Holding

The appellant was entitled to the promotion as of 1965 under GO 559, but due to the delay, the Court could not disturb existing promotions and instead awarded backwages as compensation.

Summary

The appellant, a civil servant in the Cooperative Societies department, claimed that Government Order No. 559 (May 4, 1961) entitled him to a promotion to Deputy Registrar in 1965 under the principle of reservation extended to all cadres. He filed a representation petition in 1977, which the Administrative Tribunal dismissed on the ground that the cooperative service rules did not specifically incorporate the reservation rule. On appeal, the Supreme Court held that a proper interpretation of the order made the appellant eligible for promotion in 1965, but the long, unexplained delay in seeking effective relief precluded disturbing the existing promotion structure. Consequently, the Court awarded monetary compensation (backwages) of Rs 40,000, to be paid as a lump sum, and fixed his salary at the maximum of the Deputy Registrar scale (Rs 1,600) from January 1, 1984. The Court also clarified that the compensation is payable under Section 89 of the Income Tax Act, 1961, with reference to Rule 21A of the Income Tax Rules. The appeal was allowed in part, granting compensation but not retroactive promotion.

Issues considered

Whether Government Order No. 559, 1961, extended the principle of reservation to the appellant’s cadre, making him eligible for promotion in 1965.
Whether the delay in filing the representation petition (filed in 1977) bars the appellant from obtaining the promotion.
Whether the appellant is entitled to monetary compensation (backwages) for the loss of promotion.
Whether the compensation is taxable under the Income Tax Act and the applicability of Section 89 and Rule 21A.

Legislation cited

Income Tax Act, 1961s. 192, s. 89
Income Tax Ruless. 21A

Subjects

reservationpromotioncivil servicebackwagesdelaygovernment orderincome taxcompensationadministrative law

Judgment

569
A

Y. RAMANJANEYULU

v. B

STATE OF ANj)HRA PRADESH & ORS.

MtJrch 29, 1985

[[l.A~ DESAI ~ND R.B. MISRA. JJ.l c
Civil Servfce~Princip/e of _Reservation of appoirittntnts extended to all
departments by an Order- No appropriate and timely action taken on ·ii 'by ·the
Department-;-Un'exp/ained long delay on the part of the appellant in moving for
effective remedy-Effect of,

G.0.Ms.No. 559 · dated May 4, 1961 issued by the respondent-State D
provides that the principle of reservation of appointments should be extended
to all cadres of posts includin,1 posts involving promotion:>· in all de.part
ments including the Departments of Secretariat to which it did not apply till
then., . • -

The appelJant filed a Represen1ation Petition before the Tribunal as
Jate as 1977 contending that if appropriate action would have been taken at 1 El
the time it was due as per G.Q.Ms.No. 559, he would have been eligible for' 1
promotion as Deputy Registrar or Cooperative Societies in 1965 and by
denying him the said promotion in violation of the aforesad Govt. order ; his
future promotion .to the post of Joint Registrar has been adversely affected.
The Tribunal dismissed the petition holding that the special rules for the Co~
operative service did not contain any specific provision for the application F;.
of rule of reservation and, therefore. the appellant was not entitled to claim
the benefit of the rule or reservation for promotion to the rank of Deputy
Registrar betwee:t 1965 and 1972 as· claimed by him: Hence this appeal by
special leave.

Condoning the delay in filing the special leave petition and disposing
of the appeal, the ·Court

HELD : (1) On a p_roper interpretation of the r-:levant Government
Order; the_ai)pellant Was entitled to Promotion ~s Deputy Registrar in the year
1965 Which was postponed upto October 14, 1983 when he was promoted as
Deputy Registrar. Though the appellant made number of representations but ·
he moved for an effective r~liefas late as 1977. Moreover. Ibis is not the Jone
ca~e apd if the <;ourt ~rants hjrn the rcli~f ~s claimed by him, 'J:ioµ~h he;_ hijs.
570 SUPREME COURT RBPORTS (1985] 3 s.c.R.
sought relief afler a very long unexplained delay, it would create chaos in the
service and many promotions and reversio.ns will have to be effected. The
Court is, therefore not inclined to disturb the existing promotions and post-
ings by holding that the appellant was c.ntitled .to promotion way back in
1965. In this backgaround, he is entitled to sorite monetary compensation.
B [572G-H; 573AJ

