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REPORTABLE  

IN THE SUPREME COURT OF INDIA  

CIVIL APPELLATE JURISDICTION  

CIVIL APPEAL  DIARY NO. 3744 OF 2016  

Union of India and Ors.                                    .… Appellant(s)  

Vs.  

Balbir Singh Turn & Anr.                        ….Respondent(s)  

WITH  

CIVIL APPEAL DIARY NO. 5183 OF 2017  

CIVIL APPEAL DIARY NO. 5184 OF 2017  

CIVIL APPEAL DIARY NO. 6249 OF 2017  

CIVIL APPEAL DIARY NO. 7888 OF 2017  

CIVIL APPEAL DIARY NO. 18265 OF 2016  

CIVIL APPEAL NO. 244 OF 2017  

CIVIL APPEAL DIARY NO. 31768 OF 2016  

CIVIL APPEAL DIARY NO. 38019 OF 2016  

CIVIL APPEAL DIARY NO. 42810 OF 2016

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CIVIL APPEAL DIARY NO. 42879 OF 2016  

DIARY NO. 4546 OF 2017  

DIARY NO. 11491 OF 2017  

DIARY NO. 11871 OF 2017  

DIARY NO. 13664 OF 2017  

DIARY NO. 13665 OF 2017  

DIARY NO. 13666 OF 2017  

DIARY NO. 18186 OF 2017  

DIARY NO. 18048 OF 2017  

DIARY NO. 18045 OF 2017  

DIARY NO. 18185 OF 2017  

DIARY NO. 22593 OF 2017  

DIARY NO. 30116 OF 2017  

DIARY NO. 23164 OF 2017  

DIARY NO. 11493 OF 2017  

DIARY NO. 28798 OF 2017  

J U D G M E N T  

Deepak Gupta, J.  

1. Applications for condonation of delay in filing and refiling  

the appeals are allowed.    

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2. This bunch of appeals is being disposed of by a common  

judgment since similar questions of law are involved.    

3. The 6th Central Pay Commission was set up by the  

Government of India to make recommendations in matters  

relating to emoluments, allowances and conditions of service  

amongst other things.  The Pay Commission also made  

recommendation with regard to armed forces personnel.  On  

30th August, 2008, the Central Government resolved by a  

resolution of that date to accept the recommendation of the 6th  

Central Pay Commission (‘CPC’ for short) with regard to the  

Personnel Below Officer Rank (PBOR) subject to certain  

modifications.  Clause (i) of the Resolution reads as follows :-  

“(i) Implementation of the revised pay structure of  

pay bands and grade pay, as well as pension, with  

effect from 01.01.2006 and revised rates of allowances  

(except Dearness Allowance/relief) with effect from  

01.09.2008;”  

Clause 9 of the Resolution reads as follows :-  

“(ix) Grant of 3 ACP up-gradation after 8, 16 and 24  

years of service to PBORs;”  

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4. Under the recommendations made by the 5th CPC there  

was a provision for Assured Career Progression (ACP).  Vide  

this scheme, if an employee was not promoted he was entitled  

to get the next higher scale of pay after completion of 12/24  

years of service.  The 6th CPC recommended the grant of  

benefit of ACP after 10 and 20 years of service.  The Union of  

India, however decided to grant 3 ACP upgradations, after 8,  

16 and 24 years of service to PBORs, as per Clause (ix)  

extracted above. However, it would be pertinent to mention  

that the 6th CPC did away with the concept of pay scales and  

reduced the large number of pay scales into 4 pay bands and  

within the pay bands there was a separate grade pay attached         

to a post.    

5. For the purpose of this judgment we are dealing with the  

facts of Civil Appeal Diary No. 3744 of 2016.  It would be  

pertinent to mention that all the petitioners before the Armed  

Forces Tribunal (‘AFT’ for short) who are respondents before  

us are persons below officer rank. The respondents in this  

case retired after 01.01.2006 but prior to 31.08.2008.  They

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claim that the benefit of the Modified Assured Career  

Progression (‘MACP’ for short) was denied to them on the  

ground that the MACP was made applicable only with effect  

from 01.09.2008.  The respondents approached the AFT  

praying that they are entitled to the benefit of MACP w.e.f.  

