Holding

Vacancies that arose prior to the enforcement of the 1998 Rules must be filled under the 1988 Rules; the appeal is allowed, restoring the Single Judge’s order.

Summary

Fifteen officers of a Regional Rural Bank were eligible for promotion under the 1988 Rules when the vacancies arose. While the promotions were pending, the 1998 Rules superseded the 1988 Rules. The bank, relying on a Supreme Court decision in State of Rajasthan v. R. Dayal, issued a circular directing that the promotions be made under the 1998 Rules. The appellants challenged this, and a Single Judge of the Rajasthan High Court dismissed their writ petition, but a Division Bench reversed that order, directing promotions under the 1998 Rules. On appeal, the Supreme Court held that vacancies must be filled according to the rules in force at the time the vacancy arose, i.e., the 1988 Rules, and restored the Single Judge’s decision. The Court also allowed the promotion of an appellant under disciplinary enquiry to benefit from the judgment, subject to the outcome of that enquiry. The appeal was allowed and no costs were awarded.

Issues considered

Whether vacancies that arose before the amendment of the promotion rules (1998 Rules) should be filled under the old 1988 Rules or the amended 1998 Rules.
Whether an appellant facing a disciplinary enquiry should be denied the benefit of the judgment regarding promotion.

Legislation cited

Regional Rural Banks Act, 1976s. 29

Subjects

service lawrecruitmentpromotionvacancyapplicable rulestransitional provisionsregional rural banksdisciplinary enquiry

Judgment

-( I' l
A ARJUN SINGH RATHORE AND ORS.
v.
B.N. CHATURVEDI AND ORS. r
OCTOBER 12, 2007
B
[S.B. SINHA AND HARJIT SINGH BEDI, JJ.]
~

"""r-
Service law-Recruitment process-Vacancies to be filled by
promotion, occurring prior to the enforcement of amended Rules-
c Held: Would be filled under the Rules in operation when the vacancies
had occurred-It would be governed by the original Rules-1988 Rules
and not by the amended Rules-1998 Rules-Regional Rural Banks
(Appointment and Promo:ion afOfficers and others Employees) Rules,
1988-Regional Rural Bank (Appointment and Promotion ofOfficers
D and other Employees) Rules, 1998.

When the Regional Rural Banks (Appointment and Promotion of f
Officers and other Employees) Rules, 1988 were in force, 15 posts
became available for promotion under certain category, in the Bank.
E While the vacancies still existed, the Regional Rural Bank (Appointment
and Promotion of Officers and other Employees) Rules, 1998 came into
force and superseded the 1988 Rules. In view of the judgment of this
Court in State ofRajasthan v. RDayal & Or,s., respondent-Bank directed
that the 'posts which fell vacant prior to the publication ofthe amended
F rules i.e. Rules 1998 would be governed by the Old Promotion Rules
and not by the amended rules'. Appellants were promoted to Scale-II -(:.

as per the 1988 Rules. Respondent Nos.1to5 filed writ petition seeking
direction that the pro~otion to the post of Scale-II Officers be held as
per the 1998 Rules. Single Judge of High Court dismissed the writ
G petition. However, Division Bench allowed the writ petition. Hence the
present appeal.
.).,,,- ,,...
Allowing the appeal, the Court '

HELD: 1.1. The vacancies to be filled by promotion were to be
H 320
ARJUN SINGH RATHORE v. B.N. CHATURVEDI 321
" r-
filled under the Rules which were in operation on the date when the A
vacancies had occurred. Therefore, the vacancies which had occurred
prior to the enforcement ofthe Regional Rural Bank (Appointment and
Promotion ofOfficers and other Employees) Rules, 1998 had to be filled
in under the Regional Rural Banks (Appointment and Promotion of
Officers and other Employees) Rules, 1988 and as per the procedure B
~ laid down therein. Thus, the judgment ofthe Single Judge ofHigh Court
,.- is restored. [Para 6 and 7] [324-A, D-E]
State ofRajasthan v. R.Dayal & Ors., [1997] 10 SCC 419, relied
on. c
1.2. Pursuant to the order of Division Bench the exercise for
promotion under the 1998 Rules had been carried out and all 15
appellants who appeared in the written examination had been declared
successful. The result of 14 had been declared whereas the result of
appellant No.3 had been kept in a sealed envelop as disciplinary enquiry D
,.!,
was pending against him. The plea that appellant no 3 had been subjected
to a charge-sheet dated 09.11.2005 on the basis of complaint date~
16.6.2005, that is long after the promotions had been made under the
1988 Rules in September 2000, and as such he too should be given the
benefit ofthis judgment in so far as the promotion was concerned though E
subject to the outcome of the proceedings against him, is
accepted. [Para8] [324-F-H; 325-A]
CML APPELLATE JURISDICTION : Civil Appeal No. 4840 of
2007.
...)-- F
From the final Judgment and Order dated 18.8.2005 of the High
Court of Judicature for Rajasthan at Jodhpur in D.B. Civil Special Appeal
(W) No. 818 of 2002.

