BAREILLY HOLDINGS LTD.

THEIR WORKMEN

February 16, 1979

[Y. V. CHANDRACllUD, C.J., R. S. SARK.ARIA, N. L. UNTWALIA,

0. CHINNAPPA REDDY AND A. P. SEN, JJ.J

E111ployees State Insurance Act, 1948, Section 72 and Regulation 97 framed under Section 97(1) of the E.S.l., Act, .1948, purpose and effect oj- Whether 1he deduction of half day's wages corresponding to the sickness benefit to which the lvorkmen were entitled under the E.S.l. Act, in the event of their not availing themselves of the benefits under the E.S.l. scheme in order.

By virtue of the award in Adjudication case No. 33 of 1952 given by the State Tribunal Allahabad, respondents were entitled to fifteen days' sick leave on full wages as a condition of their service. The appellant adopted the Employees State Insurance Act in 1957.

The appellant, therefore, paid to the workmen full wages for two day's sick leave out of 1.5 days' sick leave for the reason that the workmen did not get cash benefit for the first two days of the waiting period of sickness on account of the provisions of section 49 of the E.S.I. Act. For the balance of the thirteen days only half the wages'

were paid. In the industrial dispute referred for adjudication to the Indtll!trial Tribunal under section 4(k) of the U.P. Industrial Disputes Act, the award went in favour of the workmen.

Dismissing the appeal by special leave, the Court, E HELD : !. The general purpose and effect of section 72 is to deny to

the employers the right or power to reduce or discontinue the benefit payable to the workmen under their conditions of service on the ground that the benefits available under the conditions of service and under the E.S.I.

Act being similar the workmen would not be entitled to a double benefit. [240 A-Bl

Section 72 provides in terms that the mere circumstance th.et an employer is liable to make a contribution under the E.S.I. Act will not entitle him, directly or indirectly, to reduce the wages of an employee or, in so far as the Regulation permits, discontinue or reduce the benefits payable to him under the conditions of his service even if those benefits are similar to tho benefits conferred by the E.S.I. Act. The purpos.e of Section 72 is evidently to dis~ courage employers from using the benefits provided under the E.S.I. Act as an excuse or justification for reducing or dis-continuing the benefits avDilable to the workmen under their conditions of service on the ground of similarity between the two types of benefits.

The case of the appellant before the lndutrsial Tribunal was that it was making a contribution to the E.S.I. Corporation for the benefit of its employees and if any individual employee chose not to avail of the benefits due to him from the Corporation on account of the sickness benefit; it is he who ought to suffer and there would be no justification for obliging the employer to spend for his sickness benefit twice over. It is precisely this type of argument and attitude that the legislature anticipated and guarded against by incorporating the particular provision in section 72. (240 B-E]

• •

MREILLY HOLDINGS LTD. v. WORKMEN (Chandrachud, C.J.) 237

2. The contention that it is enough for justifying the deduction from wages A <lue to the workmen for sick leave that the employee is covered by the E.S.I. Act is not correct. In the first place, section 46 of the

E.S.I.

Act would show that employees who are covered by the E.S.I. Act are entitled to certain benefit subject to the provisions of the E.S.I. Act. It is, therefore, not as if the workmen are entitled to the benefits absolutely and without compliance with the conditions laid don by the Act or the Regulation.

Secondly, the proviso to Regulation 97 says that the employer shall be en- B titled to deduct from the leave salary of the employee, "the amount of benefit" to which he may be entitled under the E.S.I. Act for the corresponding period of his sickness. A \vorkman does not become entitled to the "amount" paya ble to him by way of sickness benefit unless, in the first instance, he chooses to avail himself of the sickness benefit. That benefit cannot be forced on him. This would show that the employer's right to make a deduction from the employee's sick leave WQ, ges can only be exercised. in respect of those days C of sickness leave for which the workman has actually availed of the sickness benefit. [240 F, H, 231 A-CJ

3. Benefits which are available under the E.S.I. Act are not intended as substitutes for benefits to \Vhich the workmen are entitled under the condi~ tions of their service.

A \Vorkman becomes entitled to sickness benefit only if he is qualified for it and he gets a cash benefit only if he avails himself of the sickness b'enefit.

Thus it is only when a workma.n, in fact obtains or receives a cash benefit that the employer can exercise his right to make a deduction from wages due to him by way of leave salary. Jn providing for periodical peyment!I to an insured worker in case of sickness, the legislature did not intend to substitute any of those benefits for the workmen's right to , get leave on full pay on the ground of sickness. [241. B-D, FJ

HindustOJI Times Ltd. v. Their Workmen, [1964] I SCR 234 •pplied in part.

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 1606 of 1970.

From the Award dated 28-11-1969 of the Industrial Tribunal (II) Lucknow in Adjudication Case No. 120 of 1968 published in U.P.

Gazette dated 21-3-1970.

G. B. Pai, D. N. Misra and Shri Narain for the Appellant.

Gobilzd Das (A.C.) .and Mrs. Sunanda Bhandare fo.r the Respondent.

The Judgment of the Court was delivered by

CHANDRACHUD, C.J. This appeal by special leave arises out of the award of the Industrial Tribunal, Lucknow, U.P. dated November 28, 1969.

