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“REPORTABLE”

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NOS. 2485-2490 OF 2010

Dhole Govind Sahebrao & others … Appellants versus

Union of India & others … Respondents WITH

CIVIL APPEAL NOS. 2491-2503 OF 2010

Union of India & others … Appellants versus

A. Karunanithi … Respondent WITH

CIVIL APPEAL NO. 2577 OF 2010

Union of India & others … Appellants versus

Awadhesh Kumar & others … Respondents WITH

CIVIL APPEAL NO. 10386 OF 2013

Union of India & others … Appellants

versus Issac Varghese & others … Respondents

J U D G M E N T

Jagdish Singh Khehar, J.

1. The  present  controversy  is  yet  another  seniority  dispute  amongst  

employees of the Customs and Central Excise Department.  The controversy  

herein has emerged on account of a reconstitution of cadres.  In the first  

instance,  a separate cadre was constituted,  out of  the existing ministerial  

cadre, for discharging electronic data processing responsibilities.  This was

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necessitated by the decision of the department to introduce computerization,  

in its functioning.  The instant computerization project, which commenced in  

1991-92,  seems  to  have  been  fully  implemented  in  or  around  2002-03.  

Consequent upon achievement of the above objective, the separate cadre  

so created, was sought to be re-amalgamated with the existing ministerial  

cadre.  The above noticed bifurcation and re-amalgamation, resulted in a co-

incidental career advancement, for those who had accepted to break away  

from the original ministerial cadre.  Some of those who were originally placed  

at  inferior  positions  in  the  seniority  list  of  the  original  ministerial  cadre,  

acquired superiority over their counterparts (in the original ministerial cadre),  

consequent upon their promotion within the cadre of data entry operators,  

which  resulted  in  their  acquiring  a  higher  position  in  seniority,  over  and  

above  those  who  were  senior  to  them  in  the  original  ministerial  cadre.  

Before embarking upon the niceties of the seniority dispute, it is imperative  

to  delve  upon  the  reasons  of  the  afore-stated  bifurcation,  and  re-

amalgamation of  cadres.   The instant aspect of  the matter  is accordingly  

being dealt with, in the following paragraphs.

2. The ministerial  cadre as it  originally  existed,  comprised of  posts  of  

Deputy  Office  Superintendents  (Levels  1  and  2),  Upper  Division  Clerks,  

Lower Division Clerks, Stenographers (Senior Grade and Ordinary Grade),  

Draftsmen etc.  Conditions of service of members of the original ministerial  

cadre, were regulated by the Central Excise and Land Customs Department  

Group ‘C’  Posts Recruitment  Rules,  1979 (hereinafter  referred to as,  the

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1979 Rules).   Members  of  the original  ministerial  cadre  regulated  by the  

provisions  of  the  1979  Rules  were  eligible  for  promotion  to  the  post  of  

Inspector (Ordinary Scale) - an executive cadre post.  And thereupon, even  

further promotion, in the executive cadre.

3. Consequent upon the recommendations made by the Fourth Central  

Pay Commission in paragraph 11.45 of its report, the Government of India  

took upon itself the responsibility to examine the rationalization of pay scales  

for posts responsible for discharging work relating to data entry.  The task  

sought  to  be  undertaken  was  to  prescribe  uniform  pay  scales  and  

designations for electronic  data processing posts,  in consultation with the  

Department  of  Personnel.   Consequent  upon the suggestions made by a  

committee set up by the Department of Electronics in November, 1986, the  

Government of India decided to introduce the following uniform pattern for  

Electronic Data Processing Posts:-

S.No. Designation of post Pay Scale

              Data Entry Operators

1. Data Entry Operator  

Grade ‘A’

Rs.1150-1500 This  will  be  entry  grade  for  higher  secondary  with  knowledge  of  data  entry work

2. Data Entry Operator  

Grade ‘B’

Rs.1350-2200 This  will  be  entry  grade  for  graduation  with  knowledge  of  data  entry  work  or  promotional  grade  for  Data  Entry  Operator  Grade ‘A’

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3. Data Entry Operator  

Grade ‘C’

Rs.1400-2300 Promotional Grade

4. Data Entry Operator  

Grade ‘D’

Rs.1600-2660 Promotional Grade

5. Data Entry Operator  

Grade ‘E’

Rs.2000-3500 Promotional Grade

Data Processing/Programming Staff

1. Data  Processing  Assistant  Grade ‘A’

Rs.1600-2660 Entry  grade  for  graduates  with  Diploma/Certificate  in  Computer Application

2. Data  Processing  Assistant  Grade ‘B’

Rs.2000-3200 Promotional Grade

3. Programmer Rs.2375-3500 Direct entry for holders  of  degree  in  Engineering  or  post- graduation  in  Science/Maths etc., or  post-graduation  in  Computer Application

Or

By  promotion  from  Data  Processing  Assistant Grade ‘B’

4. Senior Programmer Rs.3000-4500 Promotional Grade

In continuation of  the aforesaid  office memorandum dated 11.9.1989,  the  

Government  of  India  issued  a  further  memorandum  dated  8.1.1990,  

suggesting job descriptions for various levels of  data entry  operators and  

programming  staff,  which  could  be  adopted  by  different  

ministries/departments  of  the  Government  of  India,  with  suitable

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modifications  to  meet  their  individual  requirements.   The  suggestions  

incorporated in the annexures appended to the office memorandum dated  

8.1.1990, revealed five categories of data entry operators, differentiated and  

distinguished as under:-

“1. Data Entry Operator-A: 1150-25-1500

All  types  of  data  preparation  and  validation  including  alpha- numeric data entry, graphic data entry, voice-entry, optical entry  etc.,  and  associated  verification,  and  pre-programmed  validation,  text  processing  etc.,  on  any  type  of  machines/equipment/instrument endowed with facilities for data  entry and/or preparation for data entry and/or pre-programmed  validation of entered data including key punching machine, key  to magnetic media machine, key to optical media machine, any  type  of  computer/EDP  equipment,  any  computer  based  equipment/computer  based  instrument/computer  based  online  or real time systems/computer network based systems.

2. Data Entry Operator-B: 1350-30-1440-40-2200

In addition to those jobs mentioned for Data Entry Operator-A,  Pooling,  Counting,  Collating,  Coding,  Console  Operation,  assisting  in  the  preparation  of  Statistics,  billing,  input/output  handling  etc.,  on  any  type  of  machine/equipment/instrument  endowed  with  facilities  for  data  entry  or  preparation  for  data  entry and/or validation of entered data as specified under the  description for Data Entry Operator-A.

3. Data Entry Operator-C:

In  addition  to  those  jobs  and  machine  equipment  instrument  mentioned  for  Data  Entry  Operator-B,  training  of  operators,  scheduling  of  jobs  and  more  skill-based  validation  of  alpha- numeric  or  graphic  data  as  determined  by  the  needs  of  the  organization.

4. Data Entry Operator-D:

In addition to those jobs mentioned for Data Entry Operator-C,  programming relating to data preparation and/or validation, and  for a few staff who are considered to have the required aptitude

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and depending upon the need, supervision of the work of Data  Entry Operator-A, B and C.

5. Data Entry Operator-E:

Supervision  of  the  work  of  data  preparation,  scheduling  and  distribution of jobs among other Data Entry Operators, planning,  scheduling, coordination and implementation of interrelated and  integrated data preparation jobs, programming relating to data  preparation  and/or  validation  traction  and  if  necessary  to  do  supporting  job  of  data  entry,  verification,  validation  etc.  depending on exigencies of work.”

4. In  order  to  implement  the  recommendations  made  by  the  Fourth  

Central  Pay  Commission,  the  Central  Board  of  Excise  &  Customs,  

Department  of  Revenue,  Ministry  of  Finance,  framed the  Electronic  Data  

Processing  Posts  (Group  ‘C’  Technical  Posts)  Recruitment  Rules,  1992  

(hereinafter  referred  to  as,  the  1992  Rules).   The  aforesaid  rules  were  

framed by the President of India in exercise of the powers conferred by the  

proviso to Article 309 of the Constitution of India.  Rule 5 of the 1992 Rules  

provided,  that  all  persons  holding  the  ministerial  posts  of  Key  Punch  

Operators,  Terminal  Operators  and  Lower  Division  Clerks,  who  were  

performing the duties of Terminal Operators prior to the commencement of  

the 1992 Rules, would be deemed to be appointed as Data Entry Operators  

Grade ‘A’.  Rule 5 of the 1992 Rules further postulated, that all Data Entry  

Operators Grade ‘A’ appointed at the time of the commencement of the 1992  

Rules,  would  rank  en-block  senior  to  those  appointed  after  the  

commencement of the Rules.

5. Rule 7 of the 1992 Rules authorized, the Central Government to relax  

any other  provision of  the rules  with  respect  to  any class or  category  of

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persons.  On 2.2.1993, in exercise of the powers conferred on the Central  

Government,  the  Central  Excise  Department  permitted  its  erstwhile  

employees, to apply for posts of Data Entry Operator Grade ‘A’, subject to  

the condition, that they had completed 3 years’ regular service and satisfied  

the conditions of eligibility stipulated in the 1992 Rules.  On 9.9.1993, the  

Customs Department,  issued a circular informing the employees who had  

exercised their  option for appointment to the post of  Data Entry Operator  

Grade ‘A’, that their option was final and could not be revoked.  A number of  

employees  holding  ministerial  cadre  posts  in  the  Customs  and  Central  

Excise  Department,  accordingly  came  to  be  appointed  as  Data  Entry  

Operators Grade ‘A’.

6. Under the mandate of the 1992 Rules, the post of Data Entry Operator  

Grade ‘A’ was assigned the pay scale of Rs.1150-25-1500.  It was the lowest  

post  under the 1992 Rules.   The Schedule appended to the 1992 Rules  

provided,  that  to  be  eligible  for  appointment  to  the  post  of  Data  Entry  

Operator Grade ‘A’, an individual should have qualified the 12th standard or  

equivalent examination.  Additionally, he/she should possess a speed of not  

less than 8000 key depressions per hour, for data entry work.  The onward  

promotion from the post of Data Entry Operator Grade ‘A’ was to the post of  

Data Entry Operator Grade ‘B’.  The said promotional post was in the pay  

scale  of  Rs.1350-30-1440-40-1800-EB-50-2200.   To  be  eligible  for  

promotion  to  the  post  of  Data  Entry  Operator  Grade  ‘B’,  the  schedule  

stipulated 6 years’ regular service as Data Entry Operator Grade ‘A’.  The

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post of Data Entry Operator Grade ‘B’ was liable to be filled exclusively by  

promotion, failing which, on transfer by deputation.  Onward promotion from  

the post of Data Entry Operator Grade ‘B’, was to the post of Data Entry  

Operator  Grade ‘C’.   The said promotional  post,  was in the pay scale of  

Rs.1400-40-1800-EB-50-2300.  Data Entry Operators Grade ‘B’ with 3 years’  

regular service in the grade, were considered eligible for promotion to the  

post of Data Entry Operator Grade ‘C’.  The schedule appended to the 1992  

Rules provided, that the post of Data Entry Operator Grade ‘C’ would be  

filled up exclusively by promotion, failing which, on transfer by deputation.  

The highest post under the 1992 Rules, was the post of Data Entry Operator  

Grade ‘D’.  The said post was to be filled up by promotion from amongst  

Data Entry Operators Grade ‘C’, with 4 years’ regular service in the grade.  

The post of Data Entry Operator Grade ‘D’, was earmarked the pay scale of  

Rs.1600-50-2300-EB-60-2660.   Just  as  in  other  cases  referred  to  

hereinabove, promotion to the post of Data Entry Operator Grade ‘D’ was to  

be made exclusively by promotion, failing which, on transfer by deputation.

7. A perusal of the cadre of posts evolved under the 1992 Rules would  

reveal, that the Customs and Central Excise Department created a four-level  

cadre of Data Entry Operators, i.e. Grades ‘A’, ‘B’, ‘C’ and ‘D’.  This was in  

contradistinction to the five-level cadre of Data Entry Operators suggested in  

the deliberations carried out by the Government of India (as already noticed  

above).  A perusal of the 1992 Rules further reveals, that the cadre of Data  

Entry Operators, was separate from the original ministerial cadre.  Persons

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from the  original  ministerial  cadre  were  not  eligible  for  promotion  to  the  

different levels of posts created under the 1992 Rules.  Likewise, members  

of  different  levels  in  the  cadre  of  Data  Entry  Operators,  were  no  longer  

eligible  for  onward  promotion  to  any  post  of  ministerial  cadre.   Most  

significantly, an incumbent holding a cadre post under the 1992 Rules was  

no longer eligible for promotion to the post of Inspector (Ordinary Scale) in  

the executive cadre.  And therefore, not eligible for any onward promotion in  

the executive cadre.  Accordingly it is inevitable to conclude, that after the  

promulgation  of  the  1992  Rules,  the  Customs  and  Central  Excise  

Department comprised of a separate and distinct ministerial cadre, as also, a  

separate and distinct cadre of Data Entry Operators.