M.R. Calla, Ranjeeta Rohatgi (for P.H. Parekh & Co.) for the G
Appellants.
.....,
:"
Pramod B. Agarwala, Praveena Gautam and Raman Mishra for the
Repondents.
The Judgment of the Court was delivered by H
cl
322 SUPREME COURT REPORTS [2007] 11 S.C.R.
'{' ,. '
A HARJIT SINGH BEDI, J. 1. Leave granted.
2. This appeal is directed against the judgment and order of the
Division Bench of the Rajasthan High Court dated 18th August 2005
,~
setting aside the judgment of the learned Single Judge thereby allowing
the writ petition filed by the respondents and further directing that
B promotion to the post of Scale-II Officers be held as per the Rules of
1998. The facts leading to the filing of the appeal are as under:
--,..
3. On 28th September 1988 the Department of Economic Affairs
·(Banking Division), Ministry of Finance, Government oflndia, after
c consultation with the National Bank for Agriculture and Rural
Development and in exercise of the powers conferred by Section 29 of
the Regional Rural Banks Act 1976 notified the Regional Rural Banks
(Appointment and Promotion of Officers and others Employees) Rules,
1988 (hereinafter called the "Rules of 1988") which came into force w.e.f.
D 28th September 1988. The second Schedule of these rules provided for
the mode of appointment to different categories of officers. The appellants )..__
herein fell in category No. 6 whereas category No. 7 dealt with the
t
appointment of Area Managers or Senior Managers by promotion of
officers from category No. 6 and inter.:.alia provided that all the vacancies
E were to be filled in by promotion from qualified and eligible persons
working in the bank and that the mode of selection would be interview
and assessm~nt of performance reports for the preceding three years
period. The Board of Directors of the respondent Kshetriya Grarnin-Bank
adopted the Rules in a meeting held on 26th September 1988. It is the
F case of the appellants that by the first of April 1999, 15 posts in all had
~
become available for promotion under category 7 as no appointments had,
in fact, been made for several years. While the vacancies still existed the
Regional Rural Bank (Appointment and Promotion of Officers and other
employees) Rules 1998 (hereinafter called the "Rules of 1998") were
framed and published in the Official Gazette on 29th July 1998. The Board
G ;•
of Directors of the Kshetriya Bank adopted these rules and issued a
L
Circular dated 15th May 1999 conveying the information that the Rules ~ ,....,-
of 1988 had been superseded and that henceforth the Rules of 1998
alone would form the basis for promotion etc. The Bank of Baroda which
H was the sponsoring Bank under the Regional Rural Banks Act of 1976
ARJUN SINGH RATHORE v. B.N. CHATURVEDI 323
[HARJIT SINGH BEDI, J.]
thereafter made an enquiry from the concerned quarters and on 15th A
October 1999 addressed a letter to the Regional Rural Banks that in view
of the judgment of the Supreme Court in the case of State ofRajathan
v. R.Dayal & Ors., "any post which had fallen vacant prior to the
amendment of the Rules would be governed by the original rules and not
by the amended rules" and in order to make matters more explicit B
repeated the directive by reiterating that the "posts which fell vacant prior
to the publication of the amended ruies i.e. Rules 1998 would be governed
by the Old Promotion Rules and not by the amended rules." A copy of
the letter dated 15th October 1999 has been appended as Annexure
P-1 to the appeal. C
4. The respondent, Kshetriya-Bank thereupon issued a circular dated
13th June 2000 directing that all the vacancies which were available as
on 31st March 1998 be filled in under the Rules of 1988. 15 persons,
the appellants herein, were thereafter interviewed on 18th September 2000 D
and were found fit for promotion and the said list was also approved by
the Board of Directors and all 15 appellants were accordingly promoted
to Scale-11 under order dated 18th September 2000. Respondent Nos.
1 to 5 herein however preferred a joint Writ Petition No. 3641/2000 in
the High Cou..rt which was dismissed by the learned Single Judge on 25th E
September 2002 vide judgment appended as Annexure P-2. An appeal
was thereafter taken to a Division Bench which reversed the order of the
Single Judge thus allowing the Writ Petition and directing that the
promotions and the circulars dated 13th June 2000 and 18th September F
2000 respectively be quashed and further directing the Kshetriya Bank
to make the promotions of Scale-II Officers as per the Rules of 1998. It
is in this circumstance that the present special leave petition has been filed.
5. Notice was issued and all the respondents have been served.
However, Respondent Nos. 6 and 7 alone have put in appearance and a G
reply has been filed by the Chaim1an of the respondent-Bank. We have
accordingly heard the learned counsel who have appeared before us.
6. Mr. Calla, the learned senior counsel for appellants has argued
that the matter was fully covered by the judgment of this Court in State H
ofRajasthan v. R.Dayal, [1997] IO SCC 419 wherein it had been held
\
~ --

