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PETITIONER: M.S.USMANI & ORS.

       Vs.

RESPONDENT: UNION OF INDIA & ORS.

DATE OF JUDGMENT14/12/1994

BENCH: SAHAI, R.M. (J) BENCH: SAHAI, R.M. (J) SINGH N.P. (J)

CITATION:  1995 SCC  (2) 377        JT 1995 (1)   385  1994 SCALE  (5)270

ACT:

HEADNOTE:

JUDGMENT: 1.The question of law that arises in these appeals  directed against  order of Central Administrative  Tribunal,  Lucknow Bench,  is  whether  the appellants who  were  selected  and appointed  by  a competitive examination against  10%  quota reserved  for graduates and were promoted even to  a  higher scale  of  pay  could have  been  revered  subsequently,  on assumption that the entire process of selection and appoint- ment was against the rules. 2.Facts as they emerge from the order passed by the  Central Administrative  Tribunal  and the affidavits  filed  by  the parties,  more  particularly the Railways, are  narrated  in brief  In 1968 the Railway Board introduced a  scheme  under para 123 of the Indian Railway Establishment Manual in which provision was made for recruitment of Traffic Apprentices to the  extent  of  25% in various  supervisory  posts  in  the Transportation  Department  of  the Railway.   In  1972  the scheme of 25% was bifurcated pursuant to the decision  taken in  the  Departmental Council of the  Ministry  of  Railways under  thee Joint Consultative Machinery Scheme and  it  was decided  to recruit the Traffic Apprentices by two  methods- 15% through agency of the Railway Service Commission and 10% from  amongst  the  serving  non-ministerial  graduates   of Transportation  Department, through open competition  to  be filled   on  basis  of  Limited   Departmental   Competitive Examination.   It  further provided  that  the  departmental examination  was to be conducted strictly in order of  merit by subjecting candidates to written test and viva voce.   On 22nd  July  1975  the Railway Board  issued  another  letter communicating its decision that 10% of the annual  vacancies in  the  category  of Section  Controllers,  Station  Master (SMs),   and   Assistant  Station  Masters   (ASMS)   grade- Rs.470-700/-  and Rs.455-700/- were to be filled in  through departmental  competitive  examination from  Class-III  non- Ministerial Staff who were graduates and less than 33  years of age.  It was reiterated on 18th March 1976.  The copy  of

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the letter is extracted below:               "In  terms of Railway Board’s letter  No.E(NG)               72  RRI/18  dated March,1972  circulated  vide                             this  office letter NO.220E/172 Pt.   XI(Rectt )               dated  June,1972, 10% of the annual  vacancies               in  the category of SM’S/ASM’s/AYM’S and  Sec-               tion  Controllers gr.Rs 250-350(As) are to  be               filled  in through a departmental  competitive               examination from Class-III 387 non-ministerial  staff  who are graduates and less  than  33 years of age. It  has  been decided that the staff  selected  against  10% vacancies  in  the transportation Deptt. refereed  to  above will be trained in a Special Course, the syllabus for  which is under compilation in this office in consultation with the Principal  Zonal Training School, Chandausi.   The  selected staff  may  be booked for training courses as and  when  the syllabus  of  the  case  is finalized  and  issued  by  this office." 3.It is thus clear that the selection of Traffic Apprentices for  placing  them in various supervisory posts came  to  be extended  to SM as well at least from 1975.   The  selection against  10% quota to fill up the vacancies in the  category of  SM/ASM/TI/ AYM and SCNL in the grade Rs.  455-700/-  was initiated on 31st July 1982.  The break-up of the  vacancies for which the selection was held was:          "1. Station Master, Gr.Rs.455-700 (RS)-  11          2. Asstt, Station Master "  "  "  " -    Nil          3. Traffic Inspector Gr. Rs.             One          4. Traffic Inspector                     One          5. Section Controller Rs.470-750 (RS) -  Three                                         Total - Sixteen" 4.It is thus too late to claim, as has been attempted by the private  respondents, that    the   selection  against   10% reserved for graduates was not held or could not have been held for the post of SM.  The letter selecting the appellants  on 27th September 1983 is extracted below: "As  a result of the Section held for the above  on  2.2.83, 17.4.83  & 29.6.83, the following staff found  suitable  for the  posts  shown  against  each have  been  placed  on  the provisional  panel of 10% graduate quota in accordance  with their merit position in respective categories:- T.I S.NO.     Name               Designation          Category                                                   earmarked 1.        Shri R.C. Gupta     ASH/LIJ               T.I. STATION   MASTER 2.   Shri M.S. Usmain         ASM/MLJ               S.M. 3.   Shri Rejendra Pd.Singh   ASM/BKSA              S.M. 4.   Shri J.R.Mourya          ASM/FD                S.M. 5.   Shri S.J.Singh           LR/ASM/LKD            S.M. 6.   Shri S.S.Singh           ASM/DELD              S.M. 7.   Shri D.K.Kharey          ASM/DELD              S.M. 8.   Shri Gyan Prakash      Srivastava               ASM/LRD               S.M. 388      SECTION CONTROLLER      9. Shri Vinod Kumar      THC/LKO      SCNL     10. Shri Krishna Pd.(SC)  THC/BSB      SCNL  The   above  staff  should  note   that   the               retention  of  their  names on  the  panel  is               subject  to their work remaining  satisfactory               during   the   currency  of  the   panel   and

