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CASE NO.: Appeal (civil)  4657 of 2007

PETITIONER: Bureau of Indian Standards

RESPONDENT: S.K. Kanojia

DATE OF JUDGMENT: 05/10/2007

BENCH: Dr. ARIJIT PASAYAT & TARUN CHATTERJEE

JUDGMENT: J U D G M E N T

CIVIL APPEAL NO.  4657 OF 2007 (Arising out of S.L.P.(C) No.8051 of 2006)

(With Civil Appeal No 4658/2007 @ SLP (C) No. 8363/2006) Civil Appeal No 4659/2007 @ SLP (C) No. 8579/2006) Civil Appeal No 4660/2007 @ SLP (C) No. 8592/2006)

Dr. ARIJIT PASAYAT, J.

1.      Leave granted.  

2.      These appeals are directed against the judgment of a  Division Bench of the Delhi High Court dismissing the appeals  preferred against the order of a learned Single Judge who  allowed the writ petitions filed by the respondents.  

3.      Background facts in a nutshell are as follows:

       The respondents had claimed for directions to the  appellants-Bureau of Indian Standards (hereinafter referred to  as ’BIS’) to promote them as Scientists-D in the pay-scale of  Rs.12000-375-16500 on the date of their completion of 5 years  of service in the lower grade under a scheme known as the  "Flexible Complementing Scheme" (hereinafter referred to as  ’FCS’).  

       The BIS is governed by statutory regulations. The  relevant provision, viz. Regulation 9 of Bureau of Indian  Standards (Recruitment to Scientific Cadre) Regulation, 1988  (in short the "Regulation") reads as follows:

"9. Promotion to the Posts upto System  Scientist-E [Director (selection Grade)] " (1) The  selection for promotions shall be made from  amongst the scientific cadre officers serving in  the next lower grade by the standing staff  committee of Selection Committee ’A’ as the  case may be, on the recommendations of the  Assessment committee appointed by the  Director General under sub-regulation (3).  Selection of officers for promotion shall be  made on the basis of assessment procedure as  laid down by the Executive Committee which  shall take into account qualifications

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performance, merit, seniority, potential,  annual confidential reports for previous five  years and interview.

(2) The promotion of Selected officers to next  higher grade upto the System Scientist-E shall  be made in the same manner as laid down in  the Scheme of Flexible Complementing  formulated from time to time by the  Department of Science and Technology for  promotion of Scientists in scientific  organizations under the Central Government  and shall be effective from the date of  eligibility."  

4.      The BIS adopted recommendations of the Fifth Central  Pay Commission, with effect from 1-1-1996, and implemented  the FCS.  The FCS contemplated promotion, after completion  of certain prescribed periods of service, in relation to each post  (known as the "residency period"). These pertained not only to  posts, but also to scales of pay. The relevant residency periods  were as follows:

Scales of                       Designation             Minimum Pay                             Residency                       period linked to Performance _________________________________________________________ a)      Rs.8000\02713500        Scientist B     3 years b)      Rs.10000\02715200       Scientist C     4 years c)      Rs.12000-16500  Scientist D     4 years d)      Rs.14300-18300  Scientist E     5 years

5.      The respondents were in the pay-scale of Rs.10,000- 15,200, and working as Scientist-C, with effect from 10.3.1994  and were to have been promoted to Scientist -D, after five  years in 1999. The promotions were granted only in March,  2003, with effect from March, 2001. The delay was attributed  by the BIS, to a contemplated change in the Service  Regulations. Changes were introduced to the FCS by an Office  Memorandum dated 9th November, 1998 which modified the  eligibility for benefits of the FCS linked to the Annual  Confidential Reports of the person concerned. Regulation 9  was amended by notification dated 3rd May, 2002, in exercise  of the powers conferred by Section 38 of the Bureau of Indian  Standards Act, 1986 (in short the "Act") to read as follows:

"9.Protmotion to the Posts up to Scientist-G  "(1) The selection for promotions shall be made  from amongst the Scientific Cadre officers  serving in the next lower grade by the  Assessment Committee appointed by the  Director General under sub-regulation (2).  Selection of officers for promotion shall be  made in the same manner as laid down in the  Scheme of Flexible complementing formulated  from time to time by the Central Government  for promotion of scientists in Scientific  Organizations under the Central Government  and shall be effective from the date of  eligibility. The Scheme of Flexible  Complementing as formulated by the Central  Government vide OM No.2/41/P1C-97 dated  the 9th November, 1998 would be effective for

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Scientific Cadre Officers upto and inclusive of  the level of Scientist-E from 9th November,  1998 and for the levels of Scientist-F and  Scientist G, the date of promotion would be  effective from the date of Gazette Notification of  this revised regulation."