(2) If the appellant is given the benefit of deemed promotion from 1965
the State cannot deny identical benefit to p:rsons similarly situated and simi-
larly circumstanced. And they never questioned the alleged impropriety of
not giving them lhe ben~fit of. the Gove.rnment Order in respect of reservations
in promotion posti;. All these are relevant Considerations and therefore the
amount of backwages is fiir.ed at RS. 4a,ooo payable in one lump sum. While
c computing the amount, the Court hJ.s kept in view the period during which
the appellant would be entitled to relief. Therefore, the amount of Rs. 40,000
awarded .as compensation in the form of backwages is to be spread over for the
period 1965 to 1982. Since the amount i! payable in one lump sulfi, presum-
ably the Government may resort to s. 192 of the Income Tax Act, - but let it
be made distinctly clear that the appellant is entitled tOlthe benefit of sec. 89
of the Income Tax Act, 1961 and Rule 21 A of the Income Tax Rules and is
n: entitled to relief of spread over. The pay of the appellant sha,11 also be fixed
at Rs. 1600 i.e. the maximum of ~he scale of Deputy Registrar effective from
January!, 1984. (573E-H; 574B-C]

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 1384 of 1935

From the Judgment and. Order dated 24.3.83 of the Adminis-
Et trative Tribunal at Hyderabad in Representation Petition No. 1172
of 1977.

A. Subba Rao for the Appellant.

P. Ram Reddy, R.V.S.N. Chari and S11rfe.1/z Menon ·for the
F. Respondents.

The Judgment of the Court was delivered by

DESAI, J. Special leave granted.

G,, Delay in filing the special leave petition fondoned.

We heard Mr. A Stlbba Rao, learned connse\ for the appellant
and Mr: Ram Reddy, learned senforicoun;e1 for the State of Andhra
Pradesh.
H The appellant claims that If appropriate action would have.
bee·n taken at the time it was due, as per the O.O.Ms, No. 559
Y. RAMANJANBYULU v. ANDHRA PRADESH (Desai, J.)
. 511
' -
dated May 4, 1961 which provides that the principle of reservation A
should be extended to all cadres of posts including posts involving
·promotions in all departments inciuding the Departments of Secre-
tariat to which it did not apply ti.II then, the appellant would have
been eligible. for promotion as Deputy Registrar of Co-operative
Societies in 1965. He also claims that by denying him the promo-
tion in violation ofthe afore-mentfoned Govt. Order, his furture B
promotion to the post of Joirit Registrar has been ad.versely affected
because in that event he would have long since been appointed as
Joint Registrar. The appellant sought relief by fi!fng Representation
Petition No. 1172 of 1977 in the Andhra Pradesh Administrative
Tribunal, Hyderabad· The Tribunal held that the special rules for
the Co-operative service did not contain any specific provision for c
the application of rule of reservation and, therefore, in accordanr.e
with the Government Memo dated 27.3.1963, the appellant was riot
entitled to claim the benefit of the rule of reservation for promotion
to the rank of Deputy Registrar between 1965 and 1972 as claimed
by him.' Alternative submission of the appellant that the action
D
of the Government in giving the benefit of the rule of reservation to
the category of Section Officers in the Secretariat in Andhra
Pradesh General Service for appointment to the rank of Deputy
Registrar while omitting other feeder categories from which appoint·
men ts by transfers were made to the post of Deputy Registrar, was
discriminatory and hence violative of Arts. 14 and 16 of the Cons- E
titution, was rejected observing that the promotion from the post of
Sub-Registrar of Co-operative Societies to the post of Deputy
Registrar of Co-operative Societies was in direct line of promotion
and therefore, this category has been excluded from the table anne-
xed to G.0.Ms No. 758 dated October 30,1976. Accordingly, the
representation petition was rejected. Hence this appeal by special F
leave.

When the appeal was taken up for hearing, Mr. Ram Reddy.
frankly stated that if the benefit of the rule of reservation as set out
in the G.O.Ms. 559 of May 4, 1961 was available to the appellant, (j
he would become eligible for promotion to the post of Deputy
Registrar wayback in 1965 or latest in 1972. He also frankly con-
ceded that if now the appellant is given promotion out of turn when .
he did not take effective remedial measures till 1977, when he filed
the representation petition, there would be extensive disturbance in
various cat~gories of posts because once the appellant is $ive11 the · If
572 SUPREME COURT REPORTS (1985] 3 S.C.R

A benefit, there are numerous similar cases to whom the same benefit
will have to be extended and there will be number of promotions
and reversions_ affecting the service.

Mr. Subba Rao repelled ,the submission saying that the appel-
B lant has be_en making numerous representations which have fallen
on deaf ears and therefore, he should not be made to suffer and be
tlie viCtim of bureaucratic callousness and indifference.

