Union of India Etc. v. Majji Jangamayya Etc.(with Connected Civil… (1976)

PETITIONER:
UNION OF INDIA ETC.
Vs.
RESPONDENT:
MAJJI JANGAMAYYA ETC.(With connected Civil Appeals)
DATE OF JUDGMENT05/11/1976
BENCH:
RAY, A.N. (CJ)
BEG, M. HAMEEDULLAH
SINGH, JASWANT
CITATION:
1977 AIR 757 1977 SCR (2) 28
1977 SCC (1) 606

ACT

Constitution of India 1950, Arts. 53, 313 and 366--Scope of

Government of India Act, 1935, 241--Scope of--Office

Manual, 1955, Vol. II. r. 18--Whether statutory rule.

HEADNOTE

The Government of India, in 1950, framed a rule for

promotion of an Income Tax Officer as Assistant Commis-

sioner and it was published as rule 18 in Vol. I1 of the

Office Manual published in 1955. The rule provided that

promotion shall be strictly on merit and that no one should

ordinarily be considered for promotion unless he has com-

pleted at least ten years service as Income Tax Officer. In

1957, a memorandum was issued by the Central Board of Reve-

nue containing the following principles for proration of

Income Tax Officers Class I as Assistant Commissioners.

1. Greater emphasis should be laid on merit as a criterion.

2. The Departmental Promotion Committee should first

decide the field of choice, namely, the number of eligible

officers awaiting promotion who should be considered for

inclusion in the selection list. An officer of outstanding

merit may be included in the list even if he is outside the

normal field of choice.

3. The field of choice wherever possible should extend

to 5 to 6 times the number of vacancies expected.

4. From among such officers those who are considered

unfit for promotion should be excluded and the remaining

should be classified as ’outstanding’ very good’ and ’good’

on the basis of merit as determined by their respective

records" of service. The selection list should then be

prepared by placing the games in the order of these three

categories without disturbing the seniority inter se within

each category.

5. Promotions should strictly be made from such selection

list in the order in which the names are finally arranged.

The selection list should be periodically reviewed removing

from the list names of persons who have been promoted and

including fresh names.

On 16th August 1972 this Court set aside the seniority list

in the first Bishan Sarup Gupta case [1975] Supp. SCR 491

and gave directions for preparing a fresh list. On 21

December 1972, the Government applied to this Court for

making ad hoc promotions and the court permitted them to do

so.Accordingly, in March 1973 and November 1973 the Board

promoted 59 and 48 Income Tax Officers respectively as

Assistant Commissioners. It was distinctly stated in

those two orders that the ad hoc appointments made against

those posts were provisional and that the appointments

eventually be made on the basis of the revised seniority

list of Income Tax Officers Class I as finally approved by

this Court, and on selection by a duly constituted Depart-

mental Promotion Committee in accordance with the prescribed

procedure.In February 1973, the Income Tax Officers (Class

I) Service (Regulation of Seniority) Rules, 1973, were made

and a revised seniority list of Income Tax Officers Class I

was made on the basis of those rules. The list as well as

the Rules were approved in the second Bishan Sarup Gupta

Case [1975] 1 SCR 104. From such seniority list the Depart-

mental Promotion Committee made a selection list in July

1974, for proration of Income .Tax Officers, Class I, as

Assistant Commissioners. There were 112 vacancies and the

Government sent 336 names in the running order of seniority

for consideration of the field of

choice. The Committee followed the instructions in the 1957

Memorandum an.d found 276 to be fit for the field of choice,

assessed the merits of 145 persons in order of seniority,

found one officer outstanding, 114 very good, and 7 Sched-

uled Castes/Tribes officers good, according to the instruc-

tions. The Selection list was challenged in various High

Courts. Two of the High Courts held in favour of the peti-

tioners and the other High Courts gave interim orders stay-

ing the operation of the Selection List.

In appeals by the Union of India to this Court, the

respondents sought to support the judgments in their favour

on the following contentions :--

(1) The requirement in the rule regarding 10 years

experience was not abrogated as contended by the Government

and the affidavits field in the various proceedings on

behalf of the Union as well as the petitioners show that the

10 year rule was in force and was followed

(2) Rule 18 has the force of law under the Government of

India Act, 1935, and hence is existing law within the mean-

ing of Art. 366(10) of the Constitution and also because it

was incorporated in the Office Manual issued by the Govern-

ment of India in exercise of its executive power under Art.

53.

(3) The rule constitutes one of the conditions of serv-

ice and, therefore, should be followed.

(4) The rule imposes an obligation on the Union Govern-

ment to Consider ’ordinarily’ only Officers of ten years

service, but the selection list was prepared in violation

of the rule in that officers of 8 years experience were

considered.

(5) The selection has been made in complete violation of

the principles set out in the 1957--memorandum and was

entirely arbitrary.

(6) The promotion should be considered as on 21 December

1972 when the-Government applied to this Court for permis-

sion to make ad hoc appointments, and on the two dates when

the Government actually made 107 (59-1-48) ad hoc promotions

and it Was the duty of the Committee to regularise the 107

promotions as from the dates of the original promotion and

to consider the eligibility of an officer for promotion as

on those dates, and this not having been done. the selection

list was illegal being contrary to the observations in the

first Bishan Sarup Gupta’s case.

Rejecting these contentions of the respondents, allowing

the appeals, and upholding the Selection List,

HELD: (1)(a) The requirement Of 10 years experience in

r. 18 was modified to 8 years experience. The correspond-

ence between the Finance Ministry and Home Ministry and the

U.P.S.C. shows that there was concurrence with the change.

The High Court was in err, or when it said that the require-

ment of 8 years experience must first be included in the

appropriate recruitment rules and that until that was done

10 years experience held the field. 8 years experience

as a working rule for promotion was publicly announced by

the Minister in Parliament. Administrative instructions

are followed as a guide line on the basis of executive

policy. The requirement of 8 years was followed as a guide-

line in practice in 1968, 1970 and 1972. The requirement

was thus not only modified but was given effect to. [39F]

(b) The High Court was in error in treating the affida-

vit evidence of an officer of the Government, in other

proceedings, as a statement of fact that the 8 years rule

had not been introduced. This affidavit evidence is torn

out of context and is misread by the High Court without

going into the question as to whether such evidence is

admissible. The entire affidavit evidence as well as the

submissions made on behalf of the ’Union Government is

that the requirement of 10 years experience is replaced by

one of 8 years. It is a question of construction of. the

correspondence as to whether the 10 years rule was replaced

by 8 years rule. The fact that no rules under Art. 309

were

framed does not detract from the position that previous

administrative instruction of 10 years experience was modi-

fied to 8 years experience. The various affidavits and

documents show that the consistent position on behalf of the

Union has always been that the requirement of 10 years

experience was modified to one of 8 years. [41H; 42A-B]

(2) The rule is not a statutory rule. [42D]

(a) The contention that because Government of India has

authority to frame rules the letter of 16th January 1950 in

which the rule was framed should, therefore, be treated as

a formal’ rule is erroneous since there is a distinction

between statutory orders and administrative instructions

of the Government. The change was recorded by means of

correspondence as an administrative instruction. ’In the

absence of statutory rules, executive orders or administra-

tive instruction may be made. [42E-F]

Commissioner of Income Tax Gujarat v. A. Raman & Compa-

ny. [1968] 1 S.C.R. 10, referred to.

(b) The letter of 16th January 1950 written by an Under

Secretary in the Ministry of Finance does not prove that it

is a rule made by the Governor General or any person autho-

rised by him under s. 241(2), Government of India Act,

1935. Furthermore, there is no basis for any authentication

under s. 17 of the 1935 Act in the letter. [42G]

1955 it is specifically stated that Vol. I contains statuto-

ry rules and Vol. II, in which r. 18 occurs, contains only

administrative instructions. [42G]

S.C. Jaisinghani v. Union of India & ors. [1967] 2 S.C.R.

70, referred to.

(d) Article 313 refers to laws in force which mean

statutory laws. An administrative instruction or order is

not a statutory rule or law. The administrative instruc-

tions can be changed by the Government by reason of Art.