01.01.2006, i.e., the date from which the recommendation of  

the 6th CPC with regard to pay and benefits were made  

applicable.  The stand of the Union of India was that the  

MACP was applicable only w.e.f. 01.09.2008 and, therefore,  

the respondents who had retired prior to the said date were  

not entitled to the benefit of the MACP.  The AFT vide the  

impugned order dated 21.05.2014 held that the benefit of ACP  

granted to an employee is part of the pay structure which not  

only affects his pay but also his pension and, therefore, held  

that the ACP is not an allowance but a part of pay and,  

therefore, in terms of Clause (i) of the Government Resolution  

the MACP was payable w.e.f. 01.01.2006.

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6. The question that arises for decision is whether the  

benefit of MACP is applicable from 01.01.2006 or from  

01.09.2008.  

7. The answer to this question will lie in the interpretation  

given to the Government Resolution, relevant portion of which  

has been quoted hereinabove.   A bare perusal of Clause(i) of  

the Resolution clearly indicates that the Central Government  

decided to implement the revised pay structure of pay bands  

and grade pay, as well as pension with effect from 01.01.2006.   

The second part of the Clause lays down that all allowances  

except the Dearness Allowance/relief will be effective from  

01.09.2008.  The AFT held, and in our opinion rightly so, that  

the benefit of MACP is part of the pay structure and will affect  

the grade pay of the employees and, therefore, it cannot be  

said that it is a part of allowances.  The benefit of MACP if  

given to the respondents would affect their pension also.  

8. We may also point out that along with this Resolution  

there is Annexure-I.  Part-A of  Annexure-I deals with the pay

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structure, grade pay, pay bands etc., and Item 10 reads as  

follows :-  

10 Assured Career Progression Scheme for  

PBORs.  The Commission recommends that the  time bound promotion scheme in case of  

PBORs shall allow two financial  upgradations on completion of 10 and 20  

years of service as at present.  The  financial upgradations under the scheme  shall allow benefit of pay fixation equal  

to one increment along with the higher  grade pay.  As regards the other  suggestions relating to residency period  

for promotion of PBORs Ministry of  Defence may set up an Inter-Services  

Committee to consider the matter after  the revised scheme of running bands is  implemented (Para 2.3.34)  

Three ACP  

upgradation after  8, 16 and 24 years  of service has been  

approved.  The  upgradation will  

take place only in  the hierarchy of  Grade Pays, which  

need not  necessarily be the  hierarchy in that  

particular cadre.  

Part-B of Annexure-I deals with allowances, concessions &  

benefits and Conditions of Service of Defence Forces  

Personnel.  It is apparent that the Government itself by placing  

MACP in Part-A of Annexure-I was considering it to be the part  

of the pay structure.  

9. The MACP Scheme was initially notified vide Special  

Army Instructions dated 11.10.2008.  The Scheme was called  

the Modified Assured Career Progression Scheme for Personnel  

Below Officer Rank in the Indian Army.  After the Resolution

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was passed by the Central Government on 30.08.2008 Special  

Army Instructions were issued on 11.10.2008 dealing with  

revision of pay structure.  As far as ACP is concerned Para 15  

of the said letter reads as follows:-  

“15. Assured Career Progression.  In pursuance with  

the Government Resolution of Assured Career  

Progression (ACP), a directly recruited PBOR as a  

Sepoy, Havildar or JCO will be entitled to minimum  

three financial upgradations after 8, 16 and 24 years  

of service.  At the time of each financial upgradation  

under ACP, the PBOR would get an additional  

increment and next higher grade pay in hierarchy.  

xx   xx   xx”  

Thereafter, another letter was issued by the Adjutant General  

Branch on 03.08.2009.  Relevant portion of which reads as  

follows:-  

“…….The new ACP (3 ACP at 8, 16 and 24 years of  

service) should be applicable w.e.f. 1 Jan 2006, and  

the old provns (operative w.e.f. the Vth Pay  

Commission) would be applicable till 31 Dec. 05.   