8. The factual position depicted in the pleadings filed before this Court  

reveals, that throughout India only 211, 52 and 17 employees got promoted  

to  the posts of  Data Entry  Operator  Grade ‘B’,  Grade ‘C’  and Grade ‘D’  

respectively, under the 1992 Rules.  The remaining individuals inducted into  

the cadre of Data Entry Operators from the original ministerial cadre, have  

continued to occupy the post of Data Entry Operator Grade ‘A’, even after  

having rendered services for more than 10-15 years i.e., without obtaining a  

single promotion.   As against  the aforesaid  career progression under  the  

1992 Rules, the administration found that the ministerial  cadre employees  

holding  the  posts  of  Lower  Division  Clerk,  Upper  Division  Clerk,  and  

erstwhile  Tax  Assistant  etc.  were  promoted  (during  the  same  period  of  

service) to the post of Inspector (Ordinary Scale), and even further up to the

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post of  Commissioner on the executive side, and up to the post of Chief  

Accounts  Officer  on  the  ministerial  side,  on  account  of  better  promotion  

avenues available to the ministerial cadre.  In order to resolve the distinction  

in the two cadres of  employees,  the Central  Board of  Excise & Customs  

invited  suggestions  from  all  the  Commisionerates  for  the  re-merger  of  

cadres.   The  matter  was  examined  also  in  the  light  of  the  fact  that  the  

purpose for which the cadre of Data Entry Operators was created, had been  

achieved.   The  deliberations  lead  to  restructure/re-amalgamation,  by  

abolishing the cadre of Data Entry Operators.  To give effect to the executive  

determination the President of India, in exercise of the powers conferred on  

him by the proviso to Article 309 of the Constitution of India, framed two sets  

of rules for the Customs and Excise Department, namely, the Central Excise  

and Customs Department Tax Assistant (Group ‘C’ Post) Recruitment Rules,  

2003 (hereinafter referred to as, the TA Rules, 2003) and the Central Excise  

and Customs Department Senior Tax Assistant (Group ‘C’ Post) Recruitment  

Rules, 2003 (hereinafter referred to as, the STA Rules, 2003).  In order to  

understand  the  re-merger/re-amalgamation  of  the  cadres  in  the  Customs  

and Excise Department, it is imperative for us to delve upon the effect of the  

TA Rules,  2003,  as  also,  the  STA Rules,  2003.   We shall  examine  the  

aforementioned two sets of rules, in the following paragraphs.

9. The TA Rules, 2003 provided for the initial constitution of the cadre of  

Tax Assistants, through Rule 4 thereof.   Rule 4 of the TA Rules, 2003 is  

being extracted hereunder:-

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“4. Initial Constitution.- (1) The person appointed on regular basis  and holding the post of Upper Division Clerk and Data Entry Operator  Grade A on the commencement of these rules shall deemed to have  been appointed as Tax Assistant under these rules and the service  rendered  by  such  persons  in  the  respective  posts  before  commencement of these rules shall be taken into account as regular  service  rendered  on  the  post  of  Tax  Assistant  for  the  purpose  of  promotion etc.  

(2) The person holding the post of Data Entry Operator Grade-A  appointed under these rules as Tax Assistant shall, within two years  from  the  date  of  such  appointment  as  Tax  Assistant,  pass  the  Departmental Examination as conducted by the competent authority,  failing which he shall not be entitled to get any further increment.

(3) Any person, who holds a post of Lower Division Clerk on regular  basis and falls within the seniority list as determined by the appointing  authority at the commencement of these rules shall, on passing the  Departmental  Computer  Proficiency  examination  conducted  by  the  appointing authority,  be deemed to have been promoted with effect  from  the  date  of  passing  such  examination  on  the  post  of  Tax  Assistant.

(4) The Upper Division Clerks and Data Entry Operators Grade-A  shall be placed en-block senior and, their inter se placement shall be  fixed  in  accordance  with  the  date  of  regular  appointment  to  the  respective grade subject to the condition that their inter se placement  in respective grade shall not be disturbed.

(5) Lower  Division  Clerks  shall  be  placed  below  Upper  Division  Clerks and Data Entry Operator Grade-A."

A perusal of Rule 4 of the TA Rules, 2003 reveals, that persons holding the  

posts of Upper Division Clerk and Data Entry Operator Grade ‘A’ would be  

re-designated as Tax Assistants.  The service rendered by them as Upper  

Division Clerk  and Data Entry  Operator  Grade ‘A’  respectively,  would be  

taken  into  consideration  as  regular  service  rendered  on  the  post  of  Tax  

Assistant (for purposes of promotion etc.).  In addition to the above, Lower  

Division  Clerks  falling  within  the  seniority  list,  as  determined  by  the  

appointing  authority  at  the  commencement  of  the  TA  Rules,  2003,  on

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passing  the  departmental  computer  proficiency  examination,  would  be  

deemed to be promoted as Tax Assistants (from the date of passing such  

examination).  Rule 4 of the TA Rules, 2003 expressly postulates, that Upper  

Division Clerks and Data Entry Operators Grade ‘A’, would be placed en-

block senior to others appointed as Tax Assistants, and further, that their  

inter-se  seniority  would  be  determined  from  the  date  of  their  regular  

appointment to the respective grade.  For their inter-se placement, Rule 4 of  

the TA Rules, 2003 further postulated, that Lower Division Clerks would be  

placed below the Upper Division Clerks and Data Entry Operators Grade ‘A’.  

A perusal of Rule 4 of the TA Rules, 2003 reveals an amalgamation of three  

posts,  namely,  Upper  Division Clerk,  Data  Entry  Operator  Grade ‘A’  and  

Lower  Division  Clerk.   All  these  posts  were  amalgamated  into  a  freshly  

created cadre of Tax Assistants under the TA Rules, 2003.

10. While  deliberating  on  the  TA  Rules,  2003,  it  is  also  imperative  to  

notice,  that  Rule  5  of  the  TA  Rules,  2003  provided  for  the  methods  of  

recruitment, age limits and other qualifications, for appointment to the post of  

Tax  Assistant.   The  details  of  the  aforesaid  particulars  are  found  in  the  

schedule appended to the TA Rules, 2003.  A perusal of the above schedule  

reveals,  that 90% of the appointments made to the post of Tax Assistant  

were  to  be  by  direct  recruitment,  and  10%  by  way  of  promotion.   For  

promotion, the following conditions of eligibility were stipulated in column 12  

of the schedule appended to the TA Rules, 2003:-

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“From amongst the Lower Division Clerks and Head Havaldars who  have rendered seven years of service in the Grade on regular basis  and possess the following qualifications, namely:-

(a) Matriculation or equivalent qualification from a recognized  institution, and (b) Data Entry Speed of 5000 key depression per hour and  passed the Departmental examination with knowledge of typing  in  Hindi  or  English  at  a  speed  of  25  wpm  and  30  wpm  respectively.”

It  is  apparent  from  the  perusal  of  Rule  5,  coupled  with  the  schedule  

appended to TA Rules, 2003, that the initial merger of the ministerial cadre  

and the cadre of Data Entry Operators was made, against the post of Tax  

Assistants.   In  sum and substance,  therefore,  irrespective of  the post  (in  

ministerial  or  Data  Entry  Operators’  cadre)  occupied,  the  lowest  level  of  

amalgamation was, against the post of Tax Assistant.

11. Insofar as the STA Rules, 2003 are concerned, the initial constitution  

therein was postulated in Rule 5 thereof.  Rule 5 aforementioned is being  

extracted hereunder:-

“5. Initial Constitution.- (i) All the persons appointed on the regular  basis at  the time of commencement of these rules to the Grade of  Assistant,  Tax  Assistant,  Upper  Division  Clerk  (Special  Pay),  Data  Entry  Operator  Grade  ‘B’  and  ‘C’  shall  be  deemed  to  have  been  appointed as Senior  Tax Assistants under  these rules.  The service  rendered by them before commencement of these rules shall be taken  into account for deciding the eligibility for promotion to the next higher  grade.  

(ii)  Assistants  (Rs.5000-8000)  and  Data  Entry  Operator  Grade  ‘C’  (Rs.5000—8000) are being redesignated as Senior Tax Assistants in  the  same  scale  of  pay.  Therefore,  the  Assistants  and  Data  Entry  Operator  Grade  'C'  shall  be  placed  enblock  senior  to  the  other  categories. However their inter-se-placement shall be done according  to  the  date  from which  they  had  actually  been  appointed  to  these  grades  on  regular  basis  subject  to  the  condition  that  their  inter-se  placement in their respective category shall not be altered.

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(iii) The  Data  Entry  Operator  Grade  ‘B’  (4500-7000)  and  Tax  Assistants  (4500-7000)  have  been  placed  in  their  higher  scale  of  5000-8000 and they shall  be placed below the Assistant  and Data  Entry Operator Grade ‘C’ and their inter-se placement shall be fixed in  accordance  with  the  date  of  regular  appointment  to  the  respective  grade  subject  to  the  condition  that  their  inter-se  placement  in  respective category shall not be disturbed.  

(iv) Upper  Division  Clerk  with  special  pay  shall  be  placed  below  Assistant; Data Entry Operator Grade ‘C’, Data Entry Operator Grade  ‘B’, Tax Assistants.  

(v) The present employees would be required to pass the required  or suitable departmental examination, as specified by the Competent  Authority,  from  time  to  time,  in  Computer  application  and  relevant  procedures within two years failing which they would not be eligible for  further increments.”

A  perusal  of  Rule  5  of  the  STA  Rules,  2003  reveals,  that  at  the  initial  

constitution of the cadre the posts of Assistant, Tax Assistant, Upper Division  

Clerk  (Special  Pay)  and  Data  Entry  Operator  Grades  ‘B’  and  ‘C’  were  

merged as Senior Tax Assistants.  The aforesaid merger contemplated the  

merger of posts belonging to the ministerial cadre, and posts belonging to  

the cadre of  Data Entry  Operator.   Rule  5  of  the STA Rules,  2003 also  

expressly provided for the manner in which the above merged posts would  

be ranked in the integrated cadre of Senior Tax Assistants.  The inter-se  

ranking was provided for as under:-

(i) Assistants  and  Data  Entry  Operators  Grade  ‘C’  were  placed  

above  all  other  posts  which  constituted  the  cadre  of  Senior  Tax  

Assistants, on the promulgation of the STA Rules, 2003.  This was  

purportedly sought to be done, as is evident from Rule 5(ii) of the STA  

Rules, 2003, because the posts of Assistant and Data Entry Operator

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Grade ‘C’ were in the pay scale of Rs.5000-8000, and thereby, were  

enjoying the highest scale amongst the posts merged, to constitute the  

cadre  of  Senior  Tax  Assistants.   In  order  to  regulate  the  inter-se  

seniority  between  the  merged  posts  of  Assistants  and  Data  Entry  

Operators  Grade  ‘C’,  Rule  5(ii)  of  the  STA  Rules,  2003  further  

provided, that the inter-se placement of persons holding such posts,  

would be based on the date on which such persons had been actually  

appointed in the pay scale of Rs.5000-8000, on regular basis.

(ii) In  the same fashion as Assistants  and Data Entry  Operators  

Grade ‘C’, Rule 5(iii) of the STA Rules, 2003 provided, that Data Entry  

Operators Grade ‘B’ and Tax Assistants, who were earlier placed in  

the pay scale of Rs.4500-7000,  and thereafter  placed in the higher  

scale of  Rs.5000-8000,  would be placed en-block below Assistants  

and Data Entry Operators Grade ‘C’.  In other words, the posts of Data  

Entry Operators Grade ‘B’ and Tax Assistants which had an inferior  

position  adjudged  on  the  basis  of  pay  scales,  vis-à-vis  Data  Entry  

Operators Grade ‘C’ and Assistants, prior to the promulgation of the  

STA Rules, 2003, were placed en-masse below Data Entry Operators  

Grade ‘C’ and Assistants, so as to preserve the said inferior position in  

the cadre of Senior Tax Assistants.  Insofar as the inter-se placement  

between the Data Entry Operators Grade ‘B’ and Tax Assistants is  

concerned, Rule 5(iii) of the STA Rules, 2003 provided, that the date

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of  their  regular  appointment  in  their  respective  grades,  would  

determine their inter-se seniority in the cadre of Senior Tax Assistants.

(iii) For exactly the same reasons as have been indicated in (i) and  

(ii) above, namely, the pay scale in which the respective posts were  

placed  prior  to  the  creation  of  the  cadre  of  Senior  Tax  Assistants  

under the STA Rules, 2003, the posts of Upper Division Clerk were  

placed at  the bottom of the cadre of  Senior  Tax Assistants,  at  the  

initial constitution of the said cadre, under the mandate of Rule 5(iv) of  

the STA Rules, 2003.

12. It is imperative to point out here, that the erstwhile ministerial cadre  

was primarily engaged in discharging duties of a procedural nature, whereas  

those engaged in the cadre of Data Entry Operators were considered to be  

primarily engaged in discharging duties in the field of computer applications.  

It  is,  therefore,  that  Rule  5(v)  of  the  STA Rules,  2003  provided,  that  all  

employees appointed as Senior Tax Assistants, at the initial constitution of  

the aforesaid cadre, under the STA Rules, 2003, would be required to pass  

departmental  examinations,  so  as  to  achieve  the  proficiency  required  in  

discharging duties relating to the application of relevant procedures, as also,  

with reference to computer applications.

13. It is in the background of the aforesaid factual and legal position, that  

we  would  venture  to  adjudicate  upon  the  controversy  raised  in  these  

connected civil appeals.

