Holding

Promotions of Class III employees to non‑technical clerk posts were illegal and void ab initio, but the Court barred recovery of salaries already paid because the employees were not at fault, while denying any further arrears.

Summary

The appellants, who were Class III basic health workers, were promoted to clerk posts in 1992. An audit later held the promotions illegal because Class III employees belong to a technical cadre and cannot be promoted to non‑technical clerk positions, and the promotions violated statutory quota, reservation policy, and procedural requirements such as advertisement and proper committee approval. Consequently, the State reverted the employees to their original posts and ordered recovery of the higher salaries paid. The Supreme Court affirmed the illegality of the promotions and upheld the reversion, but held that, since the employees were not at fault, the State could not recover the salaries already paid, although no further arrears were to be granted. The appeals were dismissed with no costs.

Issues considered

Whether the promotion of Class III technical cadre employees to clerk (non‑technical) posts complied with statutory provisions and reservation policy.
Whether the reversion of the employees to their original posts was lawful.
Whether the State could recover salaries paid for the promotional posts when the promotions were void ab initio.
Whether procedural irregularities (lack of proper committee, advertisement, reservation compliance) invalidate the promotions.

Subjects

service lawpromotionreversionillegal promotionsalary recoverytechnical cadrereservation policyprocedural irregularitiespublic service employment

Judgment

PURSHOTT AM LAL DAS AND ORS. A
THE STATE OF BIHAR AND ORS.

OCTOBER 10, 2006

[ARIJJTPASAYAT ANDLOKESHWAR SINGH PANTA,JJ.] B

Service law

Promotion-From Class Ill to post of clerk-On audit objection,
reversion to original posts-Held: Reversion was correct-Class Ill employees C
belonged to technical cadre and promotional post related to non-technical
cadre, and there was no question of promotion to same class-Promotions
were not in conformity either with statutory provision or reservation policy,
and were granted despite a ban by State Government-They were granted
without placing the cases before proper Committee and procedure of D
advertisement was not adopted

Promotion/appointment found void ab initio-Recovery ofhigher salary
attached to promotional post-Held: Employees were not at fault-Recovery
of the higher salary' on the ground of gross irregularity committed by those
who granted the p.-omotion was not correct as the employees had worked on E
the promotional posts.

Appellants were employed in Class III in posts with respondent. They
were promoted to the post of Clerk. Subsequently, on audit objection,
respondent came to the view that promotions granted to appellants were illegal
• and they were reverted to their original posts. Being aggrieved by the said
order, they moved the High Court, but their challenge was rejected and recovery
of the amounts paid to them on account of promotion was also ordered. Hence
the present appeal.

Appellants contended that (ii they were not at fault; they were appointed
on the basis of the recommendations made by a Selection Committee [iii even
if there was any procedural irregularity that could not affect their promotion
and no action could be taken after lapse of time (iii( recovery of amount from
them was uncalled for.

51
52 SUPREME COURT REPORTS [2006] SUPP. 7 S.C.R.

A Respondent contended that Iii even if appellants had worked in ~
'
promotional post yet they were not entitled to higher salary attached to the
promotional post, and therefore, its recovery from them was proper.

Disposing of the appeals, the Court '•

B HELD: I. The reasons which weighed with the respondent to hold that
the promotion was illegal does not suffer form any infirmity. Class III
employees could not have been promoted as they belong to the technical cadre
and the promotional posts related to non-technical cadre. That apart the Class
III employees were already holding Class III post and, therefore, there was no
question of promotion to the same class. So far as class IV employees are
c concerned, their promotion was also not considered in terms of statutory
provision. The quota of promotion to Class III from Class IV is fixed and the
procedure is provided for deciding the question of promotion. The promotions
were granted without placing their cases before the Establishment Committee
and the Committee which accorded approval was not properly constituted, and
D the reservation policy was not followed and promotions were given without
adopting the procedure relating to advertisement The High Court also noted
that the appointments were made by the Civil Surgeon though a ban had been
imposted by the State Government on appointments. Therefore, the order of
reversion in each case cannot be faulted. [54-E, F, GJ

E 2. So far as the recovery is concerned, in a normal course if the promotion/
appointment is void ab initio, a mere fact that the employee had worked in
the concerned post for long cannot be a ground for not directing recovery.
High Court itself noted that the appellants deserve sympathy as for no fault
of theirs, recoveries were directed when admittedly they worked in the
promotional posts. But relief was denied on the ground that those who granted
F promotion had committed gross irregularities. While, therefore, not accepting
the challenge to the orders of reversion on the peculiar circumstances noticed,
it is directed that no recovery shall be made from the amounts already paid in
respect of the promotional posts. However, no arrears or other financial
benefits shall be granted in respect of the concerned period.
(54-H; 57-A, B, CJ
G
Sahib Ram v. State of Hwyana, (1995) Supp. I SCC 18; Bihar State
Electricity Board and Anr. v. Bijay Bhadur and Anr., (2000) 10 SCC 99 and
State of Karnataka and Anr. v. Mangalore University Non-teaching
--
Employees' Association and Ors., (2002) 3 SCC 302, relied on.