On September 7, 1968 the Government of U.P. referred the following dispute for adjudication to the Industrial Tribunal under

ection 4 (K) of the U.P. Industrial Disputes Act, 28 of 1947 :

"Whether the action of the employers in deducting half wages corresponding to the sickness benefit to which workmen are entitled under the E.S.I. Act in the event of the

workmen not availing the services of the E.S.I. is legal and/or justified ? If not, to what relief are the workmen entitled and with what details ?"

The respondent-workmen contended that the Employees State Insurance Act, 1948 (hereinafter called the E.S.I. Act) was adopted by the appellant, M/s Bareilly Electricity Supply Co. Ltd., in 1957, that the WO'rkmen used to enjoy, prior to 1957, 15 days' sick leave with full wages every year in accordance with the terms of an award given by the State Tribunal, Allahabad, in Adjudication Case No. 33 of 1952, that under that award, the workmen were entitled to sick leave on full wages as a condition of their service, that they also became entitled to sickness benefit under the Employees State Insurance Scheme and that the appellant was not justified in reducing the wages to the extent of a half day's wages in respect of employees availing. of sick leave.

The appellant contested the demand of the workmen on the grounds, mter aliu, th>at its action in deducting half wages corresponding to the sickness benefit to which the workmen we.re entitled under the Act in regard to the sick leave was in accordance with the provisions of Regulation 97 of the Employees State Insurance (General) Regulations 1950, that if any individual employee choose not to avail of th~ benefit due to him from the E.S.I. Corporation on account of his sickness, a deduction of half the wages corresponding to the sickness benefit could be made by the employer and that the sickness benefit provided under the E.S.I. Act and the Scheme was in substitution of the benefits. provided by the employer and not in addition thereto. The appellant raised an objection to the maintainability of the reference on the ground that the dispute referred by the State Government to the Triounal was not an industrial dispute and contended further that the subject matter of the dispute fell within the exclusive jurisdiction of the Employees State Insurance Court set up under section 74 of the E.S.I.

Act, as a result of which the Industrial Tribunal had no jurisdiction todeal with the dispute.

The objection to the maintainability of the reference and to the jurisdiction of the Industrial Tribunal to deal with it not having beeii pressed by the appellant's counsel, the only question which we liave to consider is whether the appellant can deduct half-day's wages corresponding to the sickness benefit to which the workmen are entitled under the E.S.I. Act, in the event of their not availing thmselves of the benefits under the E.S.I. Scheme.

' •

• _.---"---- ,

Before dealing with this question. it may be mentioned that the appellant has no objection to paying full wages for two days of sick leave to the workmen and in fact, it has been paying full wages for two days out of 15 days' sick leave due to the workmen. The reason for this course seems to be that the workmen do, not get cash benefit for the first two days of the waiting period of sickness by reason of the provisions of section 49 of the E.S.l. Act.

The dispute in this appeal is, therefore, confined to a period of 13 days of sick kave only, for which the workmen are being paid half wages by the appellant.

To justify the deduction of half wages from 13 days of sick leave, the appellant relies on the provisions of section 72 of the E.S. I. Act and Regulation 97 framed unde; r section 97 ( 1) of the E.S.I. Act.

Section 72 reads thns :

"Employer not to reduce the wages.

No employer by reason only of his liability for any contributions payable under this Act shall directly or indirectly reduce the wages of any employee, or except as provided by the regulations, discontinue or reduce benefits payable to him under the conditions of his se; rvice which are similar to the benefits conferred by the Act."

The relevant part of Regulation 97 is as follows :

"Discontinuance or reduction of benefi, t.

An employer may discontinue or reduce the benefits payable to his employees under conditions of tlieir service, which are similar to the benefits conferred by the Act to the extent specified below, namely:

(a) from the date of commencement of the first benefit period following the appointed day fo; r his factory or establishment -

(i) sick leave on half pay to the full extent;

(ii) such proportion of any combined general purposes and sick leave on half pay as may be assigned as sick leave but in any case not exceeding SO per cent of such combined leave;

(b)

Provided that where an employee avails himself of any H leave from the employer for sickness, maternity or temporary disablement, the employer shall be entitled to deduct from

the leave salary of the employee the amount of benefit to which he may be entitled under the Act for the correi; ponding period."

The general purpose and effect of section 72 is to deny to the employers the right or power to reduce or discontinue the benefits payable to the workmen under their conditions of service on the ground that the benefits available under the conditions of service and under the E.S.I. Act being similar, the workmen would not be entitled to a double

benefit. Section 72 provides in terms that the mere circumstance that > an employer is liable to make a contribution under the E.S.I. Act _-l,_ will not entitle him, directly or indirectly, to reduce the wages of an "- employee or, in so far as the Regulation permits, discontinue or reduce 7

the benefits payable to him under the conditions cf his service even if those benefits are similar to the benefits conferred by the E.S.I. Act.

The case of the appellant before the Industrial Tribunal was that it was making a contribution to the E.S.I. Corporation for the benefit of its employees and if any individual employee chose not to avail of the benefits due to him from the Corporation on account of the sickness benefit, it is he who ought to suffer and there would be no justification for obliging the employer to spend for his sickness benefit twice over. It is precisely this type of argument and attitude that the legislature an.ticipated and guarded against by incorporating the particular provision in section 72. The purpose of that provision is evidently to discourage employers from using the benefits provided under the E.S.I. Act as an excuse or justification for reducing or discontinuing the benefits available to. the workmen under their corrditions of service on the ground of similarity between the two types of benefits.