6.      The rationale for the amendment was spelt out in  Explanatory Memorandum to the notification, which stated,  inter alia that:

"The Scheme of Flexible Complementing (FCS)  was earlier introduced based on the guidelines  issued by the Department of Science and  Technology (DST) in November, 1983 for all  Scientific and Technical  Organizations/Institutions of the Government  of India, which was later modified vide  Department of Science & Technology’s  OM  No.A.42014/2/86-Admn.1(A) dated the 28th  May, 1986. According to this scheme, the  promotion of an officer in scientific service  from one grade to the next higher grade would  take place after a prescribed period of five  years residency service on the basis of  assessment procedure as laid down by  individual organization. Promotions made  under this scheme would be in-situ and with  effect from the date of their eligibility as per  the residency period and personal to the officer  concerned irrespective of the occurrence of the  vacancy in the higher grade.  Accordingly, in  Bureau of Indian Standards, all Scientific  Cadre Officers were considered eligible for  promotion from one grade to the next higher  grade after they had put in 5 years of  residency service in that grade.  Thereafter,  based on the assessment procedure as laid  down by the Executive Committee of Bureau of  Indian Standards, which shall take Into  account qualifications, performance, merit,  seniority, potential, annual confidential reports  for previous five years and interview by the’  Assessment Committee appointed "by the  Director General, the officers would be  promoted to the next higher grade as per their  date of eligibility."    

7.      The respondents had approached the court, complaining  that the BIS acted arbitrarily in withholding promotions to  them to the cadre of Scientist D, from the date of their  eligibility; instead of the promotion rightfully due to them in  1999, they were given the benefit in 2001. During the  pendency of their writ petitions, another notification was  issued on 12-8-2004, and published in the Gazette of India.  By this notification Regulation 9 was again amended. The  Explanatory Memorandum clarified the purpose behind the  change. It stated that BIS Regulations, 2002 adopted the  Scheme formulated by the Central Government and its  benefits were to be given to employees with effect from 9th  November, 1998. It was felt that the BIS did not possess  powers to implement the Scheme retrospectively. The policy of  the Central Government was that the Scheme should apply to

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the Scientific Cadre Officers of the BIS only prospectively.  Therefore, the Notification was issued to rectify a mistake.  Regulation 9, as amended in 2004, read as follows:

"9.Promotion to the Posts up to Scientist-G "(1)  The selection for promotions shall be made  from amongst the Scientific Cadre officers  serving in the next lower grade by the  Assessment Committee appointed by the  Director General under sub-regulation (2).  Selection of officers for promotion shall be  made in the same manner as laid down in the  Scheme of Flexible Complementing formulated  from time to time by the Central Government  for promotion of scientists in Scientific  Organizations under the Central Government  subject to the condition that the said Scheme  shall be applicable to the Scientific Cadre  Officers of the Bureau from the date of  commencement  of the Bureau of Indian  Standards (Recruitment of Scientific Cadre)  Amendment Regulations, 2004."

8.       The original writ petitioners had also urged that other  employees, viz Shri H.J.S. Pasricha, Smt. D.G. Dastidar, Shri  G. Bhaskar, Shri Bijender Kumar Jain, Shri Jayanta Roy  Chowdhury and Smt. Mala Ayyappan, had been given the  benefit of automatic ’promotion’ to Class-D in December 1998,  although by that time the proposed changes had already been  effected.

9.      The learned Single Judge allowed the writ petitions of the  respondents, relying upon the decisions of this Court in State  of Andhra Pradesh & Ors. v. Sreenivasa Rao & Ors. (1993 (3)  SCC 285); P. Mahendran  & Ors. v. State of Karnataka & Ors.  (1990 (1) SCC 411); P. Murugesan & Ors. v. State of Tamil  Nadu & Ors. (1993 (2) SCC 340); and a decision of this Court,  in CW No.4555/2001 entitled Mr. N.C.Jain & Ors. v. New  Delhi Municipal Council & Ors., decided on September 16,  2003. He rejected the contention of the appellant BIS that by  virtue of the amendments, particularly of 2004, it was no  longer possible to grant benefit of retrospective promotion to  any official or employee. 10.     The learned Single Judge held as follows:

"In 1999 the Petitioners had become entitled to  ’promotion’ to Group-D and at that time Rules  to the contrary did not exist. The then  prevailing FCS ought to have therefore been  implemented in 1999 itself and had this been  so done the Petitioners would have been  promoted to Group-D after the expiry of five  years service in Group-C. It should also not be  overlooked that the effect of the Notification of  12th August, 2004 was to return to the regime  which entitled the Petitioner to automatic  progression to Group-D on their completing  five years in Group-C.

In these circumstances, the Writ Petitions  are allowed and the respondents are directed  to promote the Petitioners to the post of  Scientist-D in the pay-scale of Rs,12,000-375-

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16,500/- as soon as each of the petitioners  had rendered five years service in the post of  Scientist-C as per the Flexible Complementing  Scheme applicable on the said date."  

