Holding

The circular of 15 May 1975, read with Regulations 7, 10 and 15 of the Food Corporation Act, governs the regularisation of ad‑hoc promotions and requires the FCI to determine inter‑se seniority of food transferees and direct recruits without striking down the entire seniority list.

Summary

After the abolition of the Central Government's Food Department, its employees were transferred to the Food Corporation of India (FCI). The FCI, exercising powers under Section 45 of the Food Corporation Act, 1964, issued a circular on 15 May 1975 governing the regularisation of ad‑hoc promotions for both transferred employees ("food transferees") and direct recruits, deeming a one‑year service in the promoted grade as satisfactory probation. A transferred employee, H.N. Bharti, whose ad‑hoc promotion was later revoked, obtained a High Court order directing the FCI to consider his case in light of the circular. The High Court subsequently quashed the seniority list for other employees, prompting appeals. The Supreme Court held that the circular, read with Regulations 7, 10 and 15, determines the procedure for regularisation and seniority, and that the entire seniority list need not be struck down; instead, the FCI must re‑determine inter‑se seniority of both categories in accordance with the circular. The Court dismissed the main appeal and directed the FCI to adjust seniority within six months.

Issues considered

The effect of the circular dated 15 May 1975 on the regularisation of ad‑hoc promotions of food transferees and direct recruits.
Whether the High Court was justified in quashing the entire seniority list or only required to direct a re‑determination of seniority.
Interpretation of Regulations 7, 10 and 15 of the Food Corporation Act, 1964 concerning probation, promotion and regular appointment.
The appropriate remedial order for the Food Corporation of India concerning seniority determination.

Legislation cited

Food Corporation Act, 1964s. 4, s. 45

Subjects

Food Corporation of Indiaad‑hoc promotionregularisationseniorityprobationRegulation 7Regulation 10Regulation 15circularcivil service

Judgment

A FOOD CORPORATION OF INDIA AND ORS.
v.
H.N. BHARTI AND ORS.
~

MARCH 25, 1992 ·
~
B [A.M. AHMADI AND K. JA YACHANDRA REDDY, JJ] ~

Civil Services : --A
Food Corporation Act, 1964 :
c Section 45-Regulations framed under the Act-Regulations 7, JO and
~·
15-Circular issued on 15.5. 75--lnter-se seniority-Direct recrnits and trans-
ferees-Fixation of-Directions issued.

On the abolition of the Food Department under the Central Govern-
D ment, the employees therein were transferred to the Food Corporation of
India (FCI). In exercise of its powers conferred by Section 45 of the Food
Corporation Act, 1964, FCI framed Regulations in regard to appointments
and promotions. Later, pursuant to Regulation 10, FCI issued a Circular
on 15.5.75 to the effect that both the employees transferred from the
erstwhile Food Department (Food Transferees) and the direct recruits will
E
be promoted on ad-hoc basis. It also stated that with the final transfer of
Food Transferees to FCI with effect from 1.3.69, their promotions had to
be regularised. It also provided that the transferees as well as direct -J.._ -
recruits would be deemed to have completed the period of probation
satisfactorily if they have completed one year of service in that grade. This
F was in' accordance with Regulations 7 and 15 which stipulated a period of
one year probation for the regular appointees in FCI- both transferees
-
and direct recruits.

One of the Respondents who was given ad-hoc promotion as Assis-
tant Manager was reverted on the ground that he was not approved for
~
G
regular promotion. Being aggrieved by the reversion order, he approached
the High Court by way of a Writ Petition. The High Court directed the FCI
to consider his case in the light of the circular dated 15.5.1975.

Some other Writ Petition were also filed before the High Court by
_-(-
H the employees challenging the seniority list, and the High Court quashed
328
...
- ...

F.C.I. v. H.N.BHARTI 329

the seniority list and directed the FCI to consider the claims of the Writ A
Petitioners in the light of the circular dated 15.5.1975.

The Union of India preferred appeals, against the orders of the
High Court. A Writ Petition has been filed directly before this Court in
regard to fixation of seniorty.
B
On behalf of FCI, it was contended that there was no need to quash
the entire seniority list, as has been done by the High Court in the
subsequent cases.

