UNION OF INDIA AND ANR.versusM. BHASKAR AND ORS.

A                         UNION OF INDIA AND ANR.
                                          v.
                            M. BHASKAR AND ORS.

                                   MAY 6, 1996

B    (K. RAMASWAMY, B.L. HANSARIA AND S.B. MAJMUDAR, JJ.]

          Service Law :

          Indian Railway Establishment Manual, 1968: Rules 123 and 127.
c
          Apprentices-Traffic/Commercial-Higher pay scale under Railway
    Board's memorandum dated 15.5.1987-Entitlement-Held: The higher pay
    scale was meant for Traffic/Commercial Inspectors of higher grade only and
    not for all grades of Traffic/Commercial Apprentices-Para 2(ii) of the
    memorandum of 1987 did not deal with revision of pay of all Traffic/Com-
D   mercial Apprentices.

          Indian Railway Establishment Code, 1951 : Rule I-A.

          Recruitment process-Railway Board's memorandum dated
E   15.5.1987-Direct recruitment to higher grade of Traffic/Commercial Appren-
    tices-Deviated from provisions of Railway Establishment Manual-Held:
    such deviation pennissible under Rule I-A of the Code.

           Traffic/Commercial Apprentices-Recruited Railway Board's
    memorandum dated 15.5. 1987-Given higher pay scales and reduced training
F   period compared to pre-1987 Apprentices-Held : such a policy neither
    discriminatory nor arbitrary and unreasonable.

          Traffic/Commercial Apprentices-Recruited on new terms w.e.f.
    15.5.1987 under Railway Board's 1987 memorandum-Held : 17ie cut-off
G   date (15.5.1987) was not arbitrary.

           Traffic/Commercial Apprentices--Pre-1987 and post-1987 appren-
    tices-Railway Board's 1987 memorandum presc1ibed new tenns w.e.f.
    15.5.1987-Apprentices recruited under 1985 adve1tisement-But called for
    training in 1989-Held: these apprentices could not be treated differently from
H   other pre-1987 apprentices because they were called for training in 1989.
                                         358
                          U.0.!. v. M. BHASKAR                          359

        Promotion-Length of cxpe1ie11ce--Computatio11 of-Order of promo-       A
tion made effective from a retrospective date-Held: the peiiod of experience
for ftutl1er promotion had to be computed Ji-om date of actual promotion and
not from retrospective date.

      The Railway Board had issued a memorandum dated 15.5.1987
which brought about some changes in the recruitment of Traffic/Commer-         B
cial Apprentices - on of the changes being that on and from 15.5.1987 the
recruitment of these Apprentices would be made in the pay scale of Rs.
I?00-2660 (this scale earlier was Rs. 1400-2300). The memorandum had
raised the standard of' examination and reduced the training period from
3 to 2 years in respect of post-1987 Apprentices. The respondents had laid     C
a claim for the higher scale of pay at par with post-1987 Apprentices even
though they were recruited pursuant to an advertisement of 1985 and were
called for training during 1989. One of the respondents was promoted as
Commercial Inspector Grade-II by an order dated 21.9.1989 effective from
11.10.1988 but was denied promotion to Grade-I although he had 2 years         D
of experience in _Grade-II as on 11.10.1990.

      The respondents tiled a petition before the Central Administrative
Tribunal for higher scale of pay on the basis of 1987 memorandum and
also challenged the validity of the memorandum because of its dis-
criminatory nature and introduction of arbitrary cut-off date. The             E
Tribunal allowed the petition and promotion of the respondent from
Grade-II to Grade-I Commercial Inspector. The Tribunal also held the
memora~dum as invalid, because of its being in the nature of administra~
live instruction it could not have changed the Indian Railway Estab-
lishment Code, 1951 which was statutory in nature.
                                                                               F
      Disposing of the Appeal, this Court

      HELD : 1.1. The memorandum of 1987 was really not one of revision
of pay of the Trallic/Commercial Apprentices, as has been understood by
those Tribunal who have conceded the higher pay scale. The higher pay          G
scale was really. meant for the Traffic/Commercial Inspector~ of higher
grade. Para 2(ii) of the memorandum of 1987 does not support the case of
the respondent that it really dealt with the revision of pay of all the
Traffic/Commercial Apprentices. [363-G, 364-C]

      1.2. Rule 1-A of the Indian Railway Establishment Code, 1951 which       H
    360                   SUPREME COURT REPORTS (1996] SUPP. 2 S.C.R.