        11.     The appellants preferred writ appeals before the High  Court which by the impugned judgment, dismissed the same.   The conclusions of the High Court are set out in paragraphs  13 and 14 of the judgment.  The High Court was of the view  that the amendment introduced in 2004 for the first time  sought to introduce a bar against retrospective promotions i.e.  from the date the eligibility conditions of the officials aspiring  for promotion were fulfilled.  Before the amendment no such  prohibition or condition existed. It was held that the  amendment is not retrospective in its operation. It was held  that though the term "retrospective" was used, the promotion  under the previous scheme as modified in 1996 and amended  in 1998 and 2002 created an entitlement in favour of the  officer in a feeder cadre to be promoted from the date he  fulfilled the eligibility condition. This, according to the High  Court, is evident from the Notification dated 9.11.1998 and  the amendment to Regulation 9 effective from 2002.  The  limiting condition of the date of promotion being after the due  date of application of the notification was in respect of  promotions above the level of Scientist E. The High Court felt  that the rationale for this conclusion was that merely the post  was included in the scheme for the first time on 3.5.2002 and  the right to be considered and granted ’in situ’ promotion to  the petitioners from the dates they acquired eligibility after  completion of the residency period did not stand altered. The  prohibition introduced in 2004 was prospective and could not  take away their right to be dealt with as on the date they  became eligible to be promoted, which indeed was the date  when the promotion was to be effective. It was held that the  respondents were promoted in 2003.  

12.     In support of the appeals, learned counsel for the  appellants submitted that the true effect of Regulation 9 has  not been duly considered. The issue relates to entitlement of  Scientific Officers in Grade ’C’ to promotion under Scientific  Officer in Grade ’D’. FCS was introduced by a Notification  issued in the year 1983/1986 wherein the same to be  applicable to three levels i.e. S-I level in the pay scale of  Rs.700-1300, S-II level in the pay scale of Rs.1100-1600 and  S-III level in the pay scale of Rs.1500-2000. It was further  provided in the scheme that in exceptional cases the scheme  may be extended to next higher level i.e. S-IV in the pay scale  of Rs.1800-2250 on merits depending upon the extent of  stagnation at that level. In the year 1988 the BIS recruitment  to Scientific Cadre Regulations were promulgated. In order to  give benefit to scientific cadre officers of the BIS, Regulation 9  made the requisite provision.  

13.     It is pointed out that the order of the learned Single  Judge and the judgment of the Division Bench have failed to  take notice of a very crucial expression i.e. ’from time to time’.  On 16.3.1994 the respondents were promoted to the post of  Scientific Grade ’C’ under the FCS. As the scheme stood then  the respondents would be entitled to further promotion as  Scientists in Grade ’D’ under FCS  upon completion of five  years of service  i.e. w.e.f. March, 1999 provided the  respondents made it under assessment procedure laid down  by BIS. Before the respondents became eligible for promotion  the scheme itself was modified on 9.11.1998 where the

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minimum residency period for promotion was reduced from  five years to four years. However, the number of years in  which the Scientific Officer became eligible was to be  determined under a graded scheme depending upon the merits  in the ACR. Under the revised scheme of 1998 the promotion  under FCS was made more rigorous providing more emphasis  on evaluation of scientific and technical knowledge so that  only scientists with demonstrable achievements or higher level  of technical merit would be recommended for promotion under  the FCS.  Under the revised scheme, respondents became  eligible for promotion in Scientists grade ’D’ after completion of  7 years of service in the Grade of Scientists Grade ’C’. Under  the amended scheme of 9.11.1998 Scientists in Grade ’F’ as  well as in Grade ’G’ were also included for being given the  benefit of FCS.  Since the regulations of 1998 more  particularly, Regulation 9 provided for the benefit of FCS only  upto Scientists Grade ’E’, there was necessity to amend the  Regulation so that Scientists Grade ’F’ and ’G’ could also be  given the benefit. With effect from 3.5.2002, Regulation 9 was  amended.  

14.     It is submitted that before the respondents became  eligible the scheme itself had undergone a change and 1986  scheme had been superseded in view of introduction of the  new scheme on 9.11.1998. There was no vested right to be  considered for promotion merely on completion of 5 years of  service. The High Court erroneously held that even if the  amendment existed there was vested right. In essence, it was  submitted that both the learned Single Judge as well as the  Division Bench committed a manifest mistake by holding that  the respondents had a vested right in the year 1999 to be  promoted to the grade of Scientists Grade ’D’ on mere  completion of five years of service. It was also submitted that  out of 180 officers who were covered by the change in the  scheme w.e.f. 9.11.1998 only four had filed writ petitions and  rest accepted the change.  

