy in  a  cadre/category  of  posts  without  creating  new  posts  for  the  purpose.  However, in case of isolated posts, in the absence of  defined hierarchical grades, financial upgradation shall be given  by the Ministries/Departments concerned in the immediately next  higher (standard/common) pay-scales as indicated in Annexure-II  which is in keeping with Part-A of the First Schedule annexed to  the  Notification  dated  September  30,  1997  of  the  Ministry  of  Finance (Department of Expenditure).  For instance, incumbents  of isolated posts in the pay-scale S-4, as indicated in Annexure-II,  will be eligible for the proposed two financial upgradations only  to  the  pay-scales  S-5  and  S-6.   Financial  upgradation  on  a  dynamic basis (i.e. without having to create posts in the relevant  scales of pay) has been recommended by the Fifth Central Pay  Commission  only  for  the  incumbents  of  isolated  posts  which  have  no  avenues  of  promotion  at  all.   Since  financial  upgradations  under  the  Scheme  shall  be  personal  to  the  incumbent  of  the  isolated  post,  the  same  shall  be  filled  at  its  original level (pay-scale) when vacated.  Posts which are part of a  well-defined  cadre  shall  not  qualify  for  the  ACP  Scheme  on  ‘dynamic’ basis.  The ACP benefits in their case shall be granted  conforming to the existing hierarchical structure only;

8. The financial upgradation under the ACP Scheme shall be  purely personal to the employee and shall have no relevance to  his  seniority  position.   As  such,  there  shall  be  no  additional  financial upgradation for the senior employee on the ground that  the junior employee in the grade has got pay-scale under the ACP  Scheme;

7

Page 8

C.A.No.5153-5157/09

9. On  upgradation  under  the  ACP  Scheme,  pay  of  an  employee shall be fixed under the provisions of FR 22(I)(a)(1)  subject  to  a  minimum financial  benefit  of  Rs.100/-  as  per  the  Department  of  Personnel  and  Training  Office  Memonradum  No.1/6/97-Pay.I  dated  July  5,  1999.   The  financial  benefit  allowed under the ACP Scheme shall be final and no pay-fixation  benefit shall accrue at the time of regular promotion, i.e,, posting  against a functional post in the higher grade;

10. Grant of higher pay-scale under the ACP Scheme shall be  conditional to the fact that an employee, while accepting the said  benefit, shall be deemed to have given his unqualified acceptance  for regular promotion on occurrence of vacancy subsequently.  In  case he refuses to accept the higher post on regular promotion  subsequently, he shall be subject to normal debarment for regular  promotion as prescribed in the general instructions in this regard.  … … …

12. The  proposed  ACP  Scheme  contemplates  merely  placement  on  personal  basis  in  the  higher  pay-scale/grant  of  financial benefits only and shall not amount to actual/functional  promotion of the employees concerned.  Since orders regarding  reservation in promotion are applicable only in the case of regular  promotion, reservation orders/roster shall not apply to the ACP  Scheme which shall extend its benefits uniformly to all eligible  SC/ST  employees  also.   However,  at  the  time  of  regular/functional  (actual)  promotion,  the  Cadre  Controlling  Authorities  shall  ensure  that  all  reservation  orders  are  applied  strictly;”

10. For the controversy at hand Clarification 52 contained in O.M. dated  

18.7.2001 is relevant.  It reads as follows :  

Points of Doubt Clarification Following  the  recommendations  of  the  Pay  Commission,  feeder  and  promotional  posts  have  been  placed  in the same scale.  Consequently,  hierarchy of a post  comprises  of  

Normally,  it  is  incorrect  to  have  a  feeder grade in the same scale of pay.  In  such  cases,  appropriate  course  of  action is to review the cadre structure.  If  as  a  restructuring,  feeder  and  promotional  posts  are  merged  to  constitute  one  single  level  in  the  hierarchy,  then  in  such  a  case,  next  financial upgradation will be in the next  hierarchical  grade  above  the  merged  levels  and  if  any  promotion  has  been  

