Holding

Classification of posts into gazetted or non‑gazetted categories cannot be based purely on pay scales; administrative considerations justify retaining the railway SAS staff in Group ‘C’, so no constitutional violation occurs.

Summary

The India Railway SAS Staff Association (appellants), comprising Section Officers and Travelling Inspectors of Accounts, were placed in the revised pay scale of Rs.2000-3200 following the Fourth Central Pay Commission but were not accorded Group ‘B’ status, unlike their counterparts in the CAG and CGDA. They contended that this denial violated Articles 14 and 16 of the Constitution and amounted to discrimination. The Central Administrative Tribunal rejected their claim, and the Union of India appealed. The Supreme Court examined whether classification of posts into gazetted or non‑gazetted categories can be based solely on pay scales and whether the railway’s decision infringed the constitutional guarantees. The Court held that classification involves multiple administrative criteria and cannot be determined merely by pay scale, and therefore there was no discrimination. Consequently, the appeal was dismissed with costs.

Issues considered

Whether denial of Group ‘B’ status to railway SAS staff, who are in the Rs.2000-3200 pay scale, violates Articles 14 and 16 of the Constitution.
Whether classification of posts into Group ‘B’ or ‘C’ can be based solely on the scale of pay.
Whether the railway’s classification scheme amounts to arbitrary or discriminatory treatment.

Legislation cited

Constitution of Indias. Article 14, s. Article 16

Subjects

classification of postsgroup B statuspay scale paritydiscriminationArticles 14 and 16railway service lawFourth Central Pay Commissionadministrative hierarchy

Judgment

A INDIA RAILWAY SAS STAFF ASSOCIATION AND ORS.
v.
UNION OF INDIA AND ORS.

JANUARY 21, 1998

B [MRS. SUJATA V. MANOHAR AND D.P. WADHWA, JJ.]
"
y

Service Law :

Classification of posts-Account staff of Railways-Fourth Central Pay
c Commission recommendations-Placed in the revised pay scale of Rs. 2000-
3200-Not granted group 'B' status-SAS staff of CAG and CODA in the
same pay scale granted group 'B' status-On challenge, claims rejected by
Tribunal-On appeal, held classification of posts cannot be done purely on
the basis of pay scales as it might lead to administrative hierarchical
imbala111;:e-Thus appellants not entitled to be placed in group 'B' status-
D
Constitution of India: Articles 14 and l 6. .K

Appellants were serving in the Railways as Section Officers or
Travelling Inspectors of Accounts in Group 'C'. The Fourth Central Pay
Commission recommended revised pay scales of Rs. 2000-3200 to Accounts
E staff under CGDA, CAG, Railways and Departments of Posts and
Telecommunication. Though appellants were placed in the revised pay scale
of Rs. 2000-3200, they were not granted Group 'B' status as has been done
in respect of their counterparts In CAG and CGDA in the same pay scale.
Aggrieved, the appellants approached the Tribunal which rejected their claim.
Hence the present appeal.
F
The contention of the appellants was that SAS (Railways) have always
been equated and granted parity with SAS(CAG) in the matter of Selection
grades, pay scales status etc., and that any deviation from the traditional
parity with the SAS(CAG) and SAS(CG DA) etc., would be discriminatory and
violative of Articles I 4 and I 6 of the Constitution.
G
The contention of the respondents was that the matter of classification
of posts in the Railways was examined in the context of recommendations of
~
the Pay Commission but it was decided to leave the existing classification
untouched as it would lead to drastic upheavals in the hierarchical structure.

