Holding

In the absence of statutory recruitment rules, appointments on deputation are valid and seniority of deputationists is determined by their date of confirmation, making them senior to direct recruits.

Summary

The appellants, originally Assistant Inspectors (Control) at the India Security Press, were appointed on deputation as Inspectors (Control) at the Bank Note Press before any recruitment rules under Article 309 existed. After the Bank Note Press later framed recruitment rules, the appellants were permanently absorbed, and the department treated them as senior to directly recruited respondents based on their earlier confirmation dates. The respondents challenged this seniority, and the Central Administrative Tribunal held that the deputation appointments were invalid and that seniority should be based on continuous officiation, thereby reversing the seniority list. The Supreme Court held that in the absence of statutory service rules, appointments on deputation are valid and seniority can be determined by the date of confirmation, giving deputationists seniority over direct recruits. Consequently, the Court set aside the Tribunal’s order and allowed the appeal, dismissing the respondents' petition.

Issues considered

Whether appointments on deputation to the Bank Note Press were valid in the absence of recruitment rules made under Article 309 of the Constitution.
Whether seniority of deputationists can be determined by the date of confirmation when no specific seniority rules exist.
Whether service rendered in the parent department can be counted towards seniority in the new department.
Whether the Central Administrative Tribunal erred in quashing the seniority list and treating the respondents as senior.

Legislation cited

Constitution of Indias. Art.14, s. Art.16, s. Art.309

Subjects

service lawsenioritydeputationrecruitment rulesArticle 309Central Administrative TribunalBank Note Pressappointment validity

Judgment

S.K. MATHUR AND ORS. A
v.
UNION OF INDIA AND ORS.

JANUARY 13, 1998

[S. SAGHIR AHMAD AND D.P. WADHWA, JJ.] B

Service Law :

Bank Note Press (Class /I/ Posts) Recruitment Rules, I 974:

Deputation-Appointment on-Jn absence of rules-Validity of-Bank
c
Note Press, at the time of its establishment, did not have its own cadre of
Inspector (Control) nor any Recruitment Rules for thatpost-Finding it not
safe or possible to entrust the responsibilities of Processing and final supply
of bank notes to RBL to new recruits, the Press decided to fill up 50% posts
of Inspector (Control) from qualified and trained persons in sister D
organisations-The appellants, who were appointed as Assistant Inspector
(Control) at India Security Press, applied for and appointed as· Inspector
(Control) in the Press on deputation-Subsequently, Recruitment Rules were
firmed for the said post and by an amendment recruitment by transfer on
deputation was provided-Held: Under these circumstances the appellants' E
appointment could not· have been faulted on the ground that there was no
provision for appointment on deputation-In the absence of Statutory Rules
under Art. 309, appointments can be regulated by administrative orders or
executive instructions-Hence, appellants' appointment valid~Constitution
of India, 1950, Art. 309. Seniority--Deputationists permanently absorbed
vis-a-vis direct recruits-Jnter-se seniority-Determination of-Post of F
Inspector (Control) in Bank Note Press-Appellants. Who were working as
Assistant Inspector (Control) in India Security Press, sent on deputation to
the Press as Inspector (Contro/)--'Subsequently, notionally promoted and
confirmed as Inspector (Control) in Parent department-Later, absorbed as
Inspector (Control) in the Press in permanent posts and their lien in parent G
department terminated under FR 14-A(g)-Respondents were direct recruits
initially appointed as Apprentice Assistant Inspector (Control) in the Press
and subsequently appointed as Inspector' (Control) on prohibition on a date
subsequent to the date of initial appointment of appellants-Thereafter,
respondents appointed on substantive basis on a date subsequent to the date
of absorption of the appellants-Held: Appellants were entitled to benefit of H
115
116 SUPREME COURT REPORTS [1998] 1 S.C.R.
A service rendered in parent department on identical posts for determination
of their seniority-More so, when there were no Recruitment Rules framed y-,
under Art. 309-Hence, CAT erred in treating the respondents as seniors to
the appellants-Moreover, as there were no service rules regulating seniority,
Government was fi1/ly justified in treating the appellants as senior to the
respondents on the basis of their earlier confirmation.
B
Seniority-Date of-Determination-Held: In the absence of service
rules regulating seniority, ''date for confirmation'' can be adopted to determine
seniority.