Regular service for the purpose of ACP shall commence  

from the date of joining of a post in direct entry grade.  

  xx  xx  xx”

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Finally, on 30.05.2011 another letter was issued by the  

Ministry of Defence, relevant portion of which reads as  

follows:-  

“5. The Scheme would be operational w.e.f. 1st Sep.  

2008.  In other words, financial up-gradations as per  

the provisions of the, earlier ACP scheme (of August  

2003) would be granted till 31.08.2008.”  

Therefore, even as per the understanding of the Army  

and other authorities up till the issuance of the letter dated  

30.05.2011 the benefit of MACP was available from  

01.01.2006.  

10. As already held by us above, there can be no dispute that  

grant of ACP is part of the pay structure.  It affects the pay of  

the employee and he gets a higher grade pay even though it  

may be in the same pay band.  It has been strenuously urged  

by Col. R. Balasubramanian, learned counsel for the UOI that  

the Government took the decision to make the Scheme  

applicable from 01.09.2008 because many employees would  

have lost out in case the MACP was made applicable from  

01.01.2006 and they would have had to refund the excess

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amount, if any, paid to them.  His argument is that under the  

old Scheme if somebody got the benefit of the ACP he was put  

in the higher scale of pay.  After merger of pay scales into pay  

bands an employee is only entitled to higher grade pay which  

may be lower than the next pay band.  Therefore, there may be  

many employees who may suffer.    

11. We are only concerned with the interpretation of the  

Resolution of the Government which clearly states that the  

recommendations of 6th CPC as modified and accepted by the  

Central Government in so far as they relate to pay structure,  

pay scales, grade pay etc. will apply from 01.01.2006.  There  

may be some gainers and some losers but the intention of the  

Government was clear that this Scheme which is part of the  

pay structure would apply from 01.01.2006.  We may also  

point out that the Resolution dated 30.08.2008 whereby the  

recommendation of the Pay Commission has been accepted  

with modifications and recommendations with regard to pay  

structure, pay scales, grade pay etc. have been made  

applicable from 01.01.2006.  This is a decision of the Cabinet.  

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This decision could not have been modified by issuing  

executive instruction. The letter dated 30.05.2011 flies in the  

face of the Cabinet decision reflected in the Resolution dated  

30.08.2008.  Thus, administrative instruction dated  

30.05.2011 is totally ultra vires the Resolution of the  

Government.    

12. Col. R. Balasubramanian, learned counsel for the UOI  

relied upon the following three judgments viz. P.K.  

Gopinathan Nair & Ors. v. Union of India and Ors. 1 ,  

passed by the High Court of Kerala on 22.03.2017, Delhi  

Urban Shelter Improvement Board v. Shashi Malik &  

Ors.2, passed by the High Court of Delhi on 01.09.2016, K.K.  

Anandan & Ors. v. The Principal Accountant General  

Kerala (Audit) & Ors3 passed by the Central Administrative  

Tribunal, Ernakulam Bench, Kerala on 08.02.2013.  In our  

view, none of these judgments is applicable because the issue  

whether the MACP is part of the pay structure or allowances  

were not considered in any of these cases.  

                                                           1 WP(C) No.23465 of 2013(G)  2 LPA 405 of 2016  3 O.A. No. 541 of 2012

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13. In this view of the matter we find no merit in the appeals,  

which are accordingly disposed of.  All pending applications  

are also disposed of.  

…………………………..J.  (Madan B. Lokur)  

……………………………J.  (Deepak Gupta)  

 New Delhi  December 08, 2017