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14. It is relevant to mention, that in the first instance, a challenge to the  

rules  referred  to  hereinabove,  was  raised  at  the  hands  of  the  erstwhile  

members of  the ministerial  cadre,  namely,  those members  of  the original  

ministerial  cadre,  who  had  not  opted  for  appointment/absorption  into  the  

cadre of Data Entry Operators.  In their challenge raised before the Central  

Administrative Tribunal, Madras Bench, Chennai (hereinafter referred to as,  

the Administrative Tribunal), a common order dated 30.12.2003 was passed,  

while disposing of Original Application nos. 558, 538 and 909 of 2003, and a  

common  order  dated  30.4.2004  was  passed  while  disposing  of  Original  

Application nos. 462 and 639 of 2003.  Another order dated 24.6.2004 was  

passed,  while  disposing  of  Original  Application  no.  1025  of  2003.   And  

likewise, an order dated 2.8.2004 was passed, while disposing of Original  

Application no. 1150 of 2003.  And finally, an order dated 14.10.2004 was  

passed while disposing of Original Application no. 71 of 2004.  It would be  

relevant to mention, that the solitary contention raised at the hands of the  

erstwhile  members  of  the  ministerial  cadre  (who  had  not  opted  for  the  

appointment/absorption into the cadre of Data Entry Operators) was, that the  

process of  bifurcation of  cadres followed by the re-amalgamation thereof,  

had adversely affected their seniority.  Accordingly, the erstwhile members of  

the ministerial cadre, claimed restoration of the position of their seniority as it  

originally existed, with reference to such other members of the ministerial  

cadre who had opted for absorption into cadre of Data Entry Operators, and  

who had thereafter, as a matter of re-amalgamation (under the provisions of

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the  TA  Rules,  2003  and  the  STA  Rules,  2003)  been  appointed  as  Tax  

Assistants and Senior Tax Assistants respectively.  The instant claim raised  

by the erstwhile members of the ministerial cadre, came to be accepted by  

the  Administrative  Tribunal  vide  orders  dated  30.12.2003,  30.4.2004,  

26.4.2004, 2.8.2004 and 14.10.2004, on the basis of the law laid down by  

this Court in Om Prakash Sharma v. Union of India, 1985 (Supp.) SCC 218.

15. The orders passed by the Administrative Tribunal  referred to in the  

foregoing paragraph were assailed through Writ Petition Nos. 8361, 8388,  

17208,  17257,  21692  to  21694,  29468,  34708,  38622  of  2004  and  Writ  

Petition  Nos.  2723,  3302  and  8606  of  2005.   They  were  also  assailed  

through Writ Petition MP Nos. 9866, 20444, 20497, 26220, 26221, 35789,  

35791, 41879, 46155 of 2004; 12236 and 9286 of 2005; 17258 and 17508 of  

2006; and WPMP No. 864 of 2004.  The instant challenge was raised at the  

hands of the Union of India, as also, the members of the cadre of Data Entry  

Operators, who were merged into the cadre of Tax Assistants and Senior  

Tax Assistants, consequent upon the promulgation of the TA Rules, 2003  

and STA Rules, 2003.  All the above mentioned writ petitions were disposed  

of by the High Court of Judicature at Madras (hereinafter referred to as, the  

High  Court)  by  a  common  judgment  and  order  dated  13.4.2007.   While  

adjudicating upon the aforesaid controversy, the High Court, in paragraph 24  

of the impugned judgment and order dated 13.4.2007, framed the questions  

arising for determination.  Paragraph 24 is being extracted hereunder:-

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“24. The contesting respondents have not challenged the entire rules  relating to the restructure of the cadres and the merger/integration of  ministerial cadre and technical cadre before the Tribunal.  It is only the  rules  relating  to  the  fixation  of  inter  se  placement  of  the  erstwhile  ministerial  cadre staff  and the erstwhile technical  cadre staff  in  the  restructured  cadre  which  are  challenged  before  the  Tribunal.   The  contesting  respondents,  who  are  presently  working  as  Preventive  Officers  on  ad  hoc  basis,  claim  that  for  determining  the  inter  se  placement of the ministerial cadre staff and the technical cadre staff in  the restructured cadre, the date of initial appointment in the services of  the Central  Excise and Customs Departments should be taken into  consideration.  On the other hand, the writ petitioners claim that the  fixation  of  inter  se  seniority  should  be  on  the basis  of  the  date  of  regular  appointment  in  the  respective  grades,  but  subject  to  the  condition that inter-se placement in the respective category, is legal  and reasonable.”

It is, therefore apparent, that the issue agitated before the High Court was  

the same as had been agitated before the Administrative Tribunal.   While  

adjudicating upon the propositions canvassed before it,  the High Court  in  

paragraph 35 of the impugned judgment and order, observed as under:-

“35. We have no quarrel with the proposition of law enunciated by  the Apex Court. But, in the cases on hand, all the parties emerge from  the same cadre of LDC and only by virtue of option, some parties have  opted  to  the  post  of  Data  Entry  Operators  and  by  virtue  of  the  impugned  Rules  they  were  afforded  fortuitous  advantage  that  too  without any stringent conditions like passing the Departmental Tests  like the case of  a LDC who is  required to  pass the same to  seek  promotion to the next category of UDC, while the rest of the LDCs.  who have not opted for the post of Data Entry Operators and were  stick on to the much higher responsible position, were put in a most  disadvantageous position. The inter se seniority has been fixed by the  impugned Rules only based on the pay and giving a go-bye to all the  norms prescribed by the Apex Court. Since the impugned legislation  suffers from the vice of discrimination and unreasonableness, we hold  that the impugned Rules are arbitrary and violative of Articles 14 and  16 of the Constitution, since they give unreasonable advantage and a  steep forward for an otherwise low category persons like Data Entry  Operators  as  against  the  LDCs/UDCs/Tax  Assistants,  who perform  highly responsible and complex duties unlike mere entering a data by  the Data Entry Operators.”

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Thereupon,  the  High  Court  considered  the  controversy  in  the  following  

perspective:-

“38. It was shown, by instances, by the learned senior counsel for  the respondents that while in a short span of time, that too, without  any condition like passing out any Departmental Test, the Data Entry  Operators moved from one Grade to other with higher pay structure,  the LDCs, who have not opted for the post of Data Entry Operator,  have  remained  and  stagnated  as  LDCs.  itself  and  because  of  the  impugned Rules, the position has further worsened, since it blocked  their further promotional avenues, by placing persons like Data Entry  Operators,  who have  already  enjoyed  the  fruits  of  promotion  more  than once, over and above LDCs/UDCs/Tax Assistants in the inter se  seniority list. It is to be mentioned that promotion is an incidence of  service.

xxx xxx xxx xxx

43. A  forcible  argument  was  advanced  on  the  part  of  the  respondents demonstrating how by virtue of the impugned Rules, the  LDCs, who have not opted to be posted as Data Entry Operators were  severely prejudiced and how the restructured cadres have paved way  for the junior DEOs to have a march over the other senior employees  of the erstwhile ministerial cadre and get fortuitous advantage. It has  also been demonstrated by materials  how the impugned Rules are  working  hard  against  the  senior  eligible  candidates  without  any  promotional avenue, since being blocked by the far junior Data Entry  Operators.  Though,  as  held  by  the  Apex  Court,  seniority  is  not  a  fundamental right, the State should have created promotional avenues  for  the  respondents  having  regard  to  its  constitutional  obligations  adumbrated in Articles 14 and 16 of the Constitution of India.

44. Therefore,  the  official  respondents  would  not  be  justified  in  blocking the promotional  avenues of  the respondents/UDCs or  Tax  Assistants,  as  the  case  may  be,  without  framing  proper  rules  and  framing faulty and arbitrary Rules like the ones in dispute. Promotion,  as held by the Apex Court is a condition and incidence of service and  as held by the Apex Court in the above Judgement, even there is an  obligation on the part  of  the State under Articles 14 and 16 of  the  Constitution to create promotional avenues for the employees and any  Rule or procedure, which goes against the above dictum, could well  be termed as an arbitrary exercise of power and violative of Articles 14  and 16 of the Constitution.

45. The  impugned  Rules  put  LDCs/UDCs/Special  Pay  UDCs/Tax  Assistants in a most disadvantageous position than their far juniors of

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Data Entry Operators, even though the nature of duties and powers  exercised by them while holding the post of LDCs/UDCs/Special Pay  UDCs/Tax Assistants not only carry a complex nature of duties but  also high responsibilities, which would increase manifold by promotion  from LDC to UDC/Special Pay UDC and from UDC/Special Pay UDC  to Tax Assistant.  Therefore,  we have no hesitation to hold that the  impugned Rules are violative of Articles 14 and 16 of the Constitution  and are liable to be quashed.”

The above consideration reveals, that the co-incidental prejudice suffered by  

the erstwhile members of the ministerial cadre, consequent upon the merger  

of cadres constituted the foundational basis, of the determination.  Their lost  

chances of promotion, and the prejudice suffered by them on the subject of  

seniority, on account of deprivation of the chances of promotion, remained  

uppermost in the mind of the High Court, while recording its final conclusion  

in paragraph 46 as under:-

“46. We have given our anxious consideration to all the aspects of  the  case  put  forth  by  both  sides  and  found  that  the  Tribunal  has  analyzed the case in a proper perspective and having regard to the  guidelines  issued  by  the  Apex  Court  regarding  fixation  of  inter  se  seniority in such cases and has arrived at an unerring conclusion to  hold that the seniority principle stipulated in the impugned notifications  is unfair  to the ministerial  cadre of the Department and considering  any other date than the date of initial  appointment  is discriminatory  and arbitrary.  We are  unable  to  find  any  illegality  or  irregularity  or  perversity  in  approach in  the well  considered  and merited  decision  arrived  at  by  the  Tribunal.  Therefore,  we  see  no  merit  in  the  contentions  raised  by  the  petitioners/Data  Entry  Operators  and  the  same deserve to be rejected.”

16. The challenge to the impugned orders passed by the Administrative  

Tribunal,  and affirmed by the High Court,  will  need an evaluation  at  our  

hands, in the background of the consideration applied in the adjudication of  

the controversy.  We shall, at the first instance, venture to determine whether  

the  propositions  applied  for  the  determination  of  the  controversy  by  the

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Administrative Tribunal and by the High Court, were in consonance with the  

law declared by this Court.

17. It would be relevant to mention, that the disputed issue of seniority,  

came to be determined in the impugned orders, by placing reliance on Om  

Prakash Sharma’s case (supra).  To understand the controversy settled by  

this  Court  in  the  aforementioned  judgment,  it  is  essential  to  extract  the  

conclusions  drawn  therein.   The  same  are  accordingly  being  extracted  

hereunder:-

“2. Department styled as workshop mentioned at Serial No. 2 above was  merged  with  the  department  office  of  the  Chief  Electrical  Engineer,  Bombay. This merger continued till July 31, 1979. Effective from August  1, 1979, all the three original departments trifurcated on August 31, 1956  were re-amalgamated in the matter of staff and a common seniority list  was  introduced  in  respect  of  all  the  four  cadres  which  were  prior  to  September  1956  on  a  common  seniority  list.  Pursuant  to  the  amalgamation  common  seniority  list  (Annexure  6)  was  drawn  up.  It  purports to be the combined seniority list of the Railway Administration,  Electrical Department, Central Railway, Jhansi. Validity of the seniority list  is impugned in this appeal. In this seniority list Appellant 1 is at Serial No.  3, Appellant 2 is at Serial No. 4, and Appellant 3 is at Serial No. 10. The  department  has  assigned  seniority  to  Respondents  3-6,  in  the  same  seniority list at Serial Nos. 2, 5, 6 and 9 respectively in the cadre of head  clerks. The appellants contend that when the three departments had a  common seniority list, the appellants were senior to Respondents 3 to 6,  but  after  trifurcation  and  re-amalgamation  Respondents  3  to  6  who  belonged to erstwhile workshop staff  and who were amalgamated with  the staff of the Chief Electrical Engineer, Bombay, obtained accelerated  promotion because of easy availability of vacancies. Consequently, when  re-amalgamation was introduced from August 1, 1979 when Respondents  3 to 6 reverted to the common seniority  list  with appellants and other  similarly  situated  persons,  they  scored  a  march  over  the  appellants  because of a fortuitous event. The contention in terms is that where staff  employed in different units under the administrative control of one higher  officer are borne on a common seniority list, when because of trifurcation  re-amalgamation all are brought back on the common seniority list, their  position ante must be reflected in the seniority list. Original seniority it is  said must prevail otherwise any other view would be denial of equality of

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opportunity in the matter of public employment guaranteed under Article  16 of the Constitution. Accordingly the appellants challenged the seniority  list  in  Writ  Petition  1415  of  1983  in  the  High  Court  of  Judicature  at  Allahabad. A Division Bench of the High Court by a short cryptic order  rejected the writ petition observing that the Court did not find any merit in  the writ petition. Hence this appeal by special leave.

3. The appellants  have an iron-clad  case.  The facts,  not  disputed,  to  summarise briefly are that under the Divisional Electrical Engineer there  were  three  separate  departments  under  his  administrative  control.  Members of the staff of the three departments were borne on a common  seniority list. In other words they were deemed to belong to one office in  the matter of seniority and promotion. This is not only not disputed but the  averment to that effect in para 6 of the petition has been admitted in the  counter-affidavit filed on behalf of the Railway Administration. It is again  admitted  that  the  three  appellants  since  their  entry  into  service  were  senior  to Respondents  3 to 6.  For  the administrative convenience the  Railway Administration trifurcated the cadres. In other words, three units  were separated from each other which resulted in each unit having its  own seniority list and the common seniority list became irrelevant from  the  date  of  the  trifurcation.  The  Unit  No.  2  called  the  workshop  was  amalgamated with the office of  the Chief Electrical Engineer,  Bombay.  That  is  not  controverted.  Respondents  3  to  6  belonged  to  the  administrative staff in the department styled as the workshop. The result  of the trifurcation and amalgamation of the workshop with the Bombay  office was that  the workshop staff  including Respondents  3 to 6 were  taken over on the seniority  list  maintained by the Bombay office.  It  is  admitted that on account of availability of vacancies in the Bombay office  Respondents  3 to 6 got  some accelerated promotions in the cadre of  head clerks. Surprisingly after a span of 23 years, Railway Administration  reconsidered its earlier decision and detached the workshop staff  from  the office of the Chief Electrical Engineer, Bombay and brought it back to  Jhansi and three former departments under Divisional Electrical Engineer  were amalgamated. In other words situation ante as on August 31, 1956  was  restored,  and  members  of  the  staff  were  brought  on  common  seniority  list  cadre-wise.  This  factual  averment  is  unambiguously  admitted.  Consequent  upon  amalgamation  in  1979  a  fresh  common  seniority list was drawn up in which cadre-wise Respondent 3 was shown  senior to Appellants 1 and 2 and Respondents 5, 6 and 9 were shown  senior  to  Appellant  3.  Obviously  when  the  amalgamation  took  place,  Respondents 3 to 6 could not score a march over erstwhile seniors on  any valid principle of seniority. This would unquestionably be denial  of  equality under Article 16 of the Constitution.  It may be that they might  have  enjoyed  some  accelerated  promotion  when  workshop  staff  was  amalgamated with the Bombay office.  But when they were repatriated  and re-amalgamated with original  two offices and brought back on the

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common  seniority  list,  they  must  find  their  original  place  qua  the  appellants. This is not a case where appellants were passed over at the  time of selection or denied promotion on the ground of unsuitability. In  such  a  situation  status  quo  ante  has  to  be  restored.  Obviously  Respondents 3 to 6 will be below the appellants and any other view to the  contrary would be violative  of Article 16 as it would constitute denial of  equality in the matter of promotion. Therefore, the seniority list drawn up  on a principle contrary to what is discussed herein would be bad in law  and deserves to be quashed.”

