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CASE NO.: Appeal (civil)  4907 of 1999

PETITIONER: M.Subba Reddy and Anr.

RESPONDENT: A.P.State Road Transport Corporation and Ors.

DATE OF JUDGMENT: 12/04/2004

BENCH: S.B.SINHA.

JUDGMENT: J U D G M E N T

With C.A. No. 4908 of 1999

S.B.SINHA, J :

INTRODUCTION:

The usual vexed question as regard determination  of inter se seniority between the direct recruit and  the promotees once again falls for consideration in  this appeal which arises out of a judgment and order  dated 3.2.1999 passed by a Division Bench of the Andhra  Pradesh High Court in Writ Appeal No.70/1990.

FACTUAL MATRIX:

The appellants herein were granted temporary  promotion in terms of Regulation 30 & 34 on or about  18.1.1993 on purely temporary basis and against the  vacancies reserved for direct recruitment subject to  appointment.  The petitioner was promoted as Assistant  Traffic Manager.  On 31.1.1983 when vacancy arose in  the promotee quota, his services were regularised after  placing him on probation with effect from 27.12.1986.   Thereafter he was confirmed on 1.4.1987.  The  respondents-direct recruits were borne into the  services of the Corporation on 9.11.1990 on being  recruited as officer under Training (General).  The  next batch of direct recruits came into the service of  the Corporation on 4.3.1991.  

The Office Order dated 9.9.1988 reads as follows:-

"The VC & MD has now accorded sanction  for regularisation of the officers in the  cadres of ATM/AME as the case may be with  probation rights with retrospective effect  from the dates indicated against them,  against the posts earmarked for promotion.   The VC & MD has also accorded sanction for  declaration of the period of probation of  these officers from the dates shown against  their names."

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A perusal of this order clearly shows that the  promotion of the appellant was regularised with  probation rights with retrospective effect from the  dates specified therein.  It categorically states that  such regularisation was against the post earmarked for  promotion.  It does not say that the seniority of the  promotees would be fixed after the direct recruitment  is made.  The direct recruits were appointed on or  about 9.11.1990.  It is also not in dispute and as  would appear from the counter affidavit filed by the  first respondent herein before the High Court that  there had been a ban on direct recruitment from 1977  upto 1988.  In the meanwhile on 13.5.1994, the  appellants were promoted to the Class I Senior Scales  as Divisional Managers.  A provisional seniority which  was prepared on 22.8.1994 was finalised on 10.11.1994  whereagainst some representations were made.  A writ  petition filed thereagainst was dismissed.  A writ  appeal preferred by the appellant was also dismissed.

Statutory Provision:

The first respondent is a statutory corporation  constituted under the Road Transport Corporation Act,  1950.  It framed ruleS in exercise of its power  conferred under Section 45 thereof.  Rule 3 of the  Recruitment Rules provides for appointment to the post  of Assistant Traffic Manager by three modes;  (i) by  direct recruitment (ii) by promotion and (iii) by  transfer or deputation.  The method of recruitment to  each post specified in column 2 of Annexure ’A’ is to  be as shown in the corresponding entry in column 3.   Sub-rule 4 of Rule 3 of Recruitment Regulation reads  thus:-

"3.     Appointment and qualification: (4)     Where suitable departmental candidates  are not available for promotion to any of the  posts specified in Annexure-A where the posts  are to be filled by promotion only, such  posts may be filled by direct recruitment by  selection provided that recruitment to all  the higher posts from the lower posts shall  be made by way of promotion and resort had to  direct recruitment only when suitable and  qualified persons are not available for  promotion."

Regulation 17 provides for temporary appointment.   A temporary appointment de’hors the rules is  permissible only in administrative interest owing to  emergency, provided, however, the post is not one which  is reserved for promotion.  Such an appointee may be  replaced by an approved  candidate who is qualified to  hold the post under the regulations.  Regulation 18  reads as under:-

"18. Date of Commencement of probation of  persons appointed temporarily:

If a person, having been appointed  temporarily under clauses (1), (3), or (6) of

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regulation 17 to a post borne on the cadre of  any service, or having been appointed to any  services otherwise than in accordance with  the regulations governing appointment thereto  is subsequently appointed to the service in  accordance with these regulations, he shall  commence his probation from the date of such  subsequent appointment or from such earlier  date (not being earlier than the date of his  first appointment on a temporary basis) as  the appointing authority may determine.  He  shall also be eligible to draw increments in  the time scale of pay applicable to him from  the date of commencement of his probation but  shall not be entitled to arrears of pay  unless otherwise ordered by the corporation."