63(1). Article 313 does not change the legal character of a

document. [43B]

(3) The High Court erred in holding that the 10 year

rule is a condition of service. The word "ordinarily" in

the rule does not impose an obligation on the Government not

to consider any Income Tax Officer with less than 10 years

experience, for promotion. The rule on the face of it,

confers a discretion on the authorities to consider Income

Tax Officers of lesser years experience if the circumstances

so require, and whether such circumstances exist should be

left to the decision of the authorities. Even the Central

Board of Revenue, in a letter written a few months after the

rule was framed, stated that the insistence of a minimum

period of experience cannot be regarded as affecting the

conditions of service. In that letter. it was stated that

the requirement of 10 years experience is sufficiently

elastic and all Income Tax Officers with more than 9 years

experience could also be considered for promotion. This

letter was referred to by this Court in Union of India v.

Vasant Jayarama Karnik [1970] 3 SCC 65. [43C-F]

(4) It cannot be said that there is a deviation from the

requirement of 10 years experience in preparing the Selec-

tion list. That requirement was modified to one of 8 years

experience. The expression ’ordinarily’ in the rule shows

that there can be deviation and such deviation can be justi-

fied by reasons. Administrative instructions if not carried

into effect for good reasons, cannot confer a right. [43G]

P.C. Sethi & ors. v. Union of India & Ors. [1975] 3 S.C.R.

201, referred to.

(5) The facts and circumstances in the present case merited

the exercise of discretion which was bona fide exercised by

determining the field of choice and from 1963, the field of

choice has always been in a running order of seniority.

(a) There were, in the present case,112 vacancies and 10

anticipated vacancies and the Departmental Promotion Commit-

tee was to make a panel of 122 officers. If the field of

choice has to be prepared on the basis of running seniority

and if 10 years experience had been adhered to, there would

not have been more than 95 officers in the field of choice

although the number of vacancies was 122. This fact alone

entitled the authorities to deviate from the rule of 10

years experience. [44E-F]

(b) The requirement of 10 years experience could not be

given effect to also because in the second Bishan Sarup

Gupta case, this Court had directed that the two classes of

Income Tax Officers, direct recruits and promotees, should

first be fully integrated before determining inter se sen-

iority. The expression ’ordinarily’ would hardly apply to

such a changed situation without destroying the integration.

If the respondents’ contention that the field of choice

shall be restricted to 10 years experience only and the

field of choice should have been at least 5 times the

number of vacancies the result would have been that out of

560 persons in the field of choice 474 persons would have

been promotees and only 86 persons would have been direct

recruits and 429 senior officers, who were direct recruits,

would have been ignored. That obviously would be unjust and

unfair and also contrary to the decision of this Court in

the second Bishan Sarup Gupta’s case. [47BC]

at least since 1963, for promotion of Income Tax Officers as

Assistant Commissioners, the administrative practice is to

take the field of choice generally of 3 times the number of

vacancies. The evidence shows that in the circumstances of

this case, it was not possible to have 5 or 6 times the

number of vacancies in the field of choice. [46E]

(d) The High Court was wrong in holding that in the field of

choice, the evaluation o{ merit of persons was not properly

done. The 1957-Memorandum requires that the field of choice

is based on running seniority and evaluation of merit does

not come into picture for deciding the field of choice.

The question of merit comes in only in the preparation of

the selection list. Seniority is the sole criterion for

determining the field of choice and merit is the sole crite-

rion for putting the officers in the Selection list. [46G]

In present case, the instructions in the 1957-memoran-

dum were strictly followed.

(e) The 7 Scheduled Caste/Tribes officers were not

entitled to a grade higher than the grade assessed by the

Committee, because, the Home Ministry instructions, regard-

ing concessions to Scheduled Castes and Tribes applied in

the case of promotions from Class III to Class II and within

Class II and from Class II to the lowest rank of Class I,

but had no application in respect of promotion within Class

I. [47E]

(f) After 122 senior officers were assessed and 114 were

found to be ’very good’, they could not be supplanted by

other who were also ’very good’. Only ’outstanding’ persons

who would be junior to the 122 could surpass them. There-

fore, the Committee rightly considered the cases of the

officers remaining out of the 276 only to find out whether

there was any one ’outstanding" as it would be a fruitless

exercise to find out who among them was ’very good’.

[48B]

(g) The contention of the respondents that the officers

remaining out of the 336 sent up, were not at all considered

by the Committee is not also acceptable. When the Committee

found, according to running seniority, that certain persons

beyond a certain number could not be in the field of

choice, the Committee did not put the names in the field of

choice. The question of the evaluation of their merits did

not, therefore, arise. It is wrong to hold that because the

Government sent the names of 336 persons the field of

choice consisted of all 336 persons. The field is to be

determined by the Committee and the Committee rightly con-

sidered 276 names as fit to be included. [48F]

(h) There is no substance in the contention that 4 of

the officers had less than 8 years experience, because, they

were ex-military officers recruited by virtue of a notifi-

cation of the Ministry of Home Affairs. [49B-C]

(i) The contention that after putting the officers in

the three categories they should further be evaluated on

merit inter se within each category is contrary to the

specific provision of the 1957-memorandum, and further,

there could not be any further intra-specific assessment of

those who are already considered to be "very good". [49D]

(6) The date for determining the eligibility of officers

has nothing to do with the dates on which ad hoc appoint-

ments were permitted and ad hoe appointments were, in fact,

made. The observations Of this Court in the first Bishan

Sarup Gupta case, are that if as a result of the fresh

seniority list, it is found that any officer was eligible

for promotion on account of his place in the new seniority

list, the Committee might have to consider his case as on

the date when he ought to have been considered and his

position adjusted in the seniority list of Assistant Commis-

sioners. The observations did not mean that although the

Committee can meet only after the seniority list is approved

by this Court, the selection would be deemed to be made at

the time when a vacancy in the post occurred and the eligi-

bility of officers for seleCtiOn should be determined by

such deemed date of selection. No employee has any right to

a vacancy in the higher post as soon as the vacancy occurs.

The Government has a right to keep it unfilled as long as it

chooses. The seniority list which is a basis for the field

of choice for promotion was approved by this Court on 16th

April 1964 in the second Bishan Sarup Gupta case. Promo-

tions to the post of Assistant Commissioners are on the

basis of the Selection List prepared by the Committee and

are to be made prospectively and not retrospectively.

[51 C-D]

JUDGMENT

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1837

of 1974.

Appeal by Special Leave from the Judgment and Order

dated 4-9-74 of the Calcutta High in Civil Rule No. 5547 (N)

of 1974.

Civil Appeals Nos. 1838-1842/74

Appeals by Special Leave from the Judgments and Orders dated

18-9-74, 29-7-74, 9-8-74, of the Allahabad High Court

(Lucknow Bench) in Civil Writ Nos. 4398, 400, 4397 of 1974

and C.W.A. 3344/74 and W.P. No. 947/74.

Civil Appeal No. 485/75

Appeal by Special Leave from the Judgment and Order

dated 24-10-74 of the Gujarat High Court in L.P.A. No.

208/74.

Civil Appeal No. 1246/75

Appeal by Special Leave from the Judgment and Order

dated 1-4-75 of the Andhra Pradesh High Court in W.A. No.

900/75.

Civil Appeal No. 2041/74

Appeal by Special Leave from the Judgment and Order

dated 15-10-74 of the Gujarat High Court in L.P.A. No.

205/74.

Niren De, Attorney General for India (In all appeals)

Devakinandan. (In a11 appeals) P.P. Rao (In C. As. 1245/75

and C.A. 2041/74), R.N. Sachthey for the appellants in CAs.

1837-42 of 74, 1246/75 and 2041/74 and R. 2 in C. As. 1839,

1840/74 and RR. 1 and 2 in C.A. 485/75.

A.K. Sen, (In CA 1837/74), I. N. Haldar (In CA 1837/74),

K.K. Singhvi (In CA 2041/74), Yogeshwar Prasad; S.K. Bagga

and (Mrs.) S. Bagga for RR. 1, 3, 7, 11, 12 and 14 in CA

1837/74 and R. 1 in CA Nos. 1839-1841/74 and 2041./74 and RR

2 and 3 in CA. No. 1246/75.

Yogeshwar Prasad and (Miss) Rani Arora for R. 1 in C.A.

1838 74.

Yogeshwar Prasadand (Miss) Rani Arora for R. 1 in C.A. 1842/

74.

Ram Panjwani, Bishamber Lal, S.K. Gupta and Dayal for

Appellant in CA. 485/75 and RR 5, 6 and 7 in CA 2041/74 for

the Interverners in CA 1838, 1841, 2041/74 and CA

No..1246/75.

