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CASE NO.: Appeal (civil)  5013 of 2000

PETITIONER: M.Srinivasa Prasad & Ors

RESPONDENT: The Comptroller & Auditor General of India & Ors

DATE OF JUDGMENT: 29/03/2007

BENCH: H.K. SEMA & V.S.SIRPURKAR

JUDGMENT: J U D G M E N T (with C.A.No.5504 of 2003)

H.K.SEMA,J.

                                These two appeals raise a common question of facts  and law and they are being disposed of by this common  judgment.  For the sake of brevity, we are taking facts from  Civil Appeal No.5504 of 2003.                 The undisputed facts are that the appellants are  direct recruits to the post of Section Officer (Commercial Audit)  in the Audit and Accounts department.  Their services are  governed by the recruitment Rules known as Indian Audit and  Accounts Department Section Officer (Commercial Audit)  Recruitment Rules, 1988 framed by the President of India  under Article 148(5) of the Constitution of India.                   The Rule inter alia provides the method of  recruitment is by promotion failing which by transfer/transfer  on deputation and failing both, by direct recruitment.  The  Rule also provides that the period of probation is two years.   Note to Rule 11 provides that during the period of probation  they should qualify in the Section Officer’s Grade Examination  (SOGE) for appointment as regular Section Officers.                 It is contended by learned counsel for the  respondents that having  accepted the terms and conditions of  appointment they are stopped from challenging the same.                 The appellants were appointed on various dates on  certain terms and conditions common to all.  The terms and  conditions inter alia read:-     1.      The period of probation will be two years.  This  may however be increased or decreased at the  discretion of the appointing authority.  His/her  appointment will be purely temporary and will be  terminable at one months notice on either side.  

2.      During the period of probation he/she will have to  undergo a regular course of training for such a  period at such place and in such manner as may  be prescribed. He/she may also be assigned  regular duties during the period of training.   

3.      During training the Section Officers Grade  Examination (SOGE) will be conducted.  He/She  will have to qualify the SOGE (Both) Part I and II  Examination within the period of probation.    Those who fail to qualify the above exam are liable  to be discharged from service.  Candidates who

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pass this examination will be posted as regular  Section Officer (Audit). 4.      xxx    xxx    xxx     xxx

5.      xxx    xxx    xxx     xxx

6.      On satisfactory completion of probation he/she will  be eligible for confirmation in the office where  he/she is posted on a regular basis as Section  Officer (Audit) subject to his/her being considered  fit in all respect for permanent retention in the  service.  His/her confirmation in the Section  Officer cadre will not however give him/her any  special claim to seniority.  The seniority of direct  recruits to the cadre vis-‘-vis Departmental  candidates passing regular Section Officer (Audit)  Grade Part II Examination will be fixed in  accordance with the seniority rules as at present  viz that a directly recruited Section Officer (Audit)  shall rank immediately below the last Section  Officer (Audit) Grade Examination passed person  officiating in the Section Officer (Audit) cadre on  the date on which he takes over charge as Section  Officer (Audit)".

          The controversy arose when the seniority of the  appellants as Section Officer was reckoned w.e.f. the date they  were qualified in the Section Officer Grade Examination for  appointment as regular Section Officers.  Aggrieved thereby  they preferred O.A.  They claimed that the initial appointment  as probation be reckoned towards the seniority for the purpose  of promotion from Section Officer to AAO.                 It is clear that in the Recruitment Rules of 1988 the  Rule is silent as to how the seniority of the direct recruits be  fixed.                  The Comptroller and Auditor General’s Manual of  Standing Orders (Administrative) Volume 1 was issued by an  executive instruction.                  Paragraph 5.6.6. provides that the seniority of the  direct recruits to the post of Section Officers on passing Part II  of the Section Officers Grade Examination shall be regulated  by the following method: (i)     A directly recruited Section Officer shall  rank immediately below the last Section  Officers Examination passed member of  the staff officiating in the Section Officers  grade on the date on which he takes over  charge as a regular Section Officer.  If an  officiating Section Officer reverts at any  time to his previous post, the reversion  not being on account of his proceeding on  leave, he shall lose his seniority vis.a.vis  all those recruited directly, who are  appointed as Section Officer upto the  date on which he again begins to officiate  continuously.  

(ii)    xxx    xxx     xxx       xxx  

(iii)   A direct recruit is appointed a Section  Officer on regular basis only on  satisfactory completion of the period of  probation prescribed in the recruitment  rules even though he passes the

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examination before that period his  seniority is also effective on his actual  taking over charge as a regular section  officer".