H Dismissing the appeal, this Court
240
INDIAN RAIL. STAFF ASSO. v. U.0.1. [D.P. WADHWA, J.] 241
HELD: I.I. There is no discrimination against the Accounts staff A
>- (Railways) in the scale of Rs. 2000-3200 by not granting them group 'B'
status like their counterparts in CAG or CGDA. 1251-E; 253-F]

1.2. Classification of posts into gazetted or non-gazetted cannot be
" done purely on the basis of scales of pay. There can be many criteria;
administrative, procedural and others which have to be taken into consideration B
'I"'
by the authorities concerned before deciding on the classification. Admittedly,
Railways have a number of posts of different operative categories in department
such as Operating, Mechanical, Civil, Electrical, S&T etc. Where Field
Operators may have scales of pay of Rs. 2000-3200 or Rs. 2375-3500 which
have been classified as group 'C' only. Thus, the simplistic situation to
classification merely based on the scales of pay might lead to administrative
c
hierarchical imbalances in any particular organisation. Selection procedure
a
for appointment to a particular group posts and requirements of department
for classification of posts are valid considerations and any disturbance thereof
would certainly lead to compounding of problems. 1251-D; 253-D]
6'
D
Associate Bank Officers Association v. State Bank of India & Ors., JT
(1997) 8 SC 422; State of Punjab and others v. Om Parkash Kaushal and
others, 11996] 5 SCC 325 and Central Railway Audit Staff Association and
others v. Director of Audit, Central Railway and others, [1993] Supp. 3 SCC
458, referred to.
E
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 4647of1992.

From the Judgment and Order dated 26.4.91 of the Central Administrative
Tribunal, Principal Bench, New Delhi in O.A .. No. 13/1998.

"'"'(
S.K. Mehta, Dhruv Mehta, Fazlin Anam and Ms. Shobha Verma for the F
Appellants.

Mrs. K. Amreshwari, A.K. Sharma and Ms. Anjani Ayyengar for the
Respondents.

The Judgment of the Court was delivered by G
'r-· D.P. WADHWA, J. The appellants are aggrieved by that part of the
order dated April 26, 1991 of the Central Administrative Tribunal (for short
'the Tribunal') whereby the Tribunal did not accept their contention that they
being in the pay scale of Rs. 2000-3200 be also granted the Group B status
like their counterparts in the office of the Comptroller and Auditor General of H
242 SUPREME COURT REPORTS [1998] J S.C.R.

A India (CAG) and the Controller General of Defence Accounts (CGDA).
The appellants had also raised another issue before the Tribunal that ..l..
they should also be granted revised pay-scale of Rs. 2000-3200 w.e.f. I. I. 1986
and not from 1.4. I987 as was granted by the respondents. The Tribunal
directed the respondents to fix the appellants in the revised scales of pay ...
B w.e.f. 1.1.1986 on notional basis and make actual payment of the differential
amount consequent to re-fixation of pay in the revised scales w.e.f. 1.4. 1987. 'r

Against this part of the relief granted to the appellants by the Tribunal, Union
of India came in appeal in this Court and by judgment dated July 15, 1994
[I 995] Supp. 3 SCC 600, the Court reversed the decision of the Tribunal and
c held that the appellants would be entitled to revised pay scales only with
effect from 1.4. 1987. It is therefore not necessary for us to go into this
controversy which stands settled.

The first appellant is an Association of Subordinate Account Service
(SAS) Staff working in the Railways. Other appellants are serving in the
D Railways as Section Officers or Travelling Inspectors of Accounts. The
appellants contend that in various Ministries and Departments of the Central .~

Government, notably Railways, Defence, Posts and Telegraphs, CAG, CGDA
etc., there is an Accounts establishment called SAS. They, therefore, contend
that SAS Railways have always been equated and granted parity with SAS
E (CAG) in the matter selection grades, pay scales, status etc. and that any
deviation from the traditional parity with the SAS Railways and SAS (CAG)
and SAS (CGDA) etc. would be discriminatory and violative of Articles 14 and
16 of the Constitution. The main grievance of the appellants, therefore, is that
while they have been placed in the pay scale of Rs. 2000-3200, they have not
been granted Group 'B' status as has been done in respect of their counterparts
F in CAG and CGDA in the same pay scale.
,.....
The genesis of the dispute it would appear relates back to the report
of the Fourth Central Pay Commission ('Commission' for short). The
Commission noted that there were about 65,000 posts of accounts staff in
Groups B and C working in different departments/offices of the Government
G of India and that the posts were in different pay scales and designations. It
noted that there were organised accounts cadres under CGDA, CAG, Railways
and Departments of Posts and Telecommunication. The Commission considered
the existing pay-scale of the accounts posts in the organised cadres and it
then looked into the representations of the associations of the accounts staff.
H The report of the Commission relating to accounts staff, in relevant part, is
"
INDIAN RAIL. STAFF ASSO. v. U.0.1. [D.P. WADl-IWA. J.] 243