A perusal of the above judgment reveals, that there were three independent  

divisions,  under  a  singular  control,  namely, (1)  Divisional  Electrical  

Engineers,  Jhansi,  (2)  Office  of  the  Assistant  Electrical  Engineers  

(Workshop),  Jhansi,  and  (3)  Office  of  the  Assistant  Electrical  Engineer,  

Jabalpur.  These three divisions had separate offices.  The clerical staff of  

the said departments, namely, clerks, senior clerks, head clerks and chief  

clerks, were borne on a common seniority list till 31.8.1956.  From 1.9.1956  

onwards,  these  three  divisions/departments,  earlier  under  the  singular  

control  of  the Divisional  Electrical  Engineer,  Jhansi, were separated from  

each  other  (consequent  upon  the  introduction  of  divisionalization,  in  the  

railways).   These  three  divisions,  therefore,  became  three  independent  

departments.  The clerical staff of the three separated departments, came to  

be placed in independent seniority lists.  The aforesaid process came to be  

reversed, and the earlier trifurcation, was undone by re-amalgamation, which  

resulted in the restoration of status quo ante, as it prevailed up to 31.8.1956.  

In the background of the foundational facts narrated hereinabove, this Court  

concluded that  the process of  trifurcation,  followed by the process  of  re-

amalgamation, restoring the status quo ante, could not result in some of the

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members of the erstwhile common cadre in scoring a march with reference  

to  seniority,  over  others  who were earlier  senior  to  them.   We shall  first  

endeavour to determine whether the legal position declared by this Court in  

Om Prakash Sharma’s case (supra) could have been applied to the present  

controversy.

18. The factual  position in Om Prakash Sharma’s case (supra) reveals,  

that the employees whose inter-se seniority dispute arose for consideration,  

were  holding  the  position  of  clerks,  senior  clerks,  head  clerks  and  chief  

clerks  in  three  divisions  under  the  control  of  the  Divisional  Electrical  

Engineer,  Jhansi.   The  said  three  divisions  were  made  independent  

departments, and the employees working in each of the departments whilst  

continuing as clerks, senior clerks, head clerks and chief clerks, were placed  

in different seniority lists.  All the above posts in the three departments were  

re-amalgamated.  Consequent upon re-amalgamation, a common seniority  

list came to be framed for clerks, senior clerks, head clerks and chief clerks.  

It is in the above circumstances, that this Court concluded, that the process  

of  trifurcation,  and subsequent  re-amalgamation,  would result  in denial  of  

equality,  if  persons  who  were  junior  prior  to  31.8.1956,  were  assigned  

positions of seniority above to those who were senior to them prior to the  

trifurcation.   And  that,  such  an  action  would  result  in  denial  of  equality,  

provided for under Article 16 of the Constitution of India.  It was, therefore  

concluded,  that  consequent  upon  the  re-amalgamation,  resulting  in  the  

employees being brought back in the common seniority list, they must be

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arrayed in the seniority list,  in the same manner as they were positioned  

prior to the trifurcation.

19. Insofar as the present controversy is concerned, it  is apparent from  

the factual narration recorded hereinabove, that the ministerial  cadre as it  

originally  existed,  comprised  of  posts  of  Deputy  Office  Superintendent  

(Levels 1 and 2), Upper Division Clerk, Lower Division Clerk, Stenographer  

(Senior  Grade  and  Ordinary  Grade),  Draftsman  etc.   Consequent  upon  

promulgation of the Electronic Data Processing Posts (Group ‘C’ Technical  

Posts) Recruitment Rules, 1992, a separate cadre of Data Entry Operators  

came to be created.  Appointment thereto, at the time of initial constitution of  

the cadre of Data Entry Operators, was made out of the original ministerial  

cadre.  The posts under the 1992 Rules, had a different nomenclature, vis-à-

vis the posts in the ministerial cadre.  Their duties and responsibilities were  

separate  and  distinct,  from  that  of  the  ministerial  cadre.   So  were  their  

avenues of promotion.  The lowest post in the cadre of Data Entry Operators  

was designated as Data Entry Operator Grade ‘A’.  Onward promotion was  

to the post of Data Entry Operator Grade ‘B’, and thereafter, to Data Entry  

Operator Grade ‘C’, and finally, to Data Entry Operator Grade ‘D’.  In the  

above view of the matter, it is not possible for us to accept, that the creation  

of the cadre of Data Entry Operators, can be described as a mere bifurcation  

of the original cadre.  A bifurcation simpliciter would envisage a division of  

the  same  posts,  as  they  originally  existed,  in  two  separate  units.   The  

controversy  adjudicated  upon  in  Om  Prakash  Sharma’s  case  (supra)  is

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illustrative of a simpliciter bifurcation (actually trifurcation), where the cadre  

posts remained the same, but there was a vertical division, whereby the said  

posts  were  re-constituted  as  two  (actually  three)  separate  cadres.  

Thereafter,  the cadres were re-amalgamated,  so as to restore the earlier  

position.  In the present controversy, it is not possible to conclude, that the  

original position was ever restored.  Consequent upon the promulgation of  

the TA Rules, 2003 and the STA Rules, 2003, the amalgamation resulted in  

appointments to the cadres of  Tax Assistants and Senior Tax Assistants.  

Neither  of  the  parties  concerned,  held  either  of  these  posts  prior  to  the  

promulgation of  the abovementioned rules.   It  is, therefore,  that  we must  

conclude, that the judgment rendered in Om Prakash Sharma’s case (supra)  

was incorrectly applied, while adjudicating upon the present controversy.

20. It is also not possible for us to accept, that the promulgation of the TA  

Rules, 2003 and the STA Rules, 2003 can be termed as a process of re-

amalgamation of the erstwhile cadre.  Consequent upon the promulgation of  

the above rules, posts from the ministerial cadre (regulated by the Central  

Excise and Land Customs Department Group ‘C’ Posts Recruitment Rules,  

1979), and the posts under the cadre of Data Entry Operators (regulated by  

the  Electronic  Data  Processing  Posts  (Group  ‘C’  Technical  Posts)  

Recruitment Rules, 1992), came to be merged into independent cadres of  

Tax Assistants and Senior Tax Assistants.  What was contemplated under  

the TA rules, 2003 and the STA Rules, 2003, was an amalgamation of posts  

from two separate cadres.  This certainly did not result in restoration of the

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status quo ante, as it existed prior to the promulgation of the 1992 Rules.  

The position here is of amalgamation, and not re-amalgamation as is in Om  

Prakash  Sharma’s  case  (supra).   Members  of  the  two  separate  cadres,  

which were sought to be amalgamated, were required at the time of initial  

constitution  of  the  cadres,  to  qualify  the  departmental  examination,  and  

alternatively  the  departmental  computer  proficiency  examination,  under  

Rules 4(2) and 4(3) of the TA Rules, 2003 and under Rule 5(v) of the STA  

Rules,  2003.   The  above  departmental  examinations  would  render  them  

suitable to discharge the duties of the posts of Tax Assistants and Senior  

Tax  Assistants  respectively.   It  is  therefore  apparent,  that  on  the  

amalgamation  of  the  pre-existing  cadres,  they  would  be  required  to  

discharge additional duties of a different nature, for which their proficiency  

was being ensured through the prescribed departmental examinations.  It is,  

therefore, not possible for us to conclude, that the TA Rules, 2003 and the  

STA Rules, 2003 had the effect of re-amalgamation of the ministerial cadre  

and the cadre of Data Entry Operators, so as to restore the position which  

existed, before the creation of the cadre of Date Entry Operators.

21. At the cost of repetition we wish to reiterate, that the factual scenario  

which emerges for determination in the present controversy, is not akin to  

that  which had arisen for  consideration  before this  Court  in  Om Prakash  

Sharma’s case (supra).  Therein, the original cadre which comprised of the  

posts of clerks, senior clerks, head clerks and chief clerk, was trifurcated and  

then re-amalgamated.  The re-amalgamated cadre also comprised of posts

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of clerks, senior clerks, head clerks and chief clerks.  The conclusions drawn  

in  the  above  judgment,  therefore,  cannot  be  applicable  to  the  facts  and  

circumstances of the present case.  We are satisfied in concluding, that the  

Courts  below clearly  erred  in  disposing  of/determining  the  controversy  in  

hand by applying the law declared by this Court in Om Prakash Sharma’s  

case (supra).

22. We  shall  now  venture  to  deal  with  another  aspect  of  the  matter,  

emerging  out  of  the  impugned  order  passed  by  the  High  Court.   The  

conclusions drawn by the High Court, as have been recorded in paragraph  

46 of the impugned judgment and order dated 13.4.2007, emerged out of a  

consideration which was noticed in paragraphs 38 to 45.  Paragraphs 38 and  

43 to 46 of the impugned judgment and order, have already been extracted  

hereinabove.  A perusal of the above consideration reveals, that the High  

Court was swayed by the co-incidental prejudice suffered by the erstwhile  

members  of  the ministerial  cadre,  resulting  in  lost  chances of  promotion.  

The  aforesaid  consideration  could  have  been  justified  only  if  chances  of  

promotion are treated as conditions of service.  Insofar as the instant aspect  

of the matter is concerned, this Court has repeatedly examined the issue  

whether  chances  of  promotion  constitute  conditions  of  service.   In  this  

behalf, reference may be made to a few judgments rendered by this Court:

(i) First of all, we may advert to the decision rendered by this Court  

in State of Maharashtra & Anr. v. Chandrakant Anant Kulkarni & Ors.,

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(1981) 4 SCC 130, wherein a three Judge Bench of this Court held as  

under:-

“16. Mere chances of  promotion are not conditions of service  and  the  fact  that  there  was  reduction  in  the  chances  of  promotion did not tantamount to a change in the conditions of  service.  A  right  to  be  considered  for  promotion  is  a  term of  service,  but  mere  chances  of  promotion  are  not.  Under  the  Departmental Examination Rules for STOs, 1954, framed by the  former State Government of Madhya Pradesh, as amended on  January  20,  1960,  mere  passing  of  the  departmental  examination  conferred  no  right  on  the  STIs  of  Bombay,  to  promotion.  By  passing  the  examination,  they  merely  became  eligible for promotion. They had to be brought on to a select list  not merely on the length of service, but on the basis of merit- cum-seniority  principle.  It  was,  therefore,  nothing  but  a  mere  chance of promotion. In consequence of the impugned orders of  reversion, all that happened is that some of the STIs, who had  wrongly been promoted as STOs Grade III had to be reverted  and  thereby  lost  a  few places.  In  contrast,  the  conditions  of  service  of  ASTOs  from Madhya  Pradesh  and  Hyderabad,  at  least so far as one stage of promotion above the one held by  them before the reorganisation of States, could not be altered  without the previous sanction of the Central Government as laid  down in the Proviso to sub-section (7) of Section 115 of the Act.”