Regulation 30 provides for temporary promotion,  clause 6 whereof reads thus:-

"(6) If any person referred to in clause  (4) is subsequently promoted to the higher  category in accordance with these  regulations, he shall commence his probation  in such category from the date of such  subsequent promotion or from such earlier  date as the appointing authority may in its  discretion determine.  He shall also be  eligible to draw increments in the time scale  of pay applicable to him from the date of  commencement of his probation but shall not  be entitled to arrears of pay unless  otherwise ordered."

Regulation 34 reads as under:

"If in any of the following categories a  sufficient number of approved candidates who  have successfully completed their training  is not available for filing posts reserved  to be filled by direct recruitment such  posts may be filled temporarily  by  departmental promotion until approved  candidates who have successfully completed  their training become available to replace  the promotees and the reverted person shall  subsequently be considered for repromotion  against the quota of vacancies reserved for  being filled by promotion.

(a)     Asstt. Mechanical Engineeer and  Asstt. Works Manager. (b)     Asstt. Traffic manager (c)     Chargeman (d)     Traffic Inspector Grade II and Head  Depot Clerk. (e)     Artisans."

In terms of item No.3 of Annexure ’A’ (Section-B)

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Class-I, Junior Scale Service, as appended to the said  regulation, so far as the post of Assistant Traffic  Manager is concerned; in a unit of 4 the first and  third vacancy are to be filled in by appointment of an  officer under training who has successfully completed  his training and the second and the fourth by promotion  of a Chief Inspector.  If, however, a suitable  candidate is not available, the vacancy can be filled  up by a suitable candidate from other categories.

Regulation 3 providing for seniority reads as  under:-

"Seniority (a)     The "Seniority" of a person in service  class, category or grade shall unless he has  been reduced to a lower rank as a punishment,  be determined by the date of his first  appointment to such service, class category  or grade.  If any portion of the service of  such person does not count towards probation  his seniority shall be determined by the date  of commencement of his service which counts  towards probation.       

Interpretation of the Regulations is required to  be considered having regard to the factual backdrop as  noticed hereinbefore.

High Court Judgment:

The learned Single Judge sought to make a  distinction between those who had been promoted prior  to 1981 and those who were promoted subsequent thereto.   The learned Single Judge of the High Court, however,  applying the quota-rota rule held that direct recruits  were rightly treated as senior to the promotees.  The  Division Bench of the high Court also proceeded on the  basis that vires of the regulations being not in  question, the question of placement of the promotee  candidates in the event of non-availability of direct  recruit candidate did not arise and in that view of the  matter the contention that the promotee candidate would  rank senior to the direct recruits must be repelled.

Findings:

       The High Court unfortunately did not enter into  the question as regard application and interpretation  of the Regulations.  It is neither in doubt nor in  dispute that any ad hoc or any temporary appointment or  temporary promotion de’hors the rules or against the  quota meant to be filled up by direct recruitment shall  be of no avail for any purpose whatsoever as consequent  upon the appointment of the direct recruits such  promotees are liable to be reverted.  However  Regulation  18 which provides for date of commencement  of probation either by way of direct recruitment or by  way of promotion, clearly states that the date of  probation may in the event of his subsequent  appointment (which would include promotion) may  commence form the date of subsequent appointment or

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from such earlier date, as the case may be.  Appellants  herein were temporarily promoted to the post of Traffic  Managers initially in the year 1983.  By an office  order dated 9.9.1988, their promotion was regularized  with retrospective effect from 27.12.1986.  Their  services were so regularized having regard to the  vacancies which occurred in the posts earmarked for  promotion.

       It is furthermore not in dispute that total ban  for direct recruitment was imposed from the year 1977  to 1988 and, thus, the purported quota and the rota  rule contained in clause 3 of Annexure ’A’ could not  have been given effect to.  In a situation of this  nature I am of the opinion that the said quota rule  become inoperative.

       A similar question come up for consideration  before a Constitution Bench of this Court in Direct  Recruitment Class II Engineering Officers’ Association  vs. State of Maharashtra and Ors. [ 1990 (2) SCC 715]  wherein this court observed:

"Mr. Tarkunde is right when he says  that in such a situation the rule  should be appropriately amended, so  that the scope for unnecessary  controversy is eliminated. But,  merely for the reason that this step  is not taken promptly, the quota  rule, the performance of which has  been rendered impossible, cannot be  treated to continue as operative and  binding. The unavoidable situation  brings about its natural demise, and  there is no meaning in pretending  that it is still vibrant with life.  In such a situation if appointments  from one source are made in excess  of the quota, but in a regular  manner and after following the  prescribed procedure, there is no  reason to push down the appointees  below the recruits from the other  source who are inducted in the  Service subsequently. The later  appointees may have been young  students still prosecuting their  studies when the appointments from  the other source take place - and it  is claimed on behalf of the  respondents that this is the  position with respect to many of the  direct recruits in the present case  - and, it will be highly inequitable  and arbitrary to treat them as  senior. Further, in cases where the  rules themselves permit the  government to relax the provisions  fixing the ratio, the position for  the appointees is still better; and  a mere deviation therefrom would  raise a presumption in favour of the