That leads to the question as to whether Regulation 97 can justify the deduction made by the appellant.

Regulation 97 provides that aii employer may discontinue or reduce the benefits payable to his employees under the conditions of their service which are similar to the benefits conferred by the E.S.I. Act but only to the extent specified in clauses (a) and (b) of the Regulation.

We are not concerned with clause (b) and sub-clauses (i) and (ii) of clause (a) have no application in the instant case.

The appellant relie.s strongly oo the proviso to Regulation 97 under which, where an employee avails himself of any leave from the employer for sickness, the employer shall be entitled to deduct from his leave salary the amount of benefit to which he may be entitled under the Act for the corresponding period. The case of the appellant is that it is enough for justifying the deduetion from wages due to the workmen tor sick leave that the employee is covered by the E.S.I. Act or the E.S.I. Scheme.

It is not possible

' •

to accept this submission.

In the first plac.~\ section 46 of the E.S.I.

Act would show that employees who are covered by the E.S.I. AcL are entitled to certain benefits subject. to the provisions of the E.S.I.

Act.

It is, therefore, not as if the workmen are entitled to the beriefit• .absolutely and. without compliance with the conditions laid down by the Act or the Regulation.

Secondly, the proviso to Regulation 97 says that the employer shall be entitled to deduct from the leave salary of the employee, "the amount of benefit" to which he may be crilitled under the E.S.I. Act for the corresponding pe.riod of his sickness.

A • , workman does not become entitled to the "amount" payable to him _. ~-by way of sickness benefit unless, in the first instance, he chooses to avail himself of the sickness benefit.

That benefit cannot be forced on him.

This would show that the employer's right to make a deduction from the employee's sick leave wages can only be exercised in respect of those days of sickness leave for which the workman has actually availed of the sickness benefit. Benefits which are available under the E.S.I. Act are not intended as substitutes for benefits to which the workmen are entitled under the conditions of their service.

As stated rlier, a workman becomes entitled to sickness benefit only if he is qTl!lified for it and he gets a cash benefit only if he avails himself of the sickness benefit.

Thus, it is only when a workman, in fuct, obtains or receives a cash benefit that the employer can exercise his right to make a deduction from wages due to him by way of leave .salary.

The decision of this Court in Hindustan Times Ltd. v.

Their Workmen(') is not directly in point bnt it can be cited in support of our reasoniug to the extent which it holds that in providing for periodical payments to an insured worker in case of sickness, the legis- _ lature did not intend to substitute any of those benefits for the workt' ·· men's right to get leave on full pay on the ground of sickness.

For these reasons, we confirm the award of the Industrial Tribunal and dismiss the appeal with costs.

V.D.K.

Appeal dismissed .

(I) [1964] I S.C.R. 234.

BAREILLY HOLDINGS LTD

THEIR WORKMEN

February 16, 1979

N. L. UNTWALIA

0. CHINNAPPA REDDY

A. P. SEN, JJ

State Insurance Act, 1948

Section 72

Section 97(1)

Allahabad

Insurance Act

section 49

section 4(k)

Industrial Disputes Act

section 72

Section 72

Section 72

E.S.I. Corporation

section 72

section 46

CIVIL APPELLATE JURISDICTION

G. B. Pai

D. N. Misra

Narain

Gobilzd Das

Sunanda Bhandare

CHANDRACHUD

September 7, 1968

Government of U.P.

Industrial Disputes Act

Bareilly Electricity Supply Co. Ltd.

section 74

section 49

section 72

section 97

Section 72

section 72

Section 72

section 72

section 46


DISTT. REGISTRAR PALGHAT & ORS.

v .

.M. B. KOYY AKUTI & ORS.

February 20, 1979

[R. S. SARKARIA AND 0. CHINNAPPA REDDY, JJ.]

Kera/a State & Subordinate Service Rules, 1958-r. 28(b)(ii)-Scope o/- Gover"!iment servo.nt appointed as lower dili.sion clerk relaxing minimum edu cational qualification-No provision in rule prescribing minimum educationar-

' •

qualificction for Promotion-Executiie 01der prescribing qualifying -_test for • promotion-Validity of.

The respondent, who originally belonged to the fadras Ministerial Service,.- was allotted to the State of Kera1a as tar lower division clerk on the reorgani sation of States.

On the ground thai he belonged to a community which was educationally backward the State Government of ladras hppointed him . as a lower division clerk relaxing the requirements Of r. 29 of the Special Rules for l\.ladras Ministerial Service. which prescribed m1n1mum general educational qualification for appointment to service under the SttJ:te Government.

I , In 1957 the State Government of Kerala is&ued an order providing: that, until common service rules were framed, every officer in the service of the new State of Kerala would be bound by the service rules oi Travancore- Cochin or l\.ladra!, to _which he belonged prior to November l, 1956.

Thereafter in supersession of tJ.ll earlier rules the Kerala State and Subor- . dinate Service Rule!, 1958 were ir3.med. Rule 1 of the General Rules in Part II stated that the ruleS in that part shall apply to all State and Subordinte Services and the holders of all posts appointed before or after the date on which those. rules came into force.