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             qualifying R.29A & B courses.  Mere fact  that               their  names have been placed on the panel  is               no  guarantee  that they will be  offered  the               post for which selected." What  is necessary to be mentioned is that this list  itself indicate the designation of candidates and the category  for which they were selected.  For instance No. 1 was working as ASM/LIJ  and  was selected for T.I. Similarly Nos.  2  to  8 working  as ASM were selected for SM and Nos. 9 and  10  who were  THC ware selected for SCNL.  The appellants  according to the counter affidavit of Railways were given training  of one year as provided by letter No.757E/ 102-(Elb) dated 17th April  1976.  They were appointed on 19th November  1984  on various  posts  for which they were selected.  Even  in  the appointment letter the details were mentioned.  For instance Usmani was shown as Assistant Station Master/MNJ in existing grade  and in the column of new designation and  station  of posting   it is mentioned SM/UTR - Rs.455-700/-.  The   list also contained names of those ASMs who were in the Scale  of Rs.425-640/-  but  as a consequence of selection  they  were placed  in  the scale of Rs.455-700/- as SM.   Many  of  the appellants  so selected and appointed were further  promoted as SMs/TI in the scale of Rs. 5 50-750/- (revised scale  Rs. 1600-2660/  -). Some of them were even selected and sent  to Iraq  for  Iraq Rail India Technical  Economic  Services  in 1988.   The  averments  in the counter  affidavit  filed  by Railways is extracted below:               "It  is however stated the the first  part  of               the  panel  of  the  aforesaid  selection  was               declared  on 27.9.83 in which one  person  was               earmarked  for the post of Traffic  Inspector,               seven  persons were earmarked for the post  of               Station  Master  GR.RS. 455-700 (RS)  and  two               persons were earmarked for the post of Section               Controller in Gr.Rs.470-750 (RS).  The 470-750               (RS).   The remaining part of thee  panel  was               announced   on  12.8.87  after   getting   the               approval   of  competent  authority  for   de-               reserving the six posts of SC/ST quota.               The incumbents on the panel formed against 10%               graduate quota were imparted the pre-requisite               training  and were posted in their  respective               cadres  after  being declared  successful  and               were allowed to reckon the seniority from  the               date of joining in the cadre in terms of  para               302  of IRE.  The applicants were promoted  to               Gr.Rs.  1600-2660(RPS)  by  virtue  of   their                             position  in the cadre of Station Master  whic h               was assigned to them by operation of para  302               of IREM." 5.   The eligibility of the appellants, their selection  and appointment  as  SM  and  further  promotion  as  SM/Traffic Inspector  cannot be disputed. Nor it can be  disputed  that they  were given seniority in accordance with paragraph  302 of  the  Establishment  Manual.  But the  Tribunal  did  not accept  the  case  of the appellants as  in  consequence  of restructuring  of C & D posts the reservation of  posts  for gradu- 389 ates  came to an end and seniority of the  appellants  after restructuring  was  contrary to Railway  Establishment  Code 302.   Before proceeding further it is necessary to  mention that the respondents who were impleaded before the Tribunal, at their own instance, relied vehemently on paragraph 123 of