The Judgment of the Court was delivered by

Ray, C.J.--The principal question in these appeal is

whether the selection list for promotion of Income Tax

Officers Class Service to the post of Assistant Commission-

ers of Income Tax is correct or not.

The selection list was prepared by the Departmental

Promotion Committee on 23, 24 and 25 July, 1974.

It may be stated here that on 16 August 1972 this Court

set aside the Seniority List which had been impugned in

Civil Appeal No. 2060(N) of 1971 and gave directions on

which the Seniority List was to be prepared. (See Bishan

Sarup Gupta v. Union of India(1).

This selection list was prepared on the basis of the

seniority list approved by this Court on 16 April, 1974 in

Bishan Sarup Gupta etc. etc. v. Union of India & Ors. etc.

(2).

The basis of the preparation of the selection list is the

field of choice. The principles for promotion to selec-

tion posts are set out in a Memorandum dated 16 May 1957

issued by the Central Board of Revenue. The principles are

these: First, greater emphasis should be placed on merit

as criterion for promotion. Appointments to selection

posts and selection grades should be made on the basis of

merit having regard to seniority only to the extent indicat-

ed there Second, the Departmental Promotion Committee or

other selecting authority should first decide the field of

choice, namely, the number of eligible officers awaiting

promotion who should be considered for inclusion in the

selection list provided, however, that an officer of

outstanding merit may be included in the list of eligible

persons even if he is outside the normal field of choice.

Third, the field of choice wherever possible should extend

to five or six times the number of vacancies expected within

a year. Fourth, from among such officers those who are

considered unfit for promotion should be excluded.The re-

maining officers should be classified as "outstanding",

"very good" and "good" on the basis of merit as determined

by their respective records of service.The selection list

should then be pre-

(1)[1975]Supp.S.C.R.491 (2) [1975] 1 S.C.R. 104.

4--1458SCI/76

pared by placing the names in the order of these three

categories without disturbing the seniority inter se within

each category. Fifth, promotions should strictly be made

from the selection list in the order in which their names

are finally arranged. The selection list should be periodi-

cally reviewed. The names of those officers who have

already been promoted otherwise than on a ’local or purely

temporary basis and continue to officiate should be removed

from the list and the rest of the names along with others

who may now be included in the field of choice should be

considered for the selection list for the subsequent period.

Several persons, mainly promotees from Class II to Class

I as Income Tax Officers challenged in writ petitions

field before several High Courts the correctness of the

field of choice so determined by the Departmental Promotion

Committee hereinafter referred to as the Committee on the

basis of which the said selection list was prepared. The

Gujarat and the Andhra Pradesh High Courts delivered judg-

ments. The other High Courts gave interim orders staying

the operation of the selection list. There are two appeals

by special leave from the judgments of the Gujarat and the

Andhra Pradesh High Courts. There are also appeals by

special leave from the interim orders of the High Courts

because the questions involved are the same.

There were 112 vacancies of Assistant Commissioners.

The Government of India sent 336 names in the running order

of seniority for consideration of the field of choice. Out

of those 336 names the Committee took 276 names in the

running order of seniority.

The principal question for consideration is whether the

field of choice determined by the Committee on the basis of

which the Committee prepared the selection list is correct

or not.

The Gujarat High Court held that the requirement of 10

years’ experience as Income Tax Officer for promotion to the

post of Assistant Commissioner as laid down in the Govern-

ment of India letter No. C. 33(17) Admn. I.I./49 dated 16

January 1950 prevailed while the Committee determined the

field of choice and this requirement was violated because

the Committee considered persons with 8 years’ experi-

ence for the field of choice. The High Court further held

that even if the requirement of 10 years’ experience was not

a statutory rule the requirement was to be complied with in

determining the field of choice unless people with such

experience were not available in the seniority list of Class

I Income Tax Officers. What the High Court said was that if

such people with 10 years’ experience were available in the

seniority list only such people should be considered in the

field of choice ignoring those in the seniority list who are

senior to such persons but have less than 10 years’ experi-

ence as Income Tax Officers. The second reason given by the

High Court for holding the selection list to be incorrect is

that under the letter dated 16 May 1957 the field of choice

should have been 5 times the number of vacancies whereas the

actual field of choice contained a much lesser number. The

third ground given by the High Court for holding the selec-

tion list

to be incorrect is that in the field of choice of Com-

mittee did not properly evaluate the merit of persons in the

field of choice. The section of persons in the selection

list was to be selection on merit only and not seniority cum

merit. The fourth reason given by the High Court is that

the date for determining the eligibility of officers for

promotion to the post of Assistant Commissioner of Income

Tax should be decided by the Committee by bearing in mind

the two dates, namely, 21 December 1972 when this Court

permitted provisional promotions and 29 November 1973 when

Government made the second batch of ad hoc promotions, as

the two terminals.

The principal contentions on behalf of the respondents

are these. First, promotions from amongst Income Tax Offi-

cers Class I Service to the post of Assistant Commissioner

of Income Tax have to be made solely on the basis of

merit. The respondents relied on rule 18 of Chapter II(c)

section 1 Vol. II of the Office Manual in support of their

contention. Broadly stated rule 18 is that the promotion

shall be strictly on merit and further that no one should

ordinarily be considered for promotion unless he has com-

pleted at least 10 years’ service as income Tax Officer.

The respondents amplified their contention to mean that

promotion to a selection post is to be made solely on the

basis of merit and not on the basis of seniority cum merit.

The second contention of the respondents is that only

such of the Income Tax Officers in Class I Service who had

put in at least 10 years’ service as Income Tax Officers

are eligible for being considered for promotion to the post

of Assistant Commissioners. This contention. is also based

on rule 18 and according to the respondents rule 18 means

that the condition precedent for eligibility to be consid-

ered for promotion to the post of Assistant Commissioner is

that an Income Tax Officer in Class I Service must have put

in at least 10 years’ service as Income Tax Officer.

The respondents further contended that rule 18 was

framed on 16 January 1950 and the letter dated 21 July 1950

addressed by the Central Board of Revenue to all Commission-

ers of Income Tax shows that the Government of India framed

the rule with the approval of the Union Public Service

Commission and the Ministry of Home Affairs. The Govern-

ment case is that the rule was abrogated. The respondents’

answer to the Government contention is that the entire

correspondence relied on by the Government shows that the

Ministry of Finance wanted to frame new rules of seniority.

The respondents also contend that the Ministry of Home

Affairs gave approval to the framing of new rules of senior-

ity but gave no. direction with regard to the rule relating

to the recruitment except stating that the said rule might

be appropriately included in the relevant recruitment rules.

Therefore the respondents contend that the recruitment rule

regarding 10 years’ experience continued whereas the senior-

ity rule stood modified in terms of the letter of M.C.

Thomas dated 4 April 1964. The respondents also rely on the

affidavit dated 8 March, 1968 flied by M.C. Thomas in the

Gujarat High Court in application No. 1365

of 1965, an affidavit of M.C. Thomas dated 21 May 1970 filed

in the Delhi High Court in writ petition No. 196 of 1970, an

affidavit of the respondents dated 5 August 1974 filed in

the Gujarat High Court in support of the contention that the

rule relating to 10 years’ service was in force at least

from 21 May, 1970. The respondents further contend that

promotions to the post of Assistant Commissioners in the

year 1964 and 1970 show that all promotees except 2 had

completed at least 10 years’ service before being selected

for promotion. Even with regard to those two promotees the

respondents submitted that both of them joined on 24 Octo-

ber, 1960 but they had been selected along with others in

May 1960. Therefore, those two officers were promoted

along with their batch mates of May, 1960.

The third contention of the respondents is that rule 18

has the force of law. It is said that under section 241 of

the Government of India Act 1935 the Government was empow-

ered to make rules. Pursuant to that power the Government of

India made the rule. The letters dated 16 January 1950 and

21 July 1950 written by the Government to the Commissioners

of Income Tax referring to rule 18 were relied on by the

respondents in support of their contention.In the alterna-

tive, the respondents contended that the decision of the

Government contained in the letter dated 16 January, 1950

was made by the Government of India in exercise of executive

powers under section 8 of the Government of India Act 1935

read with item 8 of List I of the Seventh Schedule. This

order which had the backing of law was an existing law

within the meaning of clause 10 of Article 366 of the

Constitution. In the further alternative the respondents

contended that the rule contained in the letter dated 16

January, 1950 was incorporated in the Office Manual issued

by the Government of India in exercise Of its executive

power under Article 53 of the Constitution and therefore

these instructions have the force of law. It is also said

by the respondents that the rule which affects promotions of

the persons constitutes the conditions of service.