A   had come to be made pursuant tu the power conferred by the proviso tu
    Article 309 and having stated that the recruitment in the lowest grade will
    be made in accordance with the instructions laid down by the Railway
    Board from time to time, the rule itself permitted the Railway Board to
    issue necessary instructions, and the memorandum of 1987 h3' :ng been
    issued by the Railway Board in exercise of this power, it has to be held that
B   the Board valid authority to issue the memorandum. (364-H, 365-A]

           1.3. The Apprentices recruited after 15.5.1987 were to man the posts,
    not of Assistant Station Masters, Assistant Yard Masters etc. as before, but
    of Station Masters and Yard masters. It is because of this that higher pay
C   scale was made available to them. The memorandum provided that the
    standard of examination for the Apprentices to be recruited after 15.5.1987
    was required to be higher than that which was prevailing, and if because of
    this, the period of training was made 2 years in place of 3, the same cannot
    make the policy unreasonable, as a two-year period for training is of sulli-
    ciently long duration lo equip persons selected after a more rigorous test,
D   with the knowledge re<1uired tu man the posts in question. If direct recruits
    passing examination of higher standard to man higher posts were ret1uired
    to be given higher pay scales, the same cannot be regarded in any way as
    discriminatory or even arbitrary. Snch a policy decision is not un-
    reasonable also. (365-D-E)
E          2. The cut-off date (15.5.1987) is not arbitrary because the memoran-
    dum had come to be issued following many deliberations and discussions
    \\ith different unions. So, it cannot be said that the date (15.5.1987) is one
    'picked out from a hat', in which case a cut-off date would be arbitrary.
                                                                          [365-G]
F         Union of India v. Sudhir Kumar Jaiswal, [1994) 4 SCC 212, relied on.

           3.1. Though the respondents were called for training from 1989, that
    is not enough to distinguish their case from other respondents inasmuch
    as they had come to be recruited pursuant to an advertisement of 1985; and
    so, they have to be treated as pre-1987 apperentices. The mention in para
G   2(xii) of the menorandum that the revised pay scale of Rs. 1400-2300 was
                                                     11
    meant for "apprentices already under training cannot be taken in isola-
                                                          ,


    tion; that has to be understood along with other provisions contained in the
    memorandum. Therefore, the respondents cannot be treated differently
    from other pre-1987 Apprentices because they were called for training in
H   1989. (366-FJ
                U.O.l. v. M. BHASKAR [HANSARIA, J.]                 361

      3.2. The respondent having really started working in Grade-II pur- A
suant to the order of 21.9.1989, he could not have gained experience prior
to the date he had joined pursuant to this order. The mere fact that his
promotion in Grade-II was notionally made effective from 11.10.1988 can-
not be taken to mean that he started gaining experience from that day,
because to gain experience one has to work. Notional promotions are given B
to take care of some injustice, inter alia, because some junior has. come to
be promoted earlier. But there is no doubt that the person promoted to
higher grade cannot gain experience from the date of the notional promo-
tion; it was to be from the date of the actual promotion. [367-D-E]

     CIVIL APPELLATE JURISDICTION: Civil Appeal No. 5410 of                C
1992 Etc. Etc.

     From the Judgment and Order 7.8.92 of the Central Administrative
Tribunal at Bangalore in 0 .A. No. 69 of 1991.

     P.P. Malhotra, AK. Sharma, S.A. Matto, Hemant Sharma, A.D.N.          D
Rao, Y.P. Mahajan, W.A. Quadri, V.K. Verma, Vijay Kumar Verma, Ms.
Malini Poduval, Navin Prakash, S. Kulshreshtha, C.V. Subba Rao, Ashok
K. Mahajan, R. Sathish, Janaranjan Das, Mrs. K. Sharda Devi, Irshad
Ahmad, K. Sharda Devi, N.S. Bisht, Manish Misra, Balbir Singh Gupta,
Mridula Ray Bhardwaj and T.I. Kunhikannan for the appearing parties.
                                                                           E
     The Judgment of the Court was delivered by

      HANSARIA, J. This batch of appeals requires us to decide two
questions both of whom are relatable to the Railway Board's memorandum
dated 15.5.1987 on the subject of recruitment of Traffic/Commercial Ap-
prentices. The two questions are; (1) the purport of the memorandum; and   F
(2) the validity of the same.