The Special Rules contemplated byr. 2(16) -of Part I had. hoWever. not been framed.

Rule 28 (b) (ii) of Part Il provided that all promotion!~ or appointments by transfer [other than those mentioned in cl. (i) of this rulel shall be made in accordance with the seniority, subject to the person's fitness for appolntment.

In 1961, persons who did not possess the general minimum educational qualifications but were appointed as lower division clerks, were allowed tosit for a qualifying test for promotion to upper division clerks.

In the gradation list of officiating lower division clerks prepared, the res pendent was shown at no. 1 place. Even so, when two vacancies of upper division clerks occurred, two persons junior to him in the gradation list were -Promoted ignoring the iespondent.

In his writ petition under Art. 226 of the Constitution the respondent contended that the exemption granted to him removing the bar of educational qualification enured to him for all purposes, and therefore, promotions of two juniors, ignoring r.28(b)(ii) under which seniority was the basis for pro motion, amounted to deriial of equal treatment guaranteed under Arts. 14 and

16 of the Constitution.

DISTT. REGISTRAR V. M. B. KOYYAKUTI 243

A single Judge of the High Court dismissed the petition on the ground A that the exemption granted was for the limited purpose Of enabling the resw pondent to be appointed and continued in the post of lower division clerk • but that it did not remove the bar of minimum qualification for promotion .

On appeal the di.vision bench reversed the order of the single Judge, and directed the Government to promote him la'i1.d determine his rank in the cadre of upper division clerks.

On appeal to this Court it was contended on behalf of the appellant that (I) the Special Rules contemplated by r. 2 of Part I read with the State "' ' Government's order of 1957, were the Special Rules contained in the Madras _... J....Ministerial Service Rules; (2) even if r. 28(b)(ii) was applirnble it was well within the power of the State Government to prescribe a test to judge the fitness of persons who were exempted from the minimum educational qualifications when appointed as lo, ver division clerks and (3) there was a reasonable basis for classifying those persons who did not possess the minimum educationtil qualification as a category apart from those '.\'ho possessed such a qualification.

Dismissing the appeal,

HELD : I (a) The Special Rules, for the purposes of Kerala Rules of 1958, would be as defined in r. 2(16) of Part I.

That definition contemplated that Special Rules \vould be framed by the Governor but no such rules bad been framed. [248 HJ

(b) Jn the matter of promotion as 011 upper division clerk the respondent was governed by r. 28(b)(ii) in Part II. [249 A]

2. It cannot be said that the impugned notification merely "supplemented" or filled up a gap in the statutory rules. It tended to superimpose or superadd by an executive fiat on the statutory rules something inconsistent with the same.

If lhe statutory rules framed by the Governor or any lta:w enacted under Art. 309 is silent on any particular point, the government can fill up that gap and supplement the rule by issuing administrative instructions not inconi _, k--ntent with the statutory provisions already framed or enacted. [253 D; 250 C]

In the instant case, however, it could not be said that there was a gap in the statutory provisions in the matter of promotion from the cadre of lower division clerks to that of upper division clerks.

3(a) The classification n1ade by the impugned government order was not

only unfair and irrational but also, virtually amounted to abandonment of the G te!it of seniority-cum-fitness provided in r. 28(b) (ii). [252 G-H] •

(b) Bv virtue of s. 3 of the Kerala Public Services Act, 1968, the 1958- Rules were deemed to have been made under the Act and were continued until superseded by rules made under that Act.

No Special Rules relating to upper division clerks having been made the General Rules in Part II would be applicable to upper division clerks, also. [250 El

(c) The 1958 Rules superseded all earlier rules.

The General Rules did not provide any minimum genertal educational qualification for promotion to

A the cadre of upper division clerks.

There il'I nothing in r. 28 (b) (ii) or elsewhere, which provides that a lower division clerk would be presumed to be unfit for promotion to upper division unless he possessed the minimum general educational qualification or passed the qualifying test. [250 G-HJ

There is nothing to show that the respondent wa~ considered for promotion but was found unfit. [251 BJ

(d) (i) The impugned notification prescribed the qualifying test for promotion, not for all, but only for one category of persons with reference to the l manner in which they initially entered service.

The respondent and others

like him, appointed as lower division clerks after granting them exemption, had ~

been singled out for this discrin1inatory treatn1ent. [251 1-<l _ _-l.

(d) (ii) There is nothing on record toshow that the duties discharged by the clerks of the upper division were substantia11y different from those in the lower division. [251 GHJ

(iii) The statutory rule did not warrant the classification made by the impugned order. It impinged upon the statutory rule inasmuch as it laid down that even if a lower division derk who entered service as a result of exemption from possessing minimum educational qualification satisfied the criterion of seniority-cum-fitness prescribed by this rule, he shall not be considered for promotion unless he qualified in the test.

The relevant rule did not provide any minimum general educational qualification for promotion to upper division. [252 A-BJ

Roshan Lal Tandon v. Union of lndia, [1968J 1 SCR 185; followed.

E State of lammu & Kashmir v. Triloki ]\Tath Khosa & Ors. AIR 1974 SC

1; held inapplicable.

