Supreme Court clarifies allowance parity for Indian Military Personnel in Bhutan: Union of India vs. Captain Gurdev Singh (2019) INSC 79 (11 February 2019)

Date of the Judgment: 11 February 2019
Citation: (2019) INSC 79
Judges: N.V. Ramana, J., Mohan M. Shantanagoudar, J.
The Supreme Court of India addressed the question of whether the Bhutan Compensatory Allowance (BCA) paid to Indian Military Training Team (IMTRAT) personnel in Bhutan should be equivalent to the Foreign Allowance (FA) paid to Indian diplomatic personnel of the Ministry of External Affairs (MEA) in Bhutan. This case examines the scope of a previous order by the High Court of Delhi, which had directed the implementation of a Cabinet decision regarding the BCA. The Supreme Court clarified that the High Court’s order was limited to the removal of a depression on the BCA and did not mandate parity with the FA. The judgment was authored by Justice Mohan M. Shantanagoudar.

Case Background

The case revolves around compensatory allowances for three categories of personnel in Bhutan. The first category is the IMTRAT, who train the Bhutanese Army and receive the BCA. This allowance previously had a deduction (depression) of 22.5% for Service Officers and 10% for Personnel Below Officer Rank (PBORs) due to free mess and ration facilities. The second category includes civilian personnel working on Indian projects in Bhutan, who receive the BCA without any deductions. The third category is MEA personnel who receive the FA under the Indian Foreign Service (Pay, Leave, Compensatory Allowance and other Conditions of Service) Rules, 1981.

IMTRAT personnel had demanded the removal of the depression on their BCA. A High-Level Committee and a Group of Officers recommended its removal, subject to charges for the facilities. The Cabinet approved this on 30 November 1999.

Two IMTRAT personnel filed Writ Petitions in 2004, seeking parity between their BCA and the FA of MEA personnel, arguing that parity had existed from 1973 to 1997. They also sought implementation of the 1999 Cabinet decision. The Ministry of Defence removed the depression on the BCA prospectively from 20 September 2005.

The High Court of Delhi, on 22 November 2005, set aside the prospective implementation of the Ministry of Defence order and directed that the Cabinet decision be implemented from 1 December 1999, after accounting for two ad hoc revisions of the BCA. The Union of India sought time to comply, and the Ministry of Defence issued a corrigendum on 23 February 2006, making the removal of depression effective from 1 December 1999.

The respondents filed an application for clarification, arguing that the term “civilian counterparts” in the original order should refer to MEA personnel, not civilian personnel working on projects. The High Court affirmed parity between the BCA and FA in its judgment dated 7 May 2007, leading to the current appeal by the Union of India.

Timeline

Course of Proceedings

The High Court initially allowed the writ petitions on 22 November 2005, setting aside the prospective implementation of the Ministry of Defence order dated 20 September 2005. The High Court directed the implementation of the Cabinet decision dated 30 November 1999, with effect from 1 December 1999, after accounting for two ad hoc revisions.

The Ministry of Defence issued a corrigendum on 23 February 2006, to its order, directing that the removal of depression and recovery of charges be given retrospective effect from 1 December 1999.

Subsequently, the respondents filed an application for clarification, arguing that the term “civilian counterparts” should refer to MEA personnel, not civilian personnel working on projects. The High Court affirmed parity between the BCA and FA in its judgment dated 7 May 2007, leading to the current appeal by the Union of India.

Legal Framework

The case involves the interpretation of the Indian Foreign Service (Pay, Leave, Compensatory Allowance and other Conditions of Service) Rules, 1981, specifically regarding the Foreign Allowance (FA) granted to MEA personnel serving outside India. Rule 7 of the said rules states:

“A member of the Service serving outside India may be granted a foreign allowance at such rates and subject to such conditions as may be prescribed by the Government from time to time.”

The case also considers the Cabinet decision dated 30 November 1999, which recommended that IMTRAT service personnel be paid the BCA at the same rate as their civilian counterparts, and the Ministry of Defence order dated 20 September 2005, which implemented this decision prospectively.

Arguments

Appellants’ Arguments:

• The original order did not direct parity between BCA and FA, but only contemplated periodic revisions to the BCA.
• The direction to grant retrospective effect to the removal of depression on the BCA was based on the recommendation that BCA be paid to IMTRAT at the same rate as their “civilian counterparts,” which refers to civilian deputationists in Bhutan, not MEA personnel.
• The FA and BCA are incomparable allowances for personnel with different duties and service conditions.
• Parity between the two allowances until 1997 was a coincidence and not a promise by the government.
• Granting parity would lead to demands for parity between FA and compensatory allowances in other countries.
• The difference between civilian and military personnel is a valid ground for classification.

Respondents’ Arguments:

• The original order had two parts: removal of depression and parity between FA and BCA. Only the first part was complied with.
• The term “civilian counterparts” in the Cabinet decision refers to MEA personnel, not civilian personnel working on projects.
• The appellants had previously submitted that the grievances of the respondents had been met post the removal of depression on the BCA, indicating acceptance of the interpretation of “civilian counterparts” as MEA personnel.
• The two allowances are of the same nature, meant to offset the higher cost of living in a foreign country.
• IMTRAT personnel work in a difficult terrain and deserve an equivalent or greater allowance than MEA personnel.
• Parity between IMTRAT and MEA personnel will not create grounds for parity between deputationists and MEA personnel.
• There was parity between the two allowances for 25 years, which was arbitrarily discontinued.

The innovativeness in the argument by the respondents was that they were able to convince the High Court that the term “civilian counterparts” should be interpreted as MEA personnel, despite the government’s contention that it meant civilian deputationists in Bhutan.

