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PETITIONER: MERVYN COUTINDO & ORS.

       Vs.

RESPONDENT: COLLECTOR OF CUSTOMS, BOMBAY & ORS.

DATE OF JUDGMENT: 14/02/1966

BENCH: WANCHOO, K.N. BENCH: WANCHOO, K.N. GAJENDRAGADKAR, P.B. (CJ) SHAH, J.C. SIKRI, S.M. RAMASWAMI, V.

CITATION:  1967 AIR   52            1966 SCR  (3) 600  CITATOR INFO :  F          1967 SC 839  (15,17)  F          1967 SC1889  (5)  F          1968 SC 507  (8)  RF         1970 SC2178  (4)  R          1972 SC 252  (4)  R          1972 SC 670  (12)  D          1974 SC   1  (48,54)  R          1974 SC 259  (12)  D          1974 SC1618  (14)  R          1975 SC 483  (28)  RF         1975 SC 538  (9)  D          1977 SC 251  (33,34)  R          1979 SC1073  (4,14,15)  E          1980 SC 115  (38)  RF         1980 SC2056  (73)  RF         1981 SC2181  (25)  R          1984 SC1291  (29)  D          1984 SC1595  (24,62)  R          1985 SC 781  (13)  D          1987 SC2348  (3)

ACT: Constitution  of India, Arts. 16(1), 14-’Rotational  system’ applied in filling vacancies in the cadres of Appraisers and Principal  Appraisers  in  Customs  Department-Fixation   of Seniority-validity.

HEADNOTE: The   petitioners  who  were  Appraisers  in   the   Customs Department filed a writ petition under Art. 32,  challenging the validity of the ’rotational system as applied in  fixing the seniority of Appraisers and Principal ap. praisers.  The system, as laid down in the relevant departmental  circulars was that vacancies occurring in the cadre of Appraisers were to  go alternatively to ’promotees’ and  ’direct  recruits’. According  to the petitioners this resulted  in  inequality, especially  in  view of the fact that the number  of  direct recruits  over  the years was very low.   Promotion  to  the grade  of  Principal  Appraisers  was  from  the  cadre   of

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Appraisers; only those who had served as Appraisers for five years were entitled to be promoted to the higher grade Since the  direct recruits had to wait for five years before  they could  become Principal Appraiser the promotees  below  them who  had put in five years as Appriasers  became’  Principal Appraiser,%.   In  order  to restore the  seniority  of  the direct  recruits  thus-lost,  -the  rotational  system   was applied  to the cadre of Principal Appraisers also  Ie.  one vacancy  was to go to a promotee and the other to  a  direct recruit.  The plea of inequality in violation of Art.  16(1) of the Constitution was raised by the petitioners in respect of this also. HELD  :  (i) There is no inherent vice in the  principle  of fixing  seniority  by rotation in a case when a  service  is composed   in  fixed  proportion  of  direct  recruits   and promotees.  Any anomalies that may have resulted on  account of  insufficient recruitment of direct recruits in the  past could  not be a ground for striking down the system  itself. [605 B-C, G] T.   Devadasan  v. Union of India and Ors. [1964]  4  S.C.R. 680 distinguished. (ii) The  same however, cannot be said when  the  rotational system   is   applied  to  the  recruitment   of   Principal Appraisers.   The  source of recruitment for  these  is  one only, namely, the grade of Appraisers.  There is no question of any quota being reserved from two sources in their  case. In  so  far therefore as the Government was  doing  what  it called  restoration  of  seniority  of  direct  recruits  in Appraisers  grade on their promotion to the higher grade  it was clearly denying equality of opportunity. [605 C-G]