4. Though ordinarily the court would not issue a direction requrr1ng the government to promote an aggrieved employee and thereafter determine his rank in the cttdre, in the peculiar fact! of this case the respondent satisfied the two-fold criterion for promotion laid down in r. 28(b) (ii) and since the existence of both the criteria for promotion were not in dispute the H~ Court was justified in issuing the direction, it did. [253 AB; E] .

!I.

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 2036 of 1969.

Appeal by special leave from the Judgment and Order dated 18-12-1968 of the Kerala High Court in W.A. No. 167/67.

Dr. V. A. Sayied Muhammed and K. M. K. Nair for the Appelant.

A. S. Nambiar and D. D. Gupta for the Respondents.

The Judgment of the Court was delivered by

SARKARIA, J.

This appeal by special leave, directed against a judgment, dated December 18, 1968. of the High Court of Kera la, arises out of these facts :

> Koyakutty, Respondent herein, entered service of the former\ Madras State on May 1, 1943 as temporary Section Writer on probation in r the Registration Department.

He did not possess the minimum, general educational qualification prescribed by Rule 29 of the Madras, Ministerial Service Rllies.

This rule, inter alia, provided that no person shall be eligible for appointment to the service in any post either by •

• .. direct recruitment or by recruitment by transfer on promotion unless he possesses the minimum general educational qualification prescribed

~ in the Schedule to the General Rules.

The General Rules provided that the passing of the Secondary School Leaving Examination or other ' equivalent examination shall be the minimum educational qualification

_, r-appointment to the Ministerial Service.

-<, The State Government, however,· had the power to exempt a person from this qualification.

The Madras Government passed an Order, dated April 15, 1954, (Ex. P-11), exempting, him from the said qualification for being appointed as a Lower Division Clerk in the Registration Department. It will be useful to quote this order in extenso

• A

"The Government consider that in view of the fact that Sri M. B. Koyakutty belongs to a community which is educationally backward, the petitioneashould be exempted from the minimum general educational qualification, so as to enable him to be appointed as a Lower Division Clerk in the Registration Department under G.O. MS. No. 2858 Rev. dt. 2-11-50 in his tum ........ The Governor of Madras accordingly relaxes rules 28 and 29 of the Special Rules for the Madras Ministerial Service in favour of Sri M. B. Koyakutty, a temporary Section Writer in the Registration Department in the Registration District of Palghat in order to enable him to be appointed as a Lower Division Clerk in that department.

Sd/- S. K. Chettu, Secretary to Govt."

As a result of this exemption, Koyakutty was appointed a Lower Division Clerk in the Registration Department on May 19, 1954 .

Consequent on the reorganisation of the States in 1956, Koyakutty was allotted to the Kerala State Service as Lower Division Clerk in the Registration Department.

I On May 16, 1961, the Government of Kerala issued an Order, in consultation with the Public Service Commission, that "all sucll

persons who did not possess the general minimum educational qualification and were appointed as Lower Division Clerks, after granting !hem exemption from that qualification", may be allowed to sit for a qualifying test to be conducted by the Commission, and in case they secure a certain minimum percentage of marks, they may be regarded as possessing the minimum general qualification of the S.S.L.C. Standard for purpose of promotion to Uppe.r Division and higher grades or continuance in the Upper Division, as the case may be.

The order further stated that the case of those who have been appointed and are continuing in the Upper Division, they need not be disturbed for the present,

bnt they should be reverted, if they fail to qualify at the next snch ' examination of the Commission.

According to para 3 of the Order,-..l_._ "the minimum marks to be obtained for being declare.cl eligible_ for

promotion to or continuance in the Upper Division etc. . ...... will be issued separately."

A gradation list of Clerks was prepared by the District Registrar, Palghat, in which Koyakutty was shown at No .. 1 among the officiating Lower Division Qerks, while the original respondents 1 and 2 were shown at Nos. 7 and 6, respectively.

In July 1966, two vacancies occurred in the cadre of Upper Division Qerks in the Department.

The original respondents 1 and 2, who were junior to Koyakutty, were promoted against those vacancies as Upper Division Clerks.

Koyakutty thereupon filed a writ petition under Article 226 of the Constitution in the Kerala High Court, praying that the promotion o' original respondents 1 and 2 be quashed and a di.rection be issued requiring the District Registrar, Palghat, and the State of Kerala to consider his claim and to promote him in preference to the original respondents 1 and 2.

-·...J..... • Koyakutty's contention was that nnder the Rules, seniority should be the basis for promotion; and promotion of his juniors amounted to a denial of equable treatment guaranteed under Article 14 and 16 G of the Constitution.

His stand was that the exemption granted to him by the Government, removing the bar from being appointed in the Ministerial Service enurcd for all purposes. This contntion was rejected by the trial Judge, who held that the exemption granted to Koyakutty was for the limited object of enabling him to be appointed and continued in the post of a Lower Division Clerk and did ncJt H remove the bar of minimum educational qualification for his promotion to the post of Upper Division Clerk.

In the result, Koyakutty's writ petition was dismissed.

--- • ""

On appeal by Koyakutty, a Division Bench of the High Court oreversed the judgment of the learned Single Judge, and directed the District Registrar, Palghat, and the State Government to treat Koyaikutty as eligible for promotion as an Upper Division Clerk and pass necessary orders on that basis.

