IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION   

CIVIL APPEAL NOS.6934-6946 OF 2005

Union of India ……..Appellant  

Versus

Pushpa Rani & Others ……….Respondents

WITH  

C.A. NO.6932 OF 2005

Union of India ……… Appellant

Versus

N.D. Kakkar & Others                         .…….Respondents

WITH  

C.A. NO.6919 OF 2005

All India SC/ST Railway Employees Assn. ……… Appellant

Versus

Union of India & Others                         .…….Respondents

WITH  C.A. No.612 of 2006

Union of India ……… Appellant

Versus

Jarnail Singh & Others                        .,…….Respondents

WITH  

C.A. No._______of 2008 (Arising out of S.L.P. (C) No.5045 OF 2007)

Union of India & Others ……… Petitioners

Versus

Rubi Mazumdar                         ..…….Respondent

J U D G M E N T

G.S. Singhvi, J.

1. Whether  the  policy  of  reservation  of  posts  for  Scheduled  Castes/

Scheduled  Tribes  can  be  applied  at  the  stage  of   giving  effect  to  cadre

restructuring exercise undertaken pursuant to letter No.PC-III/2003/CRC/6

dated 9.10.2003 issued by the Railway Board is the question which arises

for  determination  in  the  above  noted  appeals  filed  against  the  orders  of

Punjab  & Haryana High Court  which upheld the  decision of  Chandigarh

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Bench of the Central Administrative Tribunal (hereinafter referred to as ‘the

Tribunal’)  to quash para 14 of the said letter and the direction given for

making appointments de hors the policy of reservation.  The special leave

petition filed by the Union of  India against  the order  of Allahabad High

Court  is  being  disposed  of  along  with  appeals  because  the  issue  arising

therein is similar.   

2. For the sake of convenience, we have taken the facts from the record

of Civil Appeal Nos.6934-6946 of 2005.  The same are:-  

(i) Respondents Pushpa Rani and six others joined service as Clerks in

Ambala and Ferozepur  Divisions  of  the  Northern  Railway.   They

were promoted as Senior Clerks and then as Head Clerks.   They filed

applications  under  Section 19 of the Administrative Tribunals  Act,

1985 for quashing the instructions issued by the Railway Board vide

letter No.PC-III/2003/CRC/6 dated 9.10.2003 for giving effect to the

policy of  reservation  of  posts  for  Scheduled  Castes  and Scheduled

Tribes at the stage of restructuring of Group C and D cadres.   They

pleaded  that  the  exercise  of  restructuring  undertaken  by  the

government resulted in upgradation of the existing posts and in view

of the law laid down by the Supreme Court, the policy of reservation

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cannot  be  applied  while  making  appointment  against  the  upgraded

posts.  

(ii) In the counter filed on behalf of the administration,  it  was pleaded

that instructions issued by the Railway Board are in conformity with

the  policy  decision  taken  by  the  Government  of  India  and  the

applicants  cannot  object  to  the  reservation  of  posts  for  Scheduled

Castes and Scheduled Tribes because restructuring of cadres resulted

in creation of additional  posts  which were required to  be filled by

promotion.

(iii) The Chandigarh Bench of the Tribunal allowed the application filed

by Pushpa Rani and others along with 12 similar applications filed by

other  employees  of  Ambala  and  Ferozepur  Divisions  of  Northern

Railway,  Rail  Coach  Factory,  Kapurthala  and  Diesel-Loco

Modernization  Works,  Patiala  and  quashed  para  14  of  letter  dated

October 9, 2003. The Tribunal declared that the policy of reservation

of posts for Scheduled Castes and Scheduled Tribes is not applicable

to the restructuring scheme including exchange formula and directed

the  petitioners  herein  to  consider  the  cases  of  the  applicants

(respondents  herein) and other eligible persons for placing them in

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appropriate  pay  scales  under  the  restructuring  scheme  keeping  in

view  their  eligibility  and  suitability  and  give  them  consequential

benefits.    

(iv) The Union of India through Divisional Personnel Officer, Northern

Railway, Ambala, challenged the order of the Tribunal in Civil Writ

Petition  No.3182-CAT of  2003,  which  was  dismissed  by  Division

Bench of the High Court of Punjab and Haryana along with a batch of

similar petitions. The High Court referred to the order passed by this

Court in Contempt Petition (Civil) No.304 of 1999 in Civil Appeal

No.1481 of 1996 and held that in view of the law laid down by the

Supreme Court,  the  direction  given  by the  Tribunal  to  fill  up  the

upgraded posts without applying the principles of reservation cannot

be termed as erroneous.    

3. Shri  Amarendra  Sharan,  learned  Additional  Solicitor  General,

referred to Annexures ‘A’ to ‘K’ appended to letter dated 9.10.2003 to show

that as a result of restructuring of Group C and D cadres, additional posts

became available in the higher grades and argued that the Railway Board

did  not  commit  illegality  by issuing  direction  for  implementation  of  the

policy  of  reservation  qua  those  posts  and  argued  that  the  policy  of

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reservation was rightly made applicable in relation to the additional posts.

In support of this argument he strongly relied on the case of K. Manickaraj

vs.  Union  of  India [1997  (4)  SCC 342].   Shri  Sharan  emphasized  that

restructuring of cadres undertaken for enhancing organizational  efficiency

and  functional,  operational  and  administrative  requirements  cannot  be

treated  as  a  simple  exercise  for  upgradation  of  existing  posts  and  the

Tribunal did not have the jurisdiction to nullify the instructions issued by

the Railway Board or issue directions for making appointment by ignoring

the policy of reservation. He distinguished the orders passed in  Union of

India vs. V.K. Sirothia [1999 SCC (L&S) 938] and All India Non-SC/ST

Employees’ Association (Railway) vs. V.K. Agarwal and Others  [2001

(10)  SCC  165]  by  pointing  out  that  those  were  the  cases  of  mass

upgradation of posts and not restructuring of cadres resulting in creation of

additional posts in different grades.   

4. Shri  K.S.  Chauhan,  counsel  for  All  India  SC/ST  Railways

Association submitted that the directions given by the Tribunal are liable to

be set aside because its interpretation of the policy of restructuring is also

contrary to the law laid down by the Constitution Bench in R.K. Sabharwal

and Others  vs.  State  of  Punjab and Others  [1995  (2)  SCC 745].   He

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pointed out that the respondents had not challenged the instructions issued

by the  Railway Board  for  filling  up  the  additional  posts  which  were  to

become available as a result of restructuring of Group C and D cadres by

selection and promotion and argued that in the absence of such challenge,

the Tribunal could not have quashed para 14 of letter dated 9.10.2003 and

ordained that appointments be made by ignoring the policy of reservation.   

5. Dr.  Rajiv  Dhawan,  Senior  Advocate,  appearing  for  some  of  the

respondents, argued that restructuring of Group C and D cadres is nothing

but an exercise for upgradation of the existing posts and the Tribunal did

not commit any illegality by striking down para 14 of letter dated 9.10.2003

vide which the policy of reservation was made applicable to the upgraded

posts.   He further argued that if the policy of reservation is applied at the

stage of restructuring of Group C and D cadres then the same would amount

to giving double benefit to the members of Scheduled Castes and Scheduled

Tribes,  who had already been given out-of turn promotions.  Dr. Dhawan

relied on the larger Bench judgment of this Court in  Indra Sawhney and

Others vs. Union of India and Others  [1992 Supp. (3) SCC 217] and of

the Constitution Bench in M. Nagaraj and Others vs. Union of India and

Others [2006 (8) SCC 212] and argued that even if the upgraded posts are

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required to be filled by promotion after following the process of selection,

the  policy  of  reservation  of  posts  for  Scheduled  Castes  and  Scheduled

Tribes  cannot  be  applied  qua  such  posts  because  no  quantifiable  data

showing  backwardness  of  Scheduled  Castes  and  Scheduled  Tribes  and

inadequacy of their  representation was produced before the Tribunal.  Dr.

Dhawan made specific reference to paragraphs 85, 86, 106, 117, 119 and

121 of  the judgment  in  M. Nagaraj’s  case and argued that  the  enabling

provision  contained  in  Article  16(4-A)  cannot  be  relied  upon  by  the

appellants to justify implementation of the policy of reservation at the stage

of  restructuring  of  Group  C  and  D  cadres  because  the  members  of

Scheduled Castes and Scheduled Tribes are adequately represented in those

cadres and efficiency of  the administration  will  be adversely affected by

giving double benefit to them.  He then argued that even if para 14 of letter

dated 9.10.2003 is held to be constitutionally valid, the policy of reservation

should  be made applicable  only qua  posts  which  become available  after

9.10.2003.  Another  argument  of  the  learned  senior  counsel  is  that  if

restructuring  exercise  is  intended  to  remove  stagnation  and  improve  the

quality of services then implementation thereof cannot be made subject to

the policy of reservation.  Shri Sushil Jain and Smt. Kiran Suri, Advocates,

adopted the arguments of Dr. Dhawan and submitted that view expressed by

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different benches of the Tribunal that the policy of reservation cannot be

applied  at  the  stage  of  making  appointment  against  the  upgraded  posts

should not be disturbed because the same has been substantively approved

by this Court  in  V.K. Sirothia’s  case and  V.K. Agarwal’s  case.  In the

written  submissions  filed  by  him,  Shri  Sushil  Jain  has  highlighted  the

difference between the scheme of restructuring resulting in upgradation of

the  posts  and  the  policy  of  promotion  and  contended  that  the  Tribunal

rightly annulled para 14 of letter dated 9.10.2003 on the ground that policy

of reservation cannot be applied against the upgraded posts.  Another point

made by Shri Jain is that the definition of ‘cadre’ contained in para 4(b) of

Circular  dated 21.8.1997 is  ultra  vires para 103 of the Code because the

effect  of  statutory  rules  framed  by the  Board  cannot  be  nullified  by  an

administrative decision.  

6. Learned counsel appearing for the respondent in SLP (C) No.5045 of

2007 supported the order passed by Allahabad Bench of the Tribunal and

argued that  the direction  given for  considering  the  case  of  his  client  for

promotion as Personal Inspector Grade ‘A’ should not be upset because the

cadre comprises of only two posts out of which one was required to be filled

from the general category candidates.

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7. We  have  considered  the  respective  arguments/submissions  and

examined  the  records.  The  Railway  Establishment  Code  (hereinafter

referred to as “the Code”) was first published in September 1940.  It was

revised from time to time.  The 1985 edition of the Code was issued under

the authority of the President of India under proviso to Article 309 of the

Constitution of India. Paragraphs 103(7), 119, 120, 123 and 124 of the Code

which have bearing on the decision of these cases are as under:-

103(7) ‘Cadre’ means the strength of a service or a part of a

service sanctioned as a separate unit.

119.   In the Railway Board and attached offices   -  The

number and character of Group C &  D posts in the office of

the  Railway Board  and  other  offices,  projects,  organizations

immediately  under  its  control  shall  be  such  as  may  be

determined  by  the  Railway  Board.   The  Director  General,

Research,  Designs  and  Standards  Organisation  or  any  other

authority to whom the powers may be specifically delegated by

the  Railway  Board  may  create  temporary  posts  on  the

conditions prescribed in their respective schedules of power.  

120. On  Railways,  Production  Units  or  other

Establishment –  The number and character of Group C & D

posts  may  be  determined  by  the  General  Managers  or  the

authority in whom such powers are delegated, provided that the

prior  sanction  of  the  Railway  Ministry  is  necessary  for  the

introduction  of  a  new  category  not  already  obtaining  on  a

Railway.

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123. The Railway Board have full  powers  to  make rules  of

general  application  to  Group C & Group D railway servants

under their control.

124. The  General  Managers  of  Indian  Railways  have  full

powers to make rules with regard to Railway servants in Group

C & D under their control provided they are not inconsistent

with any made by the President or the Ministry of Railways.”   

