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CASE NO.:

Appeal (civil) 2336 of 2007

PETITIONER:

State of Punjab & Ors

RESPONDENT:

Arun Kumar Aggarwal & Ors

DATE OF JUDGMENT: 04/05/2007

BENCH:

H.K. SEMA & V.S. SIRPURKAR

JUDGMENT:

J U D G M E N T

CIVIL APPEAL NOS. 2336 OF 2007

(Arising out of S.L.P. ( C ) Nos.25592-25601 of 2005)

WITH

CIVIL APPEAL NO. 2337 and 2338 OF 2007

(Arising out of S.L.P.( C ) Nos. 26872 of 2005 and 2685 of 2006)

H.K.SEMA,J.

1. Leave granted.

2. All the aforesaid appeals are directed against the

judgment and order dated 18.10.2005 passed by the High

Court of Punjab and Haryana in several writ petitions. The

High Court by its impugned order disposed of all the writ

petitions by a common order.

3. Although the hearing of these appeals has engaged

our attention for a considerable length of time and spread over

for many days' arguments, the dispute to be resolved is

ensconced in a narrow compass.

4. We have heard the parties at length.

5. The core questions that arise for determination are

these:-

(1) Whether any indefeasible right has been

accrued to the diploma-holder

(outstanding categories) for promotion to

the post of SDO by virtue of being given

current duty charge by an order dated

21.6.2001 and whether any cause of

action arose by withdrawing the same by

an order dated 22.6.2005.

(2) Whether old 1941 Rules or new 2004

Rules which became effective from

9.7.2004 will be applied for filling up the

vacancies which arose during 2000-01

under old 1941 Rules for promotion to the

post of SDO (Irrigation Department) in the

State of Punjab.

Whether any indefeasible right has been accrued to the

diploma-holder (outstanding categories) for promotion to

the post of SDO by virtue of being given current duty

charge by an order dated 21.6.2001 and whether any

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cause of action arose by withdrawing the same by an order

dated 22.6.2005.

6. The respondents were diploma-holder Junior Engineers.

By an order dated 21.6.2001, 20 Junior Engineers Diploma-

holders (outstanding category) were given current duty charge

to look after the charge of SDOs. The current duty charge

were given under proviso to Rule 5 of 1941 Rules, who

otherwise did not possess the qualifications specified under

Rule 3 of the said Rules. The power was exercised by the

Government conferred under Rule 19 of 1941 Rules.

7. The CDC/look after charge was given subject to the

following conditions:-

(A) This CDC/Look After charge shall be on the

basis of approval to be granted as per

instructions issued by the Personnel

Department, Punjab, vide letter No.

4/2/2001- 3PP.1/3318 dated 15th March,

2001.

(B) This charge is temporary in the existing pay

scale of official and can be withdrawn

without any prior notice and the officer

cannot claim seniority etc. on the basis

thereof.

(C) The official on the basis of this CDC/ Look

after charge cannot raise any claim for

promotion under the provisions of Rule

3(1)(c) of the P.E.S. Class 2 Rules, 1941.

(D) This CDC/Look after charge shall be

subject to the decision in different cases to

be given by different Courts.

8. The CDC was subsequently withdrawn by an order

dated 22.6.2005 which was impugned by the diploma holders

(outstanding category) by filing various writ petitions. Many

grounds were recited supporting the decision to withdraw the

CDC. One shocking ground which we are tempted to quote is

as under:-

"Whereas regular enquiry No.28/2002 was

registered by the Vigilance Bureau Punjab for

tempering/stage-managing outstanding

reports by the Junior Engineers for getting

Current Duty Charge of the post of S.D.O. by

Junior Engineer and the same is still under

investigation."

9. At this stage, we may point out one of the

arguments of Mr. Nageswara Rao, learned senior counsel,

appearing for diploma-holders (non outstanding category) that

the diploma-holders represented by him are senior to those

who obtained outstanding certificates. They are also more

meritorious but outstanding certificate was not granted to

them. In the back drop of the reasons recited, which we have

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noticed above, the contention of Mr. Rao appears to hold some

water.

