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B.P. Maity and Ors. Vs. Union of India and Ors. - (Central Administrative Tribunal) (25 Oct 2017)

Organization has a right to change/re-change the promotion policy, adjust/readjust it according to the compulsions of the prevailing circumstances

MANU/CA/0689/2017

Service

The Applicants are working in RITES Ltd.-Respondent organization against the posts of Deputy General Manager (DGM) and Senior Deputy General Manager (Sr. DGM). The employees of RITES are having two types of pay scales, namely, the Central DA (CDA pay scales) and Industrial DA (IDA pay scales). As per the promotion policy of 2003, the next promotional post for officers working as DGM used to be Joint General Manager (JGM). The Respondents vide letter dated 22nd September, 2008 modified the said promotion policy and introduced an intermediary grade of Senior DGM in between DGM and JGM for which IDA pay scale of Rs. 16000-20800 was prescribed but no such CDA pay scale was prescribed. The Respondents issued an office order dated 15th June, 2009 (Annexure A-1) clarifying that, an employees of RITES who was not willing to move to IDA scales on promotion would only be re-designated by retaining his/her existing CDA scale on promotion, on giving written undertaking for such acceptance. The Annexure A-1 office order was followed by Annexure A-2 office order wherein it was stated that, in terms of Department of Public Enterprises (DPE) OM dated 10th August, 2009, it has been settled that henceforth, all appointments on promotion in RITES shall be in IDA scales only.

Thereafter, the Respondents sent Annexure A-3 communication to some of the senior DGMs, few of them are Applicants in present Original Application (OA), stating therein, that the office order dated 30th September, 2009 (Annexure A-2) holds 'good' and all appointments on promotion in RITES shall be made in IDA scales only. Aggrieved by Annexures A-1, A-2 orders and A-3 communication, the Applicants have filed the present OA, praying that Tribunal may direct the Respondents that in the event of promotion of the Applicants, they will fix their salary in the next higher CDA pay scale and thereafter the applicants will exercise the option for switching over to IDA pay scale on voluntary basis and quash impugned orders.

It is settled position of law that, the Respondent-organization has a right to change/re-change the promotion policy, adjust/readjust it according to the compulsions of the prevailing circumstances. Granting of pay scales and allowances is an exclusive executive function and this position has been upheld by the Apex Court in the case of P.U. Joshi & Others v. Accountant General, Hyderabad and Others.

The DPE is the nodal agency of the Central Government who formulates policy guidelines for CPSEs in the matters of pay & allowances and remunerations for their employees. The DPE vide its OM dated 12th June, 1990 had clearly directed the CPSEs that all appointments made on or after 1st January, 1989 in respect of all categories of employees by the CPSEs would be deemed to have been governed in IDA pay scales only. This O.M. was issued by the DPE in pursuance of the judgment of the Supreme Court in Jute Corporation Officers' Association and others v. Jute Corporation of India Ltd., in which certain directions were issued by the Hon'ble Supreme Court.

The directions relevant for present case are "(i) the scales of pay and dearness allowance as recommended in the Report will be extended to those employees who have been appointed with specific terms and conditions for grant of Central D.A. This will be equally applicable to the employees who by rules laid down by the public sector enterprises are being paid Central dearness allowance. (ii) The employees appointed on or after January 1, 1989, will be governed by such pay-scales and allowances as may be decided by the Government in its discretion. Those appointed earlier 1010 with IDA pattern will continue to be governed in accordance with the terms and conditions of their appointment. (iii) The pay revision for those employees in respect of whom the recommendations are hereby being directed to be implemented hereafter, will take place only as and when similar changes are effected for the Central Government employees. These employees will, however, continue to enjoy the option to switch over to the IDA pattern of the scales of pay etc. on a voluntary basis."

The word 'appointment' in the judgment of the Apex Court cannot be interpreted in a narrow sense. The DoP & T and Ministry of Legal Affairs have correctly interpreted that, appointments shall also include promotion as well. The Apex Court in Dr. Harikishan Singh v. State of Punjab has clearly held that, the word 'appointment' cannot mean only promotion, and it means appointment both by promotion and direct recruitment. Hence, the narrow interpretation of this word by the Applicants with reference to the DPE's OM dated 12th June, 1990 that only the appointees in CPSEs on or after 1st January, 1989 would be deemed to have been governed in the IDA pay scales is not correct. As a matter of fact, all promotions made on or after 1st January, 1989 will also be governed in terms of the DPEs OM dated 12th June, 1990 even in respect of the employees who were appointed prior to 1st January, 1989.

It is well understood that, purpose of introduction of IDA pay scale in CPSEs was to incentivise the employees of the CPSEs for better performance so that they could meet the challenges emerging from the private sectors. Continuation of CDA & IDA pay scales for all time to come in the CPSEs would not have been in their interest. Furthermore, the DPE's OM dated 12thJune, 1990 is, in fact, in compliance of the order of the Apex Court in Jute Corporation Officers' Association and others. It is reiterated that, appointment includes promotion as held by the Apex Court in Dr. Harikishan Singh v. State of Punjab. There is no merit in present application, accordingly it is dismissed.

Relevant : P.U. Joshi & Others v. Accountant General, Hyderabad and Others, Dr. Harikishan Singh v. State of Punjab, Jute Corporation Officers' Association and others v. Jute Corporation of India Ltd.

Tags : PROMOTION POLICY   RULES   VALIDITY  

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