H CIVIL APPELLATE JURISDICTION: Civil Appeal No. 4386 of2006. ~ ...
PURSHOTTAM LAL DAS v. THESTATEOFBIHAR[PASAYAT.J.] 53
From the final Order and Judgment dated 7.7.2005 of the High Court of A
Judicature at Patna in L.P.A. Nos. 545, 543 and 555 of2005.

WITH

C.A. No. 4387/2006.
B
Akhilesh Kumar Pandey and Sudhanshu Sharan for the Appellants in
C.A. No. 4386/2006.

Anjani Kumar Jha, for the Appellants in C.A. No. 4387/2006.

Gopal Singh and Nishakant Pandey for the Respondents. c
The Judgment of the Court was delivered by

ARIJIT PASA YAT, J. Leave granted.

In both these appeals challenge is to the legality of the common judgment D
passed by the Patna High Court dismissing of different Letters Patent Appeals
filed by the appellants. By the impugned judgment the High Court dismissed
the Letters Patent Appeals. It was held that the view of learned Single Judge
dismissing the writ petitions filed by the appellants challenging their reversion
as well as recovery of the amounts paid on account of promotion was in order.
E
Factual position in a nutshell is as follows:-

Except some of the appellants who were Class JV employees remaining
appellants were holding Class Ill posts, that is, Basic Health Workers. They
were promoted to the post of Clerk in the year 1992. Subsequently, an audit
team raised objection to the said promotions expressing the view that the F
appellants could not have been promoted. On the basis of the audit report
action was taken. State Government was of the view that promotions granted
were illegal and accordingly the appellants were reverted to the original post
held by each one of them. Being aggrieved by the said order, some of the
appellants moved the High Court which quashed the orders on the ground
that adequate opportunity was not granted to show cause before the action G
was taken. Thereafter, show cause notices were issued to which the appellants
responded. Ultimately they were reverted to the original post held by each
and direction was given to recover the excess amounts which had been paid.
Writ petitions were filed challenging the orders in that regard. In each case
learned Single Judge dismissed the writ petition. As noted above the Letters H
54 SUPREME COURT REPORTS [2006] SUPP. 7 S.C.R.

A Patent Appeals were also dismissed. '
In support of the appeals learned counsel for the appellants submitted
that there was no fault on the part of the appellants and they had been
appointed on the basis of the recommendations made by the Selection
Committee. Even if it is conceded that there was any procedural irregularity
B that could not have affected the promotion granted and no action could have
been taken after lapse of time. In any event, the recovery of the amount is
uncalled for.

Learned counsel for the respondent-State and its functionaries supported
the judgment submitting that the courts below had noted the reasons for
C directing reversion. Even if the appellants had worked in the promotional post
yet they were not entitled to the higher salary attached to each of the
promotional post. Therefore, the recovery has rightly been directed. Reliance
was placed on decisions of this Court in R. Vishwanatha Pillai v. State of
Kera/a and Ors., [2004] 2 SCC 105, LIC of India v. Sushi!, (2006] 2 SCC 471
D and Ram Saran v. l.G. of Police, CRPF (2006] 2 SCC 541.
The reasons which weighed by the respondent-State to hold that the
promotion was illegal does not suffer form any infirmity. Class Ill employees
could not have been promoted as they belong to the technical cadre and the
promotional posts related to non-technical cadre. That apart the Class Ill
E employees were already holding Class Ill post and, therefore, there was no
question of promotion to the same class. So far as class IV employees are
concerned, their promotion was also not considered in terms of statutory
provision. The quota of promotion to Class Ill from Class IV is fixed and the
procedure is provided for deciding the question of promotion. The promotions
F were granted without placing their cases before the Establishment Committee
and the Committee which accorded approval was not properly constituted, '
and the reservation policy was not followed and promotions were given
without adopting the procedure relating to advertisement. The High Court
also noted that the appointments were made by the Civil Surgeon though a
ban had been imposed by the State Government on appointments. Therefore,
G the order of reversion in each case cannot be faulted.
r;

So far as the recovery is concerned, in a normal course if the promotion/
appointment is void ab initio, a mere fact that the employee had worked in
the concerned post for long cannot be a ground for not directing recovery.
The cases relied upon by the learned counsel for the State were rendered in
H
PURSHOTTAM LAL DAS v. THESTATEOFBIHAR[PASAYAT,J.j 55
... different backdrop. In those cases the appellants were guilty of producing A
forged certificates or the appointments had been secured on non-pennissible
grounds. In that background this Court held that recovery is pennissible. On
the contrary, the fact situation of the present case bears some similarity to
the cases in Sahib Ram v. State of Haryana, [ 1995] Supp. I SCC 18, Bihar
State Electricity Board and Anr. v. Bijay Bhadur and Anr., (2000] I 0 SCC 99·
and State of Karnataka and Anr. v. Mangalore University Non-teaching B
-· Employees' Association and Ors., (2002] 3 SCC 302.