10. The other ground recited in the order dated

22.6.2005 supporting withdrawal of CDC which in our view

would be relevant to resolve the present controversy is in the

following terms:-

"Whereas, Govt. has notified Punjab Irrigation

Department (Group-A) Service Rules, 2004 on

30.4.2004 and it has been decided to fill up

the vacant posts of S.D.Os on regular basis

from amongst Junior Engineers by holding

D.P.C. under the Provisions of new Rules,

2004 ibid.

Now, therefore, in view of position

explained above when new Departmental

Service Rules, 2004 have been notified and

Govt. has issued fresh guidelines on

19.04.2005 for granting Current Duty Charge

and it has also been decided to fill-up the

Vacant posts of S.D.Os. on regular basis by

holding D.P.C. the continuity of holding

Current Duty Charge of the post of S.D.O. by

the above mentioned 20 Junior Engineers is

not in public interest, the Government of

Punjab is pleased to withdraw the Current

Duty Charge of the post of S.D.Os. from these

above mentioned 20 Junior Engineers with

immediate effect and these 20 junior engineers

shall continue to work as Junior Engineers

against their original posts."

(emphasis supplied)

11. It will be pertinent to mention that the

respondents/writ petitioners also challenged the vires of 2004

Rules but given up. The High Court was of the view that since

vacancies arose under 1941 Rules, it should be filled up on

the basis of 1941 Rules. The High Court quashed the order

dated 22.6.2005 and directed the Government to fill up posts

under the Government instructions issued on 1.10.1999,

29.12.2000 and 25.9.2003. The High Court further held that

the vacancies fallen prior to 31.3.2001 shall be filled up by

following the creiteria indicated by instructions dated

1.10.1999 and 29.12.2000 for determination of outstanding

merit in terms of 1941 Rules.

12. The High Court, in our view, completely ignored the

settled law enunciated by this Court on the subject.

13. To avoid multiplicity, this Court in the case of

Ramakant Shripad Sinai Advalpalkar vs. Union of

India, 1991 Supp.(2) SCC 733, held in paragraph 5 as under:-

"The arrangements contemplated by this order

plainly do not amount to a promotion of the

appellant to the post of Treasurer. The

distinction between a situation where a

government servant is promoted to a higher

post and one where he is merely asked to

discharge the duties of the higher post is too

clear to require any reiteration. Asking an

officer who substantively holds a lower post

merely to discharge the duties of a higher post

cannot be treated as a promotion. In such a

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case he does not get the salary of the higher

post; but gets only what in service parlance is

called a "charge allowance". Such situations

are contemplated where exigencies of pubic

service necessitate such arrangements and

even consideration of seniority do not enter

into it. The person continues to hold his

substantive lower post and only discharges the

duties of the higher post essentially as a stop-

gap arrangement"

14. In the case of State of Haryana vs. S.M. Sharma,

1993 Supp.(3) SCC 252, while considering the identical

question this Court held in paragraphs 11 and 12 as under:-

"11. Sharma was given the current duty

charge of the post of Executive Engineer under

the orders of the Chief Administrator and the

said charge was also withdrawn by the same

authority. We have already reproduced above

Rule 4(2) of the General Rules and Rule 13 of

the Service Rules. We are of the view that the

Chief Administrator, in the facts and

circumstances of this case, was within his

powers to issue the two orders dated June 13,

1991 and January 6, 1992.

12. We are constrained to say that the High

Court extended its extraordinary jurisdiction

under Article 226 of the Constitution of India

to a frivolity. No one has a right to ask for or

stick to a current duty charge. The impugned

order did not cause any financial loss or

prejudice of any kind to Sharma. He had no

cause of action whatsoever to invoke the writ

jurisdiction of the High Court. It was a patent

misuse of the process of the court."

15. We, accordingly, hold no such right much less

indefeasible right has been accrued to the diploma-holder

junior engineers (outstanding category) by virtue of giving CDC

to the post of S.D.O. for regularization in the post. It was

purely a stopgap arrangement, neither based on seniority nor

efficiency and no cause of action arises by withdrawing the

same by the order dated 22.6.2005.