      2. There has been a cleavage of opinion among the various Central
Administrative Tribunals (CATs) of the country. Most of the Tribunals
have rejected the understanding of the Union of India - the main appel-    G
!ant-relating to the meaning and scope of the memorandum. The Er-
nakulam Bench of the Tribunal has even regarde~ the memorandum as
invalid.

     3. The broad contents of the memorandum may he noted. It brought
about some changes in the recruitment of Traffic/Commercial Apprentices    H
    362                  SUPREME COURT REP ORTS (1996] SUPP. 2 S.C.R.

A   - one of the changes being that on and from 15.5.1987 the recruitment of
    these Apµrentices would be made in the pay scale of Rs. 1600-2660 (this
    scale earlier was Rs. 1400-2300) and, instead of all the posts being filled
    up by promotions, ratio of promotees was made 75%, and of the remaining
    25%, 10% were required to come through Railway Recruitment Boards
    and 15% on the basis of Limited Department Competitive Examination.
B
    The pre- 1987 Apprentices laid their claim for the higher scale of pa{on
    the basis of 1987 memorandum; and it is this claim which has come to be
    allowed by the majority of the CATs.
                                                                                    "
           4. The appellant has challenged the legality of this view. It has also
C   been contended that the memorandum is not invalid for the reason given
    by the Ernakulam Bench or, for that matter, any other reason. The learned
    counsel appearing for the respondents have supported the view taken by
    the majority of the CATs insofar as the benefit of higher pay scale is
    concerned. According to them the memorandum is also invalid because of
D   its discrqninatory nature and introduction of arbitrary cut-off date.

          5. To decide the controversy, it would be apposite to apprise oursel-
    ves as to what was the procedure of recruitment before the memorandum
    in question; and what was really meant by the word 'Apprentices'. We have
    put this aspect at the forefront because the Tribunals, who have granted
E   the benefit of higher pay scale, have done so, with respect, without applying
    their mind lo the relevant provision of the Indian Railway Establishment
    Manual, hereinafter the Manual, dealing with the recruitment of (1) Traffic
    Apprentices; and (2) Commercial Apprentices, Rule 123 of 1968 Edition
    of the Manual deals with recruitment of Traffic Apprentices and Rule 127
F   with Commercial Apprentices. It is apparent from this Manual that the
    posts to be held by Traffic Apprentices Before the 1987 were of (1)
    Assistant Station masters; (2) Assistant Yard Masters; (3) Traffic Inspec-
    tors; and (4) Section Controller (in the scale of Rs. 1400-2600). Insofar as
    Commercial Apprentices are concerned, these posts were of: (1) Assistant
    Claims Inspectors/Supervisors; (2) Assistant Commercial Inspectors; (3)
G Assistant Rates Inspectors (Goods and Coaching); and (4) Other Inspec-
    tors for outdoor duties. This apart, the pre - 1987 position was that in the
    Traffic and Commercial Departments, posts in the pay scale of Rs. 1400-
    2300 were being filled up to the extent of 25% by direct recruits, of which
    15% were from open market and 10% from Limited Departmental Com-
H   petitive Examination; and the balance 75% by promotion from lower grade.
                      U.0.1. v. M. BHASKAR [HANSARTA,J.]                     363

    Further, the tenn 'Apprentices' \Vas being actually used to cover 'direct       A
    recruits', as distinct from 'promotees'. Another thing to be noted, which
    again missed the Tribunals in question, is that when the pay scale of Rs.
    1400-2300 was being paid to Traffic/Commercial Apprentices, the higher
    pay scale of Rs. 1600-2660 was being paid to those who were in a higher
    grade.                                                                          B