C The Bank Note Press is a departmental undertaking of the Government
of India and is engaged in the Sovereign function of printing of Bank Notes.
Respondent No. I is the Union of India and Respondent No. 2 is the General
Manager, Bank Note Press. Since at the time of its establishment, the Press
did not have its own cadres of various posts, including the post of Inspector
(Control), nor were any Recruitment Rules made for these posts, on its
D request the Government of India Sanctioned 20 posts in the grade of Inspector
(Control). Since it was felt that is would not be safe or possible to entrust
the responsibilities of processing and final supply of Bank Notes to the
Reserve Bank of India, to raw hands, namely the new recruits, the Press,
in consultation with the Ministry of Finance decided to fill up 50% posts of
E Inspector (Control) from qualified and trained persons working in the sister
organisations, namely the India Security Press as also the Security Paper
Mill and the remaining 50% by direct recruitment. Consequently, the Press
issued a requisition letter to the sister organisations, including the India ·
Security Press for sponsoring the names of the candidates willing to take
up appointment as Inspector (Control), for which the eligibility criteria was
F five years' experience as Assistant Inspector (Control).

The appellants, who were appointed as Assistant Inspector (Control) at
the India Security Press on various dates, applied for appointment as Inspector
(Control) in the Press and were appointed on those posts on deputation on
different dates. In the meantime, all the appellants were promoted, though
G notionally, on the posts of Inspector (Control) in their parent department and
confirmed on those posts. The Central Government promulgated the Bank
Note Press (Class III Posts) Recruitment Rules, 1974 for the posts of ).
Inspector (Control) under Article 309 of the Constitution. These Rules were
amended to include transfer on deputation as one of the modes of recruitment
H Subsequently, the Government of India sanctioned six permanent posts of
S.K. MATHUR. v. U.O.l. 117

Inspector (Control). The appellants, on the recommendations of the A
_.-( Departmental Promotion Committee, were permanently absorbed on the posts
of Inspector (Control) in the Press and their lien in the Parent department
was terminated under FR 14-A(g). Respondent 3 to 9, who were the direct
recruits, were initially appointed as Apprentice Assistant Inspector (Control)
and were subsequently appointed as Inspector (Control) firstly on probation B
and later in substantive capacity, all on dates subsequent to the date of initial
appointment of the appellants in the Press on deputation and the date of
absorption of the appellants as Inspector (Control). Accordingly, the appellants
were treated as senior to respondents 3 to 9.

Being aggrieved, the respondents 3 to 9 preferred a petition before the C
Central Administrative Tribunal, which was allowed. Hence this appeal.
Allowing the appeal, this Court.

HELD: I. The Bank Note Press (Class Ill Posts) Recruitment Rules,
1974 were promulgated on 20-11-1974 when the appellants had already been D
appointed. Their appointment on deputation, therefore, could not have been
faulted by the Central Administrative Tribunal on the ground that there was
no provision for appointment on deputation on the posts of Inspector (Control)
under the Recruitment Rules as it is well-settled that in the absence of
Statutory Rules made under Article 309 of the Constitution, appointments E
and other conditions of service can be regulated by administrative orders or
executive instructions.

2.1. The Tribunal fell into patent error in overlooking the vital fact
that the appellants who were already, working as Inspector (Control) in the
sister organisation had been appointed as Inspector (Control) in the Press F
in pursuance of the administrative decision taken by respondents 1 and 2 and
there were no recruitment rules framed under Article 309 of the Constitution.
The appellants held a permanent lien in the sister organisation and on their
absorption in the Press their lien in the parent department was terminated.
Under the circumstances, they were entitled to the benefit of service rendered G
by them in the parent department on identical posts. This benefit cannot be
legally denied to them.

2.2. Where recruitment is made from two different sources and an
integrated seniority list is proposed of the persons so recruited, the benefit
of service already rendered on a similar post in a similar organisation under H
118 SUPREME COURT REPORTS [1998] 1 S.C.R.

A the same employer will have to be given to the person appointed on the new
post ~~•.

S.S. Moghe v. Union of India, 119811 3 SCC 271 and K. Madhavan v.
Union India, 11987] 4 SCC 566, relied on.