an under: A
"l l .36. The main demand of the associations of accounts staff under
CGDA, CAG, Railways and Departments of Posts and
Telecommunications is that their pay scales should be the same as for
the staff in the Indian Audit and Accounts Department (IA&AD).
They have pointed out that there was parity all along, which was B
disturbed in March, 1984 when there was a restructuring of IA&AD
into.two separate cadres, i.e. audit cadre and accounts & establishment
cadre. As a result, higher pay s..:ales were given to 80 per cent of the
staff on the audit side. They have also claimed that the duties and
responsibilities performed by them and the staff on the audit side of C
IA&AD are comparable. The All India Defence Accounts Association
had also filed a writ petition in the Supreme Court requesting the
Hon' ble Court to direct the government for bringing the pay scales
of auditors and Section Officers working in the Defence Accounts
Department at par with those in the IA&AD. The writ petition was
however allowed to be withdrawn by the Supreme Court as both the D
parties agreed that the questions raised in the petition would be better
decided by this Commission. The association subsequently made
their submission before us both in writing and orally.
11.37. Some of the official witnesses have also emphasised the need
for parity in pay scales between IA&AD and other departments. The E
Controller General of Defence Accounts has stated that the nature of
duties and responsibilities assigned to the auditors and section officers
of the defence accounts department is an integrated one combining
·audit, payment, accounting, financial advice and allied functions. He
has therefore suggested that, having regard to the complexity and
arduous nature of the jobs, they should be given the highest scale F
of pay given to the corresponding staff in IA& AD. The Controller
General of Accounts has stated that the statutory audit functions
perfonned by the staff of!A&AD are in no way unique as the internal
audit functions of the civil accounts staff under his organisation
include most of the audit functions performed by the statutory audit G
staff. Railway have pointed out that their accounts cadre had a
traditional parity with audit which should be maintained considering
the diversity, nature and quality of their work: The Departments of
P&T have suggested that whatever pay scales are given to the
accounts staff in other departments, should be given to the accounts
staff in these departments also. H
244 SUPREME COURT REPORTS [1998] l S.C.R.

A 11.38. We have considered the matter. There has all along been parity
between the staff in the IA&AD and accounts staff of other
departments, which has been disturbed by restructuring IA&AD into
two separate cadres viz., audit cadre and accounts and establishment
cadre and giving higher pay scales to a major portion of staff on the
audit side. The audit and accounts functions are complementary to
B each other and are generally performed in many government offices
in an integrated manner which is necessary for their effoctive
functioning. The staff in these offices perform functions of internal
check and audit suited to the requirements of each organisation which
are equally important. There is direct recruitment in the scz le of Rs.
C 330-560 in all the audit and accounts cadres through Staff Selection
Commission/Railway Recruitment Boards from amongst university
graduates. We are therefore of the view that there should be broad
parity in the pay scales of the staff in IA&AD and other accounts
organisations. Accordingly, we recommend that the posts in the pay
scale of Rs. 425-700 in the organised accounts cadres may be given
D the scale of Rs. 1400-2600. In the Railways, this will apply to the posts
of sub-head in both the ordinary and selection grades. We also
recommend that this should be treated in future as a functional grade
requiring promotion as per normal procedure. The proposed scale of
Rs. 2000-3200 of section officer may also be treated as a functional
E grade. With the proposed scales, there will be no selection grades for
any of the posts. As regards the number of posts in the functional
scales of Rs. 1400-2600 and Rs. 2000-3200, we note that about 53 per
cent of the total posts of junior/senior auditor and 66 per cent of the
total posts of ordinary and selection grade of section officer in IA&AD
are in the respective higher scales. Government may decide the number
F of posts to be placed in the scales of (i) Rs. 1400-2600 and (ii) Rs.
2000-3200 in the other organised accounts cadres taking this factor
into consideration. All other accounts posts may ':le given the scales
recommended in chapter 8."