8

Page 9

C.A.No.5153-5157/09

Grades  ‘A’,  ‘A’  and  ‘C’  i.e.  the  entry level and the  first  promotional  grade  are  in  the  same scale.  What  shall  be  his  entitlements  under  ACPS

allowed  in  the  past  in  grades  which  stand merged, it will have to be ignored  as already clarified in reply to point of  doubt  no.1  of  O.M.  dt.10.02.2000.  However  if  for  certain  reasons  it  is  inescapable  to  retain  both  feeder  and  promotional grades as two district levels  in  the  hierarchy  though  in  the  same  scale  of  pay,  thereby  making  a  provision  for  allowing  promotion  to  a  higher  post  in  the  same  grade,  it  is  inevitable  that  benefit  of  financial  upgradation under ACPS has also to be  allowed in the same scale.  This is for  the  reason  that  under  the  ACPS,  financial upgradation has to be allowed  as per the existing hierarchy.  Financial  upgradation  cannot  be  allowed  in  a  scale higher than the next promotional  grade.   However,  as  specified  in  condition  No.9  of  the  ACP  Scheme  (vide  DoP&T  O.M.  dated  10.02.2000,  pay in such cases shall be fixed under  the provisions of FR 22(I)(a)(1) subject  to a minimum benefit of Rs.100/-.

11. On going through the ACPS and the relevant stipulations and conditions  

it is evident that the Scheme offers higher pay scale/financial benefits only to  

those  eligible  Government  servants  who  remain  deprived  of  regular  

promotions.  For such deprivation, they are compensated by grant of monetary  

benefits on personal basis but the same does not amount to functional/regular  

promotion  and  does  not  require  creation  of  new  posts.   The  financial  

upgradations under the Scheme are to be counted against regular promotions in  

the service career of the concerned Government employee.  The two financial  

upgradations under the Scheme shall be available only if no regular promotions  

during  the  prescribed  periods  (12  and  24  years)  have  been  availed  by  an  

9

Page 10

C.A.No.5153-5157/09

employee.  As per Condition No.7, financial upgradation is admissible in the  

next  higher  grade  only  in  accordance  with  the  existing  hierarchy  in  a  

cadre/category of posts without creating new posts for the purpose.  Practical  

solution has been indicated in case of isolated posts where there is no defined  

hierarchical grades.  The condition emphasizes that financial upgradation on a  

dynamic basis (i.e. without having to create posts in the relevant scales of pay)  

has  been  recommended  by the  Fifth  Central  Pay Commission  only  for  the  

incumbents  of  isolated  posts  which  have  no  avenues  of  promotion  at  all.  

Condition  No.7  fortifies  the  view  taken  by  the  Tribunal  through  the  clear  

stipulation in the last two sentences – “Posts which are part of a well-defined  

cadre shall not qualify for the ACP Scheme on ‘dynamic’ basis.  The ACP  

benefits in their case shall be granted conforming to the existing hierarchical  

structure only.”

12. Condition No.9 indicates that on upgradation under ACP Scheme the re-

fixation of pay must yield a minimum benefit of Rs.100/- in accordance with  

the relevant Office Memorandum.  It  also clarifies that the financial benefit  

under the ACP Scheme is final and no pay fixation benefit shall accrue at the  

time of regular promotion, i.e., posting against a functional post in the higher  

grade.  Condition No.10 further clarifies that benefit under the ACPS is to be  

conditional  and the  concerned employee shall  be  deemed to have given an  

unqualified  acceptance  for  regular  promotion  on  occurrence  of  vacancy  

subsequently.

1

Page 11

C.A.No.5153-5157/09

13. Clarification  52  issued  by  O.M.  dated  18.7.2001  is  found  to  be  in  

accordance with the stipulations and conditions of ACPS.   The High Court  

erred in taking a view that it supplants the basic provisions in the ACPS.  In  

fact, the clarification, at best, supplements the provisions of the Scheme and  

cannot be faulted for doing so.