(ii) Reference may also be made to the decision of this Court  in  

Palaru Ramkrishnaiah & Ors. v. Union of India & Anr., (1989) 2 SCC  

541, wherein a three Judge Bench of this Court held as under:-

“12. In the case of  Ramchandra Shankar Deodhar, (1974) 1  SCC 317, the petitioners  and other  allocated Tahsildars  from  ex-Hyderabad  State  had  under  the  notification  of  the  Raj  Pramukh dated  September  15,  1955 all  the vacancies  in the  posts of Deputy Collector in the ex-Hyderabad State available to  them for promotion but under subsequent rules of July 30, 1959,  50  per  cent  of  the  vacancies  were  to  be  filled  by  direct  recruitment and only the remaining 50 per cent were available  for promotion and that too on divisional basis. The effect of this  change obviously was that now only 50 per cent vacancies in  the post of Deputy Collector being available in place of all the  vacancies it was to take almost double the time for many other  allocated Tahsildars to get promoted as Deputy Collectors.  In

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other words it resulted in delayed chance of promotion. It was,  inter  alia,  urged on behalf  of  the petitioners that  the situation  brought about by the rules of July 30, 1959 constituted variation  to their prejudice in the conditions of service applicable to them  immediately prior to the reorganisation of the State and the rules  were consequently invalid. While repelling this submission the  Constitution Bench held: (SCC p. 329, para 15)

“All that happened as a result of making promotions to the  posts of Deputy Collectors divisionwise and limiting such  promotions  to  50  per  cent  of  the  total  number  of  vacancies in the posts of Deputy Collector was to reduce  the chances of promotion available to the petitioners. It is  now well settled by the decision of this Court in  State of  Mysore v.  G. B. Purohit,  1967 SLR 753, that  though a  right  to  be  considered  for  promotion  is  a  condition  of  service, mere chances of promotion are not. A rule which  merely affect chances of promotion cannot be regarded  as varying a condition of service. In Purohit case (supra),  the  districtwise  seniority  of  sanitary  inspectors  was  changed to  Statewise  seniority,  and as a  result  of  this  change  the  respondents  went  down  in  seniority  and  became  very  junior.  This,  it  was  urged,  affected  their  chances  of  promotion  which  were  protected  under  the  proviso to Section 115,  sub-section (7).  This  contention  was  negatived  and  Wanchoo,  J.,  (as  he  then  was),  speaking on behalf of this Court observed: ‘It is said on  behalf  of  the  respondents  that  as  their  chances  of  promotion have been affected their conditions of service  have  been  changed  to  their  disadvantage.  We see  no  force in this argument because chances of promotion are  not conditions of service.’ It is, therefore, clear that neither  the  Rules  of  30-7-1959,  nor  the  procedure  for  making  promotions to the posts of Deputy Collector divisionwise  varies the conditions of service of the petitioners to their  disadvantage.”

xxx xxx xxx

15. It  cannot  be  disputed  that  the  Director  General  of  Ordnance  Factories  who  had  issued  the  Circular  dated  November  6,  1962  had  the  power  to  issue  the  subsequent  Circular  dated  January  20,  1966  also.  In  view  of  the  legal  position pointed out above the aforesaid circular could not be  treated to be one affecting adversely any condition of service of  the  Supervisors  ‘A’.  Its  only  effect  was  that  the  chance  of

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promotion  which  had  been  accelerated  by  the  Circular  November  6,  1962  was  deferred  and  made  dependent  on  selection according to the Rules. Apparently, after the coming  into  force  of  the  order  dated  December  28,  1965  and  the  Circular dated January 20, 1966 promotions could not be made  just on completion of two years’ satisfactory service under the  earlier Circular dated November 6, 1962 the same having been  superseded by the later circular. It is further obvious that in this  view  of  the  matter  Supervisors  ‘A’  who  had  been  promoted  before the coming into force of the order dated December 28,  1965 and the Circular dated January 20, 1966 stood in a class  separate  from  those  whose  promotions  were  to  be  made  thereafter.  The  fact  that  some  Supervisors  ‘A’  had  been  promoted  before  the  coming  into  force  of  the  order  dated  December 28, 1965 and the Circular dated January 20, 1966  could not, therefore, constitute the basis for an argument that  those Supervisors ‘A’ whose cases came up for consideration  for promotion thereafter and who were promoted in due course  in accordance with the rules were discriminated against. They  apparently did not fall in the same category.”

(iii) This Court had also declared the position of law, on the above  

aspect of the matter, in Syed Khalid Rizvi & Ors. v. Union of India &  

Ors.,  1993  Supp.  (3)  SCC  575,  wherein  a  three  Judge  Bench  

observed as under:-

“30. The next question is whether the seniority is a condition of  service or  a part  of  rules  of  recruitment? In  State of  M.P. v.  Shardul Singh, (1970) 1 SCC 108, this Court held that the term  conditions of service means all those conditions which regulate  the  holding  of  a  post  by  a  person  right  from the  time of  his  appointment (emphasis  supplied)  to  his  retirement  and  even  beyond,  in matters  like pensions etc.  In  I.N. Subba Reddy v.  Andhra  University,  (1977)  1  SCC  554,  the  same  view  was  reiterated. In Mohd. Shujat Ali v.  Union of India, (1975) 3 SCC  76, a Constitution Bench held that the rule which confers a right  to actual promotion or a right to be considered for promotion is a  rule prescribing a condition of the service. In  Mohd. Bhakar v.  Krishna Reddy, 1970 SLR 768, another Constitution Bench held  that any rule which affects the promotion of a person relates to  his condition of service. In State of Mysore v. G.B. Purohit, 1967  SLR  753,  this  Court  held  that  a  rule  which  merely  affects  chances of promotion cannot be regarded as varying a condition

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of service. Chances of promotion are not conditions of service.  The same view was reiterated  in  another  Constitution  Bench  judgment  in  Ramchandra  Shankar  Deodhar v.  State  of  Maharashtra, (1974) 1 SCC 317. No doubt conditions of service  may be classified as salary, confirmation, promotion, seniority,  tenure or termination of service etc. as held in State of Punjab v.  Kailash Nath, (1989) 1 SCC 321, by a Bench of two Judges but  the context in which the law therein was laid must be noted. The  question  therein  was  whether  non-prosecution  for  a  grave  offence after expiry of four years is a condition of service? While  negativing the contention that non-prosecution after expiry of 4  years  is  not  a  condition  of  service,  this  Court  elaborated  the  subject and the above view was taken. The ratio therein does  not  have  any  bearing  on  the  point  in  issue.  Perhaps  the  question  may  bear  relevance,  if  an  employee  was  initially  recruited into the service according to the rules and promotion  was regulated in the same rules to higher echelons of service. In  that arena promotion may be considered to be a condition of  service. In A.K. Bhatnagar v. Union of India, (1991) 1 SCC 544,  this  Court  held  that  seniority  is  an  incidence  of  service  and  where the service rules prescribe the method of its computation  it is squarely governed by such rules. In their absence ordinarily  the length of service is taken into account. In that case the direct  recruits  were  made  senior  to  the  recruits  by  regularisation  although the appellants were appointed earlier in point of time  and  uninterruptedly  remained  in  service  as  temporary  appointees along with the appellants but later on when recruited  by direct recruitment, they were held senior to the promotees.

31. No employee has a right to promotion but he has only the  right to be considered for promotion according to rules. Chances  of promotion are not conditions of service and are defeasible.  Take  an  illustration  that  the  Promotion  Regulations  envisage  maintaining integrity and good record by Dy. S.P. of State Police  Service as eligibility condition for inclusion in the select-list for  recruitment by promotion to Indian Police Service. Inclusion and  approval  of  the  name  in  the  select-list  by  the  UPSC,  after  considering the objections if any by the Central Government is  also a condition precedent. Suppose if ‘B’ is far junior to ‘A’ in  State Services and ‘B’ was found more meritorious and suitable  and was put  in  a select-list  of  1980 and accordingly  ‘B’  was  appointed  to  the  Indian  Police  Service  after  following  the  procedure. ‘A’ was thereby superseded by ‘B’. Two years later  ‘A’  was  found  fit  and  suitable  in  1984  and  was  accordingly  appointed  according  to  rules.  Can  ‘A’  thereafter  say  that  ‘B’  being  far  junior  to  him  in  State  Service,  ‘A’  should  become

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senior  to  ‘B’  in  the  Indian  Police  Service.  The  answer  is  obviously  no  because  ‘B’  had  stolen  a  march  over  ‘A’  and  became  senior  to  ‘A’.  Here  maintaining  integrity  and  good  record  are  conditions  of  recruitment  and  seniority  is  an  incidence  of  service.  Take  another  illustration  that  the  State  Service provides — rule of reservation to the scheduled castes  and scheduled tribes. ‘A’ is a general candidate holding No. 1  rank according to the roster as he was most meritorious in the  State service among general candidates. ‘B’ scheduled castes  candidate holds No. 3 point in the roster and ‘C’, scheduled tribe  holds  No.  5  in  the  roster.  Suppose  Indian  Police  Service  Recruitment  Rules  also  provide  reservation  to  the  Scheduled  Castes  and  Scheduled  Tribes  as  well.  By  operation  of  the  equality of opportunity by Articles 14, 16(1), 16(4) and 335, ‘B’  and  ‘C’  were  recruited  by  promotion  from  State  Services  to  Central Services and were appointed earlier to ‘A’ in 1980. ‘A’  thereafter  in  the  next  year  was  found  suitable  as  a  general  candidate and was appointed to the Indian Police Service. Can  ‘A’ thereafter contend that since ‘B’ and ‘C’ were appointed by  virtue of reservation, though were less meritorious and junior to  him in the State service and gradation list would not become  senior to him in the cadre as IPS officer. Undoubtedly ‘B’ and  ‘C’, by rule of reservation, had stolen a march over ‘A’ from the  State  Service.  By operation of  rule  of  reservation  ‘B’  and ‘C’  became senior and ‘A’ became junior in the Central Services.  Reservation  and  roster  were  conditions  of  recruitment  and  seniority  was  only  an  incidence  of  service.  The  eligibility  for  recruitment to the Indian Police Service, thus, is a condition of  recruitment and not a condition of service. Accordingly we hold  that seniority, though, normally an incidence of service, Seniority  Rules, Recruitment Rules and Promotion Regulations form part  of the conditions of recruitment to the Indian Police Service by  promotion,  which  should  be  strictly  complied  with  before  becoming eligible for  consideration for  promotion and are not  relaxable.”

(iv) More recent in time, is the judgment rendered by another three  

Judge Division Bench in S.S. Bola & Ors.  v. B.D. Sardana & Ors.,  

(1997) 8 SCC 522.  The majority opinion in the above judgment was  

rendered by Justice K. Ramaswamy.  In the process of consideration,  

he observed as under:-

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“145. It is true that the Rules made under the proviso to Article  309 of the Constitution can be issued by amending or altering  the Rules with retrospectivity as consistently held by this Court  in a catena of decisions, viz., B.S. Vadera v. Union of India, AIR  1969 SC 118; Raj Kumar v. Union of India, (1975) 4 SCC 13; K.  Nagaraj v. State of A.P., (1985) 1 SCC 523; T.R. Kapur v. State  of  Haryana,  1986  Supp.  SCC  584, and  a  host  of  other  decisions.  But  the  question  is  whether  the  Rules  can  be  amended taking away the vested right. As regards the right to  seniority, this Court elaborately considered the incidence of the  right to seniority and amendment of the Act in the latest decision  in  Ashok  Kumar  Gupta v.  State  of  U.P.,  (!977)  5  SCC 201,  relieving the need to reiterate all of them once over. Suffice it to  state that it  is settled law that a distinction between right and  interest  has  always  been  maintained.  Seniority  is  a  facet  of  interest.  The  rules  prescribe  the  method  of  selection/recruitment. Seniority is governed by the existing rules  and is  required  to be worked out  accordingly.  No one has a  vested  right  to  promotion  or  seniority  but  an  officer  has  an  interest to seniority acquired by working out the Rules. It would  be  taken  away  only  by  operation  of  valid  law.  Right  to  be  considered for promotion is a rule prescribed by conditions of  service. A rule which affects the promotion of a person relates to  conditions of service. The rule merely affecting the chances of  promotion  cannot  be  regarded  as  varying  the  conditions  of  service. Chances of promotion are not conditions of service. A  rule  which merely  affects  the chances of  promotion does not  amount to change in the conditions of service.”

Consequent  upon  the  above  detailed  consideration,  Justice  K.  

Ramaswamy recorded his conclusion in paragraph 153.  On the issue  

in hand, sub-paragraph AB of paragraph 153 is relevant and is being  

extracted hereunder:-

“AB. A distinction between right to be considered for promotion  and an interest to be considered for promotion has always been  maintained. Seniority is a facet of interest. The rules prescribe  the method of recruitment/selection. Seniority is governed by the  rules  existing  as  on  the  date  of  consideration  for  promotion.  Seniority is required to be worked out according to the existing  rules. No one has a vested right to promotion or seniority. But  an officer has an interest to seniority acquired by working out  the rules. The seniority should be taken away only by operation

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of  valid  law.  Right  to  be  considered  for  promotion  is  a  rule  prescribed  by  conditions  of  service.  A  rule  which  affects  chances  of  promotion  of  a  person  relates  to  conditions  of  service.  The  rule/provision  in  an  Act  merely  affecting  the  chances  of  promotion  would  not be regarded  as  varying  the  conditions  of  service.  The  chances  of  promotion  are  not  conditions of service. A rule which merely affects the chances of  promotion  does  not  amount  to  change  in  the  conditions  of  service.  However,  once a declaration of  law,  on the basis  of  existing  rules,  is  made  by  a  constitutional  court  and  a  mandamus is issued or direction given for its enforcement by  preparing the seniority list,  operation of the declaration of law  and the mandamus and directions issued by the Court  is the  result of the declaration of law but not the operation of the rules  per se.”

Justice  S.  Saghir  Ahmad  concurred  with  the  view  expressed  by  

Justice K. Ramaswamy.  A dissenting view was recorded by Justice  

G.B.  Pattanaik.   On  the  subject  in  hand,  however,  there  was  no  

dissent.  The conclusions recorded by Justice G.B. Pattanaik were to  

the following effect:-

“199. To the said effect the judgment of this Court in the case of  State of Punjab v. Kishan Das, (1971) 1 SCC 319, wherein this  Court observed an order forfeiting the  past service which has  earned a government servant increments in the post or rank he  holds,  howsoever  adverse  it  is  to  him,  affecting  his  seniority  within the rank to which he belongs or  his  future chances of  promotion,  does  not  attract  Article  311(2)  of  the  Constitution  since it is not covered by the expression reduction in rank.

200. Thus  to  have  a  particular  position  in  the  seniority  list  within a cadre can neither be said to be accrued or vested right  of a government servant and losing some places in the seniority  list within the cadre does not amount to reduction in rank even  though the future chances of promotion get delayed thereby. It  was urged by Mr Sachar and Mr Mahabir Singh appearing for  the  direct  recruits  that  the  effect  of  redetermination  of  the  seniority in accordance with the provisions of the Act is not only  that the direct recruits lose a few places of seniority in the rank  of Executive Engineer but their future chances of promotion are  greatly jeopardised and that right having been taken away the

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Act  must  be  held  to  be  invalid.  It  is  difficult  to  accept  this  contention since chances of promotion of a government servant  are  not  a  condition  of  service.  In  the  case  of  State  of  Maharashtra v. Chandrakant Anant Kulkarni, (1981) 4 SCC 130,  this Court held: (SCC p. 141, para 16)

“16.  Mere  chances  of  promotion  are  not  conditions  of  service  and  the  fact  that  there  was  reduction  in  the  chances of promotion did not tantamount to a change in  the  conditions  of  service.  A  right  to  be  considered  for  promotion  is  a  term  of  service,  but  mere  chances  of  promotion are not.”