The fourth contention on the part of the respondents is

that the use of the word "ordinarily" in rule 18 imposes an

obligation on the Union Government not to consider an Income

Tax Officer Class I who has not completed at least 10

years’ service as Income Tax Officer for promotion as

Assistant Commissioner unless there are extraordinary

circumstances. It is said that the word "ordinarily" does

not vest in the Government unfettered condition to follow

or not to follow the rule. It is also said that the use of

the word "at least 10 years’ service" shows that the word

"ordinarily" has been used to enable the Government to

consider such of the Income Tax Officers who have put in

more than 10 years’ service. The respondents also contend

that the Government proceeded on the basis that the rule

relating to 10 years’ service did not exist after April

1964; and, therefore, it cannot be said that the Government

departed from rule 18 because of extraordinary circum-

stances.

The fifth contention is that the selection has been made

in complete violation of the rule framed by the Government

of India for promotion to selection post as contained in the

Office Memorandum

of the Ministry of Home Affairs dated 16 May, 1957. This

contention is expanded by submitting that the list should

have contained names of at least 5 or 6 times the number

of vacancies existing within a year and in view of the fact

that there were 112 existing and 10 anticipated vacancies

the Government of India should have sent to the Committee

names of at least 560 officers. The Committee should then

have removed such names which were unfit for promotion and

thereafter have classified the rest as outstanding, very

good, and good on the basis of merit. The respondents

contend that the Government sent only 336 names for con-

sideration when the vacancies were more than 120 and the

Government also ignored the rule of 10 years’ experience.

It is also said that the Committee ignored the names of 59

officers from consideration and classified only 144 officers

out of the remaining 277 and prepared the list of 122 out of

144 officers. The respondents further contend that though

respondents No. 2 and 3 in Civil Appeal No. 2041 of 1974,

namely, R.K. Desai and B. Srinivasan completed 10 years’

experience they were not included within the field of choice

as officers senior to them had not completed 8 years of

service as Income Tax Officers. Therefore, rule 18 was

violated.

The sixth contention of the respondents is that the

entire selection was arbitrary and in violation of Article

16 of the Constitution. It is said that if the rule re-

quiring 10 years’ experience had been followed only such

of the persons who had put in 10 years’ service would have

been in the field for selection. It is said that the

Government included Income Tax Officers who were direct

recruits and who had put in less than 8 years’ service in

the list but excluded promotees Income Tax Officers who had

put in more than 8 years’ service as Income Tax Officers.

It is further said by the respondents that out of 122 per-

sons selected 111 are direct recruits and only 11 are promo-

tees. Reference was made to the junior-most person in the

selection list Madan Mohan Joshi. It is said that Madan

Mohan Joshi was appointed as Income Tax Officer Class I on 5

July, 1965, and, therefore, he completed 9 years’ service at

the time of selection. The last person considered by the

Committee is a direct recruit Rajeswar Rao Gnutam who was

appointed on 8 July, 1966. Again, it is said that from

amongst the promotees Raghubir Singh the promotee who joined

Class I Service on 1 May 1964 and had more than 10 years’

service was not placed in the field of choice. The

respondents, therefore, contend that promotee Officers who

had put in more than 8 years’ service as Income Tax Officers

were not included in the field of choice whereas direct

recruits who had not completed 8 years’ service were in-

cluded in the field of choice.

The seventh contention of the respondents is that the

eligibility of Income Tax Officers for the purpose of promo-

tion to the post of Assistant Commissioner should be consid-

ered either as on 21 October, 1972 or 21 March 1973 or 29

November 1973. In support of that contention it is said

that when the Government of India made an application for

filling up certain posts this Court by order dated 21 Decem-

ber 1972 permitted the Government to fill in the posts on ad

hoc basis from amongst the eligible officers on the basis of

continuous, length of service in Class I. Accordingly, by

orders dated 21 March 1973, and 29 November, 1973, 59 and

48 officers respectively were promoted on ad hoc basis.

These officers were to, be replaced by regular selection.

The seniority list was confirmed by this Court by judgment

dated 16 April 1974. The respondents, therefore, contend

that the Committee had to regularise aforesaid 107 promo-

tions, and the regularisation had necessarily to be done

from the dates of original promotions on ad hoc basis. It

is said in this context that the eligibility of officers for

the purpose of promotion must be considered either on 21

December 1972 or on 21 March 1973 or on 29 November, 1973.

The respondents also submit that the eligibility has refer-

ence to the date of vacancy and therefore only such of the

persons who had the qualified service on the date of

vacancy ought to be considered by the Committee. Reliance

was placed on the observations of this Court in Bishan Sarup

Gupta’s case(1) that after the finalisation of the seniority

list the department should consider the cases of all eligi-

ble officers for promotion on the basis of their records as

on the date when they ought to have been considered by

selection but who were not so considered.

The first question for consideration is whether the

rule of 10 years’ experience was modified to 8 years’ expe-

rience. The correspondence between the Central Government

and the Union Public Service Commission between 30 January

1963 and 26 June 1969 shows that the principle for promotion

as Assistant Commissioner is that no Income Tax Officer

should ordinarily be considered unless he has completed 8

years’ service as Income Tax Officer. The proposal for this

change from 10 years to 8 years emanated from the Finance

Ministry. The Home Ministry stated that the rule does not

strictly relate to the seniority rules in respect of As-

sistant Commissioners of Income Tax and should thus be

included in the relevant Recruitment Rules, that is, Rules

for selection for the post of Assistant Commissioner of

Income Tax. The Union Public Service Commission as will

appear from the letter dated 31 May, 1963 agreed subject to

proposed modification regarding the seniority of Assistant

Commissioners of Income Tax. It thus appears that the

Finance Ministry, the Home Ministry and the Union Public

Commission concurred with the change from the requirement of

experience for 10 years to that of 8 years. The requirement

of 10 years’ experience as laid down in the letter dated 16

January, 1950 and the Office Manual published’ in 1955 thus

came to be modified. The only thing which is to be noticed

is that no Rules under Article 309 were made. The change

from 10 years to 8 years’ experience was recorded by means

of correspondence as an administrative instruction. It is

explicable that the letter dated 16 January, 1950 as well as

the Office Manual published in 1955 was an administrative

instruction.

The change from 10 years to. 8 years’ experience was not

only given effect to in the field of choice but also, recog-

nized in the Committee meetings of September 1968, April/May

1970 and February, 1972. In September 1968, 16 persons were

over 9 years’ experience

(1) [1975] supp. S.C.R.491,506

but less than 10 years’ experience. None of these persons

was however selected to be placed on the selection list. In

April/May 1970, 14 persons were over 9 years experience but

less than 10 years’ experience, and 24 persons were over 8

years’ experience only. Out of those only 7 who were all

over 9 years’ experience were selected to be placed in the

selection list. In 1972 the Committee considered 25 persons

over 9 years’ experience but less than 10 years’ in experi-

ence, and 27 persons over 8 years’ experience. Out of these

only 10 persons who were all over 9 years’ experience were

selected to be placed in the selection list.

In the Committee meeting of July, 1974 the selection

list prepared did not have any person except 4 emergency

commissioned officers who had less than 9 years’ experience.

The last person in the seniority list selected was M.M.

Joshi bearing No. 967 in the seniority list.

8 years’ experience as a working rule for promotion was

publicly announced by the Minister in Parliament on 11 June

1971. It is rightly said by the Attorney General that

administrative instructions are followed as a guide line on

the basis of executive policy. It is not necessary to put

the same on record in so many words. In Bishan Sarup Gupta

v. Union of India & Ors. 1975 Supp. SCR 491 when the quota

rule which was statutory ceased to have statutory effect

after 5 years but the Government followed the principles as

a guide line it was upheld by this Court in the application

of the principle from 1957 to 15 January, 1959. In the

present case the requirement of 8 years was not only

followed as a guide line in practice but was also recorded

in the correspondence between the Finance and the Home

Ministries.