The Division Bench further directed that Koyakutty's rank in the cadre of Upper Division Clerks will, .also, be determined after he is promoted to that Cadre.

Hence this appeal by the District Registrar, Palghat and the State.

_.l The first question that falls to be considered is, whether in the C "' matter of promotion to the cadre of Upper Division Clerks, the res-

-<, pondent was governed by the Madras Ministerial Service Rules or by the Kerala State and Subordinate Service Rules, 1958?

The Government of Kerala, ou February 25, 1957, issued an -Order S(D)S..43405/56/PD to the effect that as an interim arrange D ment, every officer ill the service of the new State would be bourict by the Service Rules of Travancore-Cochin or Madras, as the case may be, to which he belonged prior to November 1, 1956 until common service Jules are framed and issued.

Thereafter, in exercise of the powers under the proviso to Article 309 of the Constitution, the Governor of Kerala in supersession of all rules on the subject, framed the Kerala State and Subordinate Services Rules, 1958.

Part I of these Rules deals with preliminary matters. Rule 2(16) in Part I defines "Special Rules" as meaning "the rules in Part III applicable to each service or class of service." Such Special Rules have not, however, been framed by the Governor. '~ PJlrt II contains the General Rules.

Rule 1 in Part II delineates the v cope of the General Rules. It runs thus :

• "The rules in this Part shall apply to all State and Subordinate Services and the holders of all posts, whether temporary or permanent in any such service, appointeti thereto before, or after the date on which these rules come into force as provided in sub-rule (b) of rule l in Part I except to the extent otherwise expressly, provided (a) by or nnder any law for the time being in force, or (b) in respect of any member of such service by a contract or agreement subsisting between such member and the State Government."

A Rule 2 in the same Part provides :

"2. Relation to the Special Rules.-If any provision in the General Rules contained in the Part is repugnant to a provision in the Special Rules applicable to any particular service contained in Part Ill, the latter shall in respect of that service, prevail over the provision in the General Rules in this Part."

It will bear repetition that since no Special Rules, as defined inc Rule 2(16) of Part I, have so far been framed by the Governor

uder Article 309 of the Constitution, Rule 2 in Part II has remained~ ' otiose. --- •

Rule 28 in Part II provides regarding promotion.

Clause (i) of clause (b) of this rule deals with promotion and appointment by transfer to a selection catego.ry or Selection Grade in a service. Such promotion shall be made ou the basis of merit and ability, seniority being considered only where merit and ability are approximately equal.

Sub-clause

(ii) of clause (b) of Rule 28 is captioned :

"Promotion and appointment by transfer to higher posts according to seniority".

Its material part, as it stood before the amendment of Decembe; r 28, 1970, reads as under :

"All other promotions or appointments by transfer shall, subject to the provisions of these rules and the special rules. be mde in accordance with seniority subject to the person's fitness for appointment."

It is contended on behalf of the appellants that by virtue of the Kerala Government Order dated February 25, 1957, referred to earlier, the Special Rules contained in the Madras Ministerial Service Rules, continued to govern the respondent because those Special Rules..~ have not been superseded by the Kerala Rules of 1958.

The pofnt • sought to be made out is that the Special Rules, within the meaning of Rule 2 in Part U read with the aforesaid Government Order dated February 25, 1957, will mean the Special Rules contained in the Madras Rules.

A similar argument was raised before the Appellate Bench of the High Court, also, and it was repelled, and, in our opinion, rightly.

Special Rules for the purpose of the Kerala Rules, 1958, will be as defined in Rule 2(16) in Part I. That definition contemplates that Special Rules in Part III will be framed by the Governor of Kerala.

But, no such rules have so far been framed.

We have, therefore, ne> hesitation in holding, in agreement with 1 the High Court, that in the matte; r of promotion as an Upper Division

Clerk, the appellant was governed by Rule 28(b) (ii) in Part II .

The alternative contention tbat has been advanced on behalf of the appellant is that even if Rule 28 (b )(ii) was applicable, then also, it was well within t!Je power of the State Government to prescribe a test to judge the fitness of those persons who did not possess the minimum educational qualification and were appointed as Lower B Division Clerks on being exempted from that qualification by Government Order.

In this connection, reference has, been made to Article 162 of the ·, Constitution, to show what the State GO'Vernment could do by framing

< .).._ __ a statutory rule under Article 309, proviso, could well be done by an C "> executive order, tbe executive power of the State being co-extensive with its legislative power. It is maintained that the power of tbe Government to prescribe selective test for promotion to highe.r service has been recognised by tbis Court in several decisions.

Reference has been made in this connection to the decisions of this Court in B. N. Nagarajan & Ors. v. State of Mysore & Ors.(1); Union of India D etc. v. Majji Jangamayya etc.('); State of Jammu & Kashmir v. Triloki Nath Khosa & Ors.(').

It was further submitted that the possession of the minimum educational qualification, i.e. a certificate of having passed tbe S.L.C.

Examination or any equivalent examination is presumptive proof of the fitness of the holder thereof, for promotion to the cadre of Upper Division Clerks.

Therefore, according to the counsel, there was a reasonable basis, for classifying those who did not possess tbis minimum educational qualification as a category apart from those who possessed such a qualification. In tbis context, it is further emphasised that the exemption was granted only for tbe purpose of being appointed as a )-.- _Lower Division Clerk, a!'d not for the purpose of further promotion.