201. To the said effect a judgment of this Court in the case of  K. Jagadeesan v.  Union of India, (1990) 2 SCC 228,  wherein  this Court held: (SCC pp. 230-31, para 7)

“The only effect is that his chances of promotion or his  right to be considered for promotion to the higher post is  adversely  affected.  This  cannot  be  regarded  as  retrospective effect being given to the amendment of the  rules  carried  out  by  the  impugned  notification  and  the  challenge to the said notification on that ground must fail.”

202. Again in the case of Union of India v. S.L. Dutta, (1991) 1  SCC 505, this Court held: (SCC p. 512, para 17)

“In our opinion, what was affected by the change of policy  were merely  the chances  of  promotion  of  the Air  Vice- Marshals in the Navigation Stream. As far as the posts of  Air  Marshals  open to  the Air  Vice-Marshals  in the said  stream  were  concerned,  their  right  or  eligibility  to  be  considered for promotion still remained and hence, there  was no change in their conditions of service.”

xxx xxx xxx 212. So  far  as  the  rules  dealing  with  Irrigation  Branch  are  concerned,  the  said  rules  namely  the  Punjab  Service  of  Engineers (Irrigation Branch) Class I Service Rules, 1964 have  not been considered earlier by this Court at any point of time.  One Shri  M.L.  Gupta  was appointed  to  the post  of  Assistant  Executive Engineer as a direct recruit on 27-8-1971, pursuant to  the  result  of  a  competitive  examination  held  by  the  Haryana  Public Service Commission in December 1970. The said Shri  Gupta was promoted to the post of Executive Engineer on 17-9- 1976. He made a representation to the State Government to fix  up his seniority in accordance with the service rules but as the

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said  representation  was  not  disposed of  for  more  than three  years he approached the High Court of Punjab and Haryana by  filing CWP No. 4335 of 1984. That petition was disposed of by  the High Court on the undertaking given by the State that the  seniority will be fixed up soon. The said undertaking not having  been complied with, the said Shri Gupta approached the High  Court  in  January  1986  by  filing  a  contempt  petition.  In  September  1986  the  State  Government  fixed  the  inter  se  seniority  of  the  said  Shri  Gupta  and  other  members  of  the  Service and Gupta was shown at Serial No. 72. Two promotees  had  been  shown  at  Serial  Nos.  74  and  75.  Those  two  promotees filed a writ petition challenging the fixation of inter se  seniority  between  the  direct  recruits  and  promotees  and  the  High Court of Punjab and Haryana by its judgment passed in  May 1987 quashed the order dated 29-9-1986 whereunder the  seniority of the direct recruits and promotees has been fixed and  called  upon the State  Government  to  pass  a  speaking  order  assigning position in the gradation list. The State Government  issued a fresh notification on 24-7-1987 giving detailed reasons  reaffirming the earlier seniority which had been notified on 29-9- 1986. Prior to the aforesaid notification of the State Government  Shri Gupta had filed a writ petition in the Punjab and Haryana  High Court  which had been registered  as CWP No.  6012 of  1986 claiming his seniority at No. 22 instead of 72 which had  been given to him under the notification dated 29-9-1986. The  promotees also filed a writ petition challenging the government  order dated 24-7-1987 which was registered as CWP No. 5780  of 1987. Both the writ petitions, one filed by the direct recruit,  Shri Gupta, (CWP No. 6012 of 1986) and the other filed by the  promotees (CWP No. 5780 of 1987) were disposed of by the  learned Single Judge by judgments dated 24-1-1992 and 4-3- 1992,  respectively,  whereunder  the  learned  Single  Judge  accepted  the  stand  of  the  promotees  and  Shri  Gupta  was  placed below one Shri O.P. Gagneja. The said Shri Gupta filed  two appeals to the Division Bench against the judgment of the  learned Single Judge, which was registered as Letters Patent  Appeals Nos. 367 and 411 of 1992. The aforesaid letters patent  appeals  were  allowed  by  judgment  dated  27-8-1992.  This  judgment of the Division Bench of the Punjab and Haryana High  Court was challenged by the State of Haryana in the Supreme  Court which has been registered as CAs Nos. 1448-49 of 1993.  This  Court  granted  leave  and  stayed  the  operation  of  the  judgment in the matter of fixation of seniority.  The promotees  also challenged the said judgment of the Division Bench in this  Court  which has  been  registered  as CAs Nos.  1452-1453 of  1993. During the pendency of these appeals in this Court,  an

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Ordinance was promulgated on 13-5-1985 as Ordinance No. 6  of 1995 and the said Ordinance was replaced by the impugned  Act 20 of 1995 by the Haryana Legislature. The validity of the  Act was challenged by the said Shri Gupta and pursuant to the  order of this Court the said writ petition having been transferred  to this Court has been registered as TC No. 40 of 1996. So far  as  the  validity  of  the  Act  is  concerned,  the  question  of  any  usurpation of judicial power by the legislature does not arise in  relation to the Irrigation Branch inasmuch as the Recruitment  Rules of 1964 framed by the Governor of Punjab in exercise of  power under proviso to Article 309 of the Constitution which has  been adapted by the State of  Haryana on and from the date  Haryana was made a separate State had not been considered  by this Court nor has any direction been issued by this Court.  The legislative competence of the State Legislature to enact the  Act had also not been assailed and in our view rightly since the  State Legislature has the powers under Entry 41 of List II of the  Seventh  Schedule  to  frame  law  governing  the  conditions  of  service of the employees of the State Government. That apart  Article 309 itself stipulates that the appropriate legislature may  regulate  the recruitment  and conditions of  service of  persons  appointed to public services and posts in connection with the  affairs of the Union or of any State subject to the provisions of  the Constitution.  Proviso to Article  309 confers  power  on the  President in connection with the affairs of the Union and on the  Governor  in  connection  with  the affairs  of  the State  to  make  rules  regulating  the recruitment  and the conditions  of  service  until provision in that behalf is made by or under an Act of the  appropriate legislature under Article 309 main part. In this view  of the matter, the legislative competence of the State Legislature  to enact the legislation in question is beyond doubt.  The only  question which, therefore, arises for consideration and which is  contended in  assailing the validity of the Act is that under the  Act  the  direct  recruits  would  lose  several  positions  in  the  gradation list and thereby their accrued and vested rights would  get  jeopardised  and  their  future  chances  of  promotion  also  would be seriously hampered and such violation tantamounts to  violation  of  rights  under  Part  III  of  the  Constitution.  For  the  reasons  already  given  while  dealing  with  the  aforesaid  contention in connection with the Public Health Branch and the  Buildings  and  Roads  Branch  the  contention  raised  in  the  transfer case cannot be sustained and, therefore,  the transfer  case would stand dismissed. The Act in question dealing with  the  service  conditions  of  the  engineers  belonging  to  the  Irrigation Branch must be held to be a valid piece of legislation  passed  by  the  competent  legislature  and  by  giving  it

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retrospective effect no constitutional provision has been violated  nor  has  any  right  of  the  employee  under  Part  III  of  the  Constitution been infringed requiring interference by this Court.”

(v) Finally, reference may be made to a decision rendered by this  

Court in Union of India & Ors. v. Colonel G.S. Grewal, (2014) 7 SCC  

303, wherein this Court observed as under:-

“28. As pointed out above, the Tribunal has partly allowed the  OA of the respondent primarily on the ground that the decision  contained in the Government  Order dated 23-4-2010 amends  the  promotion  policy  retrospectively  thereby  taking  away  the  rights already accrued to the respondent in terms of the earlier  policy. It is also mentioned that the revised policy fundamentally  changes the applicant’s prospects of promotion. What is ignored  is that the promotions already granted to the respondent have  not been taken away. Insofar as future chances of promotions  are concerned, no vested right accrues as chance of promotion  is not a condition of service. Therefore, in the first instance, the  Tribunal will have to spell out as to what was the vested right  which had already accrued to the respondent and that is taken  away by the Policy decision dated 23-4-2010. In this process,  other thing which becomes relevant is to consider that once the  respondent  is  permanently  seconded  in  DGQA  and  he  is  allowed to remain there, can there be a change in his service  conditions vis-à-vis others who are his counterparts in DGQA,  but  whose permanent  secondment  is  not  in  cloud? To put  it  otherwise, the sole reason for issuing Government Policy dated  23-4-2010 was to take care of those cases where permanent  secondment to DGQA was wrongly given. As per the appellants,  since the respondent had suffered final supersession, he was  not  entitled  to  be  seconded  permanently  to  DGQA.  This  is  disputed by the respondent. That aspect will have to be decided  first. That apart, even if it be so, as contended by the appellants,  the  appellants  have  not  recalled  the  permanent  secondment  order.  They  have  allowed  the  respondent  to  stay  in  DGQA  maintaining his promotion as Colonel as well, which was given  pursuant  to  this  secondment.  The  question,  in  such  circumstances, that would arise is whether the respondent can  be treated differently even if he is allowed to remain in DGQA  viz. whether not allowing him to take further promotions, which  benefit is still available to others whose permanent secondment  is not in dispute, would amount to discrimination or arbitrariness  thereby offending Articles 14 and 16 of the Constitution of India.

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In our opinion, these, and other related issues, will have to be  argued and thrashed out for coming to a proper conclusion.”

23. It is apparent from a collective perusal of the conclusions recorded in  

the  judgments  extracted  in  the  foregoing  paragraph,  that  chances  of  

promotion do not constitute a condition of service.  In that view of the matter,  

it  is inevitable to hold,  that the High Court erred in recording its eventual  

determination on the basis of the fact that the promulgation of the TA Rules,  

2003 and the STA Rules, 2003 was discriminatory and arbitrary with regard  

to the fixation of the inter se seniority, since the same seriously prejudiced  

the chances of promotion of the erstwhile members of the ministerial cadre,  

namely, those members of the original ministerial cadre, who had not opted  

for  appointment/absorption  into  the  cadre  of  Data  Entry  Operators,  with  

reference  to  and  in  comparison  with,  those  members  of  the  original  

ministerial cadre who had opted for appointment/absorption into the cadre of  

Data Entry Operators.

24. As a proposition of law it is imperative for us to record, that chances of  

promotion  do  not  constitute  conditions  of  service,  and  as  such,  mere  

alteration  of  chances  of  promotion,  would  not  per  se  call  for  judicial  

interference.   The above general  proposition  would  not  be  applicable,  in  

case the chances  of  promotion  are altered  arbitrarily,  or  on the basis  of  

considerations which are shown to be perverse or mala fide.

25. In  the  background  of  the  factual  and  legal  position  debated  and  

concluded hereinabove, only one submission survives for our consideration,

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namely, whether the inter se seniority determined at the initial constitution of  

the cadres of Tax Assistants and Senior Tax Assistants under Rule 4 of the  

TA  Rules,  2003  and  Rule  5  of  the  STA  Rules,  2003,  respectively,  is  

acceptable in law.  It is not the case of the appellants, that any perversity or  

malafides are involved in the above determination, it is however the pointed  

submission of the appellants, that the same is arbitrary and discriminatory.  

And  therefore,  violative  of  the  provisions  of  Articles  14  and  16  of  the  

Constitution of India.  In this behalf, the submission advanced on their behalf  

was two-fold.  Firstly, that dissimilar posts had been equated.  And secondly,  

that the equation of posts determined merely on the pay-scales attached to  

them, would not be acceptable in law.

26. Insofar  as the former of the said two contentions is concerned,  the  

submission was again two-fold.  Firstly, reliance had been placed on Rule 4  

of the TA Rules, 2003.  Under Rule 4(1) thereof, Upper Division Clerks and  

Data Entry Operators Grade ‘A’ had been equated with one another, and  

members belonging to the aforesaid two cadres had been given the highest  

position in the seniority list (at the stage of the initial constitution).  The inter  

se seniority amongst the Upper Division Clerks and Data Entry Operators, is  

mandated to be determined, for purposes of further promotion, with effect  

from the date on which the concerned incumbent was appointed on regular  

basis as such.  The submission advanced by the learned counsel was, that  

sub-rule (2) of Rule 4 of the TA Rules, 2003, required a Data Entry Operator  

Grade ‘A’,  who had come to be appointed as Tax Assistant,  at the initial

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constitution under the TA Rules, 2003, to pass a departmental examination  

within two years of such appointment, failing which such Data Entry Operator  

Grade ‘A’, would not be entitled to any further increment.  Accordingly, the  

submission  advanced  at  the  hands  of  learned  counsel  was,  that  the  

aforesaid mandate clearly demonstrated, that a Data Entry Operator Grade  

‘A’, had per se been found to be deficit, for discharging duties against the  

post of Tax Assistant.  The aforesaid deficiency was sought to be satisfied  

and  fulfilled,  according  to  learned  counsel,  by  requiring  the  Data  Entry  

Operator Grade ‘A’, to qualify a departmental examination, within a period of  

two  years.   That  being  the  acknowledged  position  emerging  from  the  

statutory rules,  the contention advanced was, that the post of Data Entry  

Operator  Grade ‘A’,  could not have been treated as equal  to the post of  

Upper Division Clerk, and as such, the determination of inter se seniority for  

onward promotion regulated by Rule 4(1) of the TA Rules, 2003, must be  

deemed to be both arbitrary and discriminatory,  and as such, violative of  

Articles 14 and 16 of the Constitution of India.