B 3. Moreover, respondents 1 and 2, who had assigned seniority to the
appellants on the basis of the respective dates of their confirmation, could
not be said to have acted contrary to law, at least in the particular
circumstances of the case where respondents 1 and 2 had to balance the
equities in the matter of seniority between the appellants and respondents
C 3 to 9. While respondents 3 to 9 had been directly recruited in the service
and after completing their apprenticeship, were placed on probation for the
post of Inspector (Control), the appellants had already worked for quite a
number of years on this post in their parent department where they were
given notional promotion as they were on deputation in the Press as Inspector
D (Control) on which posts they were also confirmed earlier than respondents
3 to 9. In this situation, respondents 1 and 2 were fully justified in adopting
'date of confirmation' as the basis of seniority, particularly as there were no
service rules regulating seniority of the persons working in the Press
Viewed from any angle, the appellants have to be held as senior to respondents
E 3 to 9.

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 6229 of 1990.

From the Judgment and Order dated 26.4.90 of the Central Admistrative
Tribunal Jabalpur in T.A. No. 2 of 1987.
F
Pramod Swarup for the Appellants.

N.N. Goswamy, V.K. Venna and T.G. Narayanan Nair for the Union of
India.

G The Judgment of the Court was delivered by -.
S. SAGHIR AHMAD, J. The Bank Note Press, Dewas (for short, 'the r
Press'), which is a departmental undertaking of the Government oflndia and
is engaged iri the sovereign function of the printing of the Bank Notes, was
H established in 1972. The job of printing and processing of Bank Notes is said
S.K. MATHUR. v. U.0.1. rs. SAGHIR AHMAD. J.] 119
to be a unique job which requires intensive and highly technical training with A
impeccable integrity. According to the counter affidavit filed before us, the
production .of Bank Notes is completed in two parts, namely, (i) printing of
Bank Note Sheets and (ii) processing of Bank Notes right from cutting of
sheets into the sizes of Notes to the final delivery to Reserve Bank of India
at their cash-chests. The processing wing is known as Control Wing. B
Since at the time of its establishment, the Press did not have its own
cadres of various posts, including the post of Inspector (Control), nor were
any Recruitment Rules made for these posts, it approached the Government
of India for certain posts in the Control wing being sanctioned and on its
request the Government of India sanctioned 20 posts in the grade of Inspector C
(Control). Since it was felt that it would not be safe or possible to entrust the
responsibilities of processing and final supply of Bank Notes to the Reserve
Bank oflndia, to raw hands, namely the new recruits, the Press, in consultation
with the Ministry of Finance decided to fill up 50% posts of Inspector
•·-'- (Control) from qualified and trained persons working in the sister organisations, D
namely the India Security Press, Nasik Road, as also the Security Paper Mill.
Hoshangabad, and the remaining 50% by direct recruitment. Consequently,
the Press issued a requisition letter dated 1.6.1972 to the sister organisations,
including the India Security Press, Nasik Road, for sponsoring the names of
the candidates willing to take ilp the appointment as Inspector (Control), for E
which the eligibility criteria was five years' experience as Asst!. Inspector
(Control).

The Appellants, who were appointed as Asst!. Inspector (Control) at
the India Security Press, Nasik Road, on the following dates, applied for F
appointment as Inspector (Control) in the Press and were appointed on those
posts on deputation on the dates mentioned below :

S.No. Name (S/Shri) Date of appoint- Date of initial
ment as Asst!. appointment in
Inspector (Control) Bank Note Prtss
G
in India Security on deputation
Press, Nasik Road.

I. · S.K. Mathur 92.1961 92.1973
2. M. Laxminarayan 28.7.1961 92.1973 H
120 SUPREME COURT REPORTS [ 1998] 1 S.C.R.

A 3. H.R. Shanna 16.1.1962 3.10.1973
h.
4. V.P. Bhalla 22.7.1965 3.10.1973
5. S.B. Deshmukh 7.1.1966 3.10.1973
6. S.B. Khadilkar 7.6.1962 10.1.1974

In the meantime, ;ill the appellants were promoted, though nationally, on
B the posts of Inspector (Control) in their parent department during the period -1.._
1974 - 1975 and confinned on those posts.

The Central Government, by its notification dated 20.11.1974,
promulgated the Bank Note Press (Class Ill posts) Recruitment Rules, 1974,
C for the posts of Inspector (Control), made by the President under Article 309
of the Constitution. The mode of recruitment indicated in these Rules was that
the posts of Inspector (Control) shall be filled up to the extend of 50% by
direct recruitment and remaining 50% by promotion. These Rules were amended
by Notification dated 1st December, 1975. The method of recruitment was

D
altered. It was provided that 25% of the posts would be filled up by direct
recruits while the remaining 75% by promotion, failing which, by transfer;
failing both, by transfer on deputation and failing all, by direct recruitment.
'
~·
.
The promotion quota was indicated as under :

PROMOTION
E
(i) 50% from Head Checkers with 8 years regular service in the grade
of Rs. 380-560.