15.     In response, learned counsel for the respondents  submitted that the explanatory memorandum at the time of  amendment on 12.8.2004 made the position clear and the  High Court’s view was right. It was clearly stated that the  appellant had no power to implement the scheme  retrospectively. The respondents are entitled to be considered  as per the earlier FCS and promoted in situ w.e.f. 10.3.1999.  Therefore, it was submitted that the appeals deserve to be  dismissed.  16.     Under the amended scheme there are gradings according  to the ACRs and the criteria for being considered for promotion  under the FCS have been laid down. They read as follows:

"(a) All officers will be first screened on the  basis of gradings in the Annual Confidential  Reports (ACRs) for consideration for  promotion; the ACRs should be assessed on a  10 point scale giving 10 marks for  "outstanding", 8 marks for "very good", 6  marks for "good", 4 marks for "average" and 0  for "poor" and only those officers who satisfy  the minimum residency period linked to their  performance as  

                                       Number of years in the grade                                          3               4          5         6        7     

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   8                                         Minimum percentage for eligibility

Scientist B to                  90%             80%    70%    65%   60%  \005. Scientist C

Scientist C to                  \005            90%    80%    75%   70%   60% Scientist D Scientist D to                  \005            90%    80%    75%   70%    60% Scientist E Scientist E to                  \005            \005.      90%    80%   75%         70% Scientist F Scientist F to                  \005            \005.        90%    80%  75%         70% Scientist G

Exceptionally meritorious candidates with all  outstanding gradings may be granted  relaxation in the residency period, the  relaxation being not more than one year on  any single occasion. Such a relaxation will be  limited to a maximum of two occasions in their  entire career."  

17.     The revised scheme of 1998 shows the assessment norms  for promotion. Definite focus was on evaluation of scientific  and technical knowledge. Under the revised scheme the  respondents became eligible for promotion on completion of 7  years of service. Undisputedly, the Regulations of 1998 in  Regulation 9 provided that the benefit of FCS was available  upto Scientists grade ’E’. It was therefore necessary to amend  the Regulation so that the Scientists grade "F’ and ’G’ could be  given the benefit of FCS.  

18.     The crucial expressions in the Notification of 9th  November, 1998 contain certain stipulations which are as  under. In clause 2 it has been inter-alia stated as follows:

       "\005\005.It has also been decided that  assessment norms for promotions under the  Flexible Complementing Scheme should be  rigorous with due emphasis on evaluation of  scientific and technical knowledge so that only  the scientists who have to their credit  demonstrable achievements or higher level of  technical merit are recommended for  promotion under the Flexible Complementing  Scheme."

19.     Again in Clause 3 it has been stated as follows:

                "\005\005\005\005\005\005\005Accordingly, all the posts   covered under the Flexible Complementing  Scheme shall carry the following uniform  scales of pay, designations and the minimum  residency period linked to performance:-

Scales of Pay                   Designation             Minimum Residency                                                                         Period linked to                                                                         Performance

(a) Rs.8000-13500               Scientist B             3 years

(b) Rs.10000-15200              Scientist C             4 years

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(c) Rs.12000-16500              Scientist D             4 years

(d) Rs.14300-18300              Scientist E             5 years

(e) Rs.16400-20000              Scientist F             5 years

(f) Rs.18400-22400              Scientist G             Not available

_______________________________________________________________________     In order to give immediate effect to the decision  contained in this para an umbrella Notification  has been issued vide G.S.R. No.660(E) dated  9.11.1998"

20.     As a bare reading of above quoted clause goes to show  that it was intended to give immediate effect to the decision,  an umbrella Notification G.S.R.No.660(E) dated 9.11.1998 was  being issued. The criteria for promotion have already been  quoted above.  

21.     Stand before the High Court was that the eligibility was  after 1999 and there was a vested right. It is to be noted that  under the 1998 Regulations also the same could not have  been applied to Grade ’F’ and ’G’ and so the amendment as  noted above was necessary. Learned Single Judge was not  right in holding that in 1999 the respondents had become  eligible for promotion to Grade ’D’ and at that time rules to the  contrary did not exist, overlooking the fact that in 1998 itself  amendment had brought in the prevailing FCS on the basis of  1998 Notification and not under 1986 Regulations. Learned  Single Judge was also not correct in directing promotion  because promotion is not automatic and the Annual  Confidential Reports had to be looked into. The change in  2004 does not in any way cover the respondents.  

22.     Regulation 9 provided that the promotion of selected  officers under the FCS was to be on the basis of evaluation  from "time to time". That being so, the learned Single Judge  and the Division Bench were not correct in their views. The  appeals deserve to be allowed which we direct. The order of the  learned Single Judge as affirmed by the High Court stands set  aside. There will be no order as to costs.