Para 103(i), (ii) and (iii) of the Railway Establishment Manual

(Volume I), which too is relevant for these cases reads as under:-

103. Definitions – For the purpose of these rules, unless there

be anything repugnant in the subject or context –

(i) A “Group” means a series of classes which form a

normal channel of promotion.

(ii) A “Class” comprises all appointments in the same

branch  or  department  bearing  the  same

designation.

(iii) “Grades” are sub-divisions of a class, each bearing

a different scale of pay. An intermediate grade is

any grade in a class, higher than the lowest.”

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8. Till  1997,  the  rosters  framed  for  giving  effect  to  the  policy  of

reservation were vacancy based.  In R.K. Sabharwal’s case, this Court held

that  the rosters  must  be operated with reference to the posts  and not  the

vacancies.   Thereafter,  the  Government  of  India,  Ministry  of  Railways

(Railway Board) issued revised instructions vide Circular R.B.E. No.113/97

and prescribed post based roster.  These instructions were circulated vide

letter  No.95-E(SCT)1/49/5(1)  dated  21.8.1997,  the  relevant  portions  of

which are extracted below: -

Circular No.113/97

“Under  the  existing  instructions,  vacancy based  rosters  have

been prescribed in order to implement the Government’s Policy

relating  to  the  reservation  of  jobs  for  the  Scheduled  Castes,

Scheduled  Tribes and other  Backward Classes  (OBCs).   The

application  of  reservation  on  the  basis  of  these  rosters  was

called  in  the  question  before  the  courts.   The  Constitution

Bench of the Supreme Court in the case of R.K. Sabharwal vs.

State of Punjab as well as Union of India vs. J.C. Malik has

held  that  the  reservation  of  jobs  for  Backward  Classes

SC/ST/OBCs  should  apply  to  the  posts  and  not  to  the

vacancies.   The  Court  further  held  that  the  vacancy  based

rosters can operate only till such time as the representation of

the persons  belonging  to  the  reserved categories,  in  a  cadre,

reaches the prescribed percentage of reservation.   Thereafter,

the rosters cannot operate and vacancies released by retirement,

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resignation,  promotion  etc.  of  the  persons  belonging  to  the

general  and  the  reserved  categories  are  to  be  filled  by  the

appointment of the person from the respective category so that

the prescribed percentage of reservation is maintained.

The  courts  also  held  that  persons  belonging  to  reserved

categories, who are appointed on the basis of merit and not on

account  of  reservation  are  not  be  counted  towards  the quota

meant for reservation.

With a view to bring the policy of reservation in line with the

law laid down by the Supreme Court, it has been decided that

the existing 200 point and 100 point vacancy based rosters of

direct recruitment shall be replaced by post based rosters.  All

the Zonal Railways, Production Units and Associated Officers

of the Railway Board should therefore, prepare the rosters for

Group C posts (where the minimum of scale of pay is Rs.1400

(RPS)  and  above)  based  on  principles  elaborated  in  the

Explanatory notes given in Annexure I and illustrated in  the

Model  Roster  as  given  in  Annexure  II  and  Annexure  III.

Similarly  the  concerned  authorities  may  prepare  rosters  to

replace  the  existing  100  point  rosters  in  respect  to  local

recruitment to Gr. C and Gr. D posts where the minimum of

scale of pay is  less  than 1400 (RPS) and normally attracting

candidates  from  a  locality/region  on  the  basis  of  the  same

principles.   

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The  principles  for  preparing  the  rosters  elaborated  upon  in

Explanatory notes are briefly recapitulated below:- (a) The number of points in the roster shall be equal

to the number of posts in the cadre.  In the case there is

any increase or decrease in the cadre strength in future,

the  rosters  shall  be  expanded  or  contracted

correspondingly. (b) Cadre,  for  the  purpose  of  roster,  shall  mean  a

particular grade and shall comprise the number of posts

to be filled by a particular mode of recruitment in terms

of  the  codal/manual  provisions  of  Railway  Board’s

instructions issued from time to time.  Thus, in a cadre of

say 200 posts where the recruitment rules prescribed a

ratio  of  50:50  for  direct  recruitment  and  promotion,  2

rosters  one  for  direct  recruitment  and  another  for

promotion (where reservation in promotion applies) each

comprising 100 points shall be drawn up on the lines of

the respective model rosters.  The cadre also means the

sanctioned  temporary  posts,  work  charged  posts,

supernumerary posts, shadow posts in the grade.” [Emphasis added]

9. The  relevant  paragraphs  of  Railway  Board’s  Circular  No.181/85

which was issued vide letter NO.PCIII/84/UPG/19 dated 25.6.1985 and was

considered in various cases read as under:-  

Letter dated 25.6.1985

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“1.    Restructuring of certain Group ‘C’ & ‘D’ cadres have

been under consideration in consultation with the Staff Side in

the  Committee  of  the  Departmental  Council  of  the  JCM

(Railways)  for  sometime.   The  Ministry  of  Railways  have

decided with the approval of the President to restructure certain

categories  of  Group  ‘C’  & ‘D’ as  detailed  in  the  Annexure

enclosed.

2. While  implementing  these  orders  specific  instructions

given in the footnote under the different categories should be

strictly and carefully adhered to.

3. For the purpose of restructuring the cadre strength as on

1.1.1984 will be taken into account and will include Rest Giver

and Leave Reserve posts.  

5.1 The existing classification of the posts covered by these

restructuring orders, as “Selection” and “Non-Selection”, as the

case may be, remains unchanged.  However, for the purpose of

implementation  of  these  orders,  if  an  individual  Railway

servant becomes due for promotion to only one grade above the

grade of the post held by him, at present, on a regular basis, and

such higher grade post is classified as a “Selection” post, the

existing selection procedure will stand modified in such a case

to the extent that the selection will be based only on scrutiny of

service records without  holding any written and/or  viva-voce

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test.   Under  this  procedure,  the  categorization  ‘Outstanding’

will not exist.

6.1 The existing rules and orders in regard to reservation for

SC/ST  will  continue  to  apply  while  filling  up  additional

vacancies  in  the  higher  grades  arising  as  a  result  of

restructuring.  

9. In all  the categories covered by this letter even though

more posts, in higher scales of pay have been introduced as a

result  of  restructuring,  the  basic  functions,  duties  and

responsibilities, attached to these posts at present will continue,

to which may be added such other duties and responsibilities as

considered appropriate.   

10. The Board desire that restructuring and posting of staff

after due process of selection as provided for in these orders,

should be completed expeditiously.”

The  percentage  of  upgraded  posts  is  indicated  in  Annexure  I

appended to letter dated 25.6.1985, which reads as under:-

ANNEXURE-I

Subject: Statement indicating restructuring of certain Group ‘C’ and ‘D’ cadres on Railways.

No.PCIII/84/UPG/19,  dated 25.6. 1985

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I Loco Running Staff

1. Passenger Driver ‘A’ (Rs.550-700)

All Passenger Train Drivers ‘A’ having a  run  of  250  kms.  And  above  to  be upgraded from Driver ‘A’ (Rs.550-700) to Driver ‘A’ Spl. (Rs.550-750)

All Leave Reserve for ‘A’ Spl. and ‘A’ Drivers to be kept in Grade only.

2. (i)  Goods Driver Gr.‘B’       (Rs.425-640 – 40%)

(ii)  Goods Driver Gr.‘C’        (Rs.330-560-60%)        (10% of the Gr.‘C’        posts operated as         Selection Grade posts        in Rs.425-600)

                                           Revised Goods Driver Gr.‘B’         Percentage Rs.425-640                             60     

Goods Driver Gr.‘C’               40 Rs.330-560 Selection Grade Rs.425-600 to be discontinued

3. Shunters (Rs.290-400)

30%  of  Shunters  to  be  upgraded  as Shunting Drivers Rs.330-560

4. Fireman ‘A’/Disel Asstt./ Asstt. Elec. Loco Driver (Rs.290-350)

30% of posts to be given special pay @ Rs.15 p.m.

5. Fireman ‘B’ (Rs.260-350)

Leave  reserve  posts  for  Fireman  ‘A’ hitherto  kept  in  Fireman  ‘B’  to  be upgraded to Fireman ‘A’

6. Fireman ‘C’ (Rs.210-270)

30% of Fireman ‘C’ to be upgraded to scale Rs.260-350 (L)

(L) Note: 30% of Fireman ‘C’ scale Rs.210-270 who are upgraded to scale Rs.260-350 will remain designated as Fireman ‘C’ and utilized as far as possible on Mail, Express and Passenger Trains.  The further avenue of promotion of Fireman ‘C’ in scale Rs.210-270 and Rs.260- 350 will remain unaltered.   

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7. Motormen on EMU Trains (Rs.550-700)

50% on Western Railway and 40% on Central,  Northern,  Eastern,  Southern and  S.E.  Railways to  be  upgraded  as Driver ‘A’ Spl. in scale Rs.550-750.

II. Traffic Running Staff

1. Passenger Guard ‘A’ (Rs.425-600)

(i) All  Passenger  Train  Guards having  a  run  of  250  kms.  and above  to  be  upgraded  to  Guard ‘A’ Spl. Rs.425-640.

(ii)  Leave  Reserve  for  ‘A’  Spl.  and ‘A’  Guard  to  be  kept  in  ‘A’ Grade only.

2. (i) Goods Guard Gr.‘B’      (Rs.330-560-40%)

(ii) Goods Guard Gr.‘C’       (Rs.330-530-60%)

                                           Revised Goods Guard Gr.‘B’         Percentage Rs.330-560                             60     

Goods Guard Gr.‘C’               40 Rs.330-530

III. Account Staff

Clerks Grade I to be aggregated with Selection Grade Clerks Grade I, Sub- Heads  and  Selection  Grade  Sub-Heads  and  placed  in  the  following Percentages:-

Clerk Grade I (Rs.330-560)

55%

Sub-Heads (Rs.425-700)

45%

Note:

1. Posts of Selection Grade Clerks Grade I Rs.425-700 to be discontinued. 2. Selection Grade Sub-Heads will continue as per extant orders. 3. Sub-Heads to work as Clerical hands as required by the Administration

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IV. Cash & Pay Office Staff

The cadre of Shroffs to be placed in the following Percentages:-

(a) Head-Shroff Senior Shroff Junior Shroff

Rs.425-640                       20% Rs.330-560                       40% Rs.260-400                       40%

(b) Cashiers to be placed in the following Percentages:-

Rs.455-700                        40% Rs.425-640                        40% Rs.330-560                        20%

(c) Upgradation effected to posts in Supervisory Cadre as under:- Scale (Rs.) Existing Revised 700-900 55 107 550-750 134 146 455-700 37 Nil Total 226 253  (+27 posts upgraded

from  Head  Shroff Scale Rs.425-640)

The detailed  distribution of  Supervisory Cadre Railway-wise is  given  in Annexure-II.)

V. Tool Checkers

1. CLW & DLW:  The existing  cadre  of  Tool  Checkers  in  CLW & DLW will be restructured as under:-

Scale (Rs.) Revised Percentage 260-400 330-560 425-700 550-750

40% 30% 20% 10%

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The  CLW and  DLW Administration  should  take  action  for  introducing direct recruitment in the cadre of Tool Checkers on the standard pattern applicable  to  other  Ministerial  cadres  and  merge  with  the  appropriate Ministerial cadre.

2.  Eastern Railway: The Tool Checkers on Eastern Railway will also have the grades Rs.425-700 and Rs.550-750 and the same percentage structure as laid  down  for  CLW  and  DLW  in  Item  I  above  with  the  proviso  that upgradation of posts to scale Rs.550-750 forming part of 10% of the cadre will be effected only after the existing staff promoted to scale Rs.425-700 in terms of  these  restructuring  orders  complete  one  year of  service  in  that grade from the date of physical promotion.  The Railway should take action to merge the cadre of Tool Checkers with the appropriate Ministerial cadre and introduce direct recruitment as per existing pattern applicable to the Ministerial cadre.