          6. Though the above is disputed by Mrs. Sharda Devi, appearing for
    some of the respondents, we entertain no doubt on this score, because from
I   what has been stated in para 6 of the affidavit filed by T.P. V.S. Sekar Rao,
'   Deputy Chief Personnel Officer, South Central Railway Headquarters
    Office, Secundrabad, it appears that the pay scale of Rs. 1400-2300 was         c
    being made available to Traffic Inspector Grade Ill, whereas scale of Rs.
    1600-2660 was meant for Traffic Inspectors of Grade II. Similarly, Com-
    mercial Inspector, Grade III, was getting the scale of Rs. 1400-2300 and
    Commercial Inspector, Grade II, the scale of Rs. 1600-2660. Mrs. Sharda
    Devi has referred to us in this connection to the Table of "Avenue of           D
    Promotion for SS/Tis." finding place at page 82 of this counter, to bring
    home her point. This chart itself shows that there are promotional posts
    and the old scale of Rs. 455-700 (which on revision became Rs. 1400-2300)
    was meant for some Traffic Apprentices and not all. We may refer in this
    context to what finds place in Section B of Chapter II of the Manual. This
    Section deals with Rules governing the promotion of Group 'C' and shows         E
    that some promotional posts have been categorised as selection posts and
    some non-selection. The aforesaid chart relating to the 'avenue of
    promotion' has itself mentioned which arc the non-selection -posts and
    which are selection posts.
                                                                                    F
           7. From the aforesaid, it is clear that the memorandum of 1987 was
    really not one of revision of pay of the Traffic/Commercial Apprentices, as
    has been understood by those Tribunals who have conceded the higher pay
    scale. The higher pay scale was really meant for the Traffic/Commercial
    Inspectors of higher grade. Mrs. Sharda Devi's effort to satisfy us that the    G
    higher pay scale was really a revision on the basis of what finds place in
    part 2(ii) of the 1987 memorandum is founded on misapprehension inas-
    much the mention in that sub-para that "Traffic Apprentices absorbed in
    the cadre of Section Controllers in scale of Rs. 470-750/1400-2600 (RP)
    will be fixed at starting pay of Rs. 1600 on absorption", does not mean that
    these Section Controllers were given the pay scale of_ Rs. 1600-2660, as        H
    364                  SUPREME COURT REPORTS [1996] SUPP. 2 S.C.R.

A   urged by the learned counsel. All that was conveyed by this statement was
    that the Section Controllers, even though getting the revised scale of Rs.
    1400-2600, their starting would be Rs. 1600. This was so required, accord-
    ing to Shri Malhotra appearing for the appellant, because the Trained
    Apprentices could become eligible for the post of Section Controller only
    after having two years Yard's experience in the grade of Rs. 455-700. It is
B
    this pay scale which had become on revision Rs. 1400-2300; the unrevised
    pay scale of Section Controller was Rs. 470-750, which on revision became
    Rs. 1400-2600. So, what has been stated in para 2(ii) does not support the
    case of the respondents that the memorandum of 1987 really dealt with the
    revision of pay off all the Traffic/Commercial Apprentices.
c
           8. We, therefore, hold that the Tribunals which allowed the benefit
    of :iay scale of Rs. 1600-2660 to all the Traffic/Commercial Apprentices
    irrespective of the grade of the posts held by them, not only misunderstood
    the memorandum of 1987, but misconceived the provisions relating to the
    recruitment and promotion of these Apprentices as finding place in the
D   Establishment Manual. Indeed, somehow or other they were oblivious of
    what has found place in the Manual in this regard.

           9. This leaves for consideration the question of validity of the
    memorandum. The Ernakulam Bench, which held the memorandum in-
E   valid, did so for the reason that the Railway Board, which had issued the
    memorandum, could not have changed the provisions finding place in the
    Establishment Manual, which are statutory in nature, whereas the
    memorandum was categorised as administrative instruction. Now, there is
    no dispute in law that statutory provision cannot be changed by administra-
    tive instruction. But then, the Tribunal, despite having noted Rule 1-A of
F   the India Railway Establishment Code (Volume-I) as published on 21st
    March, 1951 reading :

