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CASE NO.: Appeal (civil)  2697 of 2007

PETITIONER: Tejshree Ghag etc. etc

RESPONDENT: Prakash Parashuram  Patil & Ors. etc. etc

DATE OF JUDGMENT: 17/05/2007

BENCH: S.B. Sinha & Markandey Katju

JUDGMENT: J U D G M E N T

CIVIL APPEAL NO.    2697                  OF 2007 [Arising out of SLP (C) No. 11276 of  2006]

S.B. Sinha, J.

1.      Leave granted.          2.      This appeal is directed against the judgment and order dated  22.03.2006 passed by the High Court of Bombay in various writ petitions  filed by the private respondents herein whereby and whereunder the order of  the Tribunal dated 13.03.2002 as also the order passed in the Review  Petition arising therefrom dated 14.08.2003 were set aside.           3.       The said writ petitions came up for consideration by the High Court  in the following circumstances.            4.      In the Education Department of the State of Maharastra there exists a  cadre of Assistant Teachers.  There are 16 categories of posts in the said  cadre.  Respondents were directly appointed as Assistant Deputy Education  Inspector (for  short, "ADEI") pursuant to an advertisement issued by the  State of Maharashtra on 01.10.1992.  Advertisements for other posts in the  same cadre were also issued, namely, for the posts of Asstt. Teacher,  Physical Education Teacher, Science Supervisor etc. pursuant whereto  appointments were made in the said post. However, no seniority list was  published for a long time.  A purported seniority list was published only on  09.08.2001.  Allegedly, before publishing the said final seniority list  objections were invited.          5.      Respondents, as noticed hereinbefore, who were appointed as  Assistant Deputy Education Inspector, were transferred to the post of Asstt.  Project Officer/Asstt. Teacher and those who had been working as Asstt.  Teacher/Asstt. Project Officer were transferred to the posts of ADEI.   Indisputably, by reason of such orders of transfer, the respondents suffered  civil consequences as the quantum of their pay was reduced.           6.       Original applications were filed by them before the Maharashtra  Administrative Tribunal,  alleging  :

(i)     Orders for transfer on the basis of provisional seniority list was          without jurisdiction;. (ii)    Those who were holding the posts of Asstt. Teacher could not have          been transferred as ADEI as they were not qualified therefor; and (iii)   By reason of such transfers, the pay scale of the respondents would be          reduced  

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7.      By reason of an order dated 13.03.2002 the said original applications  were dismissed.  Review applications filed thereagainst were also dismissed.   The High Court, however, in the writ petitions filed by the respondents in  terms of its judgment dated 22.03.2006 which is impugned before us upon  noticing the scales of pay payable to the different classes of employees, inter  alia,  opined :

       "What emerges from the above discussion is  that the post of A.D.E.I had been recognized as  distinct post under the recruitment rules. The  appointment to the said posts is  both by promotion  as well as by direct recruitment.  The promotion is  from the post amongst others of Assistant Masters,  A.D.E.I.s have promotional avenue to the post of  Deputy Education Inspector to which posts the  other posts in Grade III are not entitled for  consideration.  The post of A.D.E.I. as set out  earlier carries higher pay scale than those other  posts.  In these circumstances, the respondent  authorities could not have clubbed these posts  under a common seniority or for that matter made  the posts transferable from one to another.  This  would be treating holders of dissimilar posts as  belonging to one class, which they are not.  This  will also be in violation of the recruitment rules  and affecting the promotional avenue of A.D.E.I.s.   Though there is no right to promotion, there is  right to be considered.  By the action of transfer,  this right of the Petitioner has been affected.  This  clearly amounts to an infringement of Article 14  and 16 of the Constitution of India."

8.      It was furthermore held that transfer of persons holding substantive  posts carrying lower time scale of pay would be violative of Article 14, 16  and 311 of the Constitution of India.  It was stated  :

"\005The order entailed loss of pay as well as loss of  seniority and postponement of future chances of  promotion.  It is in that context the Apex Court  held in that case that the effect of reduction in  rank, the appellant suffered loss of pay and also  suffered loss of seniority as also postponement of  future chances of promotion to the senior scale.   On the facts, therefore, the court held that the  appellant was not reverted for administrative  reasons for unavailability of post but for different  reasons.  The act of the Respondent State  therefore, in transferring the petitioner from the  higher time scale to lower time scale would attract  Article 311 of the Constitution of India.  A  reduction in the rank may be by way of  punishment or it may be an innocuous thing.  If the  Government servant has a right to a particular  rank, then the very reduction from that rank will  operate as a penalty, for he will then lose the  emoluments and privileges of that rank.  In such  cases the test for determining whether the  reduction in such cases is or is not by way of  punishment is to find out if the order for the  reduction also visits the servant with any penal  consequences.  In the instant case, the Petitioners  suffer penal consequences inasmuch as the  petitioner’s are loosing their emoluments and  privileges of the rank\005"