VI. Tracers (Rs.260-430)

The  existing  regular  incumbents  of  the  post  of  Tracers  in  all  the  four disciplines of the Engg. Departments viz. Civil Engg, Mechanical Engg., Signal & Telecommunication Engg. and Elec. Engg. Departments will be promoted in the following manner:-

20

(i)

(ii)

(iii)

(iv)

(v)

Those who possess the diploma in  Draftsmanship from recognized institutions will be upgraded as Junior Draftsman scale Rs.330-560.

Those who do not  possess the  diploma in Draftsmanship but  have completed 5 years of service as on 1.1.84 will be upgraded as Junior Draftsman in scale Rs.330-560.

The balance non-qualified Tracers will be progressively promoted by upgrading their posts as Junior Draftsman (Rs.330-560) as and when they  complete  5  years  of  service  or  acquire  the  necessary qualification.  The review will be done every six months commencing from 1.7.1986.

The vacancies which occur in the normal course in scale Rs.330-560 will continue to be filled as per existing pattern.

After the entire cadre of the Tracers has been fully accommodated in the higher grade post of Junior Draftsman in scale Rs.330-560, future vacancies in scale Rs.330-560 will  be filled cent-per-cent by direct recruitment  of  diploma  holders  in  Draftsmanship.   Detailed instructions will follow.

Note:

The  existing  cadre  of  Tracers  is  to  be  frozen  and  actual  requirements reviewed and determined with Board’s approval within six months.  In this connection, reference is invited to Ministry of Railways letter No.E(NG) II- 85/RC-2/7 dated 27.2.1985.   Once the  cadre of  the  Junior Draftsman in scale  Rs.330-560  is  fixed  finally,  it  will  be  taken  into  account  for percentage distribution applicable to the drawing office staff vide item 6 of the Annexure to this Ministry’s letter No.PCIII/84/UPG/9, dated 16.11.1984 in the subsequent annual cadre reviews.

VII. Permanent Way Mates to Permanent Way Mistries

21

(i)

(ii)

(iii)

20% of  posts  of  Permanent  Way Mates  in  scale  Rs.260-400 to  be upgraded to Permanent Way Mistries in scale Rs.380-560.

50%  of  vacancies  arising  on  or  after  1.1.85  in  scale  Rs.380-560 should be filled by candidates who have passed 12th Standard with Maths and Science.

Direct  recruitment  of  PWI Grade  III  in  scale  Rs.425-700  will  be reduce from 75% to 66-2/3% for vacancies arising in that category after the date of restructuring as proposed in item VII(i) above.  For promotion of directly recruited PW Mistries scale Rs.380-560 to PWI Grade III in scale Rs.425-700, a minimum of three years service as PW Mistries will be required including training period.

VIII Message Checkers (for Central Western & Eastern Railways only)

Message Checkers will be restructured as under:-

Grade (Rs.)

260-430 330-560 425-640 550-750 700-900 Total

        Central                  Western Extg.        Revd.       Extg.          Revd. cadre       cadre        cadre         cadre

5               4               8                7 4               3               6                5 1               2               1                2    -                1               1                1                                                      1 10            10             16              16    

       Eastern Extg.        Revd. cadre       cadre

4               3  3               3  2               2  -                1

9               9

10. The relevant paragraphs of policy contained in letter dated 9.10.2003

which is subject matter of this litigation, also read as under:-

“The Ministry of  Railways have had under review cadres of

certain Group `C’ & `D’ staff in consultation with the staff side

with  a  view  to  strengthening  and  rationalizing  the  staffing

pattern on Railways.  As a result of the review undertaken on

the  basis  of  functional,  operational  and  administrative

22

requirements,  it  has  been  decided  with  the  approval  of  the

President  that  the  Group  `C’  &  `D’  categories  of  staff  as

indicated in the Annexures to this letter should be restructured

in accordance with the  revised percentages indicated therein.

While  implementing  these  orders  the  following  detailed

instructions should be strictly and carefully adhered to:

xxx xxx xxx

1. Date of  effect  (hereinafter  referred to as cut-off  date):

This restructuring of cadres will be with reference to the

sanctioned cadre  strength  as  on the  date  following the

date on which the cadres in  the headquarter  offices  of

new  Zonal  Railways/New  Divisions  are  closed.   The

benefit of restructuring will be restricted to the persons

who are working in a particular cadre on the cut-off date.

3. Pay Fixation (Rule 1313 (FR 22) – RII).  Staff selected

and posted against the additional higher grade posts as a

result  of  restructuring  will  have  their  pay  fixed  under

Rule 1313 (FR-22)(I)(a)(1)-RII on proforma basis w.e.f.

the cut-off date with the usual option for pay fixation as

per extant  rules.   Actual  payment based on the pay so

fixed should be made from the date of taking over the

charge  of  the  higher  grade  post  arising  out  of  these

restructuring  orders.   The  benefit  under  this  rule  will,

however, no longer be available in the case of movement

from lower grade to higher grade in the non-functional

situations  where there is  no change in duties  as in the

23

case  of  movement  from  Goods  Guards  to  Sr.  Goods

Guards and Goods Drivers to Sr. Goods Drivers etc.  In

the case of such movement, the pay will be fixed under

Rule 1313 (FR 22) (I)(a)(2)-RII.  However, the benefit of

fixation  of  pay  under  Rule  1313  (FR-22)(I)(a)(1)  R-II

will  now  be  admissible  in  the  cases  of  functional

promotions such as promotion from Sr. Goods Guards to

Passenger  Guards  and Sr.  Goods  Drivers  to  Passenger

Drivers etc. though in identical scale of pay.   4. Existing  classification  and  filling  up  of  the  vacancies.

The existing classification of the posts covered by these

orders as `selection’ and `non-selection’, as the case may

be,  remains  unchanged.   Action  should  be  taken  to

position  the  employees  on  the  basis  of  selection/non-

selection/suitability/Trade  Test,  as  the  case  may  be.

However, the instructions contained in Para 13.2 should

be  followed  in  case  of  placement  of  Supervisors

(erstwhile Mistries) to grade Rs.5000-8000.

5. Extant instructions for D&A/Vigilance clearance will be

applicable  for  effecting  promotions  under  these  orders

with reference to the cut-off date.

6. Minimum  years  of  service  in  each  grade.  While

implementing  the  restructuring  orders,  instructions

regarding  minimum  period  of  service  for  promotion

24

issued from time to time should be followed.  In other

words,  residency  period  prescribed  for  promotions  to

various categories should not be relaxed.

7. Basic  functions,  duties  and  responsibilities. Since  the

cadres as detailed in the annexures to this letter are being

restructured  on  functional,  operational  and

administrative considerations, the posts being placed in

higher scales of pay as a result  of restructuring should

include  the  duties  and  responsibilities  of  greater

importance.

8. Adjustment of excess number of posts. If prior to issue of

these  instructions  the  number  of  posts  existing  in  any

grade  in  any  particular  cadre  exceeds  the  number

admissible  on  the  revised  percentages,  the  excess  be

allowed to continue to be phased out progressively with

the vacation of the posts by the existing incumbents.

11. Introduction  of  Direct  recruitment  (i)Ministerial  Staff (excluding Accounts staff)  (ii)Personnel  Inspectors (iii) Depot Material Superintendents.

The  implementation  of  restructuring  scheme  in  the

categories of Ministerial staff, Personnel Inspectors and

Depot  Material  Superintendents  is  subject  to  the

introduction  of  direct  recruitment  in  these  categories.

After implementation of the restructuring in accordance

with  the  revised  percentage  distribution  of  posts

25

indicated  in  the  annexures  enclosed,  the  vacancies

arising  in  these  categories  on  or  after  the  cut-off  date

should be filled through direct recruitment in the manner

indicated hereunder:-

11.1 An element of direct recruitment of graduates with not

less than 50% marks shall now be introduced at the level

of Office Superintendent Gr.II in the pay scale Rs.5500-

9000  in  the  Ministerial  categories  (Establishment  &

other than Establishment but excluding Accounts) to the

extent of 20% of the posts.  The remaining 80% of the

posts in grade Rs.5500-9000 shall continue to be filled

by  promotion  of  staff  from the  lower  grade  Rs.5000-

8000 as per the procedure in force.

11.2 20% of the posts in grade Rs.6500-10500 in the category

of  Personnel  Inspectors  shall  be  filled  by  direct

recruitment  from  amongst  the  candidates  possessing

Bachelor degree with Postgraduate Diploma in Personnel

Management, labour laws, etc. as mentioned in Board’s

letter  No.E(NG)I-2002/PM4/1  dated  12-07-2002.   The

remaining 80% of the posts shall continue to be filled by

promotion of staff from the lower grade of Rs.5500-9000

as per the procedure in force.

11.3 20% of the posts in grade Rs.6500-10500 in the category

of  Depot  Material  Superintendents  should  be  filled  by

direct  recruitment  from  amongst  the  candidates

possessing qualification of degree in Engineering in any

discipline.   The  remaining  80%  of  the  posts  shall

26

continue to be filled by promotion of staff from the lower

grade of Rs.5500-9000 as per procedure in force.

12. Gatemen (Engg.) As a result of implementation of this

restructuring,  more  number  of  additional  posts  will  be

available  in  the  highest  grade  of  this  category.

Henceforth,  therefore,  the  posts  of  Gatemen  (Engg.)

should be operated in grade Rs.2750-4400.  In order to

ensure  the  full  availability  of  Gatemen  (Engg.)  and

rotation  of  the  existing  staff  specially  those  who  are

working, as such, for a long period, the Trackmen etc. at

the  time  of  their  promotion  to  grade  Rs.2750-4400

should  be  posted  as  Gateman  (Engg.)  subject  to  their

fulfilling the requirement of prescribed medical standard

and literacy level etc. as per extant instructions.

13(a) Upgradation  of  the  posts  of  Supervisor  (erstwhile

Mistries) Subject to provisions of Para-13.2 below, all

the  posts  of  Supervisors  (erstwhile  Mistries)  in  grade

Rs.4500-7000  +  Rs.100  Special  Allowance  (excluding

Supervisors (P.Way) should enbloc be upgraded to the

posts  of  Junior  Engineer  Gr.II  in  the  pay  scale  of

Rs.5000-8000 and merged with the respective cadre of

Technical  Supervisors  with  its  spread  effect  in  higher

grades Rs.5500-9000, 6500-10500 & 7450-11500 as per

the  revised  percentage  distribution  of  posts  prescribed

for Technical Supervisors in these orders.

27

13(b) In case of Supervisor (P.Way), the posts being held by

the  erstwhile  PWMs  supervising  more  than  one  gang

upto a maximum of 17.26% of the sanctioned cadre of

PWMs shall be upgraded to and merged with the posts of

Junior  Engineer  (P.Way)  Gr.II  in  the  pay  scale  of

Rs.5000-8000 with its spread effect in higher grades of

JE-I, SE & SSE in grades Rs.5500-9000, 6500-10500 &

7450-11500 respectively, as per the revised percentages

prescribed for Technical Supervisors in these orders.

13.1 The  financial  implications  involved  in  the upgradation

covered  by  (a)  &  (b)  above  should  be  off  set  by

surrender  of  posts  of  Supervisors  of  equivalent  money

value.

13.2 Procedure for fitment. The  placement  of  the  existing

incumbents will be regulated as per the procedure given

below:-

(a) The  existing  regular  incumbents  of  the  posts  of

Supervisors (including Supervisors/P.Way to the extent

of upgradation of posts) will be placed in grade Rs.5000-

8000  without  subjecting  them  to  normal  selection

procedure.  Their  suitability  shall  be  adjudged  by

following  modified  selection  procedure  according  to

which the selection will be based on scrutiny of service

records and confidential reports only.