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exercise of the power of relaxation.  There would be still a third  consideration relevant in this  context : namely, what is the  conclusion to be drawn from  deliberate continuous refusal to  follow an executive instruction  fixing the quota. The inference  would be that the executive  instruction has ceased to remain  operative. In all these cases, the  matter would however be subject to  the scrutiny of the court on the  ground of mala fide exercise of  power. All the three circumstances  mentioned above which are capable of  neutralising the rigours of the  quota rule are present in the cases  before us, and the principle of  seniority being dependent on  continuous officiation cannot be  held to have been defeated by reason  of the ratio fixed by the 1960  Rules."

       The Constitution Bench summing up its decisions,  inter alia, held:- "If it becomes impossible to adhere  to the existing quota rule, it  should be substituted by an  appropriate rule to meet the ends of  the situation. In case, however, the  quota rule is not followed  continuously for a number of years  because it was impossible to do so  the inference is irresistible that  the quota rule had broken down.   Where the rules permit the  authorities to relax the provisions  relating to the quota, ordinarily a  presumption should be raised that  there was such relaxation when there  is a deviation from the quota rule.  If the quota rule is prescribed by  an executive instruction, and is not  followed continuously for a number  of years, the inference is that the  executive instruction has ceased to  remain operative. "

       The said decision of the Constitution Bench in  Direct Recruitment Class II Engineering Officers’  Association (supra) was followed by this Court in  Excise Commissioner, Karnataka and Anr. Vs. V.Sreekanta  [ 1993 (3) Suppl. SCC 53].   

       Another aspect of the matter may not also be lost  sight of.  The appellants herein were promoted in a  regular manner having been regularized in services with  retrospective effect.  Their services were not  regularized from the date of their initial ad hoc  promotion but with effect from the date  when the  vacancies became available.  Their services after  regularization would not be by way of a stopgap

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arrangement.  In Santosh Kumar V. State of Andhra  Pradesh  [ 2003 (5) SCC 511 ]  this court has laid down  the law in the following terms:-

"...The respondent was admittedly  promoted on temporary basis as OSSI  prior to the recruitment of the  appellant. Once his services were  regularised that too in the promotee  quota, the appellant being direct  recruit cannot make any grievance.  In this view it cannot be said that  the appellant was an affected person  for want of notice before passing  the order of relaxation to question  the seniority of the respondent."

       The direct recruits who were appointed in the  years 1990 and 1991, in terms of clause 3 of Annexure  ’A’ would be considered to have been appointed only  after their successful completion of training.  They  were borne in the cadre in the years 1990-1991 and,  thus, prior thereto they cannot claim seniority.   

The consequence of imposing the quota-rota rule  would become evident if the seniority list of  10.12.1994 is closely scrutinised.  Item No.20 thereof  refers to a promotee Shri U.Brahma Chari.  He was  temporarily promoted on 21.5.1981 and his services were  regularized with effect from 9.7.1981.  The direct  recruits whose services have been regularized in March,  1991 and October, 1991 would have been senior to him.   As noticed hereinbefore those who have been appointed  in 1991 would also be senior to the appellant No.1  whose promotion admittedly was regularized with effect  from 27.12.1986.

       It is trite that a direct recruit is considered to  be borne in the cadre from the date of his recruitment.   This aspect of the matter has been considered by a  Division Bench of this Court in Suraj Prakash Gupta and  Ors. vs. State of J & K and Ors. reported in [2000 (7)  SCC 561] wherein almost all the decisions operating in  the field including State of West Bengal and Ors vs.  Aghore Nath Day and Ors. [1993 (3) SCC 371] and N.K.  Chauhan vs. State of Gujarat [1977 (1) SCC 308] were  noticed.

