1

REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NOS.6491-6492 OF 2014

Coal India Ltd. & Anr. …..Appellant(s)

:Versus:

Navin Kumar Singh ....Respondent(s)

J U D G M E N T

A.M. Khanwilkar, J.

1. These appeals emanate from the judgment and order

dated 20

th May, 2010 passed by the Division Bench of the

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

and order dated 11

th December, 2013 passed in Civil Review

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

the Single Judge, with minor modifications and declared that

the past service of the respondent in the previous company of

the appellant could not be forfeited for all purposes in the

2

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

request and dismissed the review petition against the said

judgment on the ground of unexplained delay.

2. The respondent, a graduate in Chemical Engineering,

was appointed on 27

th June, 1990 in E-2 Grade and joined the

same on 4

th August, 1990 in Dankuni Coal Complex (for short

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

respondent, the Personnel Manager of the appellant company

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

dated 23

rd April, 1991 transferring the respondent from DCC

to Central Mine Planning and Design Institute Limited (for

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

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

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

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

would be reckoned from the date he joined the new

organisation, CMPDIL. Accordingly, the respondent joined

CMPDIL on 15

th May, 1991. The prevailing policy for

determination of seniority of executives on inter-company

3

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

follows:

“11. Determination of seniority of executives in E-1 to E-4

grades on inter-company transfers

This issue has two aspects:

(a) Inter-company transfer effected on administrative

grounds:-

(b) Inter-company transfer effected at the request of the

executive concerned on personal grounds.

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

E-4 grades belong to the respective company cadres on as-

in-where-is basis. Their career growth upto E-5 grade is

within the company. When an executive in these grades

moves from one company to the other, he gets absorbed in

the appropriate cadre of that company.

11.1 The Committee recommends that:

(i) When an inter company transfer is effected on

administrative grounds the seniority of the executive

shall be fixed in the company to which he is

transferred taking into account his date of entry into

the grade.

(ii) When the inter-company transfer is effected on

personal grounds at the request of the executive

concerned, his seniority in the company to which he is

transferred, shall be fixed as if he entered the grade on

the date of his assumption of charge in the new

company. In other words, such executive will lose his

past seniority in the grade.”

This policy was further clarified by way of an Office

Memorandum dated 5

th June, 1985, issued by the General

Manager (Personnel) which read as follows:

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

company transfer is effected on personal grounds at the

request of the executive concerned, his her seniority in the

company to which he/she is transferred, is fixed as if he/she

4

entered the grade on the date of his/her assumption of

charge in the new company and the executive loses his/her

past seniority in the grade. An issue has been raised whether

in such cases the period of service in a grade put in by the

executive in the previous company will also count towards

eligibility for promotion or not.

2. In this connection, it is clarified that while the name of

the officer transferred on request will be placed at the bottom

of the seniority list in his/her grade in the new company

when the officer immediately senior to his/her in the new

company becomes eligible for promotion, say after one year,

the transferee will also become eligible for consideration for

promotion provided he/she put in the minimum prescribed

grade in the previous company. However, if the Officer

immediately senior to the transferee in the new company has

put in less than the minimum prescribed period of service,

say six months, in the grade the transferor becomes eligible

for promotion even though the transferee might have put in

more than the requisite service in the grade prior to his/her

transfer.

3. Pending cases may be disposed of on the basis of the

above clarification. However, past cases will not be re -

opened.

This issues with the approval of Competent Authority.”

3. The respondent claims that in September 1993, the

appellant company held its departmental promotion committee

after which several employees were promoted from the E -2

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

promotion. The reason given to the respondent was that his

transfer to CMPDIL was done at his own requ est and his

promotion would be considered only after he completed 3

5

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

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

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

Grade vide order dated 12

th December, 1994, which also

mentioned that his seniority would be decided separately,

since he had been promoted under the cluster concept in the

centralised cadre. This order was modified on 2

nd January,

1995 to change his designation to Executive Engine er

(Chemical).

5. Post-promotion, the respondent challenged the

appellant‟s decision to exclude his work experience at DCC

(i.e. 4

th August, 1990 to 14

th May, 1991) while considering his

eligibility for promotion, by filing a writ petition being CWJC

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

grant of notional seniority to him to the post of Executive

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

th

November, 1993. The Single Judge disposed of the writ

petition vide order dated 18

th November, 1998, by merely

directing the appellant company to consider the representation

6

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

order.