(b) The  Supervisors  (other  than  P.Way)  who  do  not  get

promoted to grade Rs.5000-8000 shall continue to hold

the post in the existing grade Rs.4500-7000 + Rs.100 SA

28

as personal to them.  To this extent, the posts upgraded

to  grade  Rs.5000-8000  will  be  operated  in  the  lower

grade  Rs.4500-7000  +  Rs.100  SA  till  the  existing

incumbents  vacate  the  same  by  way  of  promotion,

retirement etc.  On vacation of the posts, the same shall

automatically be operated in grade Rs.5000-8000. 13.3 Specific  provisions  for  Supervisor  (P.Way)  The

remaining  posts  of  Supervisors  (P.Way),  erstwhile

PWMs which are not to be upgraded and shall continue

to  be  operated  in  the  existing  scale  of  pay,  should  be

redesignated as ‘Track Supervisor’.

13.4 While the existing incumbents of the post of Supervisor

(P.Way)  redisignated  as  ‘Track  Supervisor’  shall

continue to draw the scale of pay Rs.4500-7000 + Rs.100

SA as personal to them, the future incumbents to the post

of  ‘Track  Supervisor’  will  be  in  the  pay  scale  of

Rs.4500-7000  without  the  Special  Allowance  of

Rs.100/-.

13.5 The  upgradation  of  posts  of  Supervisor  (P.Way)  as

indicated  hereinabove  should  not  result  in  creation  of

posts  of  Trolleymen.   In  other  words  under  no

circumstances, additional posts of Trolleyman would be

created.

14. Provisions of reservation.  The existing instructions with

regard to reservation of SC/ST wherever applicable will

continue to apply.

29

15. Direct recruitment percentages:    Direct

recruitment  percentages  will  not  be  applicable  to  the

additional posts arising out of these restructuring orders

as on the cut-off date.  The direct recruitment percentage

will  apply for normal vacancies arising on or after  the

date  following  the  cut-off  date.   Also  the  direct

recruitment  quota  as  on  the  date  preceding the cut-off

date will be maintained.

16. Pin  pointing  of  posts.  The  administration  should  take

steps to pin-point the additional posts arising out of this

restructuring as per administrative requirements.

18. Matching Savings.  Entire scheme of restructuring is to

be a self-financing and expenditure neutral proposition.

Financial implications should be worked out taking into

account  the  mid  points  of  the  scales  of  pay  of  the

respective posts (mean of the minima and maxima of the

scale), existing number of posts and revised number of

posts in the grade on the basis of the revised percentage

of distribution of posts.  After working out the financial

implications,  the  matching  savings  should  be  effected

from the category itself.  Wherever it is not possible to

do  so  from  the  category  itself,  the  matching  savings

should  be  arranged  from  the  department  at  the

divisional/zonal level.  But before restructuring the cadre

30

as  per  the  revised  percentage  distribution  of  posts,

matching  savings  will  have  to  be  ensured  and  if  the

Department/Railways  are  not  able  to  provide  the

matching  savings,  the  particular  category/department

will  not  be  restructured.   While  effecting  surrender  of

posts of equivalent  financial  value,  the existing vacant

posts  available  in  the  categories  on  the  cut-off  date

should be considered for the purpose of off-setting the

cost  of  restructuring/financial  effects  of  restructuring.

Board desire  that  the General  Managers  should  ensure

that the restructuring is implemented expeditiously with

matching savings without any exception and difficulty.

There  would  be  no  restructuring  without  matching

savings by surrender of posts.”

19. Re-organization of Zonal Railways/Divisions:    Due to

re-organization of  Zonal  Railways/Divisions  cadres are

in a fluid situation.  It may, therefore, take some time for

the cadres in the headquarter offices of New Zones and

Divisions to stabilize.  In the circumstances, new Zonal

Railways are required to ensure that the staff transferred

to  headquarter  offices  of  new  Zonal  Railways/new

Divisions  are  not  extended  the  double  benefit  of

restructuring.  In case an employee has been given the

benefit  of  restructuring  on  the  old  (parent)  railway  in

terms of these orders, he will not be allowed the benefit

of restructuring again on the headquarter offices of new

31

Zonal  Railways/new  Divisions.   In  other  words,  no

railway servant will be considered for double promotion

as a result of this restructuring.”        

The existing and revised percentage of posts in different cadres are

indicated in Annexures ‘A’ to ‘K’ appended to letter dated 9.10.2003.  For

the sake of reference Annexure ‘A’(i) appended to that letter is reproduced

below:-

ANNEXURE ‘A’(i)

STATEMENT REGARDING RESTRUCTURING OF GROUP

‘  C’ & ‘D’ STAFF OF TRANSPORTATION TRAFFIC DEPARTMENT   

Annexure to Board’s letter No.PC III/2003/CRC/6 dated 9-10-2003

CATEGORY GRADE

(Rs.)

EXISTING %AGE

REVISED %AGE

Station Masters/Assistant Station Masters*

7450-11500 6500-10500 5500-9000 5000-8000 4500-7000

6.5 22 30 33 8.5

Train Clerks 5500-9000 5000-8000 4000-6000 3050-4590

20 30 25 25

30 36 17 17

Traffic Controllers 7450-11500 6500-10500 5500-9000

30 55 15

37 48 15

Shunting Masters/  Jamadars

5000-8000 4000-6000

25 75

50 50

32

Pointsmen/Levermen/ Shuntmen

3050-4590 2650-4000

75 25

83 17

Cabinmen 4000-6000 3050-4590

25 75

50 50

Foot Note: The revised percentage distribution of posts will be made applicable in the unified cadre as per the provisions contained in Para-10.1 of the covering letter.

11. The nature and scope of the Railway Board’s power to make rules

was considered by the Constitution Bench of this Court in B.S. Vadera vs.

Union of India and Others [1968 (3) SCR 575].  The facts of that case

were that the petitioners, who joined service as Lower Division Clerks, were

first promoted as Upper Division Clerks and then as Assistants (on ad-hoc

basis).   In June 1967, they were reverted to the posts  of Upper Division

Clerks.  It was argued on their behalf that the Railway Board does not have

the power to frame the Scheme or amend the same with retrospective effect.

This  Court  referred  to  the  provisions  of  the  Indian  Railway Board  Act,

1905, Article 309 of the Constitution and Rules 157 and 158 of the Code

(these rules are pari material to paras 123 and 124 of 1985 edition of the

Code) and held that the Railway Board’s Secretariat Clerical Service (Re-

organisation) Scheme was statutory in character and that the Railway Board

could  amend  the  same with  retrospective  effect.   Paras  21  to  25  of  the

judgment which contain its ratio are extracted below:-

33

“21.  There  is  no  controversy  that  the  Indian  Railway

Establishment  Code  has  been  issued,  by  the  President,  in

exercise of the powers, vested in him, by the proviso to Article

309, of the Constitution. Only two rules require to be noted,

and they are Rules 157 and 158, occurring in Chapter I, under

the sub-heading “Power to frame rules”. They are as follows:

“157. The Railway Board have full powers to make rules

of a general application to non-gazetted railway servants

under their control.

158. The General Managers of Indian Railways have full

powers  to  make  rules  with  regard  to  non-gazetted

railway servants  under  their  control,  provided they are

not inconsistent with any rules made by the President or

the Railway Board.”

We are  not  concerned,  really  in  this  matter,  with  Rule  158,

because the Scheme, Annexures 4 and 7, in particular, and the

various  orders,  have  been  passed  by  the  2nd respondent,  the

Railway Board. The Railway Board, as will be seen from Rule

157, have full powers to make rules of general application, to

non-gazetted railway servants under their control. The question

is whether the 2nd respondent, has, while acting under Rule 157,

power to make a rule (in this case, the Scheme), having effect

from an anterior date.

34

22. The  matter  must  be  considered,  in  the  light  of  the

provisions  of  Article  309,  of  the  Constitution.  That  Article

provides:

“309. Subject to the provisions of this Constitution, Acts

of  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:

Provided that it shall be competent for the President or

such person as he may direct in the case of services and

posts in connection with the affairs of the Union, and for

the Governor of a State or such person as he may direct

in the case of services and posts in connection with the

affairs  of  the  State,  to  make  rules  regulating  the

recruitment,  and  the  conditions  of  service  of  persons

appointed, to such services and posts until provision in

that behalf is made by or under an Act of the appropriate

Legislature under this article, and any rules so made shall

have effect subject to the provisions of any such Act.”

We may emphasize the  words  “and any rules  so  made shall

have effect subject to the provisions of any such Act,” which

must receive their due weight. To that aspect, we shall come,

presently.

23. We have already pointed out, that Annexure 4 was issued

on February 5, 1957, and Annexure 7, on March 30, 1963, and

35

that  the  initial  constitution  of  the  Service  was  to  be  from

December 1, 1954, and it is, on that basis, that the promotions,

or appointments, to the Service, are to be made. In this case,

there is  no Act of  the appropriate Legislature,  regulating the

recruitment and conditions of service, under the 2nd respondent

and, therefore, the main part of Article 309 is not attracted. But,

under the Proviso therein, the President has got full power to

make  rules,  regulating  the  recruitment,  and  conditions  of

service, of persons, under the 2nd respondent.   Further, under

the Proviso, such person, as may be directed by the President,

can also make rules, regulating the recruitment and conditions

of service, of persons, under the 2nd respondent. The rules so

made, either by the President, or such person, as he may direct,

will have currency, until provision, in that behalf, is made by or

under an Act, of the appropriate Legislature, under Article 309.

24. It is  also significant  to note that the proviso to Article

309,  clearly  lays  down  that  ‘any  rules  so  made  shall  have

effect, subject to the provisions of any such Act’. The clear and

unambiguous  expressions,  used  in  the  Constitution,  must  be

given their full and unrestricted meaning, unless hedged-in, by

any limitations.  The  rules,  which  have  to  be  ‘subject  to  the

provisions of the Constitution, shall have effect, ‘subject to the

provisions  of  any  such  Act’.  That  is,  if  the  appropriate

legislature  has  passed  an  Act,  under  Article  309,  the  rules,

framed under the proviso, will have effect, subject to that Act;

but, in the absence of any Act, of the appropriate legislature, on

36

the matter, ‘in our opinion, the rules, made by the President, or

by such person as he may direct, are to have full effect, both

prospectively, and, retrospectively. Apart from the limitations,

pointed out above, there is none other, imposed by the proviso

to  Article  309,  regarding  the  ambit  of  the operation  of  such

rules. In other words, the rules, unless they can be impeached

on  grounds  such  as  breach  of  Part  III,  or  any  other

Constitutional  provision,  must  be  enforced,  if  made  by  the

appropriate authority.

25. In the case before us, the Indian Railway Establishment

Code has been issued, by the President, in the exercise of his

powers, under the proviso to Article 309. Under Rule 157, the

President  has  directed  the  Railway Board,  to  make rules,  of

general  application  to  non-gazetted  railway  servants,  under

their control. The rules, which are embodied in the Schemes,

framed by the Board, under Annexures 4 and 7, are within the

powers, conferred under Rule 157; and, in the absence of any

Act,  having been passed by the ‘appropriate’ Legislature,  on

the said matter,  the rules, framed by the Railway Board, will

have full effect and, if so indicated, retrospectively also. Such

indication,  about  retrospective  effect,  as  has  already  been

pointed out by us, is clearly there, in the impugned provisions.”

12. In view of the pronouncement of the Constitution Bench, there cannot

be any doubt that the Railway Board and General Managers are empowered

37

to frame rules for regulating the recruitment and conditions of service of the

employees.  