27. In  order  to  counter  the  submission  advanced  at  the  hands  of  the  

learned counsel, as has been narrated in the foregoing paragraph, it was the  

contention  of  learned  counsel  representing  the  erstwhile  Data  Entry  

Operators Grade ‘A’, who came to be appointed as Tax Assistants, at the  

initial constitution of the aforesaid cadre, under the mandate of Rule 4 of the  

TA Rules, 2003, that the erstwhile members of the ministerial cadre, on the  

above analogy, must also be likewise considered to be deficit in effectively

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discharging the duties assigned to the post of Tax Assistant, inasmuch as,  

sub-rule  (3)  of  Rule  4  of  the  TA Rules,  2003  likewise  mandates,  that  a  

member of the ministerial cadre holding the post of Lower Division Clerk on  

regular basis, and falling within the seniority list determined by the appointing  

authority,  would  have  to  pass  the  departmental  computer  proficiency  

examination.  It was further submitted, that only from the date of passing the  

above examination, the person concerned would be deemed to have been  

promoted  as  Tax  Assistant.   It  was  the  pointed  contention  of  learned  

counsel, that whilst the deficiency in Data Entry Operators Grade ‘A’, was  

with reference to lack of knowledge of relevant procedures, the deficiency in  

members  of  the  ministerial  cadre  was  on  account  of  lack  of  knowledge  

relating to computer applications.

28. Learned senior counsel representing the Union of India painstakingly  

pointed out, that the ministerial cadre as it was originally constituted, handled  

all procedures manually.  Consequent upon a policy decision having been  

taken,  it  was decided to computerize the functioning of  the Customs and  

Central  Excise  Department.   This  resulted  in  the  promulgation  of  the  

Electronic Data Processing Posts (Group ‘C’ Technical Posts) Recruitment  

Rules,  1992.   The  creation  of  the  cadre  of  Data  Entry  Operators  was  

considered to be imperative,  to give effect  to the aforesaid administrative  

determination, to computerize the functioning of the Customs and Central  

Excise Department.  According to the learned senior counsel, on completion  

of the process of computerization it was felt, that for an effective functioning

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of the Customs and Central Excise Department, the existing persons who  

were  proficient  in  matters  of  relevant  procedures,  needed  working  

experience with reference to computer applications.  Likewise, Data Entry  

Operators,  it  was  felt,  needed  proficiency  with  reference  to  relevant  

procedures.   Therefore,  it  was  pointed  out,  that  neither  the  erstwhile  

members of  the ministerial  cadre,  nor  the members of  the cadre of  Data  

Entry Operators, were fully qualified to handle the duties and responsibilities  

in the Customs and Central  Excise Department,  after  its computerization.  

Therefore,  while  merger  of  above  two  cadres  was  given  effect  to,  the  

deficiencies in the two cadres were sought to be removed by requiring them  

to qualify the prescribed departmental examination.

29. A similar contention was advanced by learned counsel representing  

the private respondents, on the basis of Rule 5 of the STA Rules, 2003.  We  

have already analysed hereinabove the effect of merger contemplated under  

Rule  5  of  the  STA Rules,  2003.   Despite  our  analysis  of  the  aforesaid  

provision, to which learned counsel for the rival parties have expressed their  

approval,  the contention advanced by the learned counsel  was based on  

clause (v) of Rule 5 of the STA Rules, 2003.  Yet again, the contention was,  

that Data Entry Operators Grade ‘C’ could not be equated with Assistants,  

and likewise Data Entry Operators Grade ‘B’ could not be equated with Tax  

Assistants.    The pointed  submission in this  behalf  was,  that  Data Entry  

Operators were required by the mandate of clause (v) of Rule 5 of the STA  

Rules, 2003, to qualify a departmental examination for achieving proficiency

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in the relevant procedures, within two years, failing which they would not be  

eligible for any further increment.  The instant submission is akin to the one  

advanced at the hands of learned counsel on the basis of sub-rules (3) and  

(4)  of  Rule 4 of  the TA Rules,  2003.   The response at  the hands of  the  

learned senior counsel representing the Union of India, and the members of  

the cadre of Data Entry Operators was, that the deficiency highlighted by the  

learned  counsel  with  reference  to  Data  Entry  Operators  need  to  be  

examined closely, inasmuch as, a similar deficiency was likewise highlighted  

in  clause (v)  of  Rule  5  of  the  STA Rules,  2003,  even  with  reference  to  

erstwhile members of the ministerial cadre.  The erstwhile members of the  

ministerial cadre, it was pointed out, were required to qualify a departmental  

examination on the subject of computer applications, within two years, failing  

which they too would not be eligible for any further increment.

30. Learned senior counsel representing the Union of India, reiterated the  

factual and legal position, as he had highlighted with reference to Rule 4 of  

the TA Rules, 2003, whilst interpreting Rule 5 of the STA Rules, 2003.  Yet  

again  it  was  pointed  out,  that  on  the  completion  of  the  computerization  

process, there were deficiencies in ministerial cadre, as also, in the cadre of  

Data Entry Operators, and therefore, at the initial constitution of the cadre of  

Senior Tax Assistants, the deficiencies in both the cadres were sought to be  

satisfied, by providing for different departmental examinations for them.  It  

was the contention of the learned senior counsel representing the Union of  

India, that the submission of learned counsel, pointing out deficiency in only

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one of the cadres, namely, the cadre of Data Entry Operators, was wholly  

unjustified and unacceptable.

31. Having  given  our  thoughtful  consideration  to  the  submissions  

advanced at the hands of the learned counsel for the rival parties, on the  

basis of Rule 4 of the TA Rules, 2003, and Rule 5 of the STA Rules, 2003, it  

is not possible for us to conclude, that members of either of the two cadres  

(the erstwhile ministerial cadre, and the cadre of Data Entry Operators) can  

be treated to be superior  to one or  the other,  on account  of  the pointed  

deficiency, highlighted by the learned counsel.  It clearly emerges from the  

provisions relied upon, that consequent upon the completion of the process  

of  computerization,  in  the  Customs  and  Central  Excise  Department,  the  

erstwhile members of the ministerial cadre needed to be trained in computer  

applications,  and  the  erstwhile  members  of  the  cadre  of  Data  Entry  

Operators required to be instructed in relevant procedures.  Thus viewed, it  

is not possible for us to accept the contention of learned counsel, that either  

of the two cadres ought to be treated as superior to the other.   The first  

contention, premised on Rule 4 of the TA Rules, 2003 and Rule 5 of the STA  

Rules, 2003, respectively, is devoid of any merit, and is accordingly hereby  

rejected.

32. We shall now deal with the second submission advanced before us  

during  the  course  of  hearing,  namely,  the  second  contention  noticed  in  

paragraph 26 above.  The pointed submission advanced before us was, that

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the equation of posts under Rule 4 of the TA Rules, 2003, and under Rule 5  

of the STA Rules, 2003, was based exclusively on the pay-scales attached  

to them.   The resultant  inter  se seniority  between the posts at  the initial  

constitution of the cadres under reference, was also based exclusively on  

the  pay-scales  of  the  posts  sought  to  be  merged.   The  aforesaid  

determination, under Rules 4 and 5 referred to hereinabove, according to  

learned counsel, is wholly impermissible in law.

33. In order to canvass the proposition noticed in the foregoing paragraph,  

learned counsel placed reliance on the decision rendered by this Court in  

Chandrakant  Anant  Kulkarni’s  case  (supra).   The  controversy  in  the  

judgment  cited  for  our  consideration,  was aimed at  determining,  whether  

there was denial of fair and equitable treatment, within the meaning of sub-

section  (5)  of  Section  115 of  the  States Reorganization  Act,  1956.   The  

aforesaid fair  and equitable treatment was, with reference to the posts of  

Assistant Sales Tax Officers (from the former States of Madhya Pradesh and  

Hyderabad) and Sales Tax Inspectors (from the former State of Bombay),  

who were allocated to the new State of Bombay.  The question which arose  

for consideration, also had a bearing on the right to promotion to the next  

higher post of Sales Tax Officer.  This Court while determining the above  

controversy, held as under:-

“9. Prior  to the reorganisation of  the States,  a conference of  the  Chief  Secretaries  of  the  States  that  were  to  be  affected  by  the  reorganisation  was held  at  Delhi  on  May 18  and  19,  1956  for  the  purpose of the formulation of the principles upon which integration of  services was to be effected. The Government of India by their letter

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dated April 3, 1957 informed the State Government that the work of  integration of services should be dealt with by them in the light of the  general principles already settled at the Chief Secretaries Conference.  This has been construed to be a valid delegation of powers to prepare  the preliminary and final gradation lists under the direction and with  the sanction of the Central Government. The Government of India by  its circular dated May 11, 1957 to all the State Governments stated  inter  alia  that  it  agreed  with  the  views expressed on  behalf  of  the  States’ representatives that it would not be appropriate to provide any  protection in the matter of departmental promotion. This circular has  been  interpreted  as a  prior  approval  of  the  Central  Government  in  terms of the proviso to sub-section (7) of Section 115 of the Act in the  matter of change in the conditions of service relating to departmental  promotions.

10. The following principles had been formulated for being observed  as far as may be, in the integration of government servants allotted to  the services of the new States:

“In the matter of equation of posts: (i) Where there were regularly constituted similar cadres in  the  different  integrating  units  the  cadres  will  ordinarily  be  integrated on that basis; but (ii) Where, however, there were no such similar cadres the  following factors will be taken into consideration in determining  the equation of posts—

(a) nature and duties of a post; (b) powers exercised by the officers holding a post, the  extent of territorial or other charge held or responsibilities  discharged; (c) the  minimum  qualifications,  if  any,  prescribed  for  recruitment to the post, and (d) the salary of the post.”

It is well settled that these principles have a statutory force.

11. There is a long line of decisions of this Court starting from the  Union of India v.  P.K. Roy, (1968) 2 SCR 186, laying down that the  Central Government has been constituted to be the final authority in  the matter of integration of services under sub-section (5) of Section  115  of  the  Act.  The  matter  of  equation  of  posts  is  purely  an  administrative  function.  It  has  been  left  entirely  to  the  Central  Government as to how it has to deal with these questions. The Central  Government had established an Advisory Committee for the purpose  of assisting in the proper consideration of the representations made to  it. There is nothing in Sections 115 to 117 of the Act prohibiting the  Central Government in any way from taking the aid and assistance of

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the  State  Government  in  the  matter  of  effecting  the  integration  of  services. As observed by this Court in Roy case the usual procedure  followed by the  Central  Government  in  the  matter  of  integration  of  services generally, is in order. It is not open to the court to consider  whether  the equation of  posts  made by the Central  Government  is  right or wrong. This was a matter exclusively within the province of the  Central Government. Perhaps, the only question the court can enquire  into is whether the four principles agreed upon at the Chief Secretaries  Conference had been properly taken into account. This is the narrow  and limited field within which the supervisory jurisdiction of the Court  can operate. But where, as here, in the matter of equation of posts,  the Central Government had properly taken into account all the four  principles  decided  upon  at  the  Chief  Secretaries  Conference,  the  decision cannot be assailed at all.  In the present case, not only the  Central Government had laid down the principles for integration, but  also considered the representations and passed the final orders and  the  provisional  gradation  lists  were  prepared  and  published  by  the  State  Government  under  the direction  and with the sanction of  the  Central Government.

12. In accordance with the principles settled at the Chief Secretaries  Conference, the Government of India, in consultation with the Central  Advisory Committee, directed that the posts of ASTOs in the former  States of Madhya Pradesh and Hyderabad should be continued in an  isolated category, there being no corresponding post in the successor  State of Bombay with which they could be equated. There were 19  ASTOs in the pay scale of Rs 150-10-200-EB-15-250 from Madhya  Pradesh and 23 ASTOs in the pay scale of Rs 170-8½-225-EB-13-320  from Hyderabad allocated to the new State of Bombay. In the former  State of Bombay there was no similarly constituted cadre of ASTOs,  but there were posts of STIs in the pay scale of Rs 120-8-144-EB-8- 200-10/2-250.  It  would  have been  inequitable  and unfair  to  equate  ASTOs  from  Madhya  Pradesh  and  Hyderabad  with  STIs  from  Bombay,  looking  to  the  nature  of  their  posts,  the  powers  and  responsibilities and the pay scales attached to the same. The ASTOs  from  Madhya  Pradesh  and  Hyderabad  were,  in  the  first  instance,  superior to STIs in their respective States and the post of ASTO in  those States was a promotion post. In addition, ASTOs in those States  were Assessing Authorities and they enjoyed statutory powers of their  own to assess tax and levy penalties, whereas the STIs in Bombay  had no such powers to assess tax or levy penalty but had merely to  scrutinise returns and generally act in a subordinate capacity to STOs.  Evidently,  the  State  Government  was  wrong  in  directing  by  its  Resolution dated November 16, 1957 that the seniority of ASTOs from  Madhya Pradesh and Hyderabad and STIs from Bombay be fixed in  the cadre of STIs in the reorganised State of Bombay on the basis of

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continuous  service  including  that  in  the  lower  grade.  The  principle  adopted by the State Government for determining their relative inter se  seniority was obviously wrong, being contrary to the principles settled  at  the  Chief  Secretaries  Conference.  As  already  stated,  the  Government of India, on representation by the affected ASTOs from  Madhya  Pradesh  and  Hyderabad,  in  consultation  with  the  Central  Advisory Committee, directed that the inter se seniority should be fixed  taking  into  account  continuous  service  in  the  equated  grade  only  subject to the inter se seniority of the officers coming from the several  integrating  regions.  Upon  that  basis,  the  State  Government  by  its  Resolution dated September 10, 1960, rightly modified Notes 3 and 6  of its 1957 Resolution and directed that the seniority as on November  1,  1956 of  ASTOs from Madhya  Pradesh and Hyderabad  be fixed  above the persons in the cadre of STIs and that the inter se seniority  of ASTOs from Madhya Pradesh and Hyderabad be fixed on the basis  of their continuous service as ASTOs in their respective States.”