            "Normally recruitment will be to the lowest grade of the lowest
            class but direct recruitment on limited scale to intermediate grades
            will be made in accordance with instructions laid down by the
G
            Railway Board from time to time"

    ultimately failed to bear in mind the aforesaid provision. Rule 1-A which
    had come to be made pursuant to the power conferred by the proviso to
    Article 309 and having stated that the recruitment in the lowest grade will
H   be made in accordance with the instructions laid down by the Railway
                 U.0.l. v. M. BHASKAR [HANSARIA, J.]                   365

Board from time to time, the rule itself permitted the Railway Board to A
issue necessary instructions, and the memorandum of 1987 having been
issued by the Railway Board in exercise of this power, we hold that Board
had valid authority to issue the memorandum.


    .  J.0. Another submission made bv. Mrs. Sharda Devi in assailing the
validity of memorandum was that tough pre- 15.5.1987 Apprentices would
                                                                              B
get the scale of Rs. 1400-2300, the post 15.5.1987 Apprentices were made
available the scale of Rs. 1600-2660, for no good reason, and so, the
memorandum was arbitrary. This is more so, as earlier the apprentices
were to undergo training for 3 years, which was reduced to 2 years by the
memorandun1. Shri Malhotra's contention in this connection \vas that there    c
was a change of ·policy in the sense that Apprentices recruited after
15.5.1987 were to man the posts, not of Assistant Station Masters, Assistant
Yard Masters etc. as before, but of Station Masters and Yard Masters. It
is because of this that higher pay scale was made available to them. It was
also brought to our notice that the memorandum provided that the stand- D
ard of examination for the Apprentices to be recruited after 155.1987 was
required to be higher than that which was prcivailing, and if because of this,
the period of training was made 2 years ii)'. place of 3, the same cannot
make the policy unreasonable, as a two-year period for training is of
sufficiently long duration to equip persons selected after a more rigorous
test, with the knowledge required to man and posts in question. We agree
                                                                               E
and state that if direct recruits passing examination of higher standard to
man higher post were required to be given higher pay scales, the same
cannot be regarded in any way as discriminatory or even arbitrary. Such a
policy decision is not unreasonable also.
                                                                              F
       11. The final submission in this regard was that the cut-off date
"15.5.1987" is arbitrary. This also is not correct because the memorandum
had come to be issued following many deliberations and discussions with
different unions of which mention has been in detail in one of the docu-
ments on record. So, it cannot be said that the date (15.5.1987) is one G
'picked out from a hat', in which case a cut-off date would be arbitrary, as
stated by this Court recently in para 4 of U11ion of !11dia v. Sudhir Kumar
Jaiswal, (1994] 4 SCC 212. We are rather satisfied that the date has
relevance and the memorandum has come to be issued following the
aforesaid discussion. So, we uphold the validity of the memorandum.          H
    366                    SUPREME COURT REPORTS [1996] SUPP. 2 S.C.R.

A         Appeals (!/' SLP (C) Nos. 2533-35 of 1994

           l2. In these appeals, it was contended by Shri Das on behalf of
    respondent Nos. 2 to 4 that the cases of these respondents stand on
    different fooling from other respondent;, because, thought they had come
    to be recruited pursuant to an advertisement of January 1985, they were
B
    called for training progran1mc con1111encing frotn August 1989; and so, they
    should be taken as post - l'J87 Apprentices, for which reason they would
    be entitled to the benefit of the memorandum. This contention has been
    advanced because of the language of sub-para (xii) of para 2 of the
    memorandum, according to which the revised pay scale of Rs. 1400- 2300
c   \Vas meant for "apprentices already under training' 1• ft \Vas urged that the
    aforesaid rc~pondcnts \Vere not ''under training'1 un 15.5.1987 as they had
    been called for training which '"" lo commence from August 1'!89. Our
    attention \Vas also dra\vn by Shri Das to a document at page 130 of the
    paper hook, \vhich is a comn1unication of the Principal, Sonal Training
D   School, addressed to the Chief Optg. Supdt. by which the representation
    of 30 Traffic Apprentices for the absorption/posting in the pay scale of Rs
    IW0-2660 was forwarded for consideration.