16. Though by now, it has become an academic

question, because, in view of our interim order no one is

holding the current duty charge and also in view of the fact

that the new Rules namely 2004 Rules have now become

operative and there is no provision under new Rules for

outstanding category. Be that as it may, we are not persuaded

to accept the view taken by the High Court and the order of

the High Court quashing the order dated 22.6.2005 is set

aside.

Whether old 1941 Rules or new 2004 Rules which became

effective from 9.7.2004 will be applied for filling up the

vacancies which arose during 2000-01 under old 1941

Rules for promotion to the posts of SDO (Irrigation

Department) in the State of Punjab.

17. 1941 Rules were repealed by 2004 Rules. The

reason why 1941 Rules were repealed by the new Rules appear

to be that there was no channel of promotion for diploma-

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holders under old Rules. The only provision on which

diploma-holders could be accommodated was proviso to Rule

5, which deals with the relaxation of the Rules. Proviso to

Rule 5 reads:-

"Provided that this rule may be relaxed by

Government on the recommendations of Chief

Engineer in order to admit the promotion of a

member of the Oversees Engineering Service or

Irrigation Branch, Punjab or Irrigation Branch

(Provincial Draftsman and Tracers) Service of

'outstanding merit' who may not possess the

qualifications specified in Rule 3."

(emphasis supplied)

Now under 2004 Rules the diploma-holders are entitled to

25% out of 40% promotional quota. The criteria of

outstanding merits are also done away with by the new 2004

Rules and now the criteria applicable for promotion is

seniority- cum- merit. Mr. Rao learned senior counsel

contended that in view of the aforesaid background the

Government has brought out the new 2004 Rules, which have

become effective from 9.7.2004. He further contended that

1941 Rules were not amended but were repealed by 2004

Rules and therefore the executive instructions issued under

1941 Rules do not survive. He has invited our pointed

attention to Rule 10 of 2004 Rules, which deals with Repeal

and saving. Rule 10 is reproduced in extenso:-

10. Repeal and saving. The Punjab Service of

Engineers Class-II, (Irrigation Branch) Rules,

1941 and the Punjab Services of Engineers

Class-I, P.W.D. (Irrigation Branch Rules, 1964,

are hereby repealed:

Provided that any order issued or any

action taken under the rules, so repealed, shall

be deemed to have been issued or taken under

the corresponding provisions of these rules."

He, accordingly, contended that 1941 Rules are not in

existence and the instructions issued under 1941 Rules are

extinct along with the Rules. He further contended that 2004

Rules created new posts and those posts need to be filled up in

accordance with 2004 Rules. He further argued that the

conscious decision has been taken by the Government to fill

up the vacancies under the new Rules and, therefore, the High

Court was wrong in directing to fill up the vacancies under

1941 Rules, which were not in existence.

18. Per contra Dr. Dhawan contended that the vacancies

arose during 2000-01 under 1941 Rules and, therefore, these

should be filled up under the 1941 Rules. He further

contended that the vacancies so arisen under 1941 Rules be

filled up according to the instructions issued on 1.10.1999,

29.12.2000 and 25.9.2003. He further contended that there

was no conscious decision arrived at by the Government.

According to him, such conscious decision, if any, must be

based on deliberations. According to him, there was no such

deliberation. He further contended that the conscious

decision of the Government, if any, cannot unsettle the Rules.

WHETHER THERE WAS ANY CONSCIOUS DECISION BY

THE GOVERNMENT TO FILL UP THE VACANCIES UNDER

THE NEW RULES?

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19. We have already noticed that in 1941 Rules there was

no provision for promotion quota for diploma holders. Instead,

under proviso to Rule 5 relaxation of the Rules provided to the

extent of outstanding merit for diploma holders. The

outstanding merit category has been done away with by new

2004 Rules. In 2004 Rules, the diploma holders are entitled

to 25% out of 40% promotional quota.

20. While it is true that there appears to be no definite

decision arrived at based on deliberations, the intendment of

the authorities can be gathered from various background and

circumstances.

21. As already noted in the withdrawal order of 22.6.2005

one of the reasons recited for withdrawal of CDC was, at the

risk of repetition runs as under:

"Whereas, Govt. has notified Punjab Irrigation

Department (Group-A) Service Rules, 2004 on

30.4.2004 and it has been decided to fill up

the vacant posts of S.D.Os on regular basis

from amongst Junior Engineers by holding

D.P.C. under the Provisions of new Rules,

2004 ibid.