Disposing of the matters, this Court,
c
HELD : 1. It will be seen from the circular dated 15.5.75 that the
procedure for regularisation of 'food transferees' on their absorption in
the FCI was laid down and it was provided that the transferees as well as
direct recruits described as 'ad-hoc promotees' may be deemed to have
completed the probationary period satisfactorily if they have completed D
one year of service in that grade after following the procedure laid down
in Regulation 15 and allied orders. [333C, D]

2. Paragraph 3 of th~ circular envisages passing of formal orders
of regular appointments (as required by Regulation 7) after following the E
procedure laid down in the circular. These orders of regular appointment
will be on the post held by the 'food transferees' on the date of absorption
and if one has since been promoted, a separate· order in respect of the
promotion post would also be passed. This in brief is the import of the
circular read in the light of Regulations 7, 10 and 15. The circular has
taken care of both th,e categories, namely, direct recruits as well as 'food F
transferees'. It is, therefore, essential that· the question of seniority of both
the cadres be determined on the basis of the principles laid down in the
said circular. There was no need to strike down the entire seniority list but
it would suflice if the FCI is directed to review and determine the seniority
of the 'food transferees', as well as direct recruits who were granted ad-hoc G
promotions. [3360-F]

3. Food Corporation of India is directed to have the inter se seniority
of the direct recruits/food transferees determined in the light of the cir-
cular and grant appropriate placements to the incumbents on the basis of
the seniority so determined in the existing seniority list. Such placements H
330 "
SUPREME COURT REPORTS [1992] 2 S.C.R.

A may require a reshuffie of the seniority list which the F'CI would be free to
do. Having regard to passage of time it is directed that this may be done
within a period of six months. [336G, H; 337A, BJ

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 338 of
1987.
B
From the Judgment and Order dated 5.3.1986 of the Punjab and
Haryana High Court in L.P.A. No. 791 of 1983.

WITH

c Civil Appeal Nos. 530-531 of 1987 with Writ Petition No. 1218/1989.

K.G. Bhagat, Y. Prabhakar Rao and Ms. Madhu Moolchandani for
the Appellants. 'y"

D A.B. Rohtagi, S.K. Dhingra, K.B. Rohtagi, R. Karanjawala, Ms. M.
Karanjawala and K. Swami for the Respondents,.

Sajai Singh and Ms. Smitha Singh for the Intervenors.

The J udgrnent of the Court was delivered by
E AHMADI, J. The facts giving rise to these appeals shortly are as
under:

The respondent, H.N. Bharti, was working in the Food Department
of the Central Government when it came to be abolished w.e.f. 1st January,
F 1966. On its abolition employees of the Food Department were provisional-
ly transferred to the Food Corporation of India (F.C.I.) with effect from
the same date. H.N. Bharti was also transferred and was posted as Tech-
nical Assistant, Grade I, in the F.C.l. Later w.e.f. 19th April, 1972 he was
promoted on an ad hoc basis as Assistant Manager (Technical). Sometime
in September, 1979 the Government of India took a decision that those
G provisionally transferred should stand permanently transferred to the F.C.I.
w.e.f. 1st March, 1969. In this manner, employees of the erstwhile Food
Department came to be absorbed as employees of F.C.I. It appears that
on 15th May, 1975 a circular was issued·by the F.C.l. in regard to promo-
tion of the transferred employees and others to higher posts on regular
H basis. Before we deal with this circular, it would be advantageous to refer
I

F.C.I. v. H.N.J3HARTI [AHMADI, J.] 331

to the relevant regulations framed by the F.C.I. in exercise of powers A
conferred by Section 4 of the Food Corporations Act, 1964 {Act 37 of
1964). These reguiations were framed with the previous sanction of the
Central Government. Our attention was invited to Regulations 7, 10 and
15 thereof. Regulation 7 deals with the mode of appointment. It provides
that regular appointments in the service of the FCI can only be to the posts
B
specified in column (2) of the Table set out in Appendix 1 sanctioned for
a period of not less than one year and shall be made :

(a) in accordance with any of the modes specified against each
in column (4) thereof; or

(b) by transfer from the corresponding categories in column
c
(9) of the said Table of employees of the Central Govern-
ment in the Directorate General of Food/Pay & Accounts
Offices; or

(c) by permanent absorption of deputationists in the service of D
the Corporation.