On the basis of the recommendation of the Fourth Pay Commission
G aforesaid, Central Government, in the Ministry of Railways (Railway Board)
issued an order'dated June 18, 1987 relating to restructuring of accounts staff,
which is as under:

"The General Managers,

H All Indian Railways,
INDIAN RAIL. STAFF ASSO. v. U.0.1. fD.P. WADHWA, J.] 245
Production Units, etc. A
(As per mailing list)
Subject :- Restructuring of Accounts staff.

The Fourth Central Pay Commission vide para 11.38 of Part-I of
its Report have recommended that there should be broad parity in the B
pay scales of the staff in IA&AD and other Accounts Organisations.
It has further recommended that the proposed scales of pay of Rs.
1400-2600 and R5. 2000-3200 may be treated as functional grades in
future and that there will be no selection grade for any of these posts.
As regards the number of posts in the higher functional scales, the
Commission left this matter for the Government to decide. C
2. The revised scales of the pay for the Accounts staff have already
been notified vide this Ministry's letter No. PCIV86/Imp/Schedule/1
dated 24-9-1986. In accordance with the orders therein, certain persons
have already. been allowed the higher revised scales of pay subject
to the conditions laid down therein. D
3. The question regarding number of posts to i:>e placed in the higher
scales of pay has been under the consideration of this Ministry. It has
now been decided that the ratio of number of posts in higher and
lower scales in the accounts cadres may be as follows:-
E
(i) Section officers (A/cs), Rs. 2000-60- 80%
Inspector of Stores Accounts 2300-EB-75-3200
(ISA), Inspector of Station Rs. 1640-60- 20%
Accounts (TIA) 2600-EB-75-2900
(ii) Clerks Grade-I (including Rs. 1400-40- soo;., F
existing Sub-Heads) 1600-50- 2300-EB-60-2600
Rs. 1200-30- 20%
1560- EB-40- 2040.
As regards designation, orders will follow.
G
4. These orders take effect from 1-4-1987. As regards criteria for
appointment to the higher functional grades requiring promotion to
the grades of Rs. 1400-40-1600-50-2300-EB-60-2600 and Rs. 2000-60-
2300-EB-75-3200, orders will follow.

Hindi version will follow. H
f

246 SUPREME COURT REPORTS [ 1998] I S.C.R.

A Sci/-
(G. CHA TIERJEE) .J.,
Executive Director, Pay Commission.
Railway Board."
As seen above the validity of this order has been upheld by this Court
B fixing the revised scale of pay with effect from 1.4.1987.

As far as the recommendation of the Commission is concerned revised
pay scale has been given to the appellants. There cannot be any grievance
on that score as the recommendation has been accepted by the Central
Government. The Commission, however, in its report did not recommend that
c posts in pay-scale of Rs. 2,000-3200 in CAG, CGDA and other Ministries and
Railways be all treated as group B posts. The Commission recognised that
grouping did not strictly follow the pattern based on pay-scale in various
Ministries etc. and observed that the existing classification for those posts
might continue.

D In 1984, the work organisation in the CAG's office was restructured and
the functioning of Audit and Accounts were separated. 80% of the posts of
Section Officers (Audit) were upgraded to the pre-revised scale of Rs. 640-
1040 and given the Group B gazetted status. The staff who were manning the
accounting functions work, however, continued in the scales of pay for the
E account staff. This disturbance in the parity in pay scales between the Audit
and Accounts staff was not only resented in the establishment of CAG but
also led to protest from the Accounts staff of the Railways. This gave rise
to the.demand from the Railway Account staff for re-establishing the parity
in the pay scales etc. with the Audit staff in the CAG's office. The parity in
the pay scale was, however, restored on the recommendations of the
F Commission and in pursuance thereof the Department of Expenditure, Ministry
of Finance, Government of India, issued instructions, among others, to the
r
Finance Commissioner, Railways for reconstructing the Accounts staff, as per -
instructions extracted below:

G "4. The question regarding number of posts to be placed in the higher
scales of pay has been under the consideration of the Government
and it has now been decided that the ratio of number of posts in
higher and lower scales in the organised Accounts cadres as well as
in Accounts Wing of the IA&AD may be as follows :-

H (i) Section Otlicer (SG) Rs. 2000~60-2300-EB-75-3200 80%
INDIAN RAIL. STAFF ASSO. v. lJ.0.1. [D.P. WADHWA, J.] 247
(ii) Section Officer Rs. 1640-60-2600-EB-75-2900 .... 20% A
(iii) Section Accountant Rs. 1400-40-1600-50-2300-EB-60-2600 80%

(iv) Junior Accountant Rs. 1200-30-1560-EB-40-2040 .... 20%

The designations in different Organised Accounts cadres may be
different. In such cases also, the pay structure on these lines may be B
decided.

5. These orders take effect from 1.4.1987. The respective cadre
controlling authorities may now take necessary action to prescribe
criteria for appointment to the higher functional grades requiring
promotion to the grades of Rs. 1400-40-1600-50-2300-EB-60-2600 and C
Rs. 2000-60-2300-EB-75-3200 on the same lines as adopted for Audit
stream and thereafter take necessary action to implement these orders."

As seen above the restructuring of the Accounts cadre in the Railway;
had accordingly been carried out and relevant section of the staff granted the
scale of pay of Rs. 2000-3200 which is same as in CAG office. The appellants, D
however, submit that not only that they_ have been granted the same pay
scales but they should also be accorded parity in group classification with
their counterparts in CAG and CGDA organisations. This the respondents are
not prepared to grant.
E
Promotion to the level of Section Officer (Accounts), Inspector of Store
Accounts, Inspector of Station Accounts with the Railways from Upper
Division Clerks etc. is after passing an examination conducted by the Railways
and it is admitted that the standard of examination is comparable to that
obtaining in the SAS examination of the Audit Department of CAG. However,
it is submitted that standard of examination albne cannot be the sole criterion F
for determining parity in all respects. As seen above, the Commission had
also gone into the question of classification of posts in the Central Government
in detail and made certain recommendation for classification of posts in
various groups. But then the Commission also recommended that where there
were deviations of the nature as recommended by it, the existing classification G
for those posts might continue and the Government might, however, review
the classification in such cases as and when necessary. The Pay Commission
,,._ accepted the rationale of certain deviations from the classifications
recomm.ended by it.

The respondents have submitted that the matter of classification of H
248 SUPREME COURT REPORTS [ 1998] 1 S.C.R.

A posts in the Railways was examined in the context of the recommendations
of the Pay Commission but it was decided to leave the existing classification ..J...
untouched. Accordingly the posts carrying pre-revised scales of Rs. 700-900
and Rs. 650-960 were granted replacement scale of Rs. 2000-3200 and the
posts carrying the scale of Rs. 840-1040 were allotted the replacement scale
B of Rs. 2375-3500 and all these posts continued to be in Group 'C'. 80% of the
posts of Section Officer (Accounts) which were in the pre-revised scale of Rs.
500-900 were given the upgraded revised scale of Rs. 2000-3200 and classified
as Group 'C' on par with other posts which had been granted the replacement
scale of Rs. 2000-3200. Ii was, therefore, submitted that within the Railways,
there was no discrimination against any section of employees. It is submitted
C that the Group 'B' posts in the Railways of all departments are plac~d in the
scale of Rs: 2000-3200 but in the Account Department it is in the scale of Rs.
2375-3500. It is then submitted that appointments to Group 'B' posts in the
Railways are made in accordance with certain prescribed selection procedure.
The selection process is different in the Accounts Department and other
departments in the Railways. The procedure followed in other departments of
D Central Government, according to the respondents, is not relevant as each
department is free to evolve its own procedure for promotion etc. to suit its
requirements. Respondents also submitted that, while contradicting the plea
of the appellants, Section Officers in CAG, CODA, Railways and Departments
of Post and Telecommunications did not form an organised All India Service
E and, therefore, their pay, status, promotional prospects have to be decided
keeping in view the peculiar and special needs of the different departments.
Respondents denied that there was any violation of fundamental rights of the
Accounts employees of the Railways in not according· Group 'B' status
though they were placed in the revised scale of Rs. 2000-3200 as their
counterparts in CAG and CODA. The Tribunal considered various aspects of
F the matter and also reports of the earlier Pay Commissions and rejected the
claim of the appellants. This is how the Tribunal examined the matter :