14. In view of stipulations and conditions in the ACPS noticed above, it can  

be safely concluded that the financial upgradation under the ACPS is not only  

in lieu of but also in anticipation of regular promotion.  In such a situation, the  

contention advanced on behalf of Appellants that financial upgradation claimed  

by the Respondents cannot be granted because the same would be much in  

excess of what the officer would gain on actual promotion in the hierarchy, is  

found to have substance.  As a corollary, such claim of the Respondents must  

be rejected on the ground that persons having better claims on actual promotion  

could be fitted only in the promotional post of Grade II (Group B) of DANICS,  

i.e.  Rs.6500-200-10500/-  whereas  the  Respondents,  on  their  claims  being  

accepted, would get much higher pay scale of Rs.10000-325-15200/- available  

only to Grade I (Group A) in the DANICS.  Such a situation would be violative  

of rules of fairness and Articles 14 and 16 of the Constitution of India.  The  

claim of the Respondents had to be rejected as was done by the Tribunal in  

view of Clause 7 of the ACPS read with other relevant clauses as well as on the  

basis  of  aforenoticed  ground.   Fairness  on  part  of  State  is  a  constitutional  

obligation and hence a pay scale, which regularly promoted employee earlier  

belonging to Grade I (DASS) could not get due to established hierarchy for  

1

Page 12

C.A.No.5153-5157/09

promotion, cannot be granted to those like the Respondents on the plea that the  

financial upgradation to which they are found entitled as per existing hierarchy  

is too meagre.  In case Respondents’ claim was to be allowed on the ground  

accepted  by  the  High  Court  that  financial  upgradation  must  be  real  and  

substantial,  in  case  of  regular  promotion  in  future,  employees  like  the  

Respondents would have to be reduced in their  pay scale because actual  or  

functional  promotion as  per  established hierarchy can be only on a  post  in  

Grade II (Group B) in DANICS.

15. Besides being grossly unfair to the regular promotees, the view taken by  

the  High Court  would  also  violate  the  Government  policy  reflected  by  the  

stipulations in ACPS and the conditions attached to the same.   In the facts of  

the case, it would not be proper to exercise power of judicial review so as to  

reverse  or  modify  the  policy  decision  of  the  concerned  Government.   The  

judgment in the case of S. Arumugham (supra) has rightly been relied upon by  

learned senior counsel for the Appellants on the aforesaid issue.

16. So far as the judgment relied upon by the learned senior counsel for the  

Respondents are concerned, it is found that the facts and issues decided in the  

case of Prakash Chand (supra) were quite different.  The issue of fairness and  

constitutional obligation under Articles 14 and 16 did not arise in that case.  So  

far as the judgment in the case of Council of Scientific & Industrial Research  

(supra) is concerned, the Court had found in that case that the Respondent-Civil  

Engineer had suffered injustice and had stagnated in one post for 20 years and,  

therefore, this Court refused to exercise its powers under Article 136 of the  

1

Page 13

C.A.No.5153-5157/09

Constitution of India  although promotion granted to the Respondent  in that  

case by the Central Administrative Tribunal appeared to be erroneous.  In the  

present case, however, the benefit claimed by the Respondents would not be  

restricted  to  them alone,  rather,  the  policy  of  Government  reflected  by  the  

ACPS shall  suffer a mis-interpretation for all  times to come and the results  

would be violative of rules of fairness guaranteed by Articles 14 and 16 of the  

Constitution of India.

17. In the light of discussions made above, we find merit in the case of the  

Appellants.  The Appeals are allowed.   The judgment of the High Court under  

appeal  is  set  aside  and  as  a  result,  the  writ  petitions  preferred  by  the  

Respondents shall stand dismissed.  There shall be no order as to costs.

…………………………….J. [VIKRAMAJIT SEN]

……………………………..J. [SHIVA KIRTI SINGH]

New Delhi. July 30, 2014.

1