If we turn to Appendix 1 we find that the post of Assistant-Grade I
belongs to category III and is a non-selection post which can be filled
hundred per cent by promotion; failing that by direct recruitment. So far
as post of Assistant Manager is concerned, it belongs to category II and is
E
a selection post, which can be filled in the ratio of 25:75 by direct
recruits/promotees. Regulation 10 lays down the procedure for promotion
and provides that the promotion shall be made on the basis of seniority
subject to fitness in respect of non-selection posts and on the basis of merit,
seniority being considered only when the merit of the contending can- F
didates is approximately the same, in the case of selection posts. It further
provides that all promotions shall be considered by a Promotion Board
constituted for that purpose. There is a note appe,nded to this rule which
may be reproduced :

"Note: Purely as an interim measure, pending their permanent G
absorption in the service of the Corporation, the employees
of the Central Government in the Directorate General of
Food posted to work under the administrative control of
the Food Corporation of India may be given ad hoc promo-
tions, in accordance with the principles mutually agreed H
332 SUPREME COURT REPORTS [1992) 2 S.C.R.

A upon between the corporation and the Central Government."

It is, therefore, clear from this note appended to Regulation 10 that
pending absorption in the service of the FCI the employees of the Direc-
torate General of Food posted to work under the administrative control of
the F.C.I. were to be given 'ad hoc' promotions in accordance with the
B principles determined by the Corporation and· the Central Government.
These principles are enumerated in the circular referred to earlier. That
brings us to Regulation 15, which inter alia, provides that every person
regularly appointed to any post in the Corporation under sub-clause (a) of
clause (1) of Regulation 7 shall be required to be on probation for a period
c of one year from the date of appointment. The appointing authority may
in its discretion extend the period of probation by a further period not
exceeding one year. In other word.s, the maximum period of probation can
be two years.

D The FCT issued a circular on 15th May, 1975 pursuant to the note
below Regulation 10 extracted earlier. Taking note of the fact that under
the said note the employees transferred from the Directorate General of
Food, described as 'food transferees' could be promoted to higher posts in
the Corporation on an ad hoc basis pending their permanent absorption in
E the service of the F.C.I., it stated that all promotions to the various grades .
of the FCI, irrespective of whether one was a 'food transferee' or a direct
recruit, need regularisation. It appears from the circular that both 'food
transferees' and direct recruits were being termed as 'ad hoc' when
promoted to the next higher post. With. the final transfer of the 'food
transferees' to the FCI w.e.f. 1.3.69 promotions made on ad hoc basis
F pursuant to the note appended to Regulation 10 had to be regularised. The
circular, therefore, states that regularisation shall be on the basis of the
principle enumerated therein. It was decided keeping in view Regulation
7 and Regulation 15 that regular appointees in the service of the FCI
whether direct recruits or promotees shall be placed on probation for a
G period of one year from the date of their appointment/promotion. It was,
therefore, posited that all promotions whether by direct recruitment or
promotion will henceforth be subject to provision of Regulation 15, that is
to say, every such person shall be placed on probation as provided by that
Regulation and the instructions issued thereunder. In regard to 'food
H transferees' and direct recruits promoted to higher grades on ad hoc basis
F.C.I. v. H.N.IlHARTI [AHMADI, J.] 333

it was decided that they may be deemed to have completed the probation- A
ary period satisfactorily, if they have completed one year of service in the
grade after following the procedure laid down in Regulation 15 and
suitable orders issued in that behalf so that if a person has completed one
year of service in the promoted grade his case was required to be reviewed
with a view to determining whether or not he has satisfactorily completed B
the probationary period of one year. In regard to future promotions it was
decided that regular procedure as laid down by the Regulations should be
followed. Paragraph 3 of the circular directed the concerned authorities to
issue suitable orders for the absorption of 'food transferees' into the FCI
w.e.f. 1st March, 1969. It will be seen from this circular that the procedure C
for regularisation of 'food transferees' on their absorption in the FCI was
laid down and it was provided that the transferees as well as direct recruits
described as 'ad hoc promotees' may be deemed to have completed the
probationary period satisfactorily if they have completed· one year of
service in that grade after following the procedure laid down in Regulation
15 and ·allied orders. It appears that the respondent, H.N. Bharti, who had
been granted ad hoc promotion to the post of Assistant Manager was
reverted by an order passed by the Deputy Manager (Administration) on
the ground that he was not approved for regular promotion. He challenged
his reversion order by filing a Writ Petition No. 3624176 in the High Court
of Punjab & Haryana. That writ petition came to be allowed by quashing the E
order of reversion and the High Court directed the FCI to consider his case
in the light of the circular dated 15th May, 1975. It is against this judgment of
the High Court that Civil Appeal No. 338/87 has been preferred.