"It will be observed from the above that the intent of the Pay
Commission's observation regarding parity has been made in the
context of pay scales. The said recommendation does not allude to th~
G status and the avenues of promotion etc. In fact, the Pay Commission
has stated that promotion from the functional grade shall be "as per.
normal procedure". Obviously, the applicants have in their mind
horizontal relativity with the audit staff when they articulate about
traditional parity but this is not supported by the relevant
H recommendation of the Pay Commission. Railways are a multi-disciplined
INDIAN RAIL. STAFF ASSO. v. U.0.1. [D.P. WADHWA, J.] 249

·organisation and for them the internal relativities both the vertical and
A
horizontal within the organisation are of much greater import and
relevance than a horizontal comparison within an outside organisation/
agency. In fact, no case has been made out before us to establish that
there has always been a complete parity between the Audit staff and
the Railways Accounts staff. Group 'C' officers in the Railway B
Accounts staff have always been subjected to a more rigorous selection
for promotion to Group 'B' than has been the case in other departments
e.g. C&AG, CGDA etc. Besides, as said earlier, the Railways are multi-
disciplined and multi-dimensional organisation. This is not the case
. either in the case of C&AG or in the case of organisation of CGDA
etc. The Railways cannot be expected to blindly follow the path C
followed by "inclusive" organisations. Compared to C&AG, the
Railways are 'exclusive' organisation, being a multi disciplined one.
Besides to our mind, there has never been complete parity between
the Railway staff and the Audit/other Accounts staff in the other
departments and as observed earlier, nor any such case has been D
made out. For instance, the Railway employees have traditionally
enjoyed and zealously protected certain benefits exclusively available
to them which are denied not only to other Accounts establishments
but also to the generally of Central Government employees. The
traditional parity has been only in the pay scale and this has been re-
established w.e.f. 1.4.1987. Even the parity in the pay scale is a later E
development consequent to broad banding of the scale of pay by
respe~tive Pay Commissions.

In the case before us it is the Railway SAS employees who are seeking
to be equated in the matter of status, promotional procedure etc. with
the Section Officers in the C&AG's office and CGDA's office. The F
offices of CGDA and C&AG are not multi-disciplined organisations
like the Railways. The internal relativity in the Railways would thus
carry great weightage with the Railway Administration when they
consider equation with outside organisations of a section of the staff
from within the organisation. The total parity with outside organisations G
would disturb the internal relativities which have far-reaching
implications both posiiive and negative. The negative aspects of total
parity cannot be brushed under the carpet. Further the _procedure for
promotion are designed to suit the special requirements of the
organisational structure. The Railways have always followed a more
rigorous selection procedure, as group 'B' Accounts Officer have also H
250 SUPREME COURT REPORTS (1998] l S.C.R.

A per force to acquire reasonable knowledge of the functioning of the
other disciplines within the Railway to become effective in their job
besides the accounts and financial functions. We do not, therefore,
see any merit in the petition for diluting the procedure of selection to
Group 'B' posts followed on the Railways which has stood the test
oftime."
B
We are of the view that the Tribunal has taken a correct view of the
matter. As noted above, the Fourth Central Pay Commission had recommended
that the existing system of classification of posts in various departments of
the Central Government may be continued and had indicated the corresponding
C pay limits in the revised pay structure. The Commission had also recommended
that the Government might, however, review the classification in such cases
as and when necessary. The Railways reviewed the whole position and taking
into consideration various aspects of the matter decided that the existing
system of classification as in vogue in the Railways to continue. The