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

appellant company, after considering the respondent‟s

representation, issued an order on 16

th February, 1999,

rejecting the same inter alia on the ground that the applicable

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

that an employee would lose his past seniority in his existing

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

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

per the office memorandum of 5

th June, 1985, since there was

no senior executive above the respondent‟s Grade, the

question of the application of the said office memorandum did

not arise. The said order reads thus:

“Shri Singh was transferred from Dankuni Coal Complex,

Dankuni (West Bengal) to CMPDIL, Ranchi vide Order No.:C-

5A(iii)51434(Trans)/109 dated 23

rd

April 1991 on his own

request. In terms of policy followed prior to 1

st

April 1993

(i.e. the date from which the career growth of all executives

was centralized at CIL level), one had to lose his past

seniority in his existing grade in the event of his transfer

from one company to another on “request basis”. This policy

was followed very strictly without any exception.

The Office Memorandum dated 5

th

June 1985 only

clarifies with regard to procedure to be followed for

7

consideration of such transferred executive, when h is

immediate senior executive in the transferee company is

considered for promotion. In the case of Shri Singh since

there was no senior executive above him the question of

application of the above O.M. dated 5

th

June 1985 could not

arise. Moreover, Shri Singh having not been completed the

requisite period in the transferee company was not eligible

for consideration of his promotion as the period of service

rendered in the previous company can not be taken into

consideration for the purpose of eligibility for promotion.

In the premises, I am of the view that there is not

merit in the representation of Shri Singh (the petitioner) and

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

7. Aggrieved by the aforementioned decision, the respondent

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

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

order dated 16

th February, 1999, and praying that he may be

granted notional seniority with effect from 12

th November,

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

writ petition was allowed by the learned Single Judge vide

order dated 20

th June, 2003 who observed that although the

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

CMPDIL when he joined in that com pany, at the time of

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

could not be overlooked and therefore, denial of promotion to

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

8

the appellant company was directed to revise the date of

promotion of the respondent.

8. The appellant company challenged the order of the

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

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

and then from E-4 to E-5 Grade. On 20

th May, 2010, the

Division Bench disposed of the appellant‟s appeal, observing

that there was nothing in the policy to indicate that past

service in the previous company, from which transfer has been

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

strength of that past service he would not be entitled to

supersede the employees working in the new company in the

grade in which he had joined.

9. Aggrieved, the appellant has approached this Court by

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

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

to CMPDIL at his request and that the Office

Memorandum dated 5

th June, 1985 had no application to the

fact situation of the present case. Resultantly, the learned

9

Single Judge as well as the Division Bench committed

manifest error in granting relief to the respondent. The

respondent, on the other hand, has supported the reasons

recorded by the learned Single Judge and the Division Bench.

It is submitted that the High Court noted th e distinction

between the matter of seniority and that of the length of

service. The policy invoked by the appellant merely governs the

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

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

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

1 and

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

Joseph

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

and ought to be dismissed.

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

the appellants and Mr. Manish Kumar Saran, learned counsel

for the respondent.

1

(1996) 1 SCC 524

2

(1998) 5 SCC 305

10

11. The indisputable position emerging from the chronology

of events, is that the respondent was appointed on 27

th June,

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

th August,

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

is a subsidiary of the appellant company. That request was

considered favourably as a result of which the respondent

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

dated 23

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

“COAL INDIA LIMITED

“COAL BHAWAN”

10-NETAJI SUBHAS ROAD, CALCUTTA -700001

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

O R D E R

Shri Navin Kumar Singh, Chemical Engineer in E -2

grade presently posted at Dankuni Coal Complex is hereby

transferred in his existing capacity/grade to Central Mine

Planning & Design Institute Limited, till further orders.

2. On being released from Dankuni Coal Complex, Shri

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

further assignment in that company.

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

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

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

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

4. This issues with the approval of Competent Authority.

Sd/-

(A.K. Mukherjee)

Personnel Manager (EE)”

11

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

seniority of the respondent will be reckoned from the date he

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

CMPDIL on 15

th May, 1991, there was no senior person

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

regarding the determination of inter-se seniority of the

executives on inter-company transfers would come in the way

of the respondent for reckoning his eligibility for promotion to

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

company (CMPDIL)? As the respondent was initially appointed

in E-2 Grade on 4

th August, 1990 in DCC on completion of 3

years in September, 1993, he acquired the requisite eligibility

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

Grade. However, the department did not consider the

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

departmental promotional committee held at the relevant time.