13. We shall  now consider  whether the posts  created with reference to

different grades in Group C and D can be treated as independent cadres and

the policy of reservation can be applied while making appointment to these

cadres.   

14. A conjoint reading of paragraph 103(7) of the Code, 103(iii) of the

Railway  Establishment  Manual  and  Circular  R.B.E.  No.113/97  makes  it

clear that in the railways, the term ‘cadre’ generally denotes the strength of

a service or a part of a service sanctioned as a separate unit.  However, for

the purpose of roster, a wider meaning has been given to the said term so as

to take within its fold the posts sanctioned in different grades.  The reason

for giving this  enlarged meaning to the term “cadre” is  that  posts  in the

railway  establishment  are  sanctioned  with  reference  to  grades.   Even

temporary,  work  charged,  supernumerary  and  shadow  posts  created  in

different grades can constitute part of the cadre.  

15. In the service jurisprudence which has developed in our country, no

fixed meaning has been ascribed to the term “cadre”. In different service

38

rules framed under proviso to Article 309 of the Constitution as also rules

framed in exercise of the powers of delegated legislation, the word “cadre”

has been given different meaning.   

16. In  A.K.  Subraman and Others  vs.  Union  of  India  and  Others

[1975 (1) SCC 319], a three Judges Bench of this Court while interpreting

the  provisions  contained  in  Central  Engineering  Service,  Class  I,

Recruitment Rules, 1954, observed as under :

“The  word  “grade”  has  various  shades  of  meaning  in  the

service  jurisprudence.   It  is  sometimes used  to  denote  a pay

scale and sometimes a cadre.  Here it is obviously used in the

sense of cadre. A cadre may consist only of permanent posts or

sometimes, as is quite common these days, also of temporary

posts.”  

17. In  Dr. Chakradhar Paswan vs. State of Bihar and Others  [1988

(2) SCC 214] it was observed as under:-

“In service jurisprudence, the term ‘cadre’ has a definite legal

connotation. It is not synonymous with ‘service’. It is open to

the Government to constitute as many cadres in any particular

service  as  it  may  choose  according  to  the  administrative

convenience  and  expediency  and  it  cannot  be  said  that  the

establishment of the Directorate constituted the formation of a

joint  cadre of the Director and the Deputy Directors because

39

the posts  are not  interchangeable  and the incumbents  do not

perform  the  same  duties,  carry  the  same  responsibilities  or

draw the same pay.  The posts of the Director and those of the

Deputy Directors constitute different cadres of the Service. The

first vacancy in the cadre of Deputy Directors was that of the

Deputy Director  (Homoeopathic)  and it  had  to  be  treated  as

unreserved,  the  second  reserved  and  the  third  unreserved.

Therefore,  for  the  first  vacancy  of  the  Deputy  Director

(Homeopathic), a candidate belonging to the Scheduled Caste

had therefore to compete with others.”

18. In State of Maharashtra vs. Purshottam and Others [1996 (9) SCC

266], it was held that the “cadre” means unit of strength of a service or a

part of it as determined by the employer.   

19. The  argument  of  Shri  Sushil  Jain  that  para  4(b)  of  Circular  RBE

No.113/97 dated 21.8.1997 is ultra vires the definition of the word “cadre”

contained in para 103(7) of the Code completely ignores the stark reality

that in the railway establishment the posts are sanctioned with reference to

grades which term means sub-division of a class, each bearing a different

scale  of  pay.   Therefore,  the  posts  sanctioned  in  different  grades  would

constitute  independent  cadres  and  we  see  no  reason  why  a  restricted

40

meaning  should  be  given  to  the  term  ‘cadre’  for  the  purpose  of

implementing the roster.   

20. The next question which merits consideration is whether the policy of

reservation can be applied at the stage of restructuring of Group C and D

cadres  in  the  railways  and  whether  para  14  of  letter  dated  9.10.2003  is

violative  of  doctrine  of  equality  enshrined  in  Articles  14  and  16  of  the

Constitution.

21. A cursory reading of the relevant extracts of letters dated 25.6.1985

and  9.10.2003  reproduced  hereinabove  may give  an  impression  that  the

policies contained therein are similar but a closer scrutiny thereof reveals

the following stark dissimilarities:-

(i) In  terms  of  para  5.1  of  letter  dated  25.6.1985,  the  existing

classification  of  the  posts  covered  by  the  restructuring  orders  i.e.

‘selection’ and ‘non-selection’ was to be retained.  However, for the

purpose  of  promoting  an  individual  railway  employee  there  was

deemed modification  of  the  selection procedure and the promotion

was to be made without holding any written test and/or viva-voce.  As

against  this,  action  in  terms of  para  4  of  letter  dated  9.10.2003 is

required  to  be  taken  for  making  appointment  on  the  basis  of

41

selection/non-selection/suitability/Trade  Test  and  in  para  5,  the

requirement of D&A/Vigilance clearance has been made mandatory

for effecting promotion with reference to the cut off date.  

(ii) While the policy contained in letter dated 25.6.1985 did not specify

any minimum period of services as a condition for promotion, para 6

of  letter  dated  9.10.2003  lays  down  the  requirement  of  minimum

period of services as a condition for promotion and also declares that

residency  period  prescribed  for  promotion  to  various  categories

should not be relaxed.

(iii) Para  9  of  letter  dated  25.6.1985  postulated  retention  of  basic

functions, duties and responsibilities and addition of other duties and

responsibilities,  whereas  para  7 of letter  dated 9.10.2003 mandates

that posts being placed in the higher scales of pay should include the

duties and responsibilities of greater importance because restructuring

is  contemplated  on  functional,  operational  and  administrative

considerations.   

(iv) While  the  policy  contained  in  letter  dated  9.10.2003  postulates

progressive  phasing  out  of  excess  number  of  posts  in  a  particular

cadre, no such provision was made in the policy circulated vide letter

dated 25.6.1985.   

42

(v) The instructions contained in letter dated 25.6.1985 did not provide

for direct  recruitment  against  upgraded posts,  but  para  15 of  letter

dated  9.10.2003  unequivocally  lays  down  that  direct  recruitment

percentages will not be applicable to the additional posts becoming

available  as  a  result  of  restructuring  and  the  same  will  apply  to

normal vacancies after the cut-off date.     

(vi) Para  18  of  letter  dated  9.10.2003  shows  that  the  scheme  of

restructuring is a self-financing and expenditure neutral proposition.

There was no such provision in the earlier policy.

(vii) Annexure  1  appended  to  letter  dated  25.6.1985  shows  that  the

percentage of the upgraded posts becoming available as a result  of

restructuring varied from 20 to 60 in different grades, except in the

cadre of Tool Checkers where the percentage varied from 10 to 40.

As against  this,  the  percentage of  additional  posts  (as  indicated  in

Annexures  A to  K  appended  to  letter  dated  1.10.2003)  becoming

available as a result of restructuring of different cadres in Group C

and D posts varied from 1 to 10, except in one or two cadres where it

was more than 20.

22. From what we have noted above, it is clear that the policies contained

in letters dated 25.6.1985 and 9.10.2003 are substantially dis-similar.  The

43

exercise of restructuring envisaged in the first policy was in the nature of

upgradation  of  substantial  number  of  posts  in  different  cadres  and  the

upgraded posts were to be filled simply by scrutinizing the service records

of  the  employees  without  holding  any written  and/or  viva  voce  test  and

there was no merit based selection.  In contrast, the restructuring exercise

envisaged in letter dated 9.10.2003 resulted in creation of additional posts in

some  cadres  with  duties  and  responsibilities  of  greater  importance  and

which could be filled by promotion from amongst the persons fulfilling the

conditions of eligibility and satisfying the criteria of suitability and/or merit.

Para 13 of letter dated 9.10.2003 is, in itself, demonstrative of the difference

between simple upgradation of posts in the cadre of Supervisors which are

required  to  be  filled  without  subjecting  the  incumbents  of  the  posts  to

normal selection procedure whereas the additional posts becoming available

in other cadres are required to be filled by promotion.

23. In legal parlance, upgradation of a post involves the transfer of a post

from the lower to the higher grade and placement of the incumbent of that

post  in  the  higher  grade.   Ordinarily,  such  placement  does  not  involve

selection  but  in  some  of  the  service  rules  and/or  policy  framed  by  the

employer for upgradation of posts, provision has been made for denial of

higher  grade  to  an  employee  whose  service  record  may contain  adverse

44

entries or who may have suffered punishment – D.P. Upadhyay vs. G.M.,

N.R.  Baroda House and Others [2002 (10) SCC 258].   

24. The word ‘promotion’ means “advancement or preferment in honour,

dignity, rank, or grade”.  ‘Promotion’ thus not only covers advancement to

higher position or rank but also implies advancement to a higher grade.  In

service law the expression ‘promotion’ has been understood in the wider

sense and it  has been held that “promotion can be either to a higher pay

scale  or  to  a  higher  post”  –  State  of  Rajasthan vs.  Fateh Chand Soni

[1996 (1) SCC 562].

25. Once it is recognized that the additional posts becoming available as

a  result  of  restructuring  of  different  cadres  are  required  to  be  filled  by

promotion  from  amongst  the  employees  who  satisfy  the  conditions  of

eligibility and are adjudged suitable, there can be no rational justification to

exclude  the  applicability  of  the  policy  of  reservation  while  effecting

promotions, more so because it has not been shown that the procedure for

making appointment by promotion against such additional posts is different

than the one prescribed for normal promotion.  In Fateh Chand Soni’s case,

this  Court  interpreted  the  provisions  contained  in  the  Rajasthan  Police

Service Rules, 1954, which regulate appointment to the Selection Scale in

45

the  service  and  held  that  such  appointment  constitutes  promotion.   The

Court then considered two earlier judgments in Lalit Mohan Deb vs. Union

of India [1973 (3) SCC 862] and Union of India vs. S.S. Ranade [1995 (4)

SCC 462] and declared that  the  High Court  was in error  in holding that

appointment to the Selection Scale does not constitute promotion.

26. In  Ram Prasad and Others vs. D.K. Vijay and Others  [1999 (7)

SCC 251], it was submitted that the view taken in Fateh Chand Soni’s case

requires  re-consideration  because  the  same is  inconsistent  with  the  latter

judgments in  Ajit Singh Januja vs. State of Punjab [1996 (2) SCC 715]

and Ajit Singh II vs. State of Punjab [1999 (7) SCC 209].  While rejecting

this plea, the Constitution Bench observed:-

“The contention  of  Shri  Gopal  Subramanium for  the general

candidates that appointment from senior scale to selection scale

is  not  a  promotion  and  that  Fateh  Chand  Soni  requires

reconsideration in view of the judgments in Union of India vs.

S.S. Ranade and Lalit Mohan Deb vs. Union of India cannot be

accepted.   We are unable to agree.   We find that  both these

cases have been referred to and explained in Fateh Chand Soni

case.   Therefore,  the  reserved  candidates  are  entitled  to  be

promoted to the selection scale by way of the roster points.  But

this has to be done in the manner mentioned in R.K. Sabharwal

46

vs. State of Punjab.  The appeal of the general candidates has to

fail.”

27. A careful  reading of the policy contained in letter  dated 9.10.2003

shows that with a view to strengthen and rationalize the staffing pattern, the

Ministry of Railways had undertaken review of certain cadres.  The basis of

the review was functional, operational and administrative requirement of the

Railways.  This  exercise  was  intended  to  improve  the  efficiency  of

administration by providing incentives to the existing employees in the form

of better promotional avenues and at the same time requiring the promotees

to  discharge  more  onerous  duties.   The  policy envisaged  that  additional

posts becoming available in the higher grades as a sequel to restructuring of

some of the cadres should be filled by promotion  by considering such of the

employees who satisfy the conditions of eligibility including the minimum

period of service and who are adjudged suitable by the process of selection.