22. Civil Writ Petition No. 11644 of 1999 was filed by

Satbir Singh (AMIE Holder) praying for a mandamus to allot

31% of the promotional quota to their category. The counter

affidavit was filed by one Mr. Samir Kumar IAS on 31.5.2000

before the High Court in Civil Misc. No.10810 of 2000 in

C.W.P.No.11644 of 1999. It is stated in paragraphs 1 to 3 as

under:

1. That the Government is considering to

amend the PSE Class II Rules 1941 and

Committee of 3 Chief Engineers namely Shri

P.K. Singla, Chief Engineer, Canals IW,

Punjab, Shri Sarup Singh, Chief Engineer

National Highways, Patiala and Shri

Jatinder Singh, Chief Engineer/Public

Health, Patiala has been constituted for

making recommendations with regard to

fixing the quota for different categories and

its due incorporation in the PSE Class 1

rules by amending the same.

2. The regular promotion on the posts of

SDO's will be considered after

finalization/amendment of the

Departmental Service Rules as explained in

para 3 of the Preliminary objection.

3. The regular promotions of SDOs cannot be

considered at this stage because the

Government is considering the

amendment/finalization of departmental

service rules as explained in preliminary

objections."

\005\005\005\005.

\005\005\005\005.

23. From the record it appears that the Government also

constituted DPC for category of outstanding merit candidates

on various dates namely March, 2001, 30th April, 2001, 8th

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November, 2001, 21st November 2001, 9th January 2002 and

29th May, 2002. On all these days although the date was fixed

but no DPC was conducted. This would also indicate that the

Government was keeping in its mind the impending new Rules

of 2004.

24. Mr. Rao, therefore, contended that the conscious

decision was taken by the Government not to fill up the posts

under the 1941 Rules. In view of the conscious decision taken

by the Government, the Government, therefore, did not

conduct any DPC for promotion to the post of SDO. To

substantiate his contention he has invited our attention to the

decision of this Court in Dr. K. Ramulu vs. Dr.

S.Suryaprakash Rao, (1997) 3 SCC 59. The three Judge

Bench of this Court after referring to various decisions of this

Court upheld the conscious decision of the Government not to

fill up the post in view of the impending new rules. This Court

finally held in paragraph 15 at scc p.67 as under:-

"15. Thus, we hold that the first respondent

has not acquired any vested right for being

considered for promotion in accordance with

the repealed Rules in view of the policy

decision taken by the Government which we

find is justifiable on the material available

from the record placed before us. We hold that

the Tribunal was not right and correct in

directing the Government to prepare and

operate the panel for promotion to the post of

Assistant Directors of Animal Husbandry

Department in accordance with the repealed

Rules and to operate the same."

25. Dr.Dhawan contended that outstanding merit is a

valid criteria. In this connection, he has referred to Subash

Chander Sharma vs. State of Punjab, (1999) 5 SCC 171

at para 7:

"\005Both the aforesaid decisions were not

directly concerned with the rules with which

we are concerned in these appeals. Rule 5, as

it is worded, leaves no doubt that the rule-

making authority intended by enacting the

second proviso that a Temporary

Engineer/Overseer referred to therein should

also satisfy other conditions before he can be

promoted to Class II service\005.The last proviso

could not have been intended to enable the

Government to relax the other conditions

mentioned in the second proviso in the case of

the class of persons referred to in the last

proviso. Outstanding merit of a member of the

Overseers Engineering Service or Draftsmen

and Tracers Service obviously could not have

been ascertained unless he had completed at

least two years' continuous service. Similarly

a person having outstanding merit could have

been easily declared by the Commission on the

report of the Chief Engineer to be fit for service

and, therefore, there was hardly any point in

making a special provision for relaxation of

such conditions. It is also not possible to

believe that the said proviso was enacted for

dispensing with the requirement of age. It

would not have been difficult for a person

having outstanding merit to have passed a

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departmental test and, therefore, it is not

possible to believe that the last proviso was

enacted with a view to dispense with the

requirement of that condition\005"