JUDGMENT: ORIGINAL JURISDICTION : Writ Petition No. 97 of 1964. Petition under Art. 32 of the Constitution of India for  the ,;enforcement of fundamental rights. Ved Vyasa, J. R. Gagrat, B. R. Agarwala and N. K. Puri,  for the petitioners. C.   K. Daphtary, Attorney-General, R. Ganapathy lyer and R. N. Sachthey, for respondent no. 1. 601 B.   R.  L. Iyengar and S. K. Mehta, for respondents Nos.  6 to- 23. I. M. Lal, S. K. Mehta and K. L. Mehta, for respondents  Nos 25 and 27 to 34. Respondent No. 24 appeared in person. The Judgment of the Court was delivered by Wanchoo, J. This petition under Art. 32 of the  Constitution by  certain  Appraisers  in the Customs  Department  of  the Government  of India is directed against the seniority  list prepared  in  1963 under the order of the Central  Board  of Revenue  (hereinafter  referred  to  as  the  Board).    The petitioners  contend that the list in question  denies  them equality  of opportunity in matters relating  to  employment under the State enshrined in Art. 16(1) of the Constitution. The  system  that prevails for recruitment to  the  post  of Appraisers  is  that  50 per cent  is  reserved  for  direct recruits  while  the remaining 50 per cent is filled  up  by promotion  from subordinates in the Customs Department.   It further appears that seniority is determined in the cadre by the system of rotation, i.e., the list is arranged in such a way  that there is one person from the direct  recruits  and one  from the promotees alternately.  The contention of  the

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petitioners   is   that   this  system   has   resulted   in discriminatory  treatment against them with the  consequence that  promotees  of  much longer service  in  the  cadre  of Appraisers  are  put  in the  seniority  list  below  direct recruits with much shorter service.  This, according to  the petitioners,   offends  against  equality   of   opportunity guaranteed  under Art. 16(1) of the Constitution.   That  is one  grievance of the petitioners.  The other  grievance  of the petitioners is that in the cadre of Principal Appraisers who  are  all  promoted  from  Appraisers,  there  is  again discrimination  and  violation of  equality  of  opportunity inasmuch  as  the same method is followed in the  matter  of fixation  of  seniority of Principal Appraisers,  though  in this  case there is only one source of recruitment i.e.,  by promotion  from  the cadre of Appraisers.   The  petitioners therefore  pray  that the seniority list  prepared  in  1963 should  be  struck  down  as violative  of  Art.  16(1)  and directions  be issued to prepare a fresh seniority list  for the  cadre  of Appraisers.  They further pray  that  in  the matter of appointment of Principal Appraisers, the system at present being followed in the matter of seniority should  be struck down. The  petition has been opposed on behalf of the  Union.   It is, contended that in a service where recruitment is  partly by promotion and partly by direct recruitment, the system of fixing  seniority by rotation is followed and that  this  is being  done in a number of services under the Union.  It  is urged that there is nothing discriminatory in such a  system and  there  is  no  denial of  equality  of  opportunity  by following the rotational system for determining seniority- 602 in such circumstances.  As to the Principal Appraisers,  the case  of the Union is that these posts are  selection  posts and  selection  is made from the cadre of  Appraisers.   For this purpose Appraisers with a minimum service of five years are  eligible for promotion and there is a probation of  two years before they are confirmed.  The Union further contends that  by the system of rotation which is being  followed  in the cadre of Principal Appraisers also what happens is  that the seniority of a direct recruit in the cadre of Appraisers is  restored  as on account of five years  qualification,  a direct  recruit cannot be promoted to the post of  Principal Appraiser while his junior promotee in the post of Appraiser gets  such  promotion.  According to the  Union,  therefore, this  system  which  is  given effect to  in  the  cadre  of Principal  Appraisers merely restores the seniority which  a direct recruit had in the cadre of Appraisers.  This is  the ,only  justification  for  the  system  in  the  matter   of seniority in the cadre of Principal Appraisers. We shall first consider the question of Appraisers.  As  far back  as 1936, an order was passed by the Board  which  laid down  that  recruitment to the Customs  Appraisers’  Service would be from two sources, i.e. 50 per cent by promotion, 25 per cent directly from ,experts and 25 per cent by means  of a  competitive  examination  or  ,selection  by  the  Public Service Commission.  It was also said in the said order that those percentages would be the maximum and the Collectors of Customs  would  not  be bound to recruit  upto  the  maximum particularly  in the case of recruitment by  promotion.   In actual practice however this order has been acted upon as if it  provides 50 per cent for promotees and 50 per  cent  for direct  recruits,  whether  they  are  experts  or  come  by competitive  examination or selection by the Public  Service Commission.   In  1940,  the Government of  India  issued  a circular  for  the determination of  relative  seniority  of