This cannot be equated with upgradation of posts which are required to be

filled  by  placing  the  existing  incumbents  in  the  higher  grade  without

subjecting them to the rigor of selection.   

28. In view of the above discussion, we hold that the Railway Board did

not  commit  any illegality  by directing  that  the existing  instructions  with

47

regard  to  the  policy  of  reservation  of  posts  for  Scheduled  Castes  and

Scheduled Tribes will apply at the stage of effecting promotion against the

additional  posts  and the Tribunal  committed serious illegality by striking

down para 14 of letter dated 9.10.2003.   

29. Before parting with this aspect of the case, we consider it necessary to

reiterate  the  settled  legal  position  that  matters  relating  to  creation  and

abolition  of  posts,  formation  and  structuring/restructuring  of  cadres,

prescribing  the  source/mode of  recruitment  and  qualifications,  criteria  of

selection,  evaluation  of  service  records  of  the  employees  fall  within  the

exclusive  domain  of  the  employer.  What  steps  should  be  taken  for

improving  efficiency  of  the  administration  is  also  the  preserve  of  the

employer.  The power of judicial review can be exercised in such matters

only  if  it  is  shown  that  the  action  of  the  employer  is  contrary  to  any

constitutional or statutory provision or is patently arbitrary or is vitiated due

to  mala  fides.  The  Court  cannot  sit  in  appeal  over  the  judgment  of  the

employer and ordain that a particular post be filled by direct recruitment or

promotion  or  by  transfer.  The  Court  has  no  role  in  determining  the

methodology of recruitment or laying down the criteria of selection.  It is

also not open the Court to make comparative evaluation of the merit of the

candidates.  The Court cannot suggest the manner in which the employer

48

should  structure  or  restructure  the  cadres  for  the  purpose  of  improving

efficiency of administration.    

30. We may now deal with an ancillary question whether the policy of

reservation  of  posts  for  Scheduled  Castes  and  Scheduled  Tribes  can  be

applied in the matter of promotion.

31. The framers of the Constitution were very much conscious and aware

of  the  widespread  inequalities  and  disparities  in  the  social  fabric  of  the

country as also of the gulf between rich and poor and this is the reason why

the goal of justice – social, political and economic was given the place of

pre-eminence in the Preamble.  The concept of equality enshrined in Part III

and Part IV of the Constitution has two different dimensions.  It embodies

the principle of non-discrimination [Articles 14, 15(1), (2) and 16(2)].  At

the same time it obligates the State to take affirmative action for ensuring

that  unequals  (downtrodden,  oppressed  and have-nots)  in  the  society  are

brought at a level where they can compete with others (haves of the society)

(Articles 15(3), (4), (5), 16(4), (4A), (4B), 39, 39A and 41).  

32. The  legislative  and administrative  measures  taken  by the  State  for

providing  reservation  of  seats  and  posts  in  the  field  of  education  and

49

employment are reflective of the affirmative action taken for achieving the

goal  of  real  equality.   However,  implementation  and  execution  of  such

actions have continuously faced roadblocks at several stages.   Those who

had been benefited by the existing system cried foul and created the bogy of

violation  of  their  legal  and constitutional  rights.   Almost  all  the  actions

taken by the State and its agencies for ameliorating the conditions of have-

nots  of  the society by providing reservation were subjected to  periodical

judicial scrutiny. By and large, the Courts approved the affirmative actions

of  the  State  but  on  some  occasions  the  policy  of  reservation  or

implementation  thereof  was  found  to  be  faulty  and actions  taken  by the

government have been nullified or sliced by judicial intervention.   

33. Article  16(1) ensures  that  there  shall  be equality of opportunity in

matters relating to employment or appointment.  Clause (2) thereof declares

that no citizen shall be treated ineligible or discriminated in respect of any

employment or office under the State on the ground only of religion, race,

caste,  sex,  descent,  place of birth,  residence or any of  them.  Clause (4)

enables  the  State  to  make  provision  for  reservation  in  favour  of  any

backward  class  of  citizens  which,  in  the  opinion  of  the  State,  is  not

adequately  represented  in  the  services  under  the  State.   In  General

Manager,  Southern  Railway  vs.  Rangachari [AIR  1962  SC  36],  the

50

Constitution Bench made comparative analysis of Articles 16 (1), (2) and

(4) and held that reservation can be made not only at the stage of initial

appointment, but also while making appointment against selection post.

34. The ratio of Rangachari’s case was reiterated in State of Punjab vs.

Hira  Lal  and  Others [1970  (3)  SCC  567].   In  that  case,  the  Court

considered whether the Government of Punjab could provide for reservation

of 10% of posts for Scheduled Castes and Scheduled Tribes at the stage of

promotion.  While reversing the judgment of Punjab & Haryana High Court

which had quashed the policy of the State Government, this Court referred

to the judgment in Rangachari’s case and held:-

“The  reservation  must  be  only  for  the  purpose  of  giving

adequate representation in the services to the Scheduled Castes,

Scheduled  Tribes  and  Backward  Classes.  The  exception

provided in Article 16(4) should not make the rule embodied in

Article 16(1) meaningless. But the burden of establishing that a

particular reservation made by the State is offensive to Article

16(1) is on the person who takes the plea. The mere fact that

the reservation made may give extensive benefits  to some of

the persons who have the benefit of the reservation does not by

itself make the reservation bad.

It  is  true  that  every  reservation  under  Article  16(4)  does

introduce  an element  of  discrimination  particularly when the

51

question of promotion arises. It is an inevitable consequence of

any reservation of posts that junior officers are allowed to take

a  march  over  their  seniors.  This  circumstance  is  bound  to

displease the senior officers. It may also be that some of them

will  get  frustrated  but  then  the  Constitution  makers  have

thought fit  in the interests of the society as a whole that  the

backward class of citizens of this country should be afforded

certain protection.”

35. In Akhil Bharatiya Soshit Karamchari Sangh (Railway) vs. Union

of  India  and  Others [1981  (1)  SCC  246],  Chinnappa  Redy,  J.  in  his

concurring judgment observed as under:-

“Reservation  of  posts  and  all  other  measures  designed  to

promote  the  participation  of  the  Scheduled  Castes  and  the

Scheduled  Tribes  in  the  Public  Services  at  all  levels  are

necessary consequences flowing from the Fundamental Right

guaranteed  by  Article  16(1).   This  very  idea  is  emphasized

further by Article 16(4).  Therefore, when posts whether at the

stage of  initial  appointment or at  the stage  of  promotion are

reserved or other preferential treatment is accorded to members

of the Scheduled Castes, Scheduled Tribes and other socially

and economically backward classes,  it  is not a concession or

privilege  extended  to  them;  it  is  in  recognition  of  their

undoubted Fundamental Right to Equality of Opportunity and

in discharge of the constitutional obligation imposed upon the

52

State to secure to all its citizens ‘Justice, social, economic and

political’  and  ‘Equality  of  status  and  opportunity’,  to  assure

‘the dignity of the individual’ among all citizens, to ‘promote

with special care, the educational and economic interests of the

weaker section of the people’, to ensure their participation on

equal basis in the administration of the affairs of the country

and  generally  to  foster  the  ideal  of  a  ‘Sovereign,  Socialist,

Secular,  Democratic  Republic’.   Every  lawful  method  is

permissible to secure the due representation of the Scheduled

Castes and Scheduled Tribes in the Public Services.  There is

no  fixed  ceiling  to  reservation  or  preferential  treatment  in

favour of the Scheduled Castes and Scheduled Tribes though

generally reservation may not be far in excess of fifty per cent.

There is no rigidity about the fifty per cent rule which is only a

convenient guide-line laid down by judges.  Every case must be

decided with reference to the present practical results yielded

by  the  application  of  the  particular  rule  of  preferential

treatment and not with reference to hypothetical results which

the application of the rule may yield in the future.”

36. In  Indra  Sawhney’s  case,  the  larger  Bench  considered  whether

Clause (4) of Article 16 was confined to initial appointment or the same can

be  applied  at  the  stage  of  promotion.   After  elaborate  discussion,  the

majority of the larger  Bench held that  Article 16(4) is  confined to initial

appointment  and cannot  extend to  providing  reservation  in  the  matter  of

53

promotion.  At the same time it was held that the promotions already made

by applying the policy of reservation will not be affected and the policy may

continue to operate for a period of 5 years.     

37. The  judgment  in  Indra  Sawhney’s  case led  to  seventy-seventh

amendment  of  the  Constitution.   The  Statement  of  Objects  and  Reasons

incorporated in the bill introduced, which led to the passing of Constitution

(Seventy-seventh  Amendment) Act, 1995 reads as under:-

“Statement of Objects and Reasons.– The  Scheduled  Castes

and the  Scheduled  Tribes  have  been  enjoying the  facility  of

reservation in promotion since 1955.  The Supreme Court in its

judgment dated 16.11.1992 in the case of  Indra Sawhney vs.

Union of India [1992 Supp. (3) SC 217], however, observed

that reservation of appointments or posts under Article 16(4) of

the Constitution is confined to initial appointment and cannot

extend to reservation in the matter of promotion.  This ruling of

the  Supreme Court  will  adversely  affect  the  interests  of  the

Scheduled  Castes  and  the  Scheduled  Tribes.   Since  the

representation  of  the  Scheduled  Castes  and  the  Scheduled

Tribes in  services  in  the States  has not  reached the required

level,  it  is necessary to continue the existing dispensation of

providing reservation in promotion in the case of the Scheduled

Castes and the Scheduled Tribes.  In view of the commitment

of  the  Government  to  protect  the  interests  of  the  Scheduled

Castes and the Scheduled Tribes, the Government has decided

54

to continue the existing policy of reservation in promotion for

the Scheduled Castes and the Scheduled Tribes.  To carry this

out, it is necessary to amend Article 16 of the Constitution by

inserting a new clause (4-A) in the said article to provide for

reservation  in  promotion  for  the  Scheduled  Castes  and  the

Scheduled Tribes.”

Clause (4-A) which was inserted by the aforesaid amendment reads as

under:-

“Nothing in this article shall prevent the State from making any

provision for reservation in matters of promotion to any class

or classes of posts in the services under the State in favour of

the Scheduled Castes and the Scheduled Tribes which, in the

opinion  of  the  State,  are  not  adequately  represented  in  the

services under the State.”

38. The constitutionality of the above reproduced clause has been upheld

in M. Nagaraj’s case.   

39. We shall  now advert  to  the  decisions  of  different  benches  of  the

Tribunal and orders passed by this Court in the context of the actions taken

by the competent authority for giving effect to the policy of restructuring

envisaged in letter dated 25.6.1985 for reservation of posts for Scheduled

Castes and Scheduled Tribes.   

55

40. The policy contained in Railway Board’s letter dated 25.6.1985 was

considered by Allahabad Bench of the Tribunal in case bearing registration

No.384 of 1986,  V.K. Sirothia vs. Union of India and Others.  Some of

the peculiar features of V.K. Sirothia’s case are:-

(i) Prior to 1.6.1981 there were 3 categories of guards in grades ‘A’, ‘B’

and ‘C’ in Jhansi Division of Central Railway.

(ii). On  1.6.1981  a  fourth  category  was  created,  which  was  called  as

guards grade ‘A’ (Special).

(iii) Originally  69  posts  of  guards  grade  ‘A’  were  upgraded  and  re-

designated as guards grade ‘A’ (Special).

(iv) 109 posts of guards grade ‘B’ were upgraded to guards grade ‘A’ and

182 posts of guards grade ‘C’ were upgraded to that of guards grade

‘B’.  Consequently, 272 posts of guards remained in grade ‘C’.

(v) The above redistribution of posts was done as a result of restructuring

of  cadre  of  guards  in  Jhansi  Division  by  the  Railway  Division

manager.   

(vi) There was redistribution among various grades of guards on 1.1.1984.