26. He has also referred to J.N. Goel v. Union of

India (1997) 2 SCC 440 at para 14:

"We may now come to the proviso to Rule 21(3)

which was inserted in 1972. As noticed

earlier, the proviso permits relaxation in the

matter of educational qualifications for

promotion of Assistant Engineers to the cadre

of Executive Engineers and an Assistant

Engineer though not a graduate could be

promoted provided he had "outstanding ability

and record". The said criterion of "outstanding

ability and record" prescribed by the proviso

cannot be regarded as vague or arbitrary. In

service jurisprudence "outstanding merit" is a

well-recognised concept for promotion to a

selection post on the basis of merit. Such

assessment of outstanding merit is made by

the DPC on the basis of the record of

performance of the employee. It cannot,

therefore, be said that the proviso to Rule 21(3)

which enabled a diploma-holder Assistant

Engineer to be promoted as Executive

Engineer if he had "outstanding ability and

record" suffers from the vice of arbitrariness\005"

27. In our view, the decisions of this Court, referred to

by Dr. Dhawan are not at all applicable in the facts and

circumstances of the case at hand.

28. We are gravely concerned with the manner in which

the certificates of outstanding merit categories were obtained

by diploma-holders (respondents herein). It is disclosed in the

impugned order of 22nd June, 2005 that the certificates of

outstanding merit categories were obtained by

tempering/stage managing and manipulation by diploma-

holders Junior Engineers for getting CDC of the post of S.D.O.

This has casted a serious doubt of the credibility of their

outstanding merit categories. It is also disclosed that enquiry

No. 28/2002 was also registered by Vigilance Bureau, Punjab.

We found ourselves extremely difficult to sift the grain from

the chaff. This is one of the reasons that persuaded the

appropriate authority for taking conscious decision not to fill

up the post under 1941 Rules.

29. Dr.Dhawan also contended that the vacancies are to

be filled up in accordance with the contemporary Rules. In

this connection he has referred to Y.V. Rangaiah v

J.Sreenivasa Rao,(1983) 3 SCC 284 at para 9:

"\005Under the old rules a panel had to be

prepared every year in September.

Accordingly, a panel should have been

prepared in the year 1976 and transfer or

promotion to the post of Sub-Registrar Grade

II should have been made out of that panel. In

that event the petitioners in the two

representation petitions who ranked higher

than Respondents 3 to 15 would not have been

deprived of their right of being considered for

promotion. The vacancies which occurred

prior to the amended rules would be governed

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by the old rules and not by the amended rules.

It is admitted by counsel for both the parties

that henceforth promotion to the post of Sub-

Registrar Grade II will be according to the new

rules on the zonal basis and not on the State-

wise basis and, therefore, there was no

question of challenging the new rules. But the

question is of filling the vacancies that

occurred prior to the amended rules. We have

not the slightest doubt that the posts which

fell vacant prior to the amended rules would be

governed by the old rules and not by the new

rules."

30. There is no quarrel over the proposition of law that

normal Rule is that the vacancy prior to new Rules would be

governed by the old Rules and not by the new Rules. However,

in the present case, we have already held that the Government

has taken conscious decision not to fill the vacancy under the

old Rules and that such decision has been validly taken

keeping in view the facts and circumstances of the case.

31. Dr.Dhawan has also referred to P.Ganeshwar Rao

vs. State of A.P. (1988) Supp. SCC 740 at para 11:

"In view of the foregoing we are of the view that

the observations made by the Tribunal to the

following effect, namely:

In this case the Rules for

recruitment have been changed on

April 28, 1980. Hence, prima facie

it would not be legal to make direct

recruitment against temporary

vacancies, even if the vacancies

were at an earlier date earmarked

for direct recruits\005. In these

circumstances, there is, in my

opinion, no scope for direct

recruitment against temporary

vacancies after April 28, 1980 i.e.

the date on which the Rules were

amended as stated above.

are unsustainable. We hold that the

amendment made on April 28, 1980 does not

apply to the vacancies which had arisen prior

to the date of the amendment."