Issues Framed by the Supreme Court

The fundamental issue before the Supreme Court was:

1. Whether the impugned judgment went beyond the scope of the original order in directing parity between the FA and the BCA payable to IMTRAT personnel.

Treatment of the Issue by the Court

The following table demonstrates as to how the Court decided the issues

Authorities

The following cases were considered by the court:

The following legal provisions were considered by the court:

Judgment

The Supreme Court held that the High Court’s clarification in the impugned judgment, which directed parity between the BCA and FA, was beyond the scope of the original order. The original order was limited to the implementation of the Cabinet decision regarding the removal of depression on the BCA, not parity with the FA.

The Court also held that there were no valid grounds for the High Court to grant parity between the BCA and FA. The Court noted that the purpose of both allowances is to meet the higher cost of living abroad, but the requirements to be met are different. IMTRAT personnel benefit from mess and canteen facilities, while also receiving additional allowances like the “Difficult Area Allowance” and Military Service Pay.

The Court further stated that the nature of work, terms of appointment, and conditions of service of IMTRAT and MEA personnel are different. The Court also affirmed that the difference between civilian and defence personnel is a valid classification.

The Court directed the government to remove the depression of 6% and 4% on the BCA payable to IMTRAT personnel with immediate effect.

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily influenced by the following factors:

• The Court emphasized that the original order of the High Court was specific to the implementation of the Cabinet decision regarding the removal of depression on the BCA and did not explicitly mandate parity with the FA.
• The Court noted that the term “civilian counterparts” was not defined in the original order or the Cabinet decision, and thus, the High Court’s interpretation of it to mean MEA personnel was incorrect.
• The Court highlighted the differences in the nature of work, terms of appointment, and conditions of service between IMTRAT and MEA personnel.
• The Court recognized that IMTRAT personnel receive additional benefits, such as mess and canteen facilities, as well as allowances like “Difficult Area Allowance” and Military Service Pay, which MEA personnel do not receive.
• The Court reiterated that the difference between civilian and defence personnel is a valid classification, which justifies treating IMTRAT and MEA personnel differently.
• The Court acknowledged that while the purpose of both allowances is to meet the higher cost of living abroad, the requirements to be met are different for the two categories of personnel.

The Supreme Court’s reasoning was based on a careful analysis of the original order of the High Court, the Cabinet decision, and the arguments of both parties. The Court emphasized the importance of adhering to the specific directions given in the original order and not expanding its scope through interpretation. The Court also highlighted the differences between IMTRAT and MEA personnel, which justified the differential treatment in terms of allowances.

The Court considered and rejected the argument that the term “civilian counterparts” should be interpreted as MEA personnel, stating that this interpretation was not supported by the original order or the Cabinet decision.

The Court also considered the argument that parity between the two allowances had existed for 25 years but held that this was not a valid reason to demand continued parity, as the government has the right to modulate allowances based on circumstances.

The Court also considered the argument that IMTRAT personnel cannot be equated with civilian personnel on deputation, but held that this was not a sufficient ground to grant parity between IMTRAT and MEA personnel.

The Court’s decision was based on a combination of legal interpretation and factual analysis. The Court’s legal interpretation focused on the scope of the original order and the meaning of the term “civilian counterparts.” The factual analysis focused on the differences between IMTRAT and MEA personnel and the benefits they receive.

The Supreme Court’s decision was unanimous, with both Justices concurring in the judgment.

The Supreme Court observed, “It is clear that the operative portion of the order unambiguously states only that the Cabinet decision dated 30.11.1999 has to be given effect from 01.12.1999 (i.e. the Ministry of Defence order dated 20.09.2005 has to be given retrospective effect from 01.12.1999).”

The Supreme Court further stated, “By granting the relief of parity, the Court went beyond the relief explicitly granted in the original order. It was not open to the Court to interpret the relief granted in such a manner so as to expand its scope to include the second relief prayed for but not granted.”

The Supreme Court also held, “Moreover, it has not been shown by the respondents that the nature of the work done by the IMTRAT and MEA personnel is one and the same, or even comparable. The terms of appointment and conditions of service of the IMTRAT and MEA personnel are also completely different. This aspect in itself is sufficient to negate the case for parity pled by the respondents.”

Key Takeaways

• The Supreme Court clarified that a court’s power in a clarificatory proceeding is different from that in a revision or appeal.
• The judgment emphasizes the importance of adhering to the specific directions in a court order and not expanding its scope through interpretation.
• The decision highlights that the difference between civilian and defence personnel is a valid classification, and differential treatment in terms of allowances is justified.
• The Court directed the government to remove the depression of 6% and 4% on the BCA payable to IMTRAT personnel with immediate effect.

Directions

The Supreme Court directed the Government to remove the depression of 6% and 4% respectively on the BCA payable to IMTRAT personnel, being the Service Officers and PBORs, with immediate effect.

Development of Law

The ratio decidendi of this case is that a court’s power in a clarificatory proceeding is different from that in a revision or appeal, and that a court cannot expand the scope of its original order through interpretation. This case also reinforces the principle that the difference between civilian and defence personnel is a valid classification, and differential treatment in terms of allowances is justified. The Supreme Court has, in this case, clarified that the High Court’s directions were limited to the removal of depression on the BCA and did not mandate parity with the FA.

Conclusion

The Supreme Court allowed the appeal in part, setting aside the High Court’s judgment that had affirmed parity between the BCA and FA for IMTRAT and MEA personnel in Bhutan. The Supreme Court clarified that the original order was limited to the removal of depression on the BCA and did not mandate parity with the FA. The Court also directed the government to remove the remaining depression on the BCA for IMTRAT personnel with immediate effect.