69  posts  of  guards  grade  ‘A’  which  were  upgraded  to  grade  ‘A’

(Special) (15 posts) and grade ‘A’ (Special-II) (54 posts).  Some more

56

posts of guards in grade ‘C’ were upgraded to grade ‘B’.  Out of 109

posts of grade ‘A’ 32 were upgraded as grade ‘A’ (Special-II) and 77

were left as guards grade ‘A’.

(vii) Similarly  in  grades  ‘B’ and ‘C’ the percentage  of  distribution  was

interchanged and instead of 182, 272 posts were upgraded to that of

grade ‘B’ leaving out 182 posts in grade ‘C’.

41. The Tribunal noted that as per Railway Board’s letter No.E9(P&A)-

II-SCT/3 dated 2.8.1983, the policy of reservation for Scheduled Castes and

Scheduled Tribes is not applicable where cadre restructuring results in mass

upgradation of posts and held:

“6. In this connection Railway Board’s letter No.E9(P&A)-

II-SCT/3 dated 2.8.1983, which is placed at Annexure-I of the

petition,  refers  Board  have  clarified  in  this  letter  that  where

cadre restructuring results in mass up-gradation of posts in a

particular category reservation for SC/ST is not to be provided.

However,  in  cases  where  restructuring  results  in  partial  up-

gradation on the basis  of percentage distribution  the existing

rules should be applied against the additional number of higher

grade  posts  which  become  available  as  a  result  of  cadre

restructuring.   The first important aspect of this letter is ‘mass

up-gradation’.   What does the term ‘mass’ signify and how it

should be interpreted?  Does it mean that if all the posts in a

category  are  upgraded  en-block,  such  an  up-gradation  will

57

justify  for  being called ‘mass  up-gradation’  or  is  it  that  if  a

major percentage is up-graded then it will be called ‘mass up-

gradation’? The dictionary meaning of the word ‘mass’ is large

quantity or number.  ‘It can not be said that the large quantity

will only mean all  the posts being upgraded.   Large quantity

should  mean what  the  word  signifies  i.e.  a  large  number  of

posts should be involved in the exercise.   The petitioner Guard

grade ‘C’ there were 454 posts.  By an up-gradation made on

1.6.81 40% of these posts got upgraded to grade ‘B’ while on

1.1.84 the percentage was changed to 60%.  Out of total 454

posts 40% works out to 182 posts to a 60% to 272 posts.  This

is sizeable number and it cannot be said that the figure is in any

way small.   This should fall within the meaning of mass up-

gradation.

7. The  second  condition  enunciated  in  the  Board’s  letter

leads us to the question whether this up-gradation has resulted

in  additional  posts.   The  restructuring  of  posts  was  done  to

provide relief in terms of promotional avenues.  No additional

posts  were  created?  Some  posts  out  of  existing  total  were

placed in higher grade to provide these avenue to the staff who

were stagnating.   The placement of these posts in the higher

grade cannot be termed as creation of additional posts.   There

were  definite  number  of  posts  and  total  remained  the  same.

The  only  difference  was  that  some of  these  were  now in  a

higher grade.   It was a deliberate exercise or re-distribution

with the primary object of betterment of chances of promotion

58

and  removal  of  stagnation.   Additional  posts  could  only  be

created  if  there  were  additional  requirements.   There  should

have been justification for their creation and proper sanction.

We find no such situation here.   It was a simplicitor exercise of

dividing the total number in ratios.   It was done on 40:60 first

and later it was made 60:40 the number remained same.  

8. It  would  be  different  matter  if  in  a  fixed  cadre  the

promotion  are  made  on  occurrence  of  vacancies  in  higher

grades.   Such  vacancies  arise  due  to  promotion,  attrition  or

creation  of  additional  posts.    It  is  in  such  situations  that

reservation percentages  apply and have to be followed.  Up-

gradation  of  cadres  by  redistribution  of  posts  will  lose  its

primary objective if it is taken as generation of additional posts

in the up-graded posts which it rightly is not.

There has to be rationality in the implementation of direction

and instructions.  The criteria has also to for cumulated keeping

the aims and as regards in view.  The key note thought behind

the  exercise  should  not  be  lost  sight  of.    It  is  to  improve

prospects, remove stagnation and provide avenues.   The very

purpose  is  defeated if  the end result  is  anything  also.    The

ambiguity in the Railway Board’s letter of 2.8.83 needs to be

clarified  and  correctly  interpreted.   There  cannot  be  any

additional posts as result of restructuring up-gradation.   The so

called promotion  as  a result  of  redistribution  of  posts  is  not

promotion attracting reservation.  The 454 posts in grade ‘C’

59

had already been subject  to reservation, a second reservation

tantamount to giving unintended benefits.”

42. The  appeal  preferred  against  the  aforementioned  order  [Union  of

India  vs.  V.K.  Sirothia  (supra)]  was  dismissed  by  this  Court  in  the

following terms:-

“Heard counsel  on both sides.  The finding of Tribunal  that

“the so called promotion as a result of redistribution of posts

is  not  promotion attracting  reservation”  on  the facts  of  the

case, appears to be based on good reasonings.   On facts, it is

seen  that  it  is  a  case  of  upgradation  on  account  of

restructuring  of  the  cadres,  therefore,  the  question  of

reservation  will  not  arise.   We do  not  find  any ground  to

interfere with the order of the Tribunal.”

43. The same issue was considered by Jabalpur Bench of the Tribunal in

T.A. No.139 of 1986, Ashok Kumar Shrivastava vs. Union of India decided

on  March  24.  1987.    That  case  involved  upgradation  of  300  posts  of

Assistant District Medical Officers to those of District Medical Officers in

accordance with the directions issued by the Railway Board vide circular

dated  31.7.1981.  Ashok  Kumar  Shrivastava  and  another  challenged  the

applicability of reservation to the upgraded posts and pleaded that they were

entitled to the higher post without requiring to undergo any selection.   The

60

Tribunal  referred  to  the  orders  passed  by  Allahabad  Bench  in  V.K.

Sirothia’s  case and judgment of the Full  bench of Kerala High Court in

N.G. Prabhu v. Chief Justice, Kerala High Court (1973 Labour Industrial

Cases 1399) and held :

“24. Railway Board in  their  letter  No.81/E  (GR) 11/7/7/30,

dated  16.5.1981,  to  UP SC which  recommending only 5 per

cent  direct  recruitment  to  the  posts  of  DMOs  informed  the

Secretary, UPSC as under :

However,  the  situation  has  since  changed  in  that  the

justification  for  direct  recruitment  of  Divisional  Medical

Officers no long exists.    Many Assistant Divisional Medical

Officers  are  not  postgraduates.   There  has  been  considered

demand for scrapping of direct recruitment.   The Ministry of

Railways have an in-depth study of the problem and have come

to the conclusion that there is no justification to continue direct

recruitment in senior scale for the following reasons, etc.  

It is also clear from the following extract of subsequent

order of upgradation dated 31.7.1981 (Annexure ‘A’) that the

process was only to give better pay to same ADMOs.  

An  over  all  view  of  the  organizational  and  medicare

structure  of  the  Indian  Railways  has  been  taken  keeping  in

view  the  basic  objectives  of  improving  effectiveness  and

quality  of  service.    As  a  result  of  the  review,  it  has  been

61

decided that 300 existing posts of Assistant Divisional Medical

Officers in Indian Railway Medical Service should be placed in

the senior scale as Divisional Medical Officer.  

We  also  find  that  posts  of  ADMOs  have  been  just

upgraded and placed in the higher scale of DMO to give relief

to ADMOs who were stagnating.   Persons so upgraded are not

going to occupy any new posts  as  the total  number of  posts

remains unchanged and the total strength of ADMOs and DMO

remains the same.  No new post  has been created as per the

Indian Railway Medical Services (CMO, Addl. CMO, MS and

Div./Sr.  MO)  Recruitment  Rules,  1978  (Annexure  ‘R-2’)  or

Order  8I/EGRIII/7/30,  dated  16.5.1981.   The  placement  of

same posts in higher grade is not creation of additional posts.  

25. Under these circumstances this Tribunal is  of the view

that  this  mass  upgradation  of  300  ADMOs  to  the  exactly

equivalent number of posts of DMOs is a case of their being

simply placed in  the  higher  senior  scale of the grade and as

admittedly also no selection is involved, cannot be considered

to involve any process of promotion or fresh appointment and

therefore no fresh reservation of SC and STs in terms of the

prescribed percentage can be made to the upgraded posts and to

the existing  incumbents  holding  the posts  of  ADMOs which

were  upgraded.   What  is  applicable  to  this  situation  is  not

Railway Board’s Circular No.X/78/E(SCT)/15/13/P & II, dated

22.2.1982 (Annexure ‘E’) but Railway Board’s Circular No. E

62

(P&A)  II,  83/RS/8,  dated  2.8.1983  an  extract  of  which  is

reproduced below :

In  supersession  of  instructions  contained  in  Board’s

Letter No.81/E(SCT) 15/83 dated 16.1.1982 and 5.5.1982 the

Board desires to clarify that where cadre restructuring results in

on  mass  upgradation  of  posts  in  a  particular  category,  the

question of providing for reservation to SC/ST according to the

extent rules and orders in such a situation should not ordinarily

arise since reservations have already been made in the lower

grade.   However,  if  cadre  restructuring  results  in  particular

upgradation  of  a  Cadre/Category  on  the  basis  of  percentage

distribution, the existing rules and orders governing reservation

for SC/STs will apply against the additional number of higher

grade  posts  which  become  available  as  a  result  of  cadre

restructuring on the basis of existing rules and order providing

for reservation for SC/STs.

The respondent has not stated that the above instructions have

been superseded.

26. In similar  circumstances,  a  Full  Bench of Kerala  High

Court in N.G. Prabhu v. Chief Justice, in para 16 observed as

under :

In other words, if the upgradation relates to all the posts

in  a  category  naturally  there  is  no  sense  in  calling  it  a

63

promotion of all the person in that category.   That is because

there is no question of appointment from one post to another.

Parties continue to hold the same posts but get a higher scale of

pay.  It may be that it is not all the posts in a particular category

that are so upgraded but only a part of it.  Normally, the benefit

of such upgradation would go to the seniors in the category.

They would automatically get a higher scale of pay.   That is

because  though  their  posts  continue  in  the  same category,  a

higher scale of pay is fixed for those posts.  It is appropriate

then to say that the seniors have been nominated to the higher

grade  which  has  been  so  created  by  the  upgradation.   The

phenomenon does not differ from the case where all the posts

are upgraded, and it appears to us that those who get the higher

grade  cannot  be  said  to  have  been  ‘promoted;  because  here

again  there  is  no  question  of  appointment  from one  post  to

another.  They continue to hold the same post, but because of

seniority in the same post they are given a higher scale of pay.  

On the same analogy thus, this upgradation of 300 posts

of ADMOs in present case is not an appointment of a member

of the service by promotion to a post in the service on a higher

scale  of  pay  and  therefore  does  not  attract  the  reservation

principle.  Allahabad bench of CAT in its decision in OA 384

of 1986 V.K. Sirothia v. Union of India has held in the case of

upgradation of railway guards as follows :

64

The restructuring of posts was done to provide relief in

terms  of  promotional  avenues.    No  additional  posts  were

created.   Some posts out of existing total were placed in higher

grade  to  provide  these  avenues  to  the  staff  who  were

stagnating.   The placement of these posts cannot be termed as

creation of additional posts.   There were definite number of

posts and the total remained the same.  The only difference was

that some of these were in a higher grade.   It was deliberate

exercise of redistribution with the primary object of betterment

of chance of promotion and removal of stagnation.”  