The High Court said that the requirement of 8 years’

experience was to be included in the appropriate Recruitment

Rules and until that was done the High Court held that 10

years’ experience held the field. The High Court failed to

consider the true effect of the correspondence between the

finance and the Home Ministries and the Union Public Service

Commission. The Ministry of Finance by its letter dated 30

January 1963 stated that the condition of 8 years’ service

for promotion was proposed to be retained. The Home Minis-

try by its letter dated 20 February, 1963 pointed out that

the requirement of 8 years’ experience for promotion did not

strictly relate to seniority rules relating to Assistant

Commissioners of Income Tax and should be delinked from such

rules and should be appropriately included in the relevant

Recruitment Rules. Thus the Home Ministry and the Union

Public Service Commission agreed in principle to the re-

quirement of 8 years’ experience and the Finance Ministry in

practice changed the requirement of 10 years’ to 8 years’

experience. The letter of the Finance Ministry proposing

the retention of the requirement of 8 years experience was

only in Grade I. The minimum experience in Grade I proposed

by the Board was approved by the Secretary as well as the

Minister.

The High Court referred to the affidavits filed by M.G.

Thomas in other proceedings. In one of the affidavits

affirmed by Thomas

on 8 March 1968 and referred to by the High Court in Special

Civil Application No. 1365 of 1965 in the Gujarat High Court

in paragraph 5 thereof Thomas said as follows: "The Depart-

mental Promotion Committee which met sometime in August,

1949 recommended that no officers should be promoted as

Assistant Commissioners of Income Tax until he had worked

for not less than 10 years as Income Tax Officers. The

Government of India agreed with the recommendation of the

Departmental Promotion Committee that it was necessary in

the interest of efficiency that the Assistant Commissioner

of Income Tax should at least have 10 years of service as

Income Tax Officer so that for the post ok Assistant

Commissioner of Income Tax matured and seasoned officer

may be obtained. For arriving at the decision, the Govern-

ment of India was also influenced by the recommendation of

Income Tax Investigations Commission". The High Court also

referred to paragraph 9 in the said affidavit of Thomas

where he said as follows: "It can thus be seen that the

seniority rules for Assistant Commissioner of Income Tax

were mainly framed due to the situation created by the

introduction of Income Tax Service Class I on an All India

basis and the requirement of a minimum period of 10 years of

service (later on reduced to. 8 years’ service) (as a requi-

site condition for promotion)-this requirement of minimum

service-resulted in a senior Income Tax Officer who had not

completed the required length of service being passed over

by a junior Income Tax officers, who had completed the.

required service. To safeguard the interest of such senior

Income Tax Officer rule 1 (iii) (b) meaning thereby 10

years’ rule was introduced which enabled the senior officers

to regain their seniority on subsequent promotion".

The High Court also referred to the affidavits of Thomas

in Civil Writ Petition No. 196 of 1970 in the Delhi High

Court. M.G. Thomas was an Under Secretary in the Ministry

of Finance in 1964. In the affidavit affirmed by Thomas in

Writ Petition No. 196 of 1970 in the Delhi High Court he

dealt with paragraph 39 of the petition of Bishan Sarup

Gupta where it was said that paragraph 18, of section 1,

Volume 1 of the Office Manual clause (b) mentioned about the

eligibility of 10 years of minimum service before an Income

Tax Officer would be considered for promotion to the post of

Assistant Commissioner. The High Court said that Thomas in

his affidavit in reply had admitted the said statements and

concluded that of 8 years’ rule had been introduced Thomas

would not have missed to mention the same in his affidavit.

The High Court also referred to two features. First,

that it was not a proposal of anew rule of 8 years in place

of existing rule of 10 years; secondly, it was an assumption

that the existing rule prescribed the minimum period of 8

years’ service. The High Court further referred to the

Delhi High Court proceedings in Writ Petition No. 196 of

1970 where Counsel for the Union said that the Government

expected new rules to be framed under Article 309 to limit

the field of choice to those who had 8 years’ service to

their credit as Income Tax Officers. The High Court read

this argument of counsel for the Union in the High Court to

concede that no change in the rule of 10 years’ service as

Income. Tax Officer was made so as to reduce the period from

10 years to 8 years.

The Central Board of Revenue as appears in No. F.

1/19/60-Ad. II at a meeting on 2 May, 1959 approved the idea

of laying down the. minimum period of service uniformly for

the three wings of the Central Board of Revenue for purposes

of determining the eligibility of officers for promotion.

It was decided that before an officer was promoted to a

higher post he must have put in a period of minimum service

as follows: For promotion to Deputy Collector/Assistant

Commissioner (Grade Rs. 1000-1400)--minimum service pre-

scribed was 8 years’ service in Class I posts. For promo-

tion to Collector (Grade Rs. 1300-1600)--the minimum serv-

ice prescribed was 12 years in Class I post out of which at

least two years should be in the grade of Deputy Collector.

For promotion to. the post of Collector (Grade Rs. 1600-

1800)--the minimum service prescribed was 14 years in Class

I posts provided that for promotion as Collector of Central

Excise (scale Rs. 1600-1800) the officers should have worked

at least two years in the scale of Rs. 1300-1600. For

promotion to Collector Grade I/Commissioner Grade I (scale

Rs. 1800-2000) the minimum service prescribed was 16 years

in Class I posts. For promotion to Selection Grade posts of

Collectors/Commissioners the minimum service prescribed was

20 years in Class I posts.

The Secretary in the note mentioned that he would

prefer the alternative of keeping the rule and relaxing it

in suitable cases. This note of the Secretary shows that he

preferred the retention of the rule in the other 4 grades,

namely. Collector Grade Rs. 1300-1600, Collector Grade

Rs.1600-1800, Collector Grade I/Commissioner Grade I Grade

Rs.1800-2000 and Selection Grade Posts of Collectors/ Com-

missioners. That is apparent from the fact that the Board

suggested the retention of minimum service in Grade

1(Assistant Commissioners) but not in the other four grades

including the Selection Grade. The Minister preferred the

deletion of the rule about Selection Grade. Thus the mini-

mum experience in Grade I proposed by the Board was approved

by the Secretary as well as the Minister.

The minutes of the meeting of the Central Board of

Revenue of 22 October 1960 show that the Board of Revenue

decided-’that the minimum service of 8 years in Class I

Service may be prescribed in the case of Deputy

Collector/Assistant Commissioners (Grade Rs.1100-1400).

The affidavit evidence of Thomas shows that the minimum

period of 10 years was later reduced to 8 years. The affi-

davit does not show that the requirement of 10 years’ serv-

ice was maintained. In the Delhi High Court proceedings

Bishan Sarup Gupta in his petition made reference to cer-

tain administrative instructions. Thomas in answer to

those paragraphs did not have any occasion to say anything

otherwise. Further counsel for the Union in the Delhi High

Court merely stated that the Government was expecting rules

to be framed under Article 309..This does not mean that the

requirement of 8 years’ experience as an administrative

practice did not prevail. The High Court was in error in

treating the affidavit evidence of Thomas in other proceed-

ings as a statement of fact that 8 years’ rule had not been

introduced. This affidavit evidence in other proceedings is

torn

out of context and is misread by the High Court without

going into the question as to whether such affidavit evi-

dence is admissible in evidence. It is apparent that the

entire affidavit evidence as well as the submission on

behalf of the Union is that the requirement of 10 years’

experience be replaced by 8 years. Administrative practice

as indicated in the Department Promotion Committee meetings

and the Minister’s statement in Parliament supported that

contention of the Union. It is a question of construction

of correspondence as to whether 10 years’ rule was replaced

by 8 years’ rule. The fact that no rules under Article 309

were framed does not detract from the position that the

previous administrative instruction of 10 years’ experience

was modified to 8 years’ experience.

It was suggested on behalf of the respondents that the

various affidavits and documents asserted that the require-

ment of 10 years’ experience had been abrogated and it was

not open to the Government to take the stand that require-

ment of 10 years’ rule was modified or changed. The conten-

tion is without any substance because the consistent posi-

tion on behalf of the Union has always been that the re-

quirement of 10 years’ experience was modified to 8 years

and the Gujarat High Court considered the question whether

10 years’ experience was abrogated or modified.

The second question is whether the requirement of 10

years’ experience was a statutory rule. The High Court held

that the requirement of 10 years’ experience is not a

statutory rule. Counsel for the respondents contended that

the requirement of 10 years’ experience is statutory because

the letter dated 16 January 1950 is by the Government of

India and the Government of India has authority to frame

rules and one of the letters dated 21 July, 1950 referred to

it as a formal rule. The contention is erroneous because

there is a distinction between statutory orders and adminis-

trative instructions of the Government. This Court has held

that in the absence of statutory rules executive orders or

administrative instructions may be made. (See Commissioner

of Income Tax Gujarat v.A. Raman & Company(1).