D
circumstances which went into such consideration have been enumerated as
under:
I
"(i) On the Railways posts in scale of Rs. 2000-3200 and Rs. 2375-3500
are merely off shoots of restructuring and do not in a real sense
constitute a Group 'B' cadre either from the point of view of
responsibilities or duties.
E
(ii) Adoption of the pay limits for classification implemented on the
civil side would result in placing a very large number of posts in
scales Rs. 1640-2900/-, Rs. 2000-3200 and Rs. 2375-3500 in Group 'B'.
This would include the categories like Mail Drivers, Office
Superintendents, Lab. Supdts., Stenographers, Teachers, Sr. Console
F Operators, Asstt,,Programmers, Chief Power Controller, Chief Traction
Loco Foreman 'A'. Fuel Inspector 'B' Driving Inspector, Power 1
Controllers, Loco Foremen (B), Traction Loco Controller, Asstt. Loco ·
Foreman (R), Driving Inspector, Section Officer Accounts, Inspector
of Station Accounts, Inspector of Travelling Accounts, Matrons,
G Radiographers, Pharmacist, Inspector in RPF, etc.

(iii) Nearly 32000 posts in scale of Rs. 2000-3200 and Rs. 2375-3500
would become entitled for 3 additional I st A passes per annum,
besides eligibility to additional luggage on these passes.

H (iv) On the Railways, all appointments to Gr. 'B' posts are made on
INDIAN RAIL. STAFFASSO. v. U.0.1. [D.P. WADHWA,J.] 251
the basis of a selection consisting of a written examination viva-voce A
and assessment of records which is not the case on the civil side. The
promotional avenues and methodology would have to be reviewed.

(v) At present, Group 'B' constitutes the managerial level, exercising
control over staff in the lower grades. If the classification norms on
the civil side is adopted on the Railways it would lead to drastic B
-....:·
upheavals in the hierarchial structure.

(vi) Group 'B' officers are entitled to Stenographic Assistance in Scale
of Rs. 1200-2040 on a sharing basis, on the Railways. Increase in the
number of Group 'B' posts would lead to the need for a corresponding
increase in the number of Stenographers in this scale. c
(vii) It would lead to problems regarding accommodation on the
Railways." '
Classification of posts into gazetted or nongazetted cannot be done
purely on the basis of scales of pay. There can be many criteria; administrative, D
procedural and others which have to be taken into consideration by the
authorities concerned before deciding on the classification. Admittedly,
Railways have a number of posts of different operative categories in department
such as Operating, Mechanical, Civil, Electrical, S&T etc. where field operators
may have scales of pay of Rs. 2000-3200 or Rs. 2375-3500 which have been E
classified as Group 'C' only. As such it cannot be said that there is any
discrimination against the Account staff in the scale of Rs. 2000-3200/-

In Associate Banks Officers Association v. State Bank of India & Ors.,
JT (1997) 8 S.C. 422 employees unions of various banks which were subsidiaries
of the State Bank of India under the State Bank of India (Subsidiaries Banks) F

- Act, 1959 claimed higher terminal benefits, better medical facilities and extra
increments in their pay-scale on the ground that such benefits were available
to the employees holding equivalent or similar ranks in the State Bank of
India. This Court declined to give relief to the petitioners and said that "equal
pay for equal work for both men and women" was one of the Directive
Principles of State Policy laid down in Article 39(d) of the Constitution had G
been applied in cases of irrational discrimination in the pay-scales of workers
doing the same or similar work in an organisation and that it had not been
applied when there was a basis or an explanation for the difference. The Court
said that extending this principle to compare pay-scales in one organisation
with pay-scales in another organisation would be stretching of the doctrine H
,)
:~

252 SUPREME COURT REPORTS [1998] 1 S.C.R.

A even though between the employees doing comparable work and if at all it
had to be applied it must be done with caution lest the doctrine snaps. This
Court said that many ingredients go into the shaping of wage structure in any
organisation and that a simplistic approach, granting higher remuneration to
other workers in other organisations because another organisation had granted
B them, might lead to undesirable results. In the present case what we find is
that the appellants have been granted the same pay-scale as that given to the
staff in the Indian Audit and Accounts Department. Their grievance here is ,....-
that they should be given the same status viz., their post be incorporated in
Group B post as is existing in the CAG and CGDA.