324 SUPREME COURT REPORTS [2007] 11 S.C.R.

A that the vacancies to be filled by promotion were to be filed wider the
rules which were in operation on the date when the vacancies had
occurred. Relying on and referring to an earlier judgment in the case of
Y. VRangaiah v. JSreenivasa Rao, [1983] 3 SCC 284 it was opined
as under:
B
"This Court has specifically laid (sic) that the vacancies which
occurred prior to the amendment of the Rules would be governed
by the original Rules and not by the amended Rules. Accordingly,
this Court had held that the posts which fell vacant prior to the
c amendment of the Rules would be governed by the original Rules
and not the amended Rules. As a necessary corollary, the vacancies
that arose subsequent to the amendment of the Rules are required
to be filled in in accordance with the law existing as on the date
when the vacancies arose."
D
7. The above legal position has not been seriously disputed by the
learned counsel for respondent Nos. 6 &7. We are therefore of the opinion
that the vacancies which had occurred prior to the enforcement of the
Rules of 1998 had to be filled in under the Rules of 1988 and as per the
E procedure laid down therein. We are therefore of the opinion that the
judgment of the learned Single Judge needs to be restored. We order
accordingly.
8. There is another aspect of the matter which needs to be taken
F care of. It has been brought to our notice during the course of hearing
that pursuant to the order of Division Bench the exercise for promotion
under the Rules of 1998 had been carried out and that all 15 original
respondents (present appellants) had appeared in the written examination
and been declared successful but the result of 14 had been declared on
G 22nd November 2005 whereas the result of one, Ram Narayan Meena
appellant No. 3 before us, had been kept in a sealed envelop as a
disciplinary enquiry was pending against him. It has however been pointed
otit that Ram Narayan Meena had been subjected to a charge-sheet dated
09 .11.2005 on the basis of acomplaint dated 16th June 2005' that is
H long after the promotions had been made under the Rules of 1988, and
as such he too should be given the benefit ofthis judgment in so far as
ARJUN SINGH RATHORE v. B.N. CHATURVEDI 325
[HARJIT SINGH BEDI, J.]
the promotion was concerned though subject to the outcome of the A
proceedings against him. We find merit in this plea as well. It needs to be
highlighted that the promotion under the Rules of I988 had been made
way back in September 2000 i.e. long before the complaint had been
made against Ram Narayan Meena. We are therefore of the opinion that
he too should be given the benefit of this judgment subject to the outcome B
of the disciplinary proceedings. We accordingly allow the appeal in the
above terms. There will be no order as to costs.
N.J. Appeal allowed .

..r