• As against this, Mr. Nambiar, appearing foc the respondents, 5Ub- -• mils that once the bar of minimum educational qualification was removed for appointment as Lower Division Clerk, further promotion of the respondent was governed by Rule 28(b){ii), Part I of the • Kerala Rules of !958. After their appo, intment, the respondent or others like him who had been exempted from possessing the minimum educational qualification, had become integral members of the same cadre.

They could not be singled out for hostile treatment. Counsel has submitted that the rule enunciated by this Court in Triloki Nath

(I) [1966] 3 S.C.R. 682

(2) [1977]2 S.C.R. 28

(3) AIR 1974 S.C. I.

17-196 SCI/79

Khosa's case (ibid), is not applicable because the facts of that case we.re entirely different.

Counsel further stated that any executive order issued by the Government, cannot supplant the statutory rules framed by the Governor under Article 309. Executive instructions can operate only in areas not covered by the rules.

But here the area was fully occupied by the statutory rule 28(b)(ii).

There can be no quarrel with the proposition that if the statutory rules framed by the Governor or any law enacted by the State Legislature under Article 309 is silent on any: particular point, the Government can fill up that gap and supplement the rule by issuing administrative instructions not inconsistent with the statutory provisions already framed or enacted.

The Executive instructions in order to be valid must run subservient to the statutory provisions. In the instant case, however, it could not be said that there was a gap or a void in the statutory provisions in the matter of promotion from the cadre of Lower Division Clerks to that of Upper Division Cle.rks.

After the enactment of the Kerala Public Services Act of 1968, the position was that by virtue of Section 3 of that Act, the Kerala State Subordinate Services Rules of 1958 framed by the Governor un.der the proviso to Article 309 of the Constitution were deemed to have been made under the Act and we.re continued until superseded by rules made under that Act.

As noticed already, no Special Rules relating to Upper Division Clerks have been framed.

The General Rules in Part II will, therefore, be applicable to Upper Division Clerks, also.

It will beaJ:" repetition that the preamble to the Rules and Rule I in Part II, indicate that all the previous rules have been superseded.

These General Rules do not provide any minimum general educa- G tional qualification for promotion to the cadre of Upper Division Clerks from that of Lower Division Clerks.

All that is required by rule 28 (b) (ii) which governs the promotions from the Lower Division to the Upper Division, is tbat promotions shall be made m accordance with seniority subject to the person's fitness for appointment. There is nothing in this sub-rule or elsewhere H which provides that a member of the Lower Division will be presumed to be unfit for promotion to the Upper Division unless he possesses the minimum general educational qualification, or

...

• •

~ passes a qualifying test. It is conceivable that the State Government may prescribe a general test for all Clerks of the Lower Division to judge their fitness for promotion to the Upper Di, ision.

But, such is not the case here.

The respondent and the others like him who were appointed as Lower Division Clerks after granting them exemption from possessing the minimum general educational qualification have been singled out for this discriminatory treatment.

There is 1iothing on the record to show that the case of the respondent was considered for promotion and he was found unfit.

• •

• ,

' '>

The ratio of Triloki Nath Khosa's case (ibid) does not advance the case of the appellant State.

Therein, persons appointed directly and -by promotion were integrated into a common class of Assistant Engineers.

Rule 12 provided that Graduates among the Assistant Engineers, shall be eligible for promotion to the cadre of Executive Engineers, to the exclusion of diploma-holders. This rule was a statutory rule.

Its constitutional validity was challenged on the ground that it violated Articles 14 and 16 of the Constitution. This Court, speaking through Chandrachud J. (as he then was), repelled this cmtention with the reasoning that the classification of Assistant Engineers into degree-holders and diploma-holders could not be held to rest on any unreal or unreasonable basis. The classification was made with a view to achieving administrative efficiency in the Engineering Services . • It will be seen that Triloki Nath's case, is distinguishable from t!:e one before us, at least, in three important aspects.

Firstly, in that case, the statutory rule in question did not make any discrimination in relation to the source of recruitment, it simply provided that Graduates alone shall go into the higher cadre of Executive Engineers, irrespective of whether they were appointed as Assistant Engineers directly or by promotion.

In the present case, the impugned notification

~--prescribes a qualifying test for promotion, not for all but only for one • _ category of persons with reference to the manner in which they initial- -• ly entered service.

Secondly, in Triloki Nath's case the post of the Executive Engineer carried higher responsibility and duties of a supervisory character requiring higher mental equipment and adm'nisfrative skill.

Thus, there, the classification rested on intelligible diITerentiru having a direct nexus to the object (viz., administrative effi-

,.. ciency), to be achieved. In the instant case, there is nothing on record to show that the duties discharged by the clerks of the Upper Division are substantially different from those in the Lower D:vision.

Thirdly, in the instant case the statutory rule docs not warrant the cla, s'.fication made by the impugned Government Order.

The primary criterion for promotion to the Upper Division prescribed by Rule 28(b) (ii) in seniority if the person concerned is otherwise not urn'.

The

J!'

impugned Government Order impinges upon that statutory rule inasmuch as it lays down that even if a Lower Div.ision Clerk who entered service as a result of exemption from possession minimum educational qualification, satisfied the criterion of seniority-cum-fitness prescribed by this Rule, he shall not be considered for promotion unless he qualifies in the test.