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9.      Mr. C. Balakrishna, learned counsel appearing on behalf of the  appellants, would, inter alia, submit that the terms and conditions of service  of the employees being  governed by the statutory rules, the impugned  judgment cannot be sustained.  Our attention in this behalf has been drawn  to the notification dated 27.05.2005 making rules in terms of  proviso to  Article 309 of Constitution of India called ’Maharashtra Education Service  Administrative Officer of Municipal School Board, Assistant Deputy  Educational Inspector, Assistant Project Officer, Assistant Teacher in Junior  Colleges of Education, Coordinator, Councellor, Extension Officer in State  Council of Educational Research and Training Pune, Lecturer in Junior  Colleges, Programme Assistant, Science Supervisor, District Science  Supervisor, Subject Assistant, Subject Expert and Technical Assistant  (Recruitment) Rules, 2005’  (Rules).  It was contented that in terms of the  said rules, the respondents were not entitled to hold the posts of Assistant  Deputy Education Inspector.            10.     It is not in dispute that the cadre of Maharashtra Education Service  Group ’C’ consists of 16 different categories of posts.  All posts at all  material times were not treated to be equivalent at least in the matter of scale  of pay.  It is stated that a decision to sanction three tier scale of pay to full  time teachers teaching in higher school was taken by the State Government.   According to it if the direction of the High Court is given effect to, the same  would violate the conditions of service of the employees concerned working  in the Education Department and only in that view of the matter 2005 Rules  have been framed.

11.     Respondents herein were holders of posts on which they were  employed.  The posts carried the scales of pay prescribed therefor.

12.     The terms and conditions of their service, thus, unless altered  expressly, would be governed by the rules which were in existence at the  time when the impugned orders were passed.  It is true that the State has the  power to alter the terms and conditions of service even with retrospective  effect by making rule framed under proviso appended to Article 309 of the  Constitution of India, but it is also well-settled that the rules so made  ordinarily should state so  expressly.

13.     It has been contended that 2005 are retrospective in nature or have  retroactive operation.   

14.     By reason of the said rules the effect of the judgment of the High  Court is not sought to be taken away.  It was not given retrospective effect.   Rules framed by the State had also not brought to the notice of the High  Court.            15.     The orders of transfer were passed by Authority in purported exercise  of its executive power.  Executive power can be exercised only in terms of  the extant rules.  It is well-settled that where executive order results in civil  consequences, principles of natural justice are required to be complied with  prior thereto.  It is not a case where an order of transfer was passed by way  of change of place of employment within an organization simpliciter.  An  order of transfer ordinarily should be in terms of the existing rules.  Transfer  may even be incidental to the conditions of service, but thereby nobody can  be deprived of his existing right. Existence of a power and exercise thereof  are two different concepts.  An Executive power in absence of any statutory  rules cannot be exercised which would result in civil or penal consequences.   Such exercise of power must, moreover,  be bona fide.  It cannot be done for  unauthorized purpose.  An Executive order passed for unauthorized purpose  would amount to malice in law.  An order of transfer  cannot prejudicially  affect the status of an employee.  If orders of  transfer substantially affect the  status of an employee, the same would be violative of  the conditions of  service and, thus,  illegal.  Transfers  must be made to an equivalent post.   [See Ramadhar Pandey v. State of U.P. & Others (1993)  Supp. (3) SCC 35  

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Hussain Sasan Saheb Kaladgi v. State of Maharashtra, (1988) 4 SCC 168  and P.C. Wadhwa v. Union of India and Anr. [1964 (4) SCR 598]  

16.     In Vice-Chancellor, L.N. Mithila University v. Dayanand Jha (1986) 3  SCC 7, it was held : "\005The true criterion for equivalence is the status and the  nature and responsibility of the duties attached to the two  posts. Although the two posts of Principal and Reader are  carried on the same scale of pay, the post of Principal  undoubtedly has higher duties and responsibilities. Apart  from the fact that there are certain privileges and  allowances attached to it, the Principal being the head of  the college has many statutory rights, such as: (i) He is the  ex officio member of the Senate. (ii) He has the right to be  nominated as the member of the Syndicate. (iii) As head of  the institution, he has administrative control over the  college Professors, Readers, Lecturers and other teaching  and non-teaching staff. (iv) The Principal of a constituent  college is also the ex officio member of the Academic  Council of the university. (v) He has the right to act as  Centre Superintendent in the university examinations. It is  thus evident that the High Court was right in holding that  the post of Reader could not be regarded as an equivalent  post as that of Principal in the legal sense. Maybe, when  the affairs of a college maintained by the university are  mismanaged, the Vice-Chancellor may, for administrative  reasons, transfer a Professor or Reader of any department  or college maintained by it to the post of the Principal of  such college, but the converse may not be true. While the  Professors and Readers by reason of their learning and  erudition may enjoy much greater respect in society than  the Dean or Principal of a college, it does not follow that  the post of Principal must be treated as equivalent to that  of a Reader for purposes of Section 10(14) of the Bihar  State Universities Act, 1976, as amended."

17.     The orders of transfer impugned before the Tribunal in any event   could not have been passed without complying with the principles of natural  justice.   

18.     We are not oblivious of the decision of this Court in Prasar Bharti &  Ors. v. Amarjeet Singh & Ors. [2007 (2) SCALE 486], wherein order of  transfers, if not otherwise arbitrary and irrational and thus violative of  Article 14 of the Constitution of India, was upheld.   

19.     In this case we are not concerned with enforcement of the Rules.   They were brought in force at a latter stage.  It is for the State to apply the  provisions of the said rules only if any occasion arises therefor but keeping  in view the fact that the said rules have not been given a retrospective effect,  the impugned orders cannot be supported by reason thereof or otherwise.

20.     We, therefore, do not find any merit in this appeal.  It is accordingly  dismissed with costs.  Counsel’s fee assessed at Rs. 10,000/-.