It is now admitted . that the petitioner had filed Writ Petition
No. 376 of 1968 in the High Couri of Andhra Pradesh and in res-
c ponse to his request, the Government re-fixed the seniority of the
appellant in the cadre of sub-Registrars of Co-operative Societies
just below Shri N. Raghunatha Rao. It is also admitted that the
petitioner became eligible for promotion as D_eputy Registrar from
the year 1965. It is further admitted that the petitioner has been
working as Deputy Registrar with effect from October 14, 1983.
D
The vertical line of promotion in Co-operative service appears
to be sub-Registrar of Co-operative Societies moving upward as
Deputy Registrar of Co-operative Societies and then to special
category of Deputy Registrars and then as Joint Registrar. We were
E informed that the post of Registrar is an J.A.S. cadre post. The
appellant as Deputy Registrar at present is in the pay scale of
Rs. 1050-1600 and bis substantive pay is Rs. 1400 per month. The
pay scale admissible for the post of special category of Deputy
Registrar is Rs. 1250-1800.

Mr. Ram Reddy, learned counsel for the State of A.P. fairly
F stated that if the court does not accept the interpretation as put by
the Tribunal, then obviously the appellant would be eligible for
promotion from 1965. But his is not the lone case and if the court
grants him the relief as claimed by him, though he has sought relief
i
after a very long unexplained delay, it would create chaos in the
service and many promotions and reversions wiil have to be effected.
G
According to Mr. Ram Reddy, it is a case in which monetary
compensation would be more than adequate. There is considerable
force in this submis~ion. As pointed out earlier, though undoub-
tedly the appellant made number of representations, he moved for
an effective relief as late as 1977. We are therefore, not inclined
ff \o disturb the existing promotions and postings by holdin~ that tl!~
Y. RAMANJANEYULU v. ANDHRA PRADESH (Desai, J.) 573
appellant was entitled to promotion way back in 1965. In this
A
background, the appellant is entitled to some monetary compen·
sation.

Mr. Ram Reddy pointed out that after giving the appellant
a deemed promotion from 1965, if .his monthly salary is worked
out according to the scale then admissible for the promotional post, B
roughly Rs. 1,20,000 would be payable to him. And if he is given
the benifit, the State cannot .deny identical benefit to persons
similarly situated and similarly circumstanced. And they never
questioned the alleged impropriety of not giving th em the benefit of
the Government order in respect of reservations in promotional c
posts. All these are relevant considerations
, and to some extent for
this situation the appellant himself is to blame. Mr. Ram Reddy
suggested that the adequate momtary compensation could be around
Rs. 30,000. On the other hand, Mr. A. Subba Rao attempted to
pursuade us to give all the backwages on the footing of a deemed
date of promotion. We propose to steer the middle course. D

Before we determine the amount payable as backwages, we
must make it distinctly clear that while computing the amount we
have kept in view the period during which the appellant would be
entitled to relief at our han_ds. As poihted earlier, on a proper inter-
E
pretation of the relevant Government order, the appellant was
entitled to promotion in the year 1965 which was postponed upto
1983. Therefore, this amount which we propose to award as
compensation in the form of backwages is to be spread over for the
period 1965 to 1982. Now that the amount of Rs 40,000 which
we are hereby awarding is payable in one lump sum, presumably the F
Government may resort to Sec. 192 of the Income Tax Act, but
let it be made distinctly clear that the appellant is entitled to the
benefit of Sec. 89 of the Income Tax Act, 1961 and Rules 21A of
the Income Tax Rules and he is entitled to relief of spread over ..
Therefore, while computing the total amount of Rs 40,000 we
have. kept the spread over in view for a period of roughly 17 years G
which would mean that he is being awarded Rs. 2, 500 per year as
backwages. This would not make the income taxable, if it is not
otherwise taxable. If therefore, any deduction is made towards
income tax while making the payment it is iucumbent upon the
Andhra Pardesh authorities to take all necessary steps to obtain the H
574 SUPREME COURT REPORTS [1985] 3 s.c.R.

A relief for the appellant under Sec. 89 of the Income Tax Act read
with Rule ZIA of the Income Tax Rules.

The appellant is already promoted as Deputy Registrar of Co-
operative Societies. The scale admissible for the post is Rs 1050-
1600. We direct that the pay of the appellant shall be fixed at
B Rs. 1600 i.e. the maximum of the scale effective from January 1,
1984 and be should be paid Rs 40,000 in all towards backwages.
We order accordingly. The payment herein directed shall be made
within a period of three months from today. We order accordingly.
There will be no order as to costs.
c

M.L.A. Appeal allowed in part
D