The letter dated 16 January 1950 written by an Under

Secretary in the Ministry of Finance does not prove that the

requirement of 10 years’ experience for promotion to the

post of Assistant Commissioner was a rule made by the Gover-

nor General or any person authorised by him under section

241 (2) of the Government of India Act, 1935. Furthermore,

there is no basis for any authentication under section 17 of

the 1935 Act in the letter of 16 January, 1950. In the

preface to the Manual published in 1955 it is specifically

stated that Vol. I of the Manual contains statutory rules

and Vol. II contains administrative instructions. The

requirement of 10 years’ experience is in Vol. II of the

Manual.

In S.G. Jaisinghani v. Union of India & Ors.(2) it is

stated at pp. 717-718 that the quota fixed by the Government

in its letter dated 18 October, 1951 must be deemed to be

fixed in exercise of the statutory

(1) [1968] 1 S.C.R. 10. (2) [1967] 2 S.C.R. 703.

power under Rule 4 of the Recruitment Rules. There is no

such statutory rule under which the letter of 16 January,

1950 was written,

Counsel on behalf of the respondents contended that the

requirement of 10 years’ experience laid down in the letter

dated 16 January, 1950 had the force of law because of

Article 313. Article 313 does not change the legal charac-

ter of a document. Article 313 refers to laws in force

which means statutory laws. An administrative instruction

or order is not a statutory rule. The administrative in-

structions can be changed by the Government by reason of

Article 53(1)(a) itself.

The High Court said that even if the requirement of 10

years’ service is not statutory, it is binding on the Gov-

ernment and is a condition of service. Counsel for the

respondents contended that the word "ordinarily" in the rule

imposes an obligation on the Government not to consider any

Income Tax Officer with less than 10 years’ experience for

promotion except in extraordinary circumstances. The

requirement of 10 years’ experience on the face of it con-

fers a discretion on the authorities to consider Income Tax

Officers if according to. the authorities the circumstances

so require. What the circumstances are or should be are

left entirely to the decision of the authorities. The

Central Board of Revenue by a letter dated 21 July, 1950 a

few months after the letter dated 21 July, 1950 a few months

after the letter dated 16 January, 1950 which spoke of 10

years’ experience stated that the insistence on a minimum

period of experience, cannot be regarded as affecting the

conditions of service. In the letter dated 21 July, 1950 it

was said that the requirement as to 10 years’ experience is

sufficiently elastic and all Income Tax Officers with more

than 9 years’ experience could be considered for promotion.

The letter dated 21 July, 1950 was referred to by this Court

in Union of India v. Vasant Jaygram Kamik & Ors(1). It

appears in that case that in November, 1951 the case of

officers who had completed 9 years’ gazetted service were

considered and the Committee further decided to consider for

promotion in the near future officers who had completed 8

years of service before 31 December, 1951. In 1953 officers

who had completed 8 years’ service were considered for

promotion.

The expression "ordinarily" in the requirement of 10

years’ experience shows that there can be a deviation from

the requirement and such deviation can be justified by

reasons. Administrative instructions if not carried into

effect for good reasons cannot confer a right. (See P.C.

Sethi & Ors. v. Union of India & Ors. (2). The requirement

of 10 years’ experience cannot be considered by itself. It

is to be read along with administrative instructions of 16

May, 1957. The reason is that the requirement of 10 years’

experience is for being considered for promotion. In para-

graph 2 of the letter of 16 May, 1957 containing the said

instructions it is said that the Committee should first

decide the field of choice. namely, the number of eligible

officers awaiting promotion who should be considered to be

included in the seniority list provided that an officer of

outstanding merit may be included in the list even.if he is

outside the normal List.

(1) [1970] 3 S.C.C. 658. (2) [1975] 3 S.C.R. 201.

For the foregoing reasons our conclusions are these:

First 10 years’ experience was modified to 8 years’ experi-

ence. Second there was no statutory rule requiring 10

years’ experience. Third the facts and circumstances merit-

ed the exercise of discretion which was bona fide exercised

by determining the field of choice. Fourth there was no

deviation from 10 years’ experience because of the modifica-

tion to 8 years’ experience. Fifth there could not be

insistence on 10 years’ experience as conditions of service.

The next question is what should have been the field of

choice. The two groups of Income Tax Officers in Class I,

namely, the direct recruits and the promotees have always

found that the field of choice has been prepared strictly on

the basis of running seniority in the seniority list of

Income Tax Officers Class I. In the three decisions of this

Court relating to these officers Jaisinghani’s case, Bishan

Sarup Gupta’s case and Bishan Sarup Gupta’s case (supra) it

will be seen that since 1962 there has been a long fight

between direct recruits and promotees mainly in respect of

seniority list of income Tax Officers Class I. This strug-

gle regarding seniority would have hardly any meaning

unless the two groups fought to gain higher positions in the

Seniority List only for the purpose of being in the field of

choice for consideration for promotion to the post of As-

sistant Commissioner. if this was not so and if only a cer-

tain number of years’ requirement was the only consideration

for being in the field of choice, this requirement would

have. been fulfilled in any case without a higher place in

the seniority list. From 1963 the field of choice has

always been in a running order of seniority. This has been

the administrative practice for over 10 years.

There were 112 vacancies and 10 anticipated vacancies in

1974. The Committee was to make a select panel of 122 offi-

cers. If the field of choice has to be prepared on the

basis of running seniority, and if 10 years’ experience had

been adhered to, there would not have been more than 95

officers in the field of choice although the number of

vacancies was 122. This fact alone will entitle the author-

ities to deviate from the rule of 10 years’ experience.

By reason of the violation of the quota rule since 1952

benefiting the promotees this Court issued the mandamus in

Jaisinghani’s case (supra). The collapse of the quota rule

and seniority rule from 16 January, 1959 led to the judgment

of this Court dated 16 August 1972 in Bishan Sarup Gupta’s

case (supra). The introduction of the roster system of 1

direct recruit and 1 promotee being placed alternately in

the order of seniority with effect from 16 January, 1959

was upheld by this Court in the judgment dated 16 April,

1974 in Bishan Sarup Gupta’s case (supra). As a result oF

the seniority list being upheld by this Court by the deci-

sion dated 16 April, 1974 many promotees lost their earlier

places in the Seniority List. This Court on 16 April, 1974

in Bishan Sarup Gupta’s case (supra) at page 114 of the

report said "In the case before us in the absence of a rule

determining inter se seniority between the two classes of

Income Tax Officers, there is really no integration of the

service, which is unavoidably necessary for the purpose of

effective promotions. One cannot speak

of promotions from a cadre unless it is fully integrated."

There was a change in the seniority list from what prevailed

at least in 1952. The requirement of 10 years’ experience

could not be given effect to in such a changed situation and

the expression "ordinarily" would hardly apply to such a

changed situation without destroying the integration and

restoring to the promotees the position which they had

enjoyed in the past with the Quota Rule and the Seniority

Rule and which they lost as a result of the last decision of

this Court dated 16 April, 1974.

If the respondents’ contention that the field of choice

shall be restricted to 10 years’ experience only and the

field of choice should have been at least five times the

number of vacancies, the result would have been that out of

560 persons in the field of choice, 474-persons would have

been promotees and 86 persons would have been direct re-

cruits and the last direct recruit in the seniority list

would have been No. 873 and No. 874 to No. 1922 would have

been all promotees. If the above basis suggested by the

respondents were followed 429 persons all direct recruits

and all senior officers in the seniority list would have

been ignored in the field of choice. That would be unjust,

unfair and upsetting the decision of this Court dated 16

April, 1974.

In the letter of 16 May 1957 it is stated that the field

of choice wherever possible should extend to 5 or 6 times

the number of vacancies expected within a year. The letter

contained administrative instructions from the Home Ministry

generally to all Ministries and was not meant specially for

the Board of Revenue. These administrative instructions

have been changed in the matter of promotions from Income

Tax Officers to Assistant Commissioners at least from 1963

by the administrative practice of having in the field of

choice generally three times the number of vacancies. In

the Committee meeting held on 16 March, 1963 the Committee

considered the names of first 33 eligible Income Tax Offi-

cers in order of existing seniority for 11 vacancies. In

the meeting of the Committee held on 26 and 27 August, 1963

the Committee decided to consider the cases of 30 officers

in order of seniority for 10 vacancies. In the Committee

meeting held on 3 March, 1964 the Committee considered for

21 vacancies the names of 60 persons in order of seniority.