Having dealt with the controversy on the parameters recorded through the  

aforesaid observations, this Court concluded as under:-  

“19. Be that as it may, the fact remains that the condition regarding  the  passing  of  the  departmental  examination  became  incapable  of  compliance  in  the  case  of  ASTOs  from  Madhya  Pradesh  and  Hyderabad who had been  promoted as STOs Grade III. They were  entitled to such promotion without passing such examination. Under  the relevant  rules  which regulated  their  conditions  of  service,  there  was  only  a  possibility  of  reversion  in  the  eventuality  of  their  not  passing  the  examination  within  the  stipulated  time.  Since  no  examinations admittedly have been held, there is no question of their  reversion  as ASTOs.  If  the  decision  of  the  High  Court  were  to  be  upheld, it would imply that many of the ASTOs from Madhya Pradesh  and Hyderabad who had been promoted as STOs Grade III and during  the past 20 years have reached the higher echelons of service, would  now have to be put back as ASTOs, for no fault of their own. Many of  them either have retired or are on the verge of retirement.

20. There was thus no alternative for the State Government but to  suspend the operation of the amendment made on January 20, 1961  to Rule 1 (b)(ii) of the Recruitment Rules, by its order dated October 1,  1965,  which made the passing of  the STO examination a condition  precedent for promotion of STIs to STO Grade III. There can be no  doubt that the State Government’s Resolution dated June 13, 1964  and its memorandum of November 21, 1964, clarifying that the ASTOs  from Madhya Pradesh and Hyderabad were entitled for promotion to  the  post  of  STO  Grade  III  without  passing  the  departmental

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examination, placed STIs from Bombay at a disadvantage. To ensure  ‘fair and equitable treatment’, the State Government rightly dispensed  with the requirement of passing the departmental examination in the  case of STIs from the former State of Bombay.

21. In the end, reverting back to the main question. On an overall  view of things, we are satisfied that the State Government acted with  the best of intentions. It endeavoured to strike a balance between the  competing claims to relative seniority. When sub-section (5) of Section  115 of the Act speaks of “fair and equitable treatment”,  obviously it  envisages a decision which is fair and equitable to all.”

34. Reliance  was  also  placed  on  the  decision  of  this  Court  in  S.P.  

Shivprasad Pipal v. Union of India & Ors., (1998) 4 SCC 598.  In the said  

judgment,  this  Court  considered  the  validity  of  the  notification  dated  

3.2.1987, which had resulted in the constitution of a Central Labour Service,  

by a merger of three existing cadres.  According to the appellant before this  

Court, the three cadres which were sought to be amalgamated, had different  

statutory functions, different qualifications and different duties and powers.  

By merging the three cadres, according to the appellant before this Court,  

unequals had been treated as equals.  The pointed contention on behalf of  

the appellant,  who belonged to one of the three cadres was, that he had  

been  placed  in  a  condition,  worse  than  the  position  he  occupied  in  the  

original cadre.  The claim of the appellant was, that his chances of promotion  

had  been  substantially  diminished.   One  of  the  grounds for  raising  the  

challenge was, that the merger of the three cadres was in violation of Articles  

14  and  16  of  the  Constitution  of  India.   This  Court  having  taken  into  

consideration the decision in the Chandrakant Anant Kulkarni’s case (supra),  

concluded as under:-

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“14. The  Cadre  Review  Committee  after  examining  the  kinds  of  duties discharged by these officers decided that since they all worked  in the area of  labour  welfare,  it  would be desirable that  they could  widen  their  experience.  This  would  be  possible  if  the  cadres  were  integrated  and  the  posts  were  made  interchangeable  so  that  the  members of the cadre could get a more varied experience in different  areas  of  labour  welfare,  thus  making  for  a  better-equipped  cadre.  Therefore, although the exact nature of work done by the three cadres  was different, it would be difficult to say that one cadre was superior or  inferior to the other cadre or service.

15. A  decision  to  merge  such  cadres  is  essentially  a  matter  of  policy.  Since  the  three  cadres  carried  the  same  pay  scale  at  the  relevant  time,  merging  of  the three cadres cannot  be said to have  caused any prejudice to the members of any of the cadres. The total  number of posts were also increased proportionately when the merger  took place so that the percentage of posts available on promotion was  not in any manner adversely affected by the merger of the cadres.

16. The appellant, however, contends that as a result of the merger  his promotional chances have been very adversely affected because  his position in the seniority list has gone down. Rule 9 of the Central  Labour Service Rules, 1987 under which the merger is effected, lays  down the rules of seniority. It provides that the inter se seniority of the  officers appointed to the various grades mentioned in Schedule I at  the  initial  constitutional  stage  of  the  service  shall  be  determined  according  to  the  length  of  regular  continuous  service  in  the  grade  subject to maintenance in the respective grade of inter se seniority of  officers recruited in their respective original cadres. The proviso to this  Rule  prescribes  that  although  Assistant  Labour  Commissioner  (Central), Labour Officer and Assistant Welfare Commissioner shall be  equated, all  Assistant Labour Commissioners (Central) holding such  posts  on  or  before  31-12-1972  shall  be  en  bloc  senior  to  Labour  Officers  and  (2)  Senior  Labour  Officers  and  Regional  Labour  Commissioners  shall  be  equated.  But  all  Regional  Labour  Commissioners holding such posts on or before 2-3-1980 shall be en  bloc senior to the Senior Labour Officers.

17. Explaining the proviso the respondents  have said  that  before  31-12-1972  Assistant  Labour  Commissioners  were  in  a  higher  pay  scale than Labour Officers. The parity between their pay scales came  about only from January 1973. That is why to preserve their inter se  position,  Assistant  Labour Commissioners  appointed prior  to 31-12- 1972  have been  placed  above Labour  Officers.  Similarly,  Regional  Labour Commissioners drew a higher pay scale than Senior Labour  Officers prior to 1980. The parity has come about in 1980 and hence

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Regional Labour Commissioners holding such posts on or before 2-3- 1980 have been placed above Senior Labour Officers.

18. The seniority rules have thus been carefully framed taking all  relevant factors into consideration. The respondents have also pointed  out that as a matter of fact, by reason of the merger, the appellant has  not,  in  fact,  suffered  any  prejudice  and  he  has  also  received  promotions.

19. However,  it  is  possible that  by reason of  such a merger,  the  chance  of  promotion  of  some of  the  employees  may be  adversely  affected, or some others may benefit in consequence. But this cannot  be a ground for setting aside the merger which is essentially a policy  decision. This Court in Union of India v. S.L. Dutta, (1991) 1 SCC 505,  examined  this  contention.  In  S.L.  Dutta  case a  change  in  the  promotional  policy  was  challenged  on  the  ground  that  as  a  result,  service conditions of the respondent were adversely affected since his  chances of promotion were reduced. Relying upon the decision in the  State of Maharashtra v.  Chandrakant Anant Kulkarni, (1981) 4 SCC  130, this  Court  held  that  a  mere  chance  of  promotion  was  not  a  condition  of  service  and the fact  that  there  was a reduction  in  the  chance of promotion would not amount to a change in the conditions  of service.”

35. It is in the background of the aforesaid submission advanced at the  

hands of learned counsel, that we would consider the validity of the merger  

of cadres contemplated by Rule 4 of the TA Rules, 2003 and Rule 5 of the  

STA Rules, 2003.  The position in the present controversy is not comparable  

to  the  position  examined  by  this  Court  in  the  judgments  referred  to  

hereinabove.   It  needs  to  be  understood,  that  the  cadre  of  Data  Entry  

Operators, was created out of the original ministerial cadre.  It is, therefore  

apparent,  that the members of the two cadres were originally discharging  

similar duties.  It is only as a consequence of the administrative decision to  

computerize the functioning of the Customs and Central Excise Department,  

that a separate cadre of Data Entry Operators came to be created.  The  

newly  created  cadre,  exclusively  functioned  towards  giving  effect  to  the

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decision  to  computerize  the  functioning  of  the  department.   There  was  

thereafter  a division of  duties  discharged by the original  members  of  the  

ministerial cadre.  One cadre of employees exclusively thereafter discharged  

procedural duties of the department, whereas, the other cadre of employees  

exclusively  thereafter  discharged  duties  aimed  at  computerization  of  the  

functioning of the department.  Even though, it  is apparent, that the Data  

Entry  Operators  exclusively  functioned  towards  the  process  of  

computerization  of  the  functioning  of  the  Customs  and  Central  Excise  

Department, yet that could not be possible without their existing experience  

in the erstwhile ministerial  cadre.  Consequent upon the merger of posts,  

consequent,  upon the promulgation of  the TA Rules,  2003,  and the STA  

Rules,  2003,  the  nature  and  duties  of  the  two  cadres  were  combined.  

Consequent  upon  their  appointment  as  Tax  Assistants  and  Senior  Tax  

Assistants, members of the erstwhile ministerial cadre, and members of the  

cadre of  Data Entry Operators,  were required to perform both procedural  

duties and duties relating to computer applications.  The deficiencies in the  

two cadres sought to be merged, were sought to be overcome, by subjecting  

the members of the two cadres to different examinations, whereby, the two  

cadres were trained for discharging their duties efficiently, on merger, whilst  

holding the posts of Tax Assistants/Senior Tax Assistants.  It is, therefore,  

not possible for us to accept, that there was any serious difference between  

the two merged cadres, either on the issue of nature of duties, or on the  

subject of powers exercised by the officers holding the post, or the extent of

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territorial or other charge held, or responsibilities discharged by them, or for  

that matter, the qualifications prescribed for the posts.  On account of the  

aforesaid, by and large similarity, we are satisfied, that the merger of the  

cadres,  and  the  determination  of  the  inter  se  seniority  on  merger,  were  

justifiably determined,  on the basis of the different pay-scales of the cadres  

merged,  under  the  TA  Rules,  2003  and  the  STA  Rules,  2003.  By  the  

mandate of the above Rules, all posts in equivalent pay-scales were placed  

at the same level.  Posts in the higher scale of pay, were given superiority on  

the subject of inter se seniority, with reference to posts in the lower scale of  

pay.  In our considered view, the above determination, at the hands of the  

rule framing authority, on the issue canvassed before us, cannot be termed  

either arbitrary or discriminatory.  We are, therefore satisfied in concluding,  

that the provisions of Rule 4 of the TA Rules, 2003 and Rule 5 of the STA  

Rules, 2003, cannot be faulted on the touchstone of Articles 14 and 16 of the  

Constitution of India.

36. For all the reasons recorded hereinabove, we are satisfied, that the  

different  orders  passed  by  the  Administrative  Tribunal,  and  the  common  

order dated 13.4.2007 passed by the High Court, are liable to be set aside.  

The same are accordingly hereby set aside.  The appeals filed by those who  

moved to the cadre of Data Entry Operators from the ministerial cadre, and  

were  thereupon  amalgamated  in  the  cadre  of  Tax  Assistants/Senior  Tax  

Assistants, are allowed.  The connected appeals preferred by the Union of  

India, are also allowed. In the above view of the matter, the authorities shall

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give effect to Rules 4 and 5 of the TA Rules, 2003 and the STA Rules, 2003,  

respectively, without any further delay.

……………………………J. (Jagdish Singh Khehar)

……………………………J. (S.A. Bobde)

New Delhi; March 26, 2015.

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ITEM NO.1B               COURT NO.4               SECTION XII

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              S U P R E M E  C O U R T  O F  I N D I A

                      RECORD OF PROCEEDINGS

Civil Appeal  No(s).  2485-2490/2010

DHOLE GOVIND SAHEBRAO & ORS.                  Appellant(s)

                               VERSUS

UNION OF INDIA & ORS.                              Respondent(s)

WITH

C.A. No. 2491-2503/2010 , C.A. No. 2577/2010, C.A. No. 10386/2013

[HEARD  BY  HON'BLE  JAGDISH  SINGH  KHEHAR  AND  HON'BLE  S.A.BOBDE,JJ.]

Date : 26/03/2015 These appeals were called on for judgment   today.

For Appellant(s) Mr. K.Maruthi Rao, Adv. Ms. K. Radha, Adv. for Mrs. Anjani Aiyagari,AOR(NP)

                   Mr. B. V. Balaram Das, AOR                     Mr. B. Krishna Prasad,AOR

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For Respondent(s)Mr. Jayanth Muthraj, Adv.

for Mr. C. K. Sasi,Adv.

Mr. Fakhruddin, Sr. Adv.

                    Mr. Vijay Kumar,AOR

                    Mr. B. Krishna Prasad,AOR

                   Mr. P. Narasimhan,AOR

Mr. S. R. Setia,AOR

Mr. Vikas Mehta, AOR

Mr. Raghavendra S. Srivatsa, AOR

Mr. Rauf Rahim, AOR

Hon'ble  Mr.  Justice  Jagdish  Singh  Khehar  pronounced  the  

judgment of the Bench comprising His Lordship and Hon'ble Mr. Justice S.A.  

Bobde.

For the reasons recorded in the Reportable judgment, which is  

placed on the file, the appeals are allowed.

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The authorities  shall  give effect  to  Rules  4  and 5 of  the  TA  

Rules,  2003  and  the  STA Rules,  2003,  respectively,  without  any  further  

delay.

(Parveen Kr. Chawla) (Renu Diwan)

   Court Master Court Master