       This court formulated the following points for  consideration:- "(1) Whether the quota rule had  broken down ? Whether excess  promotees are to be pushed down ?  Whether there is a quota-rota rule ?  (2) Whether the ad hoc/stopgap  promotion of Assistant Engineers  (and Assistant Executive Engineers)  could be made beyond six months and  till regularisation, by the  Government without consulting the  Public Service Commission ? Whether  the Government could have  regularised the ad hoc service by

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executive order dated 2-1-1998 ?  Whether the point raised in para IX  of the written submissions by the  direct recruits that retrospective  regularisation cannot be made in  respect of the ad hoc/stopgap  service and could be made only if  the initial appointment as Assistant  Engineers or Assistant Executive  Engineers was "in accordance with  rules", is correct ?  (3) Whether the direct recruits  could claim a retrospective date of  recruitment from the date on which  the post in direct recruitment was  available, even though the direct  recruit was not appointed by that  date and was appointed long  thereafter ?"  

As regards the quota rule, the Court referring to  the dicta of the Constitution Bench in Direct  Recruitment Class II Engineering Officers’ Association   (supra) held that quota rule as far as possible should  be followed.

       Ban on direct recruitment was an outcome of a  policy decision of the corporation.  The legality of  the said  policy decision  on the part of the  corporation was not questioned by the direct recruits  on the ground of mala fide or otherwise.  A suitable  candidate was, thus, not available in terms of the  extant regulations, which should receive a broad  interpretation. When in terms of a policy decision, no  appointment can be made, the question of finding out a  suitable candidate would not arise.  Having regard to  the policy decision of the corporation the question of  considering the candidature of any person for direct  recruitment at the relevant time, thus, did not arise.   The said policy decision evidently had presumably been  taken keeping in view the financial health of the  corporation.  It is well settled that only because  certain vacancies existed, the employer cannot be  forced to employ persons against their will.  If the  ban order was not questioned and the same had been  followed over a period of more than 10 years, an  inference has to be raised that the quota rule had  broken down.   

       The following observations of this Court in Suraj  Prakash Gupta (supra) are furthermore worth noticing: "We shall next refer to the  contention for the direct recruits  that "rota-quota" rule is to be  applied. Before us, it is not  disputed by the learned counsel for  the direct recruits that in the  Recruitment Rules, 1978, there is  only a quota rule and that no rota  rule has been expressly prescribed."

       It categorically held that the principles of  "rota" cannot be employed to the quota rule and the

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same can break down because of past practice.  Even  this aspect of the matter has not been considered by  the High Court.

       As regard point No.3 the Division Bench in Suraj  Prakash (supra) took into consideration a large number  of earlier decisions of this Court and held that  services of ad hoc/stop gap service of promotees can be  regularized.  The court noticing the decisions relating  to the employees governed by the service regulations  framed by the State of Andhra Pradesh (which are in  pari materia with the rules in question) in no  uncertain terms held that services of an employee can  be regularized with retrospective effect.  This court  while arriving at the said conclusion also relied upon  a large number of decisions arising from other states  which also support the legal principle that the  regularization of the promotees with retrospective  effect is permissible in law.  It was categorically  held:-

"Service of the promotees which  is  regularized with retrospective  effect from the date of vacancies  within the quota counts for  seniority."

        This court in no uncertain terms repelled the  contention that if promotees occupied the quota   belonging to the direct recruits they had to be  pushed  down whenever direct recruitment was made, stating:-

"This contention, in our view,  cannot be accepted.  The reason as  to why this argument is wrong is  that in service jurisprudence, a  direct  recruit can claim seniority  only from the date of his regular  appointment.  He cannot claim  seniority from a  date when he was  not born in the service."

The direct recruits of 1990 and 1991 by reason of  the impugned seniority list could not, thus, have been  placed over and above the appellants.

Furthermore, in a case of this nature this court  shall not consider the matter relating to allocation of  vacancy in term clause (1) of Appendix ’A’ as a rigid  formula; in terms whereof even the promotees would be  denied seniority from the date of regularisation.  The  regulation governing the field clearly suggest that in  a case of this nature the promotees should be held to  be senior to the direct recruits.  Regulation 3 clearly  states that respective dates of first appointment in  service shall be the determinative factor.  If the  rules governing appointment contained in Appendix ’A’  could not be given effect to for good and valid  reasons, the quota rule, if any, must be held to have  broken down.  In any event as Regulation 18 permits

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regularisation of promotion with retrospective effect;  in absence of any challenge to the office order dated  31.1.1988, the court must give effect thereto in terms  whereof the appellants were placed on probation with  effect from 21.07.1986 which must be considered to be  the crucial date for determining the seniority.  The  regulations in my opinion should be read in a manner so  that a meaningful effect thereto can be given.