In Bihar State Electricity Board's case (supra) it was held as follows:

"9. Further, an analysis of the factual score at this juncture goes
to show that the respondents appointed in the year 1966 were allowed c
to have due increments in tenns of the service conditions and salary
structure and were also granted promotions in due course of service
and have been asked after an expiry of about 14-15 years to replenish
the Board exchequer from out of the employees' salaries which were
paid to them since the year 1979. It is on this score the High Court D
observed that as both the petitioners have passed the examination
though in the year 1993, their entitlement for relief cannot be doubted
in any way. The High Court has also relied upon the decision of this
Court in the case of Sahib Ram v. State of Haryana, (1995] Supp I
SCC 18, wherein this Court in para 5 of the Report observed: (SCC p.
20) E
"5. Admittedly the appellant does not possess the required
educational qualifications. Under the circumstances the appellant
would not be entitled to the relaxation. The Principal erred in
granting him the relaxation. Since the date of relaxation the
appellant had been paid his salary on the revised scale. However, F
...
it is not on account of any misrepresentation made by the appellant
that the benefit of the higher pay scale was given to him but by
wrong construction made by the Principal for which the appellant
cannot be held to be at fault. Under the circumstances the amount
paid till date may not be recovered from the appellant. The G
principle of equal pay for equal work would not apply to the
scales prescribed by the University Grants Commission. The
appeal is allowed partly without any order as to costs."
10. The High Court also relied on the unreported decision of the
learned Single Judge in the case of Saheed Kumar Banerjee v. Bihar H
56 SUPREME COURT REPORTS [2006] SUPP. 7 S.C.R.

A SEB (CWJC No. 710of1994 disposed of on 27.01.1995). We do record
our concurrence with the observations of this Court in Sahib Ram
case (supra) and come to the conclusion that since payments have
been made without any representation or a misrepresentation, the
appellant Board could not possibly be granted any liberty to deduct
or recover the excess amount paid by way of increments at an earlier
B point of time. The act or acts on the part of the appellant Board
cannot under any circumstances be said to be in consonance with
equity, good conscience and justice. The concept of fairness has been
given a go-by. As such the actions initiated for recovery cannot be
sustained under any circumstances. This order, however, be restricted
C to the facts of the present writ petitioners. It is clarified that Regulation
8 will operate on its own and the Board will be at liberty to take
appropriate steps in accordance with law except, however, in the case
or cases which has/have attained finality.

In Mangalore University Non-teaching Employees' case (supra) it
D was held as follows:
"12. Though the above discussion merits the dismissal of the Writ
Petitions and the denial of relief to the respondents, we are of the
view that on the special facts of this case, the employees of the
University have to be protected against the move to recover the
E excess payments upto 31.03.1991. When the concerned employees
drew the allowances on the basis of financial sanction accorded by
the Competent Authority i.e. the Government and they incurred
additional expenditure towards house rent, the employees should not
be penalized for no fault of there is. It would be totally unjust to
recover the amounts paid between the 1.4.1994 and the date of issuance
F
oft he G.O. No. 42 dated 13.2.1996. Even thereafter, it took considerable
•
time to implement the G.0. It is only after 5th March, 1997 the
Government acted further to implement the decision taken a year
earlier. Final orders regarding recovery were passed on 25.3.1997, as
already noticed. The Vice-Chancellor of the University also made out
G a strong case for waiver of recovery upto 31.3.1997. That means, the
payments continued upto March 1997 despite the decision taken in
principle. In these circumstances, we direct that no recovery shall be
effected from any of the University employees who were compelled
to take rental accommodation in Mangalore City limits for want of
accommodation in University Campus upto 31.3.1997. The amounts
H
PURSHOTTAM LAL DAS v. THESTATEOFBIHAR[PASAYAT.J.] 57

- paid thereafter can be recovered in instalments. As regards the future
entitlement, it is left to the Government to take appropriate decisions,
as we already indicated above. "
A

High Court itself noted that the appellants' deserve sympathy as for no
fault of theirs, recoveries were directed when admittedly they worked in the
promotional posts. But relief was denied on the ground that those who B
granted had committed gross irregularities.

While, therefore, not accepting the challenge to the orders of reversion
on the peculiar circumstances noticed, we direct that no recovery shall be
made from the amounts already paid in respect of the promotional posts.
However, no arrears or other financial benefits shall be granted in respect of C
the concerned period.

The appeals are accordingly disposed of. No costs.

vs. Appeals disposed of.