(ii) 25% from Head Clerk, Confidential Secretary, Senior Stenographer
and Hindi Translator in the grade of Rs, 425-700 and Dy. Accountant
F in the grade of Rs. 425-640 with at lP-ast 3 years regular service in
the respective grades.

The posts from which appointment on transfer could be made on the
post of Inspector (Control) were indicated as under:

G. TRANSFER

(i) Inspector Control (Rs.550-800) belonging to the Currency Note r
Press, Nashik Road, failing which.

(ii) Asstt. Inspector Control belonging to the Currency Note Press,
H Nashik Road, with at least 5 years regular service in the grads of
S.K. MATHUR. v. U.0.1. [S. SAGHIR AHMAD. J.) 121
Rs. 425-640. A
In 1976. six permanent posts of Inspector (Control) were sanctioned by
the Government with effect from 22.1.1976. Respondent Nos. 3 to 10, who are
the direct recruits, were initially appointed as Apprentice Inspectors (Control)
between October 1973 and January 1975 on a fixed stipend of Rs. 350/- per
:nonth. They were appointed in substantive capacity in 1977. The relevant B
dates of their initial appointment as Apprentice Asst!. Inspector (Control),
their appointment as Inspector (Control) (on probation) and their appointment
is substantive capacity, are indicated below:

;.
"'"
122 SUPREME COURT REPORTS [ 1998] I S.C.R.

A which these permanent posts were created. Consequently, by order dated
22.3.1976, the appellants were appointed as Inspector (Control) in substantive
capacity with effect from 22.1.1976. In their order of appointment, it was
indicated as under:

"2. Consequent on their acquiring liens on the permanent posts of
B Inspectors Control to which they have been substantively appointed
the liens held by them in the India Security Press, Nasik Road, stand
terminated under F.R. 14-A(g) and they have severed all connections
with that organisation."

The direct recruits, namely, respondent Nos. 3 to 9 were appointed on
C the posts of Inspector (Control) in subst~ntive capacity in 1975 on the dates
indicated above.

Having regard to the above facts, when the seniority list of Inspectors
(Control) was issued by the department, the appellants were shown as senior
D to the direct recruits, namely, respondent Nos. 3 to 9, specially in the seniority
list published on 18.9.1979.

It may be pointed out that two posts of Deputy Control Officer (Group
'B' Gazetted), being the promotional posts for Inspector (Control) became
available. The Recruitment Rules for these posts were published by Notifkation
E dated 26.12.1975, in which the mode of recruitment was indicated to be
'promotion', failing which, by transfer and failing both these modes, the posts
were to be filled up by transfer on deputation. Since Inspectors (Control)
having requisite length ofservice were not available nor were candidates for
appointment by transfer on deputation available, the eligibility condition in
the Recruitment Rules was relaxed by the Government in consultation with the
F Union Public Service Commission and the appellants S.K. Mathur and M.
Laxminarayanan were appointed as Deputy Control Officer on regular basis
with effect from 21.8.1978. It may be pointed out that these two appellants,
who were the senior most persons and who were inducted on the post of
Inspector (Control) in the Press from India Security Press, Nasik Road, had
G already been given ad hoc promotion on the post of Deputy Control Officer
for a short term of one year. S.K. Mathur was appointed on such short term
promotion with effect from 9.7.1975 while M. Laxminarayanan was appointed
with effect from 4.7.1976.

Respondent Nos. 3 to 9 feeling aggrieved by the absorption of the
H appellants on permanent basis on the .posts of Inspector (Control) as also by
S.K. MATHUR. v. U.0.1. [S. SAGHIR AHMAD, J.] 123

being treated as junior to the appellants, filed a writ petition in the High Court A
.....-\ of Madhya Pradesh in November, 1980, which was transferred to the Control
Administrative Tribunal, Jabalpur Bench. The relevant claims were :

"(a) To declare that the recruitment rules notified by the Ministry of
Finance in 1975 (i.e., recruitment rules for the post of Inspector
(Control) vide dated 1.12.75 (Annexure R-4) are unconstitutional B
being violative of Article 14 and l 6 of the Constitution;