32. He has also referred to B.L. Gupta vs M.C.D.,

(1988) 9 SCC 223 at para 9:

"When the statutory rules had been framed in

1978, the vacancies had to be filled only

according to the said Rules. The Rules of 1995

have been held to be prospective by the High

Court and in our opinion this was the correct

conclusion. This being so, the question which

arises is whether the vacancies which had

arisen earlier than 1995 can be filed as per the

1995 Rules. Our attention has been drawn by

Mr.Mehta to a decision of this Court in the

case of N.T. Devin Katti v. Karnataka Pubic

Service Commission. In that case after

referring to the earlier decisions in the cases of

Y.V. Rangaiah v. J.Sreenivasa Rao, P.

Ganeshwar Rao v. State of A.P. and A.A.

Calton v. Director of Education it was held by

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this Court that the vacancies which had

occurred prior to the amendment of the Rules

would be governed by the old Rules and not by

the amended Rules. Though the High Court

has referred to these judgments, but for the

reasons which are not easily decipherable its

applicability was only restricted to 79 and not

171 vacancies, which admittedly existed\005"

33. He further submitted that rights of candidates that

are eligible under the unamended Rules cannot be taken away

by subsequent amendment. In this connection, he referred to

P. Mahendran vs. State of Karnataka, (1990) 1 SCC 411

at para 5.

"\005Since the amending Rules were not

retrospective, it could not adversely affect the

right of those candidates who were qualified

for selection and appointment on the date they

applied for the post, moreover as the process of

selection had already commenced when the

amending Rules came into force, the amended

Rules could not affect the existing rights of

those candidates who were being considered

for selection as they possessed the requisite

qualifications prescribed by the Rules before

its amendment moreover construction of

amending Rules should be made in a

reasonable manner to avoid unnecessary

hardship to those who have no control over the

subject matter."

34. He further contended that the power of appointing

authority for the post amendment cases confined to those

cases. Reference is made to AA Calton vs. Director of

Education, (1983) 3 SCC 33 at para 5:

"\005Although the Director in the present case

exercised that power subsequent to August 18,

1975 on which date the amendment came into

force, it cannot be said that the selection made

by him was illegal since the amending law had

no retrospective effect. It did not have any

effect on the proceedings which had

commenced prior to August 18, 1975. Such

proceedings had to be continued in accordance

with the law as it stood at the commencement

of the said proceedings. We do not, therefore,

find any substance in the contention of the

learned counsel for the appellant that the law

as amended by the U.P. Act 26 of 1975 should

have been followed in the present case."

35. All the decisions referred to above are relating to

amendment of the Rules. We have already held that 1941

Rules were repealed by 2004 Rules. The facts of those cases

are, therefore, not applicable to the facts of the present case.

36. Dr. Dhawan further argued that the diploma-holders

outstanding merit candidates have vested rights under 1941

Rules and that rights under new Rules are saved and not

repealed by 2004 Rules. Reference is made to N.T.Devin

Katti vs. KPSC, (1990) 3 SCC 157 at para 11:

"\005.Lest there be any confusion, we would like

to make it clear that a candidate on making

application for a post pursuant to an

advertisement does not acquire any vested

right of selection, but if he is eligible and is

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otherwise qualified in accordance with the

relevant rules and the terms contained in the

advertisement, he does acquire a vested right

of being considered for selection is accordance

with the rules as they existed on the date of

advertisement. He cannot be deprived of that

limited right on the amendment of rules during

the pendency of selection unless the amended

rules are retrospective in nature."

(emphasis supplied)

37. These decisions are of no assistance to the diploma-

holders outstanding category, in the view that we have taken.

38. We hold the Government has taken conscious decision

not to fill up the posts under the old 1941 Rules. The

impugned order of the High Court is set aside. We may at this

stage point out that the problem seems to have been

compounded by the inaction/casual approach of the

Government detrimental to public interest. The State

Government shall now fill up the vacant posts in accordance

with the 2004 Rules within a period of three months from

today. All the eligible candidates who satisfy the criteria laid

down under 2004 Rules shall be considered. The entire

process of recommendation and appointment shall be

completed within three months from today.

39. The impugned order of the High Court is set aside.

The appeals are disposed of in terms of the above directions.

No costs.