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

December, 1994.

12

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

nothing to indicate that the transferee would lose his past

service rendered in the parent company for all purposes. The

policy of forfeiture of seniority in the parent company,

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

transfer on personal grounds. That is to ensure that no

prejudice is caused to the executives already working in the

transferred company. For that reason, the seniority of the

executives seeking inter-company transfer on personal request

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

of assumption of charge in the transferred company. It has

been made explicitly clear that the executive seeking inter-

company transfer on personal grounds will lose his past

seniority in the Grade. No more and no less.

14. Indubitably, the respondent is not claiming seniority over

any person already working in the new company (CMPDIL)

before the date on which he assumed charge thereat on 15

th

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

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

13

4

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

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

Grade whilst working in CMPDIL . The High Court justly

accepted the claim of the respondent that for determination of

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

be reckoned. That cannot be confused with the issue of

seniority in CMPDIL as they are two different and distinct

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

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

clause 11 or any other official document – to even remotely

suggest that on seeking inter-company transfer on personal

grounds, the executive concerned would lose even his past

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

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

respondent could not have been rejected by the department.

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

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

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

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

14

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

where he was transferred on compassionate grounds is

regular service. It is no different from the service rendered at

the place where he is transferred. Both the periods are taken

into account for the purpose of leave and retiral benefits. The

fact that as a result of transfer he is placed at the bottom of

the seniority list at the place of transfer does not wipe out

his service at the place from where he was transferred. The

said service, being regular service in the grade, has to be

taken into account as part of his experience for the

purpose of eligibility for promotion and it cannot be

ignored only on the ground that it was not rendered at

the place where he has been transferred. In our opinion,

the Tribunal has rightly held that the service held at the

place from where the employee has been transferred has to

be counted as experience for the purpose of eligibility for

promotion at the place where he has been transferred.”

(emphasis supplied)

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

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

reads as follows:

“6. From the facts set out above, it will be seen that

promotion was denied to the respondent on the post of

Senior Storekeeper on the ground that he had completed 3

years of regular service as Storekeeper on 7-6-1980 and,

therefore, he could not be promoted earlier than 1980. In

coming to this conclusion, the appellants excluded the

period of service rendered by the respondent in the Central

Ordnance Depot, Pune, as a Storekeeper for the period from

27-4-1971 to 6-6-1977. The appellants contended that, since

the respondent had been transferred on compassionate

grounds on his own request to the post of Storekeeper at

Cochin and was placed at the bottom of the seniority list, the

period of 3 years of regular service can be treated to

commence only from the date on which he was transferred to

Cochin. This is obviously fallacious inasm uch as the

respondent had already acquired the status of a permanent

employee at Pune where he had rendered more than 3 years

of service as a Storekeeper. Even if an employee is

15

transferred at his own request, from one place to another

on the same post, the period of service rendered by him

at the earlier place where he held a permanent post and

had acquired permanent status, cannot be excluded from

consideration for determining his eligibility for

promotion, though he may have been placed at the

bottom of the seniority list at the transferred place.

Eligibility for promotion cannot be confused with

seniority as they are two different and distinct factors.”

(emphasis supplied)

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

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

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

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

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

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

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

Grade will have to be reckoned from the date of his

assumption of charge on 15

th May, 1991, but that can have no

bearing while determining his eligibility criterion of length of

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

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

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

4

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

16

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

with the direction given by the High Court to assign notional

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

from 12

th November, 1993.

17. As regards the Office Memorandum dated 5

th June, 1985,

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

different matter that it addresses the difficulty expressed

about the denial of opportunity of promotion to the executives

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

Office Memorandum, it is discernible that the department has

clarified the position that if the concerned executive has

already completed service for a specified period including the

period of service with the old company, would become entitled

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

granting similar advantage to the executive who opted for

inter-company transfer on personal request and who

incidentally enters at number one position in the seniority in

the new company would be anomalous. Concededly, what is

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

17

personal request, is only the seniority position in the new

(transferred) company – which would commence from the date

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

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

company. The two being distinct factors, neither the policy

nor the office memorandum would be an y impediment for

reckoning the period of service rendered by the respondent

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

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

fail.

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

to costs.

.………………………….CJI.

(Dipak Misra)

…………………………..….J.

(A.M. Khanwilkar)

…………… ……………..….J.

(Dr. D.Y. Chandrachud)

New Delhi;

September 25, 2018.