c In State of Punjab and others v. Om Parkash Kaushal and others,
[ 1996] 5 SCC 325 the State Government granted uniform pay scales to the
teachers employed in various privately managed schools in the State of
Punjab. The pay scales were similar to the pay scales drawn by the Government
teachers. This was in pursuance to Section 7 of the Punjab Privately Managed
Recognised School Employees (Security of Service) Act, 1979. There was no
D dispute that the pay scales and dearness allowance which were being paid
to the private teachers were not less than what was being paid to the
Government teachers holding corresponding posts. The private teachers
however wanted that their conditions of service should be same as that of
Government teachers. This Court negatived this plea and said that other
E conditions of service relating to the Government teachers could not be extended
to private teachers.

In Central Railway Audit Staff Association and others v. Director of
Audit, Central Railway and others, [1993] Supp. 3 SCC 458 the employees
belonging to the Office of the Comptroller and Auditor General of India,
F working in the Railway Audit Department were designated as Section Officer
prior to March 1, 1984. They got promotion from that day as Assistant Audit
Officers and were designated as Officers Group B Gazetted. On the
recommendations of the Fourth Pay Commission, pay scale of Assistant
Audit Officer was revised to Rs. 2000-3200 from January I, 1986. The grievance
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G of these Assistant Audit Officers Group B Gazetted was that the Indian
Railways should not have denied to them the benefits, such as, issue of
Railway Travel Passes/P.T.Os, allotment of Railway Quarters, giving of
accommodation in Rest Houses/Retiring Rooms, taking of family members
while on tour, etc.- which benefits were admissible to Group B Gazetted
Officers of the Railways. It was submitted on behalf of the Railways that the
H fact that the Assistant Audit Officers in Railway Audit Department, on the
INDIAN RAIL. STAFF ASSO. v. U.0.1. [D.P. WADHWA, J.] 253
pay scale of Rs. 2000-3200 but designated by the CAG of India as Group B A
" '
Gazetted was not sufficient to equate them with Group B Officers of the
.L
Railways who held higher posts with scale of pay of Rs. 2000-3500 and that

- if the Railways gave facilities and privileges to the Assistant Audit Officers,
who were not Railway servants, treating them on a par with railway servants
of Group 'B', they could find no valid reason to deny such facilities and B
privileges to the railway servants holding posts on the pay scale of Rs. 2000-
'"'< 3200. The Railways further said that if that had to be done, the Indian
Railways would be required to extend similar facilities and privileges to all
railway servants who hold posts in the Indian Railways on the scale of pay
of Rs. 2000-3200 which meant extending the benefits to thousands of railway
servants involving heavy financial burden on the Railways. This Court found C
that the contentions raised on behalf of the Assistant Audit Officers were
unacceptable in that, if accepted, they would lead to unjust results of the
Indian Railways conferring special privileges and facilities upon persons
belonging to foreign department of Comptroller and Auditor General of India
whi!e their own servants who held equivalent posts on the same scale of pay
would be denied such privileges and facilities. The Court, therefore, found D
substance in the submissions made on behalf of the Railways.

Thus, the simplistic solution to classification merely based on the scales
of pay might lead into various complications and might lead to administrative
hierarchial imbalances in any particular organisation. Selection procedure for E
appointment to a particular group post and requirements of a department for
classification of posts are valid considerations and any disturbance thereof
would certainly lead to compounding of problems. We, therefore, cannot
subscribe to the view that the scale of pay alone can be the criteria for
classification of posts. Respondents have given valid and justifiable reasons
as to why the Account staff in the scale of Rs. 2000-3200 cannot be put at F

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par with their counterparts in CAG or CGDA in respect of putting the Account
staff in Group 'B' posts merely on the basis of parity of pay scales.

There is no merit in this appeal. Therefore, the appeal is dismissed with
costs.

S.V.K. Appeal dismissed.

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