The relevant statutory Rules governing the appellant do not provide any minimum general education qualification for promotion to the Upper Division.

' The case in point is Roshal Lal Tandon v. Union of India.(') In that case, before the impugned notification was issued, there was only one rule of promotion for both the departmental promotees and the-- ~"- • direct recruits, and that rule was seniority-cum-suitability, and there ? was no rule of promotion separately made for application to direct recruits.

As a result of the impugned notification, a discriminatory treatment was made in favour of the direct recruits, i.e. existing Apprentice Train Examiners who had already been absorbed in Grade 'D' by March 31, 1966, because the notification provided that this group of Apprentice Train Examiners should first be accommodated en bloc in Grade 'C' upto 80 per cent of vacancies reserved for them without undergoing any selection.

Ramaswami J., speaking for a Bench of five learned Judges, held that the impugned notification violated the guarantee under Articles 14 and 16 of the Constitution.

The reason was that once the direct recruits and promotees were absorbed in one cadre, they formed one class and they could not be discriminated against for the purpose of further promotion to the higher Grade 'C'. In that case, it was not disputed that before the impugned notification was issued there was only one rule of promotion for both the departmental promotees and the direct recruits and that rule was 'seniority-cum-suitability'.

The impugned notification was . discriminatory because in the case of that category who were appointed- as Train Examiners by promotion the aforesaid test of 'seniority-cum- • suitability' prescribed by the rule for further promotion to the higher •- Grade 'C' was abandoned and, instead, selection on merit only was adopted.

The principle enunciated in Roshan Lal Tandon v. Union of India applies with greater force to the facts of the present case because here the classification made by the impugned Government Order is not only unfair and irrational but also, virtually amounts to abandonment of the test of seniority-cum-fitness provided in rule 28 (b) (ii).

H The last point for consideration is, whether it was proper for the High Court to issue a positive direction requiring the appellant to ••

ll) [196811s.c.R.1ss.

promote the respondent to the Upper Division and thereafter to determine his rank in the cadre of Upper Division Clerks. Ordinarily, the court does not issue a direction in such positive terms, but the peculiar feature of this case is that it has not been disputed that Koyakutty respondent satisfies the two-fold cr; terion for promotion laid down in the statutory rule 28(b)(ii). Indeed, the District Registrar, Palghat, who was impleaded as respondent 3 in the writ petition, expressly admitted in paragraph 8 of his counter-affidavit filed before the High Court, "that the seniority of service is the basis of promotion from the ranks of Lower Division Clerks to the ranks of Upper Division Clerks provided they are fully qualified by passing the departmental tests for the purpose". It was never the case of the Registrar that Koyakutty was not otherwise fit for promotion. Indeed, even in the grounds of appeal to this Court, incorporated in the Special Leave Petition, it is not alleged that Koyakutty did not satisfy the criterion of senioritycum-fitness prescribed by Rule 28 (b) (ii). The position taken by the appellant, throughout, was that this rule should be deemed to have heen "supplemented" by the impugned Government Notification. It is not correct that the impugned Notification merely "supplements" or fills up a gap in the statutory rules. It tends to superadd or super impose by an Executive fiat on the statutory rules something inconsis .. tent with the same.

Since the existence of both the criteria viz., seniority and fitness for promotion to the Upper Division prescribed by the statutory Rule 28(b) (ii), in the case of Koyakutty was not disputed, the High Court was justified in issuing the direction, it did.

For the foregoing reasons the appeal fails and is dismissed with costs.

)..- -P.B.R.

A ppeai d1sm1ssed .

DISTT. REGISTRAR PALGHAT & ORS

B. KOYY AKUTI & ORS

February 20, 1979

R. S. SARKARIA

0. CHINNAPPA REDDY, JJ.

Subordinate Service Rules, 1958

State Government of Kerala

Kerala

Travancore- Cochin

November l, 1956

Art. 226

Arts. 14 and

16

Madras

Ministerial Service Rules

Art. 309

s. 3

Kerala Public Services Act, 1968

AIR 1974 SC

1

Kerala High Court

V. A. Sayied Muhammed

K. M. K. Nair

A. S. Nambiar

D. D. Gupta

SARKARIA

Koyakutty

of the High Court of Kera la, arises out of these facts :
Koyakutty, Respondent herein, entered service of the former\ Madras State on May 1, 1943 as temporary Section Writer on probation in r the Registration Department.

Madras Government

April 15, 1954

M. B. Koyakutty

Governor of Madras

S. K. Chettu

Koyakutty

May 19, 1954

May 16, 1961

Government of Kerala

Public Service Commission

Palghat

Article 226

Article 14 and 16

Koyaikutty

Travancore-Cochin

November 1, 1956

Article 309

Part I of these Rules

PJlrt II contains the General Rules

Relation to the Special Rules

Article 309

February 25, 1957

Article 162

Article 309

Nambiar

[1966] 3 S.C.R. 682

Khosa

Article 309

Article 309

Section 3

Article 309

These General Rules

Triloki Nath Khosa

Articles 14 and 16

Chandrachud

Triloki Nath

Ramaswami

Articles 14 and 16