                   Rule 12 of Indian Audit & Accounts Deptt.  Recruitment Rules, 1989 deals with the recruitment by  promotion and it provides, ’Section Officers (Audit) who have  qualified Section Officers Grade Examination and have three  years of regular service in the grade’.           The seniority in Section Officers cadre is governed  by paragraph 5.6 of the executive instructions.  It reads:- "5.6.1(i) Each Civil Audit Office and Civil  Accounts Office and each Railway Audit Office  has its own Section Officers cadre except  where any such office is re-organized into two  or more independent offices and so long as the  cadre is not separated for the offices into  which it has been reorganized.    (ii) The interse seniority of Section Officers  (Commercial) is based on All India basis under  separate orders issued by the Comptroller and  Auditor General of India.    

(iii) Similarly the seniority Section Officers  (Defence Audit each) and Section Officers  (posts and Telecommunications Audit) each is  fixed separately.    5.6.2 xxx    xxx     xxx      xxx

5.6.3 xxx    xxx     xxx      xxx

5.6.4 xxx    xxx     xxx      xxx

5.6.5 xxx    xxx     xxx      xxx

5.6.6.  The seniority of the direct recruits to  the post of Section Officers on passing Part II  of the Section Officers Grade Examination  shall be regulated by the following principles:                (i) A directly recruited Section Officer  shall rank immediately below the last Section  Officers Examination passed member of the  staff officiating in the Section Officers grade on  the date on which he takes over charge as a  regular Section Officer.  If an officiating  Section Officer reverts at any time to his  previous post, the reversion not being on  account of his proceeding on leave, he shall  lose his seniority vis.a.vis all those recruited  directly, who are appointed as Section officers  up to the date on which he again begins to  officiate continuously.

Note : The terms last Section Officer’s Grade  Examination passed member of the staff refers to  one who has passed in an earlier examination and  not in the examination in which the direct recruit  has come out successful.

      (ii) As between direct recruits themselves.

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(a) One who completely passes the Section  officers’ Grade Examination earlier shall rank  senior to those who pass the examination at a  later date, irrespective of the date of their  recruitment of or of the date of passing Part I  of the Section officers Grade Examination.         (b) Amongst the persons who pass in the same  Section Officers’ Grade Examination, relative  seniority shall be determined according to the  year of recruitment i.e. those belonging to an  earlier batch of recruitment shall be senior to  those belonging to a subsequent batch.    (c) Where the direct recruits belonging to the  same batch of recruitment pass the same  Section Officers’ Grade Examination, the  Chartered Accountants as a class will rank  senior most, interse seniority among them  being fixed with reference to the date of  passing the Chartered Accountants (final)  examination, the person passing in an earlier  examination ranking senior to the one passing  in subsequent examination.  The cost and  works Accountants as a class will be ranked  below the Chartered Accountants, the interse  seniority among them being determined on the  same lines as for Chartered Accountants.   When the date of passing the Chartered  Accountants (final)/ICWA (final) examination is  the same, the relative seniority within the  relevant class of persons will be determined  according to seniority in age.  All other persons  will rank as a class below the Chartered  Accountants and Cost and Works  Accountants, the interse seniority among them  being fixed in accordance with the rank  secured at the time of selection for  appointment.  If for the purposes of ranking,  two or more of them have been bracketed, the  older person shall be the senior.  

(iii) A direct recruit is appointed as a Section  Officer on regular basis only on satisfactory  completion of the period of probation  prescribed in the Recruitment Rules even  though he passes the examination before that  period, his seniority is also effective on his  actually taking over charge as a regular  Section Officer.

(iv) Once the seniority of a directly recruited  Section Officer is fixed in an office he is for  further advancement, governed by the same  provisions as laid down for other Section  Officers."  

               Para 4.8 of the said Manual of Standing Orders  Vol.1 provides: "Recruitment to the grade of Assistant Audit  Officer (AAO) in the IA & AD is made by  promotion from the grade of Section Officers  who have qualified in Section Officer Grade

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Examination and have three years of regular  service in the grade as on the crucial date on  the basis of seniority subject to fitness.

Note: The direct recruits will be selected on the  basis of an entrance examination conducted by  Comptroller and Auditor General of India or  any authority specified by him. During the  period of probation they should qualify in the  Section Officers Grade Examination (SOGE) for  appointment as regular Section Officers".