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the  Railway Manual and urged that the  Traffic  apprentices could be selected for certain posts but not for the post  of SM.   The claim proceeded on misapprehension as it  did  not take note of the letter issued in 1972, 1975 copies of which have   been  filled  with  the  counter  affidavit  of   the Railways.n  The  selection  in 1982 as  is  clear  from  the affidavit  of Railways was held for the posts earmarked  for SM.   The  Selection  and  appointment  of  the  appellants, therefore,  could not be said to be against rules  for  this reason.   Another  aspect which need be clarified  is  about status promotion.  According to respondents the  appointment of  appellants could be made only in the grade of  Rs.  425- 640/-  and  they  could not be promoted  in  thee  grade  of Rs.455-700/-.  But  that  stands  belied  as  the  selection Rs.455-700/-. 6.   The reason for reversion of the appellants   may now be examined and whether it  was well founded.  In August 1983 C &  D  posts in the Northern Railway were  restructured.   It came  into  effect on 1.8.1983. The restructuring  was  done with reference to cadre strength as it existed on  1.8.1983. It  provided for grant of proforma benefit from 1.8.1982  to the  staff eligible for higher grade.  The restructuring  in the  category  of SM/ASM was in two  groups  depending  upon whether existing cadres or SM/ASMs was separate or combined. It  was  further provided that revised percentage  would  be allotted  depending upon whether the existing structure  was combined  or  separate, since different  practices  were  in vogue  in different zones.  In consequence of  restructuring it  appears all those ASMs who were working in the grade  of Rs.330-560/- and were graduates and had worked earlier  with appellants   but  had  not  appeared  in   the   competitive examination  or had appeared but failed stood  upgraded  and were placed in scale of Rs.425-700/- for ASM. 7.Till  1987  there was no dispute and the Railway  and  the employees both understood that those who had come by way  of selection against 10% quota in September 1983 and those  who came  by  way  of restructuring  were  in  their  respective positions  and there was no occasion for grievance  as  each was placed in the same scale of pay. 8.   In  1987  the appellants were promoted  in  the  higher grade  of Rs. 1600-2660/- (Rs.550-750/-). Some of them  were appointed as TIS.  The appointment order of appellant No.  1 is extracted below:               "A. As the result of suitability test for  the               post  of Traffic-Inspector in grade Rs.  1600-               2660/-.   The  following two  candidates  have               been  found  suitable and are placed  on  this               select list in order of their seniority.               1.    S/Shri M.S.Usmain, SM/LKO               2.    S/Shri R.O. Jaiswai, SCNL/LKO               B.    Consequent  on  the placement  of  above               named staff on the select list for the post of               Traffic-Inspector  in  grade  Rs.  16002660/-,               S/Shri  M.S. Usmani, SM/LKO and R.D.  Jaiswal,               SCNL/LKD  are promoted and posted as  Traffic-               Inspector  PBH  & REL  respectively  in  grade               Rs.1600-2660/-." 390 9.   At  this  stage when the appellants were  selected  and placed in the scale of Rs.1600-2660/- (Rs.550-750/-) another controversy  arose  which even though not  relevant  may  be mentioned   as  it  probably  furnished  the  occasion   for beginning  of what ultimately led to the reversion order  of the  appellants.   In May 1987 the Railway  Board  issued  a circular  that  fresh  recruits  to  the  post  of   Traffic

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Apprentice  would be placed in the scale of Rs.  1600-2660/- Whereas those who were already serving shall be in the scale of   Rs.1400-2300/-   (Rs.425-700/-).   This   resulted   in discrimination   between  the  two  classes  of   the   same employees.    Therefore,   many  of  the   person   affected approached the Central Administrative Tribunal and different tribunal  in  different  States  allowed  their  claim   and directed  that  all  those  Traffic  Apprentices  would   be entitled to be placed in the scale of Rs. 1600-2660/ -  with effect from 15th May 1987.  The order of the Tribunal became final as the Special Leave Petitions filled against some  of the  orders passed by the tribunals were dismissed  by  this Court.   When the appellants thus became entitled for  scale of  Rs.  1600-2660-/- with effect from 15th May  1987  those ASMs who as a result of restructuring of the grade has  been placed  in the same scale of ASM as was being drawn  by  the appellants  as  SM  approached  after  four  years   through Railwaymen’s  Union  and  made a demand  in  68th  Permanent Negotiating Meeting that the post of Station Master in grade Rs. 1600-2660/ - may be filled by invoking the principle  of pro-rata,  that  is  the ratio of 1,17.  In  other  words  I should  be  promoted from the grade of SM and 17  should  be promoted  from the grade of ASMS.  This demand was  rejected by  D.R.M.,  Lucknow  as  the  pro-rata  principle  was  not applicable.  The Union having failed at the divisional level raised the issue at headquarters.  What is significant to be mentioned is that the Union never claimed that the selection or  appointment of the appellants was illegal or  irregular. It  agitated  for applicability of  pro-rata  principal  for promotion   to   the  higher  post.   It  appears   on   the representation made by the Union comments were invited  from the  D.R.M.,  Lucknow  who apprised  the  headquarters  that promotion  as SM through selection against 10% reserved  for graduates  was  due from 1979.  It was further  pointed  out that the cadre of ASM grade Rs. 14002300/- and SM Rs.  1600- 2660/-  were separate.  The respondents did not  accept  the claim of Union of granting promotion to the higher scale  on pro-rata basis.  But they held that the entire selection  of the  appellants  in  September  1983  was  illegal  as   the restructuring  having  been  done on  1st  August  1983  the appointment of appellants in September 1984 was contrary  to restructuring.  It was in consequence of this decision  that the  appellants were reverted from the post of  SM/TI  grade Rs.1600-2660/-to  the post of ASM grade Rs. 1400-2330/-  and placed below all the ASM in panel on 1st August 1989 for the purposes of seniority. 10.  On these facts and in the circumstances of the case two question arise for adjudication  one, whether selection  and appointment  of the appellants in pursuance  of  examination held  in  1983 could be said to be illegal  or  against  the rules  in  view of restructuring of grade C &  D  staff  and second,  whether even if it was so could the  appellants  be reverted even though they had moved higher in the  hierarchy and had been promoted to higher scale of SM or Tls.  It  was submitted by the 391 learned  counsel for appellants that the  appellants  having been  selected  and appointed as Station Masters  through  a competitive  examination  in  which others  either  did  not appear  or failed they could not have been reverted to  post below  the post in which they had been regularized.  It  was urged that even though the appellants had been selected  for the post of SM in the grade of Rs. 455-700/- (revised  scale -  Rs.1400-2330/-)  but they having been  appointed  in  the higher grade of Rs.470-759/- (revised scale  Rs. 16002660/-)