In Rudra Kumar Sain and Ors. vs. union of India  and Ors. [ 2000 (8) SCC 25] a Constitution Bench Of  this Court while considering the relevant provisions of  Delhi Higher Judicial Services Rules held that the  concept of ’cadre’ is larger than the ’service’ under  the recruitment rules.  While following the earlier  decision of this Court in O.P. Singla and Anr. Vs.  Union of India & Anr.[ 1984 (4) SC 450 ] it was  observed:

"We are also unable to accept the  contention of Mr. Subramanium that  until the principle of "quota"  provided in Rule 8 is made  applicable to appointments under  Rules 16 and 17, such appointees,  under Rules 16 and 17 cannot claim  continuous length of service for  their seniority. Such a contention  appears to have been considered and  negatived in Singla case ((1984) 4  SCC 450 : 1984 SCC (L&S) 657 :  (1985) 1 SCR 351). The judgment of  this Court in Singla case ((1984) 4  SCC 450 : 1984 SCC (L&S) 657 :  (1985) 1 SCR 351) is obviously  intended to evolve some equitable  principle for determination of inter  se seniority of a group of officers,  when the Rule of seniority contained  in Rule 8(2) has been held to be not  operative because of breaking down  of "quota and rota" Rule. To meet  the peculiar situation, the Court  evolved the principle that  continuous length of service should  be the criteria for inter se  seniority between the direct  recruits and the promotees,  provided, the promotees did possess  the required qualification as per  Rule 7 and the appointments had been  made under Rules 16 and 17, after  due consultation and/or approval of  the High Court, which in our view  also is the most appropriate basis,  evolved in the fact-situation. This  being the position, we see no  justification for reconsidering the  decision of this Court in Singla  case ((1984) 4 SCC 450 : 1984 SCC  (L&S) 657 : (1985) 1 SCR 351). That  apart, the Recruitment Rules have  been amended in the year 1987 and  the aforesaid principle, which had

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been evolved in Singla’s case  ((1984) 4 SCC 450 : 1984 SCC (L&S)  657 : (1985) 1 SCR 351) would apply  for determining the inter se  seniority between the promotees and  direct recruits, all of whom had  been appointed to the Higher  Judicial Service, prior to the  amendment of the Rules in question,  which was made in the year 1987."

The court further held that if a strict  construction to the different provisions of the rules  is given then all the temporary appointees under Rule  16 who might have rendered 5 to 10 years of service  would be denied of their right for the purpose of  seniority observing:  

"It is this impasse created on account of  inaction of the authorities and on account of  non-adherence to the provisions of the Rules  strictly, which persuaded the Court in Singla  case ((1984) 4 SCC 450 : 1984 SCC (L&S) 657 :  (1985) 1 SCR 351) to evolve the principles  for working out equities and that principle  has to be followed by the High Court in  drawing up the seniority list."

        Furthermore when two interpretations are possible;  the one which promotes justice and equity should be  preferred.  Although hardship cannot not be a ground  for striking down a law but when two views are  possible, it is permissible in law that the court shall  interpret the statutory provision in such a manner so  that possible hardship is avoided.

       In Mahadeo Oil Mills and Others Vs. Sub-Divisional  Magistrate Araria and Others [AIR 1978 Patna 86], it  was held:

"...I am aware of the well settled  rule of construction that the  argument from inconvenience and  hardship is a dangerous one and is  only admissible in construction of  statutory provisions where there are  alternative methods of construction.   But another principle which has to  be borne in mind is that if too  literal an adherence to the words of  an enactment appears to produce an  absurdity and injustice, it will be  the duty of the Court of  construction to avoid such a result  in case the enactment is capable of  any other fair interpretation.  As  Maxwell on the Interpretation of  Statutes, Twelfth Edition, points  out at p.43,

"It was stated in this way by Parke  B.: ’It is a very useful rule, in  the construction of a statute, to

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adhere to the ordinary meaning of  the words used, and to the  grammatical construction, unless  that is at variance with the  intention of the legislature, to be  collected from the statute itself,  or leads to any manifest absurdity  or repugnance, in which case the  language may be varied or modified,  so as to avoid such inconvenience,  but no further.’ ’If’, said Brett  L.J. ’the inconvenience is not only  great, but what I may call an absurd  inconvenience, by reading an  enactment in its ordinary sense,  whereas if you read it in a manner  in which it is capable though not  its ordinary sense, there would not  be any inconvenience at all, there  would be reason why you should not  read it according to its ordinary  grammatical meaning."    

       Yet again in Commissioner of Income Tax, Bangalore  Vs. J.H. Gotla, Yadagiri [(1985) 4 SCC 343], this Court  held:

"47...Though equity and taxation are  often strangers, attempts should be made  that these do not remain always so and if  a construction results in equity rather  than in injustice then such construction  should be preferred to the literal  construction..."

For the aforementioned reasons I respectfully  dissent with the opinion of Brother Kapadia, J., I  would allow this appeal.