At the Committee meeting held on 5 and 7 December, 1964 for

18 vacancies the Committee decided to consider the cases of

60 officers in order of seniority,. At the meeting held on

4 July, 1965 the Committee considered 60 Income Tax Officers

in order of seniority for promotion to 20 vacancies. At the

Committee meeting held on 4 and 6 December, 1965 the Commit-

tee considered 122 persons in order of seniority for 45

vacancies. In December, 1965 the Committee considered 114

senior most Income Tax Officers and 48 were promoted as

Assistant Commissioners. At the meeting held on 17 May,

1966 the Committee considered the case of 65 officers and

approved the promotion of 48 officers. At the meeting held

on 16 and 17 September, 1968 the Committee considered 240

persons for promotion to 90 posts. In September, 1968 the

Committee considered the cases of 16 officers who had less

than 10 years’ experience. The Committee in February 1969

considered 61 persons for 20 posts. In September, 1969 the

Committee considered 105 persons for promotion to 35 posts.

There is a note made by Thomas in the month of February,

1970 in F. No. 20/2170-Ad.VI to the effect that if officers

with less than 8 years’ service and their juniors are ex-

cluded from the list of officers to by considered by the

Committee for 90 vacancies arising during the year only 193

officers will be available. This is said to be less than

three times the number of vacancies but this could not be

helped unless junior officers are considered over the head

of their seniors..The number of such juniors officers with 8

years’ service is also limited, namely, 11. In the circum-

stances, the selection was made from 193 officers. In

April, 1970 the Committee had to select 80 persons for

promotion. They desired that 240 names should normally be

considered. The Members however stated that the. Ministry

had already furnished the names of 193 eligible officers and

there were no more eligible officers who could be consid-

ered. The Committee accordingly considered those 193 offi-

cers in order of seniority. In April and May 1970 the

Committee considered the cases of 38 persons with less than

10 years’ experience. In 1972 there were 84 vacancies and

10 more vacancies were likely to arise. Therefore for 94

selection posts the field of choice should normally have

been 3 to 5 times the number of vacancies. It was found

that there should have been at least 300 officers. There

were 213 officers with 8 years’ experience. There were

some promotees with more than 8 years’ experience but they

were junior to the direct recruits.. As the direct recruits

had not completed 8 years’ service their juniors were not

considered for promotion over them.

In the background of these facts and circumstances it

was not possible to have 5 or 6 times the number o.f vacan-

cies in the field of choice for the simple reason that the

Committee required 8 years’ experience for promotion to the

post of Assistant Commissioner. If the field of choice had

to be based on running seniority the Committee could rightly

only have 276 officers in the field of choice in the present

case.

The next question is whether the Committee evaluated the

merit of persons in the field of choice. The High Court

held that in the field of choice the evaluation of merit of

persons was not properly done. The decision of the High

Court is wrong for the following reasons. The letter dated

16 May, 1957 indicates that the Committee was first to

decide the field of choice. The cardinal feature which is to

be kept in the forefront is that the field of choice is

based on running seniority in the seniority list and evalua-

tion of merit does not come into picture for deciding the

field of choice. Paragraph 3 of the said letter states that

those in the field of choice who are considered unfit should

excluded from consideration. Under paragraph 4 of the

letter evaluation of the remaining officers on the basis of

merit has to be done by classifying the officers under three

different categories,namely, ’outstanding’, ’very good’ and

’good’. Paragraph 4 of the letter states that the selection

list is to be prepared by placing the names of officers in

the said three categories, without disturbing the seniority

inter se within each category.

In the present case in view of 112 actual vacancies the

Government sent 336 names for the field of choice, that is,

three times the number of vacancies. Since 1963 the Commit-

tee has been receiving from the Government the names of

persons forming three times the number of vacancies. The

336 names sent by the Government were in the running order

of seniority between S.M. Islam No. 155 in the seniority

list and R.N. Dave No. 1186 in the seniority list. Under

paragraph 2 of the letter dated 16 May, 1957 it is the

function of the Committee to decide the field of choice.

The Committee proceeded on the basis of 8 years’ experience

and thus could not possibly have in the field of choice any

name from No. 1131 onwards because every alternate number

thereafter had less than 8 years’ experience. The Committee

stopped at No. 1123.

The Committee at the meeting held on 23, 24 and 25 July

1974 assessed the merits of 145 persons in order of seniori-

ty first. After such assessment the Committee found three

officers No. 1, 30 and 109 in the list as not yet fit and

excluded them. The Committee also excluded 4 officers

whose findings were in sealed cover or whose reports were

not yet complete (No. 2, 3, 6 and 138 in the Committee

List). These 7 officers were excluded from further consid-

eration for the selection list. In accordance with para-

graph 3 of the letter 16 May, 1957 the Committee considered

the remaining 138 officers and assessed their merits and put

them in three categories. The Committee found only one

officer "outstanding", namely No. 16 in the list, 114 offi-

cers "very good" and 7 Scheduled Castes/Scheduled Tribes

officers were ’good’. These 7 Scheduled Castes and Sched-

uled Tribes officers were No. 21, 24, 26, 90, 91, 93 and 94

in the list. The respondents contended that these 7 Sched-

uled Castes/Scheduled Tribes officers should have been given

a grade higher than the grade assessed by the Committee

because of the Home Ministry Instructions dated 11 July,

1968. The respondents’ contentions are incorrect for these

reasons. In paragraph 2 of the Home Ministry instructions

dated 26 March, 1970 on the subject "Concessions to Sched-

uled Castes and Scheduled Tribes in posts filled by promo-

tion--Class I Services/ posts" it was laid down inter alia

that the Scheduled Castes/Scheduled Tribes officers, who

were senior enough in the zone of consideration for promo-

tion so as to be within the number of vacancies for which

the selection list has to be drawn, would be included in

that list provided they are not considered unfit for promo-

tion. In paragraph 1 of these instructions, reference was

made to the Home Ministry instructions dated 11 July, 1968.

It would be found from those instructions as ’also the Home

Ministry instructions dated 26 March, 1970 that the July,

1968 instructions applied in the case of promotions from

Class III to Class II and Within Class II and from Class II

to the lowest rank or category to Class I but had no appli-

cation in respect of promotion within Class I.

The Committee found No. 16 to be ’outstanding’, 114 (No.

2 to 115) ’very good’ and 7 Scheduled Castes/Scheduled

Tribes officers ’good.’ and they were to be included in the

selection list vide Home Ministry instructions dated 26

March, 1970. The Committee next assessed the merit of the

rest of the 276 officers to ascertain whether

any of them was ’out standing’. If any one among these

remaining officers was not found ’outstanding’ but was only

’very good’ he would not come within the selection list

because the selection list was prepared, after evaluating

the merits of the officers on the basis of seniority in the

seniority list in accordance with the fetter dated 16 May,

1957. Paragraph 4 of that letter was followed by the

Committee along with the Home Ministry instructions. It

would not be necessary for the Committee after having con-

sidered 145 to put the others in the category of ’very good’

when the Committee assessed their merits and found them to

be not ’outstanding’. After 122 senior officers were as-

sessed and the Committee found that no other officers junior

to them could be assessed to the higher category namely,

’outstanding’ it would be fruitless exercise to find out who

among these officers were very good’ or ’good’ or ’not yet

fit’. The reason is obvious. Those in the selection list

of 122 who had been found to be ’very good’ could not be

supplanted by others who were ’very good’ Only ’outstand-

ing’ persons who would be junior to the category of 122

’very good’ would surpass the category of ’very good’.

Therefore the Committee rightly considered the cases only to

find’ out whether there was any one outstanding and the

Committee found none of them to be ’outstanding’.

The Government sent the names of 336 officers in the

running order of seniority. Out of 336 the Committee found

276 to be fit for the field of choice. The Committee found

1 ’outstanding’, 114 ’very good’ and 7 Scheduled

Castes/Tribes ’good’. The respondents contended that the

rest 59 were not at all considered by the Committee. This

contention is not acceptable for these reasons. From No.

1131 in the seniority list every alternate number was an

officer with less than 8 years’ experience. Under the

letter of 16 May 1957 it is the Committee and not the Gov-

ernment which decides the field of choice. When the Commit-

tee found according to the running seniority No. 1131

onwards could not be in the field of choice the Committee

did not put the names of the 59 officers in the field, of

choice. The question of the evaluation of the merits of

these 59 officers did not, therefore, arise because first

the seniority list was Considered by the Committee and

second the Committee took into consideration only those who

were in the seniority list and fulfilled 8 years’ experi-

ence.