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candidates appointed by direct recruitment and by promotion. In  that circular it was stated that "where in a  department two  permanent  or  quasi permanent  vacancies  occur,  even simultaneously, and the first vacancy is in accordance  with the rotation meant for a direct recruit, the direct  recruit will  rank  in seniority above the promotee even  though  he joined  his  post after the promotee had been  promoted  and confirmed".  Reliance has been placed on behalf of the Union on  this  circular in the matter of  fixation  of  seniority between  direct recruits and promotees in a cadre  in  which rotational system prevails.  The petitioners however rely in reply  on  a circular issued in June  1949.   That  circular dealt  with the seniority of displaced  government  servants who  had  been  absorbed temporarily in  service  under  the Central Government.  The occasion for that circular was  the division of India, and the creation of Pakistan resulting in displacement  of a large number of public servants from  the area which went to Pakistan.  ’That circular provided for  a change in the system due to displaced 603 government  servants  having in most cases  lost  all  their property  and having to migrate in difficult  circumstances. It  was therefore thought fit to give some weightage in  the matter  of  seniority  to  such  persons  on   compassionate grounds.   It  was therefore decided that the  seniority  of persons  appointed  on permanent or  quasi  permanent  basis before  January  1,  1944  should  not  be  disturbed,   but thereafter  displaced persons should be given  consideration and  their  seniority  counted on the  basis  of  length  of service  in  the particular grade as well as service  in  an equivalent  grade.   "Service in an  equivalent  grade"  was defined as service on a rate of pay higher than the  minimum of the time scale of the grade concerned.  The principle  of this circular was also applied to ex-Government servants  of Burma  appointed under the Central Government and  employees of  the former Part B States taken over by the Centre  as  a result of federal financial integration.  Naturally as  this change could not be applied only to displaced persons  etc., it  was applied to the existing government servants  of  the Government of India also from January 1, 1944.  But there is nothing  in the circular to show that the seniority  of  the existing government servants inter se was to be disturbed on the  basis  of  this circular.  The  real  purpose  of  this circular  appears  to  be to  fix  seniority  for  displaced persons etc., in accordance with it and for that purpose  it applied   the  same  principle  to  the   existing   central government servants from January 1, 1944. It appears that by 1959, the circular of 1949 for absorption of  displaced  government servants etc., had  worked  itself out.   Therefore,  on December 12, 1959, the  Government  of India issued another circular containing general  principles for  determining seniority of various categories of  persons employed  in  central  services.   By  this  circular,   the circular of 1949 and certain other circulars issued to  deal with   special  types  of  recruitment  like   war   service candidates  were cancelled, and thereafter seniority was  to be  determined  by the circular of 1959, which  states  that instructions  contained in the said circulars  had  achieved their  object  and there was no longer any reason  to  apply those  instructions in preference to the  normal  principles for determining seniority in future.  For the future certain general  principles were laid down for fixing the  seniority in the circular of 1959.  These principles were not to apply retrospectively  but were given effect to from the  date  of their  issue, subject to certain reservations with which  we