44. The Union of India unsuccessfully appealed against the order of the

Tribunal inasmuch as SLP No.11801 of 1987 filed by it was dismissed by

this Court on 8.12.1987 in the following terms:

“We have heard the learned counsel for both the parties and we

have gone through the judgment of the Central Administrative

Tribunal  at  Jabalpur  Bench  in  Ashok  Kumar  Shrivastava  &

Ors. v. Union of India & Ors. (T.A. No.139/86) decided on 24th

March, 1987 against which the special leave petition is filed.

We agree with the reasons given by the Central Administrative

Tribunal for the conclusion it has reached.  We hereby affirm

the  judgment  of  the  Central  Administrative  Tribunal.    The

Special Leave Petition is dismissed.”

65

45. In  O.A.  No.414  of  1987,  N.K.  Saini  &  Others  vs.  The  Director

General,  RDSO  &  Others,  the  applicant  challenged  the  question  of

application  of  policy  of  reservation  in  the  matter  of  promotion  to  the

upgraded posts becoming available as a result of restructuring of cadres in

Research  Design  &  Standards  Organization.   Allahabad  Bench  of  the

Tribunal  referred  to  the orders  passed  in  V.K. Sirothia’s  case  and  A.K.

Srivastava’s  case and held that  the upgraded posts  could  not  have been

offered to the reserved category candidates.

46. S.L.P. (C) No.9628-30 of 1988, Govind Sahai & Ors. vs. N.K. Saini

& Ors., was dismissed by the Supreme Court by a short order which reads as

under:-

“Heard learned counsel for the petitioners at length and also

heard learned counsel  for  the Central  Government.   In  our

opinion,  we  see  no  reason  to  entertain  this  special  leave

petition.  It is, therefore, dismissed.

47. In All India Non SC/ST Employees Association (Railway), Bikaner &

Another vs. Union of India & Others, O.A. No.326 of 1989, Jodhpur Bench

of  the  Tribunal  ruled  that  the  reservation  for  Scheduled  Castes  and

Scheduled Tribes is not applicable in the case of upgradation of the existing

posts.

66

48. Petition for special leave to appeal filed by the Union of India against

the afore-mentioned order which was converted as Civil Appeal No.1481 of

1996 was dismissed by this Court on 19th November, 1998 in the following

terms:-

“Special Leave granted in S.L.Ps.  Heard counsel on both sides.

This  court  on 3.1.96 granted special  leave but  limited to the

proposition that the reservation for SC and ST is not applicable

in the case of upgradation of existing posts.  This issue we have

decided today in Civil Appeal No.3622/95 etc.  In the light of

that decision, these appeals are dismissed with no order as to

costs.”      

49. The  Association  which  was  respondent  before  this  Court,  filed

Contempt  Petition  (C)  No.304  of  1999.  During  the  pendency  of  the

Contempt Petition, the railway administration filed I.A. No.2 of 2000 for

clarification of order dated 19th November, 1998 by claiming that there was

a lot of confusion.  The same was disposed of vide this Court’s Order dated

31.1.2001.  The relevant portions of which read as under:-

“It appears from all the decisions so far that if as a result  of

reclassification  or  readjustment  there  is  no  additional  posts

which  are  created  and  it  is  a  case  of  upgradation,  then  the

principle  of  reservation  will  not  be  applicable.   It  is  on  this

basis  that  this  Court  on  19th November,  1998  had  held  that

67

reservation for SC and ST is not applicable in the upgradation

of  existing  posts  and  Civil  Appeal  No.1481/1996  and  the

connected  matters  were  decided  against  the  Union  of  India.

The  affect  of  this  is  that  where  the  total  number  of  posts

remained  unaltered,  though  in  different  scales  of  pay,  as  a

result of regrouping and the effect of which may be that some

of the employees who were in the scale of pay of Rs.550-700

will go into the higher scales, it would be a case of upgradation

of  posts  and  not  a  case  of  additional  vacancy or  post  being

created to which the reservation principle would apply.  It is

only if in additional to the total number of existing posts some

additional posts are created that in respect of those additional

posts  the  reservation  will  apply,  but  with  regard  to  those

additional posts the dispute does not arise in the present case.

The  present  case  is  restricted  to  all  existing  employees  who

were re-distributed into different scales of pay as a result of the

said upgradation.”

50. In K. Manickaraj’s case the Court considered whether the benefit of

reservation could be extended to the appellant while making appointment on

the post of Welfare Inspector Grade II.  The Court noted that as a result of

restructuring, the number of posts available in cadre of Welfare Inspector

Grade II increased from 23 to 26 and if reservation of 15% of promotion

was  given to  Scheduled  Castes,  4  posts  would  be available  for  reserved

category.  On behalf of the respondents, it was pleaded that there has been

68

no change in the strength of the posts in Grade II which remained 23 and the

upgraded posts were meant only for sport persons.  The Tribunal accepted

the  contentions  raised  by  the  respondents  and  negatived  the  claim  of

appellant.  This Court reversed the order of the Tribunal and observed:-

“It is admitted that the total number of posts in Grade II was 23

and 3 posts from Grade III were upgraded to that of Grade II.

The upgraded posts  which  were made as  early as  in  August

1987, as per Memorandum dated 24-8-1987, still  continue. It

is, therefore, not possible for us to accept the contention of the

learned counsel for the respondent that the alleged upgradation

was made for a temporary period meant for sports personnel.

The  posts  which  were  upgraded  in  the  year  1988  having

continued till  date,  the cadre  strength  of  Grade  II  Inspectors

must be held to have become 26 and not 23 as contended by the

respondent. If 15% of the cadre is meant for reserved category

people then it  would work out  at  4 and admittedly there are

only 3 persons belonging to the Scheduled Castes in Grade II.

In  that  view  of  the  matter  the  appellant  was  entitled  to  be

promoted against the 15% reserved quota of posts in Grade II

treating the total number of posts in Grade II to be 26. In our

considered opinion the Tribunal was in error in not taking into

account  the upgraded posts  which  have  been upgraded  from

Grade III to Grade II on the ground that it was meant for sports

personnel. While computing the number of posts available for

69

reserved  category,  there  is  no  justification  to  exclude  the

upgraded posts which had continued from 1988 till date.”

51. An analysis of orders passed by the Tribunals and this Court shows

that all cases except that of K. Manickaraj’s case involved upgradation of

large  number  of  posts  which  could  be  filled  by  placing  the  existing

incumbents in the higher grade without subjecting them to the process of

selection.  Different Benches of the Tribunal referred to the policy decision

taken by the Railway Board that  reservation policy for Scheduled Castes

and Scheduled Tribes is not applicable where cadre restructuring results in

mass upgradation of posts and held that the administration was required to

make appointment/placement against the upgraded posts without reserving

posts  for  Scheduled  Castes  and  Scheduled  Tribes.  This  Court  repeatedly

emphasized that the restructuring exercise did not result in creation of new

posts/additional posts which could be filled by promotion by following the

procedure  of  selection.   Therefore,  these decisions  are  of  no help  to  the

cause of the respondents.  At the cost of repetition, we consider it necessary

to emphasize that restructuring exercise envisaged in letter dated 9.10.2003

resulted in creation of additional posts in most of the cadres covered by the

policy and the government had taken a conscious decision to fill  up such

posts by promotion from amongst eligible and suitable employees and the

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promotees  were  burdened  with  duties  and  responsibilities  of  greater

importance.  Therefore, the Tribunal and High Court were not justified in

treating it as a case of upgradation of posts simplicitor.  Consequently, the

decision  of  the  Tribunal  to  quash  para  14  of  letter  dated  9.10.2003  and

direction given for making appointments de hors the policy of reservation

are legally unsustainable.   

52.     The arguments made by learned counsel in the context of paras 11

and  15  need  not  detain  us  because  none  of  the  issues  decided  by  the

Tribunal  and  High  Court  relate  to  direct  recruitment  against  future

vacancies.   

53. The  point  remains  to  be  considered  is  whether  the  order  of  the

Tribunal, which has been confirmed by the High Court, can be maintained

by applying the ratio  of  M. Nagaraj’s  case.  Dr. Rajiv Dhawan, learned

senior  counsel  appearing  for  some  of  the  respondents,  made  strenuous

efforts to convince us that the policy of reservation cannot be applied at the

stage of  making promotions  because  the  Railway Administration  did  not

produce any evidence to show that Scheduled Castes and Scheduled Tribes

were not adequately represented in different cadres and that the efficiency

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of administration will not be jeopardized by reserving posts for Scheduled

Castes and Scheduled Tribes, but we have not felt persuaded to accept this

submission. In the applications filed by them, the respondents did not plead

that  the  application  of  the  policy of  reservation  would  lead  to  excessive

representation of the members of Scheduled Castes and Scheduled Tribes,

or that the existing policy of reservation framed by the Government of India

was not preceded by an exercise in relation to the issue of adequacy of their

representation.  Rather,  the  thrust  of  their  claim was that  restructuring  of

different cadres in Group C and D resulted in upgradation of posts and the

policy of reservation cannot be applied qua upgraded posts.   Therefore, the

Union of India and the Railway Administration did not get opportunity to

show that  the  employees  belonging  to  Scheduled  Castes  and  Scheduled

Tribes  did  not  have  adequate  representation  in  different  cadres;  that  the

outer  limit  of  reservation  i.e.  50% will  not  be  violated  by  applying  the

policy of reservation and that the efficiency of administration will  not be

jeopardized by applying the policy of reservation.  Therefore, it is neither

possible nor desirable to entertain a totally new plea raised on behalf of the

respondents, more so, because adjudication of such plea calls for a detailed

investigation into the issues of facts.  

Civil Appeal No._____@ S.L.P. (C) No.5045 OF 2007

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54. Leave granted.

55. In this appeal, Union of India and two others have challenged order

dated 5.4.2006 passed by Allahabad Bench of the Tribunal and order dated

6.7.2006 passed by High Court of Allahabad in Writ Petition No.34662 of

2006. The facts culled out from the record of the appeal show that as a result

of cadre restructuring exercise undertaken pursuant to the policy contained

in letter dated 9.10.2003, two posts of Personal Inspector Grade I (Rs.6500-

10500/-) became available in Varanasi Division of Northern Railway.  One

of  these  posts  was  earmarked for  general  category and the other  for  the

reserved category.   The respondent  who  was  holding  the  post  of  Senior

Personal  Inspector  represented  for  appointment  against  the  unfilled  post

earmarked  for  reserved  category  by  contending  that  she  fulfils  the

conditions of eligibility.   Her claim was rejected by the competent authority

on the premise that the reserved post cannot be offered to general category

candidate.   She then filed O.A. No.509 of 2005.  The Allahabad Bench of

the Tribunal relied on the order passed by this Court in V.K. Sirothia’s case

and the one passed by the Full Bench of the Tribunal in O.A. No.933 of

2004 (P.S. Rajput and two others v. Union of India and Others) and held

that  the applicant  (respondent herein)  is  entitled to  be considered for  the

second  post.   The  High  Court  also  relied  on  the  order  passed  in  V.K.

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Sirothia’s  case and dismissed the writ petition filed by the Union of India

and others.    

56. We  have  heard  learned  counsel  for  the  parties.   In  view  of  the

findings  recorded  by  us  in  civil  appeals  that  policy  of  reservation  is

applicable  to  the  cadre  restructuring  exercise  undertaken  pursuant  to  the

policy  contained  in  letter  dated  9.10.2003,  the  orders  impugned  in  civil

appeal  arising out  of Special  Leave Petition (Civil)  No.5045 of 2007 are

liable to be set aside.  

57. In   the   result,  the   appeals   are   allowed     and       the

impugned  orders  are  quashed.   As  a  consequence,  the

original  applications  filed by the  respondents  in  all  the cases  shall  stand

dismissed.  However, parties are left to bear their own costs.  

……………………. J. (B.N. Agrawal)

…………………….J. (G.S. Singhvi)

New Delhi July 29, 2008  

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