One P.N. Verma filed a Writ Petition No. 3580177 in the High Court
for quashing the seniority list and for a declaration that the promotion of F
respondents Nos. 4 to 41 to the post of Assistant Manager was null and
void. That writ petition came to be disposed of on 14th October, 1983.
Without going into the merits of the cas~, the learned Single Judge in the
High Court disposed of the matter on the basis of the decision in H.N.
Bharti's case as it was contended before him that the case was squarely G
covered by the ratio of that decision since the claim for fixation of seniority
has to be decided in the light of the policy decision in Annexurc P-3 i.e.,
the circular dated 15th May, 1975. In view of that concession, the seniority
list was set aside with a direction similar to the one granted in H.N. Bharti's
H
334 SUPREME COURT REPORTS [1992] 2 S.C.R.

A case This decision has given rise to C.A. No.531/87. Soon thereafter,
Dharam Singh and M.L. Batra filed the Civil Writ Petition No. 4482/78 for
finalisation of the seniority list and incidental reliefs. This writ petition was
disposed of by an order dated 24th October, 1983 relying on the decision
in P.N. Verma's case. The seniority list was quashed and it was directed
B that the claim of the incumbents be considered in the light of the circular
of 15th May, 1975. This was once again on concession by counsel. That has
given rise to C.A. No. 530/87.

One Upendra Kumar has filed a writ petition (C) No. 1218/89 for
fixation of his seniority and for .incidental reliefs. That arose because by a
C letter dated 27th October, 1989, the De.puty Manager, informed him that
his representation was examined and it was decided that as the matter was
subjudice in this Court it was not possible to accede to his request regard-
ing fixation of seniority till the matter was finally disposed of by this Court.
He was informed that he was at liberty to approach to this Court for any
D · remedy he may deem fit. it was on account of this letter that he filed this
. petition under Article 32 of the Constitution.

We may clarify that H.N. Bharti and P.N. Verma were transferred
employees from the Directorate General of Food whereas the other
E employees concerned in this batch of cases were direct recruits in the cadre
of Technic~I Assistant-Grade I. The intervenors may belong to either
category. Mr. Bhagat, the learned counsel for the FC!, contended that what
the High Court had determined in the case of H.N. Bharti was that the
FCI considered his case in the light of the circular dated 15th May, 1975.
He submitted that the FCI would have no objection to acquiescence in that
F decision, had it not been interpreted to mean or convey that the entire ---
seniorty list prepared by the FCI was liable to be quashed, as has been
done by the High Court in the subsequent decisions in the case of P.N.
Verma and Dharam Singh and M.L. Batra. He submitted that there was
no need to quash the entire seniority list because all that the High Court
G had directed in H.N. Bharti's case was to reconsider the question in the
light of the circular of 15th May, 1975. He submitted that he would have
no objection. to following the same course of action in the case of other
employees also, whether transferees or direct i:ecruits, since the question
of regularisation had to be determined in the light of the principles and
J-
H guidelines laid down in the circular of 15th May, 1975. Mr. Rohtagi, the
F.C.I. v. H.N.BHARTI [AHMADI, J.] 335

learned counsel for the direct recruits submitted that their seniority had to A
be determined on the basis of Regulation 15 since they had satisfactorily
completed the period of probation prescribed thereunder. He submitted
that since their seniority had not been determined on the basis of that
Regulation and the seniority list had been prepared without determining
their seniority and placement in the seniority list on that premise the entire B
-~ seniority list was liable to be quashed.