          13. As to the last <locun1cnt. \VC \vould say that the .same is inconse-
E   qucntial inasmuch as the Principal had only forwarded the representation.
    Though it is correct that the respondents were called for training from
    1989, that is not enough to distinguish their cash from other respondents
    inasmuch as they had come to be recruited pursuant to an advertisement
    of January 1985; and so, they have to he treated as pre-1987 Apprentices.
    What has been stated in sub-para (xii) cannot be taken in isolation; that
F
     has to be understood along with other provisions contained in the
     memorandum. If this were to be so <lone, we do think if we would be
    .iustiricd in treating these respondents <liffc;n.:ntly fron1 other pre-1987
    Apprentices hccause they \Vere called for training in 1989. We have taken
    this vii..:\V because it is kno\vn that at times there arc no vacancies in training
G   :.;choo1 and so training programme has co be spread out. \Ve, therefore,
    reject the contention advanced on behalf of these responuents by Shri Das.

          Appeal @ SLP (C) No. 15438 of 1994

H         14. In this appeal, a separate argument was advanced on behalf of
                      U.0.1. v. M. BHASKAR [HANSAJUA,J.J                        367

    respondent No. 1 Prakash Chandra Ojha, who had approached the Patna                A
    Bench of the CAT with the grievance that he was unjustly and illegally
    denied promotion to Grade-I Commercial Inspector in 1990, despite his
    having been promoted as Commercial Inspector Grade-II by an order
    dated 21.9.1989, which was made effective from ll.10.1988, because of
    which he had become eligible for promotion to Grade-] on ll.10.1990, as            B
    the eligibility condition was completion of 2 years of experience in Grade-
    n. The Patna Bench held that the exclusion of this respondent from the
    list of eligible candidates for the selection meant for 1990 was wrong.

           15. The aforesaid decision has been challenged in .this appeal by the
    Union of India by contending that 2 years' period of experience has to be          C
    reckoned, not from 11.10.1988, but from 21.91989. There is no dispute that
    the eligibility condition is 2 years experience in Grade-II. No\v, this respon-


-   dent having really started working in Grade-II pursuant to the order of
    21.9.1989, he could not have gained experience prior to the date he had
    joined pursuant to this order. The mere fact that his promotion in Grade-JI
                                                                                       D
    \Vas notionally n1a<le effective fonn 11.10.1988 c:annot be taken to 111ean that
    he started gaining experience from that day, because to gain experience
    one has to \Vork. Notional promotions are given lo take care of sonic
    injustice, inter alia, because sonic junior has tome to be pron1otcd earlier.
    But we entertain no doubt that the person promoted to higher grade
    cannot gain experience from the date.,. of the notional promotion; it has to       E
    be from the date of the actual promotion.

          16 We, therefore, hold that the view taken by the Patna Bench qua
    this n:spondent is not sustainable.
                                                                                       F
                                      Conclusion

           17. All the appeals, therefore, stand disposed of by setting aside the
    judgments of those Tribunals which have held that the pre-1987 Traf-
    fic/Commercial Apprentices had become entitled to the higher pay scale
    of Rs. 1600-2660 by the force of memorandum of 15.5.1987. Contrary view G
    taken is affirmed. We also set aside the judgment of the Ernakulam Bench
    which declared the memorandum as invalid; so too of the Patna Bench in
    appeal @ SLP (C) No. 15438 of 1994 qua respondent No. I. We also state
     that cases of respondents 2 to 4 in appeals @ SLP (C) Nos. 2533-35 of
     1994 do not stand on different footing.                                      H
    368                  SUPREME COURT REPORTS [1996] SUPP. 2 S.C.R.

A         18. Despite the aforesaid conclusion of ours, we are of the view that
    the recovery of the amount already paid because of the aforesaid judg-
    ments of the Tribunals would cause hardship to the concerned respon-
    dents/appellants and, therefore, direct the Union of India and its officers
    nut to recover the amount already paid. This part of our order shall apply
    (!)to the respondents/appellants who are before this Court; and (2) to that
B   pre-1987 Apprentice in whose favour judgment had been delivered by any
    CAT and which had become final either because no appeal was carried to
    this Coon or, if carried, the same was dismissed. This benefit would be
    available to no other.

    V.S.S.                                                 Appeal dismissed.




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