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are not concerned. One  of  the  principles in this circular of  1959  is  with respect  to  relative  seniority  of  direct  recruits   and promotees.   It provides that relative seniority  of  direct recruits and promotees shall be determined according to  the rotation of vacancies between direct recruits and  promotees which shall be based on the quota of reservation for  direct recruitment  and promotion respectively in  the  recruitment rules.   It  was further explained that a roster  should  be maintained  based on the reservation for direct  recruitment and promotion in the recruit- 604 ment  rules.  Where, for example, the reservation  for  each method  is 50 per cent, the roster will run  as  follows-(1) promotion, (2) direct recruitment, (3) promotion, (4) direct recruitment,  and  so on.  Appointments should  be  made  in accordance   with  this  roster  and  seniority   determined accordingly.   A  question  has  been  raised  whether   the circular of 1940 to which we have already referred  survived after  this  circular  of 1959; but in  our  opinion  it  is unnecessary  to  decide that question, for the  circular  of 1959  itself  lays down that seniority shall  be  determined accordingly, i.e. in accordance with the rotational  system, depending upon the quota reserved for direct recruitment and promotion respectively.  It is this circular which according to  the  respondent  has been followed  in  determining  the seniority of Appraisers in 1963. Before  we come to what has been done in 1963 in the  matter of fixing seniority of Appraisers, we may refer to two other circulars.   The first is a circular of the Board issued  in 1953.   That circular in our opinion has nothing to do  with the  question  of  fixing of  seniority  as  between  direct recruits   and  promotees.   Its  main  value  is  that   it emphasises that the proportion fixed for direct recruits and promotees  should  be rigidly maintained.  It  also  directs that promotion to higher grades should be made on the  basis of  a  combined seniority list of both direct  recruits  and promotees.   Then there is another circular of  1955.   That circular  again  emphasises the rotational system  and  says that it has been decided that "inter se seniority of  direct recruits and promotees in the grade of Appraisers should  be determined  in the order in which the vacancy in that  grade is filled by a direct recruit or by a promotee according  to the  quota  fixed for such appointments".  Stress  has  been laid  on behalf of the petitioners on the words "is  filled" in this circular, and it is urged that this means that until the  direct  recruit  is actually recruited  and  fills  the vacancy  meant for a direct recruit he cannot get  seniority from  before  the date he fills the vacancy  merely  on  the ground of rotational system of fixing seniority.  We do  not think that this is the meaning of the words "is filled" used in  this circular.  We have already said that this  circular also  emphasises  the  rotational system in  the  matter  of fixing of seniority and all that it means is that  vacancies should  be filled either by direct recruits or by  promotees according to the quota fixed for such appointments. This  brings us back to the circular of 1959, and  the  main question in that connection is the meaning to be assigned to the  words  "’seniority  determined  accordingly",  in   the explanation to principle 6 relating to relative seniority of direct  recruits  and promotees.  As we  read  these  words, their  plain  meaning is that seniority  as  between  direct recruits  and promotees should be determined  in  accordance with the roster, which has also been specified, namely,  one promotee  followed by one direct recruit and so  on.   Where

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therefore  recruitment  to  a cadre  is  from  two  sources, namely, 605 direct  recruits and promotees and rotational system  is  in force,  seniority  has  to  be  fixed  as  provided  in  the explanation  by alternately fixing a promotee and  a  direct recruit in the seniority list.  We do not see any  violation of  the  principle of equality of opportunity  enshrined  in Art.  16(1)  by following the rotational  system  of  fixing seniority  in  a  cadre half of  which  consists  of  direct recruits and the other half of promotees, and the rotational system by itself working in this way cannot be said to  deny equality  of  opportunity  in  govern  ment  service.    The anomalies which have been referred to in the petition  arise not  on account of there being anything opposed to  equality of  opportunity  in  government service by the  use  of  the rotational   system;  they  arise  out  of  the   fortuitous circumstance that in this particular service of  Appraisers, for  one  reason or another, direct recruitment  has  fallen short  of the quota fixed for it.  It is merely  because  of this   fortuitous  circumstance  that  anomalies  to   which reference has been made in the petition have arisen.   There is  no doubt that if direct recruitment had kept  pace  with the quota fixed therefor there would have been no  anomalies in  fixing  the  seniority  list.   The  question  therefore narrows down to this: Can it be said that there is denial of equality of opportunity which arises out of this  fortuitous circumstance  and  which  is  not a  vice  inherent  in  the rotational  system?   We are not prepared to  say  that  the rotational   system  of  fixing  seniority  itself   offends equality   of  opportunity  in  government   service.    Any anomalies which may have resulted on account of insufficient recruitment  of  direct recruits in the past cannot  in  our opinion be a ground for striking down the rotational system, which, as we have said, does not itself amount to denial  of equality  of  opportunity  in the matter  of  employment  in government  service.  It is regrettable that some  anomalies have appeared because of insufficient recruitment of  direct recruits  in the past in this particular service.  But  that in  our  opinion  can be no reason  for  striking  down  the seniority  list  prepared in 1963 which  is  undoubtedly  in strict  accordance with the rotational system based  on  the fixed  quotas  for recruitment of direct  recruits  and  pro motees.   The  order of the Board of 1963 on  the  basis  of which  the  impugned seniority list of Appraisers  has  been prepared   clearly   lays  down  that  "the   principle   of determination  of seniority of the direct recruits  and  the promotees  inter se in the prescribed ratio of I : I  should be  worked  out".   This order is  in  accordance  with  the circular  of 1959 and as we have said already, there  is  no inherent  vice  in  the principle  of  fixing  seniority  by rotation  in  a case where a service is  composed  in  fixed proportion  of  direct recruits and promotees.   Nor  do  we think  that this system is on a par with  the  carry-forward rule which was struck down by this Court in T. Devadasan  v. Union of India and others(1) and on which strong reliance is placed  on  behalf of the petitioners.  In the case  of  the carry-forward  rule  certain quota is fixed annually  for  a certain class of persons and it is carried forward 1.  [1964] 4 S. C. R. 680. M11Sup CI/66-7 606 from year to year.  This is very different from a case where a  service  is  divided into two parts  and  there  are  two sources  of recruitment, one of promotion and the  other  by