(b) to qi:ash the order of promotion of Shri S.K. Mathur and Shri M.
Laxminarayanan to the post of Deputy Control Officer by writ in the
nature of certiorari;
c
(c) to quash the seniority list published on 18.9.79 (i.e. seniority of
Inspector (Control);

(d) to direct the department to treat the petitioners' seniority over the
Respondent No. 3 to 8."
--< D
• The Tribunal, by the impugned judgment dated 26.4.1990, held that the
present appellants could not be treated as senior to respondent Nos. 3 to 9
and the service rendered by them prior to 1.12.1975 could not be reckoned
for purposes of determining their seniority as their appointment on deputation
on the posts of Inspector (Control) was not in accorda.nce with the rules as E
they existed prior to l .12.1975 when there was no provision for appointment
being made on those posts by deputation. The Tribunal was of the view that
a provision for appointment on deputation on the posts oflnspector (Control)
was made forthe first time by amendment made in the Rules on 1.12.1975 and
since the appellants were absorbed in substantive capacity on those posts
with effect from 22.1.1976, they could reckon their seniority with effect from F
that date, while respondents 3 to 9, who were also appointed as Inspector
(Control) would be entitled to reckon their seniority from the date of continuous
officiation on that post irrespective of the fact that respondents 3 to 9 had
completed their probation period subsequent to the substantive absorption
of the appellants. The Tribunal was also of the view that since deputation was G
not one of the modes of recruitment for appointment on the post of Inspector
(Control), the deputationists, namely, the present appellants would not be
entitled to carry the benefit of their past service, including the service rendered
in the India Security Press, Nasik Road, to the department in which they were
ultimately absorbed in substantive capacity. The Tribunal, consequently,
quashed. the seniority list and directed that a review DPC be convened to H
124 SUPREME COURT REPORTS [1998] l S.C.R.

A consider the cases of promotion from the post of Inspector (Control) with
reference to the respective position of the candidates in the revised seniority h.
list. It was further provided that till this was done, the promotion of S.K.
Mathur and M. Laxminarayanan shall be treated as provisional.

After having heard learned counsel for the parties, we are of the opinion
B that the Tribunal was wholly in error in quashing the seniority list and in
coming to the conclusion that a person working on deputation is not entitled
to the benefit of service rendered by him in the parent department.

The appellants, who were initially working as Asstt. Inspector (Control)
C in the India Security Press, Nasik Road, were appointed on the posts of
Inspector (Control) in the Press on deputation during the period from 9th
February, 1973 to 10th January, 1974, while there were no recruitment rules for
regulating the appointments or other conditions of service in the Press, which
was established only in 1972. In the absence of rules made under Article 309
of the Constitution, the authorities decided to fill up the posts of Inspector
D (Control) by direct recruitment to the extent of 50% and the remaining 50%
by bringing in the qualified and trained persons from sister organisations so
as to constitute a nucleus of trained and experienced persons in the cadre.
This decision was taken in view of the delicacy of the post and the requirements
of intensive and highly technical training coupled with unimpeachable integrity
E required to man those posts. Having taken this administrative decision, the
autnorities circulated a letter dated I. 6.1972 to sister organisations, namely
the India Security Press, Nasik Road, as also the Security Paper Mill,
Hoshangabad, for sponsoring the names of the suitable candidates who were
willing to take up the appointment in the Press at Dewas. The appellants,
whose names were sponsored and who had also expressed their willingness
F to work at Dewas, were consequently appointed as Inspector (Control) on
deputation. The Rules, namely, the Bank Note Press (Class III Posts) Recruitment >---, -
Rules, 1974 were promulgated on 20.11.1974 when the appellants had already
been appointed. Their appointment on deputation, therefore, could not have
been faulted by the Tribunal on the ground that there was no provision for
G appointment on deputation on the posts of Inspector (Control) under the
Recruitment Rules as it is well-settled that in the absence of Statutory Rules
made under Article 309 of the Constitution, appointments and other conditions
of service can be regulated by administrative orders or executive instructions.

The question relating to the inter se seniority of direct recruits, namely,
H respondents 3 to 9, and the persons brought on deputation, namely, the
S.K. MATHUR. v. U.0.1. [S. SAGHIR AHMAD, J.] 125
present appellants who were ultimately absorbed on permanent basis in the A
Press at Dewas, has also been erroneously decided by the Tribunal by
denying them the benefit of their past service.