We have carefully considered the rival contentions and we are of the
opinion that the decision taken by the High Court in H.N. Bharti's case
does not call for intervention. Even on the submission of Mr. Bhagat, the
~ learned counsel for the FCI, the view taken by the High Court in H.N. C
Bharti's case does not require any intervention if it is understood to leave
~ the matter of fixation of seniority to the FCJ on the basis of the principles
or guidelines lai.d down by the circular of 15th May, 1975 which in turn
refers to Regulations 7, 10 & 15. Civil Appeal No. 338 of 1987 must,
therefore, stand dismissed with no order as to costs. D

The circular refers to the note below Regulation 10 which permitted
ad hoc promotions to be given to the erstwhile employees of the Direc-
torate General of Food as a purely interim arrangement pending their
permanent absorption in the FCI. Consequently promotions granted to E
'food transferees' as well as direct recruits were being termed 'ad hoc'
pending the finalisation of question of absorption of the former in the FCI.
The promotion to direct recruits were also termed 'ad hoc' presumably to
avoid complications in the matter of fixation of inter se seniority between
'food transferees' and direct recruits. Regulation lO(i) and (ii) set out the\
criteria for promotion to non-selection arid selection posts. The note at the F
foot of that regulation was clearly an interim measure pending final absorp-
tion of 'food transferees' in the FCI. But, since even direct recruits were.
given ad hoc promotions pending the absorption of 'food transferees', the
circular had to provide for the regularisation of both. It was, therefore,
decided that 'food transferees' and direct recruits promoted to higher G
grades on 'ad hoc' basis may be taken to have completed the probationary
period satisfactorily if they have completed one year of service in that grade
after following the procedure outlined in Regulation 15 and suitable orders,
if any. Regulation 15 has two aspects viz., (i) it lays down the period of
probation and (ii) how the period spent on temporary service or deputation H
336 SUPREME COURT REPORTS [1992) 2 S.C.R.

A service shall be dealt with in counting the period of probation for confir- ·
mation. Once the date of completion of probation period is determined
and confirmation made, the relative seniority between direct recruits and
'food transferees' has to be settled as laid down by Regulation 16. The
illustration given in the circular clarifies how the question of termination
of probation has to be determined. If an incuQlbent has completed service
B
of one year in the promoted grade, his case would have to be reviewed lo
determine if he had satisfactorily completed the probationary period or
would it have become necessary to extend the probationary period hy
another year as provided by Regulation 15(2). If the concerned authority
finds his service to be satisfactory within the first year of his prohation
c period it. may confirm him but otherwise decide if he would have been
confirmed on completion of the extended period. The decision taken in
this behalf would regulate the seniority between 'food transferees' and
direct recruits. Paragraph 3 of the circular envisages passing of formal
orders of regular appointments in the FCI (as required by Regulation 7)
D after following the procedure laid down in the preceding paragraph of the
circular, wherever applicable. These orders of regular appointment will he
on the post held by the 'fOod transferees' on the date of ah;..orptiun and if
one has since been promoted a separate order in respect of the promotion
post would also be passed. This in brief is the import of the circular read
E in the light of Regulations 7, 10 and 15 referred to t:arlier. The circular
has, therefore, taken care of both the categories, namely, direct recruits as
well as 'food transferees'. It is, therefore, essential that the question of
seniority of both the cadres be determined on the basis of the principles
laid down in the said circular as explained hereinabovc. There was no need
F to strike down the entire seniority list but it would suffice if the FCI is
dire.cted to review and determine the seniority of the 'food transferees' as
well as direct recruits who were granted ad hoc promotions, in the light of
the said circular as explained by us. We, therefore, allow the Appeal Nos.
530 and 531 of 1987 to this limited extent only, that is to say, instead of
G quashing of entire seniority list the FCI is directed to have the inter se
seniority of the direct recruits/food transferees be determined in th1.: light
of the circular and grant appropriate placements to the incumbents on the
basis of the seniority so determined in the existing seniority list. Such
placements may require a reshuffle of the seniority list which the FCI
would be free to do. Except for this modification, we do not see any reason
H
F.C.I. i-. H.N.BHARTI (AHMADI, J.) 337

to interfere with the order passed by the High C::ourt which is the subject A
matter of Civil Appeal Nos. 530-531 of 1987. The case of the writ petitioner,
U pcndra Kumar, will also be determined in the light of this judgment along
with those of the respondents in the appeals. The case of the intervenors
as well as Narinder Gangwar may also be similarly determined. Having
regard to passage of time we direct that this may be done within six months B
from today. There will be no order as to costs.

G.N. Matters disposed of.