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direct  recruitment.  In such a case, the whole cadre  of  a particular service is divided into two parts and there is no question  of carrying anything forward from year to year  in the matter of annual intake.  The basis on which the  carry- forward  rule  was  struck  down  by  this  Court  does  not therefore apply to a case where the whole cadre of a service is  divided in certain fixed proportions  between  promotees and  direct recruits.  The petitioners therefore can get  no assistance  from  Devdasan’s  case.(1)  The  petition   must therefore  fail  so  far  as  seniority  of  Appraisers   is concerned. This brings us to the question of Principal Appraisers.   We are  of  opinion  that the  petitioners  have  a  legitimate grievance  in  this respect.  The source of  recruitment  of Principal  Appraisers  is  one, namely, from  the  grade  of Appraisers.   There  is therefore no question of  any  quota being  reserved  from  two  sources  in  their  cases.   The rotational system cannot therefore apply when there is  only one   source   of  recruitment  and  not  two   sources   of recruitment.   In a case therefore where there is  only  one source  of recruitment, the normal rule will apply,  namely, that a person promoted to a higher grade gets his  seniority in  that  grade according to the date of  promotion  subject always  to his being found fit and being confirmed,  in  the higher grade after the period of probation is over.  In such a case it is continuous appointmentin the higher grade which determines  seniority for the source of recruitment is  one. There  is  no question in such a case of reflecting  in  the higher grade the seniority of the grade from which promotion is  made  to the higher grade.  In so far therefore  as  the respondent  is doing what it calls restoration of  seniority of  direct  recruits  in Appraisers’  grade  when  they  are promoted  to the Principal Appraisers’ grade, it is  clearly denying  equality of opportunity to Appraisers which is  the only  source  of recruitment to  the  Principal  Appraisers’ grade.   There is only one source from which  the  Principal Appraisers  are  drawn, namely,  Appraisers,  the  promotion being by selection and five years’ "experience as  Appraiser is  the  minimum qualification.  Subject to  the  above  all Appraisers  selected  for the post of  Principal  Appraisers must  be  treated  equally.  That means they  will  rank  in seniority  from the date of their continuous acting  in  the Principal  Appraisers’ grade subject of course to the  right of government to revert any of them who have not been  found fit  during the period of probation.  But if they are  found fit  after  the period of probation they rank  in  seniority from  the  date they have acted  continuously  as  Principal Appraisers  whether they are promotees or  direct  recruits. The  present  method by which the respondent puts  a  direct recruit  from the grade of Appraiser, though he is  promoted later, above a promotee 607 who  is promoted to the grade of Principal Appraiser  on  an earlier  date clearly denies equality of  opportunity  where the  grade  of Principal Appraiser has only  one  source  of recruitment, namely, from the grade of Appraisers.  In  such a  case the seniority in the grade of  Principal  Appraisers most  be  determined according to the.  date  of  continuous appointment in that grade irrespective of whether the person promoted  to  that  grade from the Appraisers’  grade  is  a direct recruit or a promotee.  This will as we have  already said be subject to the government’s right to revert any  one promoted as a Principal Appraiser if he is not found fit for the  post  during  the period of  probation.   The  petition therefore  will  have  to be allowed. with  respect  to  the

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method  by  which  seniority  is  fixed  in  the  grade.  of Principal Appraisers.  That method denies equality of oppor- tunity  of  employment to the Appraisers who  are  the  only source of’ recruitment to the grade of Principal Appraisers. What the impugned method seeks to do is to introduce a  kind of   reservation  in  respect  of  the  two  categories   of Appraisers  from  which the promotions are  made,  and  that cannot be done when the source of promotion is one. Appraisers is concerned but allow it so far as the seniority of Principal Appraisers is concerned and the method used  by the  respondent in that connection must be struck down,  and we  further direct the determination of their  seniority  in the  manner we have stated above.  In the  circumstances  we pass no order as to costs. Petition allowed in part. 608