               A fascicule reading of the Rules and the Manual two  things clearly emerge: (a) The passing of qualifying  examination/departmental examination (SOGE) prescribed for  the purpose of determining the seniority and (b) A Section  Officer passing an examination first would have precedent over  a person who passes the examination later.                   We have already noticed that the Rules are silent  insofar as with regard to the determination of seniority.    In  order to supplement the Rules, the standing orders by  executive instructions, as noticed above, have been brought  out to fill the gap unfilled by the statutory Rules.                  It is vehemently contended by Mr. M.N.  Krishnamani, leaned senior counsel for the appellants that the  general principle is that the seniority be reckoned from the  date of appointment.  He further contended that the executive  instructions cannot supplement the rules.  He also contended  that merely accepting the terms and conditions of  appointment would not debar the appellants from claiming  seniority from the date of appointment.  We do not agree with  these contentions.  It is also contended by Mr. Krishnamani  that once the incumbent passed the departmental/qualifying  examination his seniority would relate back to the date of  appointment.   To support his contention, Mr. Krishnamani  learned senior counsel, referred to the decision of this Court in  the case of Mohan Lal    vs.  State of Himachal Pradesh,  (1997) 4 SCC 416, where this Court pointed out in paragraph  8 as under:- "8. A reading of this rule relating to conduct of  examination would indicate that the  Government shall hold the examinations twice  a year between 3rd week of April and 1st week  of November, or on such other dates as are  notified by the Excise and Taxation  Commissioner. The examination so conducted  by the Institute of Public Administration,  Shimla shall be in the manner prescribed in  Paragraph (ii) of Rule 4 of the Rules. It is,  therefore, clear that the Government is  required to conduct the examinations twice a  year and the candidates are required to pass  the examinations within two years from the  date of joining the post on probation. The Rule  does not give four chances to every candidates.  They shall pass the departmental examination  within two years. On successful completion of  probation and declaration thereof, his seniority  would relate back to the date of appointment".                                                               (emphasis supplied)                 This Court has taken that view because in that case  the Rule itself provides namely Rule 11(3)(i) of the H.P. Excise

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and Taxation Department (Inspectorate Staff, Class III)  Service.  Rule 11(3)(i) reads:-

11.(3) On the completion of the period of  probation of a person and passing the  prescribed examination the appointment  authority may \026

(a)     if his work and conduct is found satisfactory-

(i) confirm such person from the date of his  appointment if appointed against a  permanent vacancy; or                                   \005\005\005\005..       

The facts of that case have no application in the present case.         The sole controversy to be determined is that as to  whether by an executive instructions/standing orders to fill  the gap not covered by the Rules and not inconsistent with the  Rules if framed can be validly made and enforceable?         The question posed is no more res integra.     A  Constitution Bench of this Court in Sant Ram Sharma   vs.   State of Rajasthan, AIR 1967 SC 1910, has considered the  similar question and held in paragraph 7 as under:-

"We proceed to consider the next contention of  Mr. N.C. Chatterjee that in the absence of any  statutory rules governing promotions to  selection grade posts the Government cannot  issue administrative instructions and such  administrative instructions cannot impose any  restrictions not found in the Rules already  framed.  We are unable to accept this  argument as correct.  It is true that there is no  specific provisions in the Rules laying down  the principle of promotion of junior or senior  grade officers to selection grade posts.  But  that does not mean that till statutory rules are  framed in this behalf the Government cannot  issue administrative instructions regarding the  principle to be followed in promotions of the  officers concerned to selection grade posts.  It  is true that Government cannot amend or  supersede statutory Rules by administrative  instructions, but if the rules are silent on any  particular point Government can fill up the  gaps and supplement the rules and issue  instructions not inconsistent with the rules  already framed."                                                           (emphasis supplied)                               In Union of India   vs.  H.R. Patankar, 1984  (supp.) SCC 359, a similar view was taken by this Court.  It  was held that even if there are no statutory rules in force for  determining seniority in a Service or even if there are statutory  rules but they are silent on any particular subject, it is  competent to the Government by an executive order to make  appropriate Seniority Rules or to fill in the lacuna in the  statutory rules by making an appropriate seniority rule in  regard to the subject on which the statutory rules are silent.                 We have already noticed that the statutory rules are  silent about the determination of inter se seniority.  This was  made clear by the Comptroller and Auditory General’s Manual  of Standing Orders (Administrative).  In view thereof, these

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appeals are devoid of merits and are accordingly dismissed.   No costs.