From the facts given in the beginning of this judgment, it will be seen
that the appellants were working on the posts of Asstt. Inspector (Control)
in their parent department when they were sent on deputation to the Press B
at Dewas. In due course, they were promoted to the posts of Inspector
(Control) in their parent department and were also given 'permanent' status.
They were subsequently absorbed on permanent posts in the Press at Dewas
with effect from 22. 1.1976. They were already working on the posts of Inspector
(Control) on deputation, having been appointed during the period between C
9th February 1973 to 10th January, 1974, when respondents 3 to 9 joined the
Press, having been appointed as Apprentice Asst!. Inspectors (Control) during
the period between 5th February, 1973 to 20th January, 1975. They were
subsequently appointed as Inspector (Control) and placed on probation during
the period 5th April, 1975 to 20th January, 1976 and were subsequently
appointed on substantive basis in 1977, five of them on 1.8.1977 and three D
on 3.9.1977. Respondents 1 and 2, namely, the Union of India and the General
Manager, Bank Note Press, Dewas, contended before the Tribunal that in the
absence of any seniority rules, they had assigned seniority with reference to
the date of confirmation. Since appellants were confirmed prior to the
confirmation of respondents 3 to 9, the Former, namely, the appellants, were E
treated as senior. The Tribunal after considering their contention held as
under :

"However, m the peculiar case of the BNP Dewas where the
respondents 3 to 8 have been inducted from other sister organisation
at a time when no recruitment rules existed and the subsequent rule F
provided for deputation but without retrospective effect not much
reliance can be placed on the general principle of seniority which the
respondents I and 2 have cited in .support of arranging the seniority
of the petitioners and the respondents 3 to 8 according to the dates
of their confirmation. It is also not normal to confirm a person from
the date of regular absorption as has been done in the case of the G
respondents 3 to 8. Confirmation is related to the performance and
other criteria and the cases of confirmation have to be referred to the
DPC as required by Article 26(51) of the Civil Services Regulations.
Although the respondents 3 to 8 may have been initially deputed but
only after their absorption they become employees of the new H
126 SUPREME COURT REPORTS (1998] I S.C.R.

A organisation i.e. in this case the SNP Dewas. Thus, when they were
absorbed on 22.1.76 their cases of confinnation had to be taken up
and considered like any other departmental employees. They cannot
be automatically confirmed from the same date as the da}e of
absorption. In other words if the DPC has not examined the cases of
the confinnation of the respondents 3 to 8 and the respondents I and
B 2 have confinned them from 22.1.1976, the date ofconfinnation of the
respondents would have to be treated as an arbitrary one resulting in
invidious disc(imination against the petitioners. Where quotas are
provided then confinnation has also to take place against the vacancies
in tenns of the quotas. The respondents have not produced any DPC
c record, in regard to the confinnation of the petitioners and the
respondents 3 to 8 as Inspector Control. Therefore, the dates of
confirmation of the respondents 3 to 8 as well as the petitioners on
which the seniority lists of 1977, 1978 and 1979 are based cannot be
held to be proper or valid for the reasons discussed above. In any
case the date of appointment of the respondents 3 to 8 prior to
D 1.12.1975 cannot be accepted for purposes ofreckoning seniority. For.
these reasons these seniority lists cannot be upheld and are liable to
quashed."

After recording the above finding, the Tribunal proceeded to record the
E funher finding as under :

"In the circumstances of the case, the only valid principle for
detennining seniority between the petitioners and the respondents 3
to 8 would be the principle of continuous officiation from the dates
of their regular absorption as regular Inspector (Control) irrespective
F of the fact that the petitioners completed their probation period
subsequently. The dates of substantive appointments are not
necessarily the dates of confinnation but the dates of regularisation.
·Substantive appointment does not mean that an official has to be
confinned. He hold a substantive appcilntment if he has been appointed
in a regular manner or reguJarised against a clear civil post. Thus, the
G dates of continuous officiation on the posts of Inspector (Control)
would be reckoned from the dates of their regular absorption. The
respondents I & 2 should, therefore, revise the seniority list in the
respective orders and rearrange them in accordance with the principle
indicated above and in the light of our observations. The seniority
H lists of 1977, 1978 and 1979 are quashed."
S.K. MATHUR. v. U.0.1. [S. SAGHIR AHMAD, J.] 127

In recording the above finding, the Tribunal fell into patent error in A
overlooking the vital fa'tt that the appellants who were already working as
Inspector (Control) in the sister organisation had been appointed as Inspector
(Control) in the Press at Dewas in pursuance of the administrative decision
taken by respondents I and 2 as there were no recruitment rules in existence.
The appellants held a permanent lien in the sister organisation and on their B
absorption at Dewas, their lien in the parent department was terminated.
Under the circumstances, they were entitled to the benefit of service rendered
by them in the parent department on identical posts. This benefit cannot be
legally denied to them. The Tribunal erred in holding otherwise.