It is wrong to hold that because the Government sent the

names of 336 persons for consideration by the Committee the

field of choice consisted of 336 persons. The field of

choice is to be determined by the Committee. The Committee

considered 276 names as fit to be included in the field of

choice. It is erroneous to suggest that there were 336

names in the field of choice. The field of choice consist-

ed. of 276 names as determined by the Committee whose juris-

diction it was to determine. The Committee considered upto

No. 1123 in the seniority list to be in the field of choice.

Officers from 1124 to 1130 were not included by the Commit-

tee either because they had retired or joined the Indian

Administrative Service and in any event no complaint has

been made on their behalf. The Committee found that from

No. 1131 onwards every alternate officer had not completed 8

years’ service and therefore they could not be put in the

field of choice according to the Committee. The contention

of the respondents that there were 336 officers in the

field of choice and the Committee did not consider all the

336 persons unmeritorious.

The respondents next contended that persons bearing No.

877, 879, 881 and 883 in the seniority list had been put on

the selection list although they had less than 8 years’

experience. There is no substance in the’ contention for

the following reason. These 4 officers were taken on the

ground that they were ex-military officers recruited to the

Income Tax Department in 1968 and were deemed to have been

recruited in 1964 by virtue of the Ministry of Home Affairs

Notification dated 4 October, 1967.

Another submission was made on behalf of the respondents

that after the Committee had put different persons in three

categories ’outstanding’, ’very good’ and ’good’ the Commit-

tee should have further evaluated the merit of all officers

inter-se within each of the said three categories. This

submission is contrary to the specific provision of para-

graph 4 of the letter dated 16 May, 1957. Further within

the category of ’very good’ there could not be any further

intra-specific assessment of those who were ’very good’.

A criticism was made by the respondents that the assess-

ment was to be only on merit and not seniority-cure-merit.

This contention is wrong. Paragraph 2 of the letter of 16

May, 1957 states that the field of choice is to be decided

by the Committee. No question of merit arises in deciding

the field of choice. The field of choice is only on the

basis of running seniority. The question of merit arises

after the field of choice is decided. The selection-was

correctly done strictly on merit in accordance with para-

graphs 3 and 4 of the letter dated 16 May. 1957. The Commit-

tee decides the field of choice in the running order of

seniority. The Committee excludes names from the field of

choice who are considered unfit for promotion. The remaining

officers are classified as ’outstanding’, ’very good’ and

’good’ on the basis of merit. The selection list is pre-

pared by placing the names in the order of these three

categories. That inter-se seniority of officers in the

selection list under each category is not disturbed. These

are the instructions in the aforesaid letter. It will thus

be.. seen that seniority is the sole criterion for determin-

ing the field of choice in the running order of seniority

and merit is the sole criterion for putting the officers in

the selection list in each category according to merit.

Finally the contention of the respondents is that the

date for determining the eligibility of officers for promo-

tion to the posts as Assistant Commissioners should have

been decided by the Committee by bearing in mind the two

dates namely, 21 December 1972 and 29 November 1973. 21

December 1972 is the date when this Court permitted the

Union Government to make ad hoc promotions. 21 March 1973

and 29 November 1973 are the two dates when the Central

Board of Direct Taxes promoted 59 and 48 officers respec-

tively. This Court in the order dated 21 December, 1972

stated that the Government would be entitled to appoint

people in order of seniority determined according to the

date 5--1458SCI/76

Of continuous officiating appointment in Class I subject to

the suitability which would be decided by the Central Board

or Direct Taxes. This order was made without prejudice to

the contentions of the parties or their rights in the ap-

peals. Pursuant to the interim order of this Court the

Government made two orders dated 21 March 1973 and 29 Nov-

ember 1973 provisionally promoting 59 and 48 officers re-

spectively. In each of the Government orders it is specifi-

cally stated as follows: "The above promotions are purely ad

hoc and have been made on the basis of the suitability as

decided by the Central Board of Direct Taxes in terms of

directions issued by this Court in their order dated 21

December 1972. These promotions will not confer any claim

for continued "officiation" (sic) in the grade of-Assistant

Commissioner of Income Tax or for seniority in that grade.

Appointments against these posts will eventually be made on

the basis of the revised list of seniority of Income Tax

Offices Class I as finally approved by this Court and on

selection by a duly constituted Departmental Promotion

Committee to be convened in accordance with the prescribed

procedure. The promotions ordered will not establish any

claim for eligibility or for selection on merit by a proper-

ly constituted Departmental Promotion Committee when the

same is convened".

It is manifest from the order of this Court and the two

orders made by the Government pursuant to this Court’s order

that these 107 promotions were purely provisional or ad hoc

and were made by the Central Board of Direct Taxes and not

by the Committee which is the authority for determining

promotions. Further these provisional promotions were not

made in conformity with the letter of 16 May 1957. It is

distinctly stated in the aforesaid two Government orders

that appointments against these posts will eventually be

made on the basis of revised seniority of Income Tax Offi-

cers Class I as finally approved by this Court and on selec-

tion by a duly constituted Departmental Promotion Committee

to be convened in accordance with the prescribed procedure.

On 9 February 1973 the Income Tax Officers (Class I)

Service (Regulation of Seniority) Rules, 1973 were made

under Article 309 See Bishan Sarup Gupta’s case (supra).

The revised seniority list of Income Tax Officers Class I

was made on the basis of the Income Tax Officers (Class I)

Service (Regulation of Seniority) Rules, 1973 and was ap-

proved by this Court on 16 April, 1974. See Bishan Sarup

Gupta’s case (supra). The selection list was made by the

Committee after it met on 23, 24 and 25 July, 1974. Under

paragraph 2 of the letter dated 16 May, 1957 the Committee

was to decide the field of choice by including therein

eligible officers awaiting promotion. This means that

whether an officer is eligible or not should be decided with

reference to the date of the Committee meeting. This has

always been done at all the Committee meetings.

The respondents contended that the regularisation of 107

promotees had to be done from the date of original promo-

tions on ad hoc basis. In this connection, the respondents

relied on the observations of this Court in Bishan Sarup

Gupta’s case (supra) at p. 506 of the report. The observa-

tions relied on are that after the fresh seniority

list is made in accordance with the directions given by this

Court in Bishan Sarup Gupta’s case (supra) it would be open

to any direct recruit or promotee to point out to the de-

partment that in the selection made to the post of Assistant

Commissioner from 1962 onwards he, being otherwise eligible,

is entitled on account of the new seniority given to him to

be considered for promotion to the post of Assistant Commis-

sioner.

The observations of this Court in Bishan Sarup Gupta’s

case (supra) are that if as a result of the fresh seniority

list it is found that any officer was eligible for promotion

to the post of Assistant Commissioner on account of his

place in the new seniority list, the department might have

to consider his case for promotion on his record as on the

date when he ought to have been considered, and if he would

be selected his position will be adjusted in the seniority

list of Assistant Commissioners. The object is to see that

the position of such a person is not affected in the senior-

ity list of Assistant Commissioners because he is actually

promoted later pursuant to the new seniority list, although

according to the new seniority list itself he should have

been promoted earlier. The observations do not mean that

although the Committee can meet for the selection of offi-

cers for promotion to the post of .Assistant Commissioner

only after the seniority list is approved by this Court, the

selection would be deemed to be made at the time when a

vacancy in the post of Assistant Commissioner occurred and

the eligibility of officers for selection will be determined

by such deemed date of selection. No employee has any right

to have a vacancy in the higher post filled as soon as the

vacancy occurs. Government has the right to keep the vacancy

unfilled as long as it chooses. In the present case, such a

position does not arise because of the controversy between

two groups of officers for these years. The seniority list

which is the basis for the field of choice for promotion to

the post of Assistant Commissioner was approved by this

Court on 16 April, 1974. Promotions to the post of Assist-

ant Commissioners are on the basis of the selection list

prepared by the Committee and are to be made prospectively

and not retrospectively.

For the foregoing reasons the judgments and orders

appealed against are set aside. The selection list made by

the Departmental Promotion Committee forming the subject

matter of these appeals is held to be correct, lawful and

valid. Parties will pay and bear their own costs.

V.P.S. Appeals allowed.

Union of India Etc. v. Majji Jangamayya Etc.(with Connected Civil Appeals)