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after  suitability test the Railways were not  justified  in either  reverting  them or setting aside selection  after  a lapse  of nearly six years.  It was urged that even  if  for any reason the appellant were reverted from the higher  post they  could  not  be pushed down below the  ASMs  and  their placement  below  all  the  ASMs promoted  as  a  result  of restructuring  was arbitrary.  This according  to  appellant has  resulted even in disturbing the original  seniority  of the appellants as ASM prior to selection which was  contrary to  the rules.  It was forged that the  respondents  wrongly construed  the restructuring circular as what  was  provided therein  was that a panel of non-selection post would  lapse in  consequence of restructuring.  But this could not  apply to  the  selection of SMs which was a  selection  post  both before  and after restructuring.  It was also urged that  in any case the appellants having moved up higher in  hierarchy the  setting aside of their selection and appointment  which was  otherwise  in accordance with law only because  of  the restructuring  G.O.  relating to grade C & D,  railways  was unfair. 11.  Restructuring was done to upgrade certain percentage of posts in each grade of ASM    and SM.  The percentage was to be worked out on the cadre in each category as it existed on 1st  August 1983.  This upgradation had nothing to  do  with 10%  graduate  quota.   But some difficulty  does  arise  as paragraph  3  of  the  restructuring  order  provided   that vacancies  arising  after  July  1983  would  be  filled  in accordance  with  the procedure provided  in  the  circular. This  gave rise to arguable issue whether the vacancies  for which  selection  was  held in 1982  and  all  processes  of selection  had  been  completed  in  June  1983  except  the declaration  of panel could be said to be available on  31st July 1983.  Much was said and could be said on behalf of the appellants but it is not necessary to express any opinion on various  issues  touching  upon  the  applicability  of  the circular  to  the vacancies other than those  arose  out  of restructuring.   Nor it is necessary to express any  opinion on  the  clarification issued in August 1984  regarding  10% graduate  quota  and whether it could be  confined  to  only those who had been sent for training prior to 1.8.1983 or it could be extended even to those who had been selected  prior to  this date as thee appeal is liable to succeed  on  other ground. 12.  The reversion order issued by the Railways appears  not only  to  be unjust but vitiated by error of  law.   It  was passed  without affording any opportunity of hearing to  the appellants.   The  appellants had been  selected  through  a competitive  merit  examination.  Their  selection  was  not challenged.  They had been regularized and been promoted  to even  higher grade on basis of suitability test.   Reverting such  persons  after a lapse of six year from  the  date  of there   selection,  five  years  from  the  date  of   their appointment, and two years from the date of their  promotion in the higher scale, was not warranted.  The ap- 392 pellants having been regularized as SMs and promoted further as  TIs it was not open either for Railways to  re-open  the selection  held  earlier or for other employees  to  agitate that  the selection held in 1982 was vitiated as  the  panel was announced after the cadre had been restructured. 13.  Therefore, without deciding the large issue and not  as precedent  we are of opinion that the appeals are liable  to succeed.  The order passed by the Tribunal is set aside  and the  order  issued  by the Railway  in  1989  reverting  the appellants  is quashed.  They shall be entitled to  continue

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in  their  respective posts and shall also  be  entitled  to consequential benefits. 14.  No Costs. 393