This Court in S.S. Moghe & Ors. v. Union ofIndia & Ors., [1981] 3 SCC C
271, has already held that when a new service is proposed to be constituted
by the Government, it is fully within the competence of the Government to
decide as a matter of policy the sources from which the personnel required
for manning the service are to be drawn.

In this decision, it was also laid down that the deputationists, who had D
already put in a number of years of service in their parent department, were
to be given seniority over the direct recruits for purposes of promotion.

Again, in K. Madhavan & Anr. v. Union of India & Ors., [1987] 4 SCC
566, while considering the question of seniority of a deputationist, who was
subsequently absorbed on permanent basis in the new department, it was E
observed as under· :

"We may examine the question from a different point of view. There
is not much difference between deputation and transfer. Indeed, when
a deputationist is permanently absorbed in the CBI, he is under the
rules appointed on transfer. In other words, deputation may be regarded F
as a transfer from one government department to another. It will be
against all rules of service jurisprudence, if a government aervant
holding a particular post is transferred to the same or an equivalent
post in another government department, the period of his service in
the post before his transfer is not taken into consideration in computing G
his seniority in the transferred post. The transfer cannot wipe out his
length of service in the post from which he has been transferred. It
has been observed by this Court that it is a just and wholesome
principle commonly applied where persons from different sources are
drafted to serve in a new service that their pre-existing total length of
service in the parent department should be respected and presented H
128 SUPREME COURT REPORTS [1998] 1 S.C.R.

A by taking the same into account in determining their ranking in the
new service cadre."

We are in respectful agreement with the above view. We are of the
opinion that where recruitment is made from two different sources and an
integrated seniority list is prepared of the persons so recruited, the benefit
B of service already rendered on a similar post in a similar organisation under
the same employer will have to be given to the person appointed on the new
post. We are also of the opinion that in the particular facts and circumstances
of the present case, benefit of service rendered by the appellants on the post
of Inspector (Control) in the parent department could not have been legally
C denied to them, particularly as there were no rules of seniority made under
Article 309 of the Constitution providing specifically that benefit of past
service would not be allowed. The Tribunal was not justified in allowing
seniority to respondents 3 to 9 on the basis of continuous officiation on the
post of Inspector (Control) even though appellants had been appointed
earlier. The Tribunal was in error in treating the appellants to have joined the
D department only from the date of their substantive absorption. By treating
respondents 3 to 9 as senior to the appellants, the Tribunal acted contrary
to the basic tenets of service jurisprudence discussed above. ·

In addition to what has been stated above, respondent Nos. I and 2,
E who had assigned seniority to the appellants on the basis of the respective
dates of their confirmation, could not be said to have acted contrary to Jaw,
at least in the particular circumstances of the case where respondents I and
2 had to balance the equities in the matter of seniority between the appellants
and respondents 3 to 9. While respondents 3 to 9 had been directly recruited
in the service and after completing their apprenticeship, were placed on
F probation for the post of Inspector (Control), the appellants had already
worked for quite a number of years on this post in their parents department
where they were given notional promotion as they were on deputation in the
press as Inspector (Control) on which posts they were also confirmed earlier
than respondents 3 to 9. In this situation, respondents I and 2 were fully
G justified in adopting 'date of confirmation' as the basis of seniority, particularly
as there were no service rules regulating seniority of the persons working in
the Press. On this criteria, which, in our opinion, is wholly reasonable in the
facts of this case, appellants were rightly treated by respondents I and 2 as
senior to respondents 3 to 9.

H Viewed from any angle, the appellants have to be held as senior to
S.K. MATHUR. v. U.0.1. [S. SAGHIR AHMAD, J.) 129
respondents 3 to 9. A
In view of the above, the appeal is allowed, the judgment dated 26.4.1990
passed by the Tribunal is set aside and the claim petition filed by respondents
3 to 9 is dismissed, but without any order as to costs.

v.s.s Appeal allowed. B