Supreme Court clarifies compassionate appointment eligibility: Bank of Baroda vs. Baljit Singh (2023)

Date of the Judgment: 21 June 2023
Citation: 2023 INSC 584
Judges: Justice B.V. Nagarathna and Justice Manoj Misra
Can a person be appointed on compassionate grounds if their family’s financial condition does not meet the criteria specified in the applicable scheme? The Supreme Court of India addressed this question in a recent case concerning the appointment of a dependent of a deceased bank employee. The Court clarified that compassionate appointment is not a matter of right and is subject to the conditions laid down in the relevant scheme. The judgment was delivered by a two-judge bench comprising Justice B.V. Nagarathna and Justice Manoj Misra.

Case Background

The respondent’s father, an employee of the appellant-Bank of Baroda, passed away on 16 May 1999, while still in service. At that time, the bank had a scheme in place, issued on 18 August 1998, for the appointment of dependents of deceased employees on compassionate grounds. The respondent’s mother applied for his appointment as a Peon under this scheme on 21 February 2000. While this application was pending, the bank introduced another scheme on 10 March 2004. On 25 March 2004, the respondent informed the bank that he had completed his matriculation in March 2004. The bank rejected his application on 8 June 2004. Aggrieved by this decision, the respondent filed a suit seeking a declaration and mandatory injunction for his appointment on compassionate grounds. The Trial Court ruled in favor of the respondent, directing the bank to appoint him. However, the First Appellate Court overturned this decision. Subsequently, the High Court of Punjab and Haryana reversed the First Appellate Court’s decision and restored the Trial Court’s order.

Timeline

Course of Proceedings

The Trial Court initially decreed the suit in favor of the respondent, directing the bank to appoint him on compassionate grounds. The appellant-Bank then appealed to the Additional District Judge, who overturned the Trial Court’s decision. The respondent subsequently filed a Regular Second Appeal before the High Court of Punjab and Haryana. The High Court set aside the First Appellate Court’s judgment and restored the Trial Court’s decree. The Bank then appealed to the Supreme Court.

Legal Framework

The case revolves around the interpretation and application of the Bank’s 1998 Scheme for compassionate appointments. The scheme stipulates that a dependent of a deceased employee can be considered for compassionate appointment if the family is without means of livelihood and in a penurious condition. The scheme also includes a formula to calculate the family’s financial position, stating that if the monthly income is less than 60% of the total emoluments the deceased was drawing at the time of death, the case for compassionate appointment can be considered. The Supreme Court also considered previous judgments on compassionate appointments, emphasizing that such appointments are an exception to the general rule of recruitment and not a vested right.

Relevant Clause from the Scheme:

“b) Dependent of an employee dying in harness can be considered for compassionate appointment provided the family is without means of livelihood and the condition of the family is penurious.
c) Calculation formula for income:
Following formula would be followed for arriving at the financial position or income of the family:
The total of the following amounts received as Terminal Benefits will form the available resources:
i. Balance of provident fund.
ii. Gratuity.
iii. Additional Retirement Benefits.
iv. Investments made from loan from others.
From the above, following outstanding financial liabilities to be deducted:
i. Housing loan
ii. Vehicle loan
iii. Other loans from bank
iv. Loan from others
After arriving at the net amount remaining with the family, interest @11% be applied to arrive at monthly income of the family by further taking into consideration:
i. Net salary of dependent family members viz., spouse/ son/ daughter/ dependent unmarried brother/dependent unmarried sister.
ii. Pension (monthly)
iii. Income from savings and other investments.
After arriving at the monthly income as above, if the same is less than 60% of the total emoluments (which the deceased was drawing at the time of death) less Tax @ 15% (if the income is more than Rs.10,000/- p.m.) the case for compassionate appointment can be considered.”

Arguments

Appellant’s Arguments:

• The High Court erred in favoring the respondent without considering the factual aspects of the case, especially the financial status of the respondent’s family.
• The respondent did not meet the financial criteria specified in the 1998 Scheme for compassionate appointment. The family’s income was above the threshold for consideration.
• The respondent had not completed his matriculation within four years of his father’s death, making him ineligible for appointment as a clerk and overqualified for a Peon position.
• Compassionate appointment is not a matter of right but an exception to the general rule of recruitment.
• The suit seeking a declaration and mandatory injunction against the bank was not maintainable.

Respondent’s Arguments:

• The respondent was eligible for compassionate appointment as he had passed 8th standard when his father died and later completed his matriculation.
• The application for compassionate appointment was filled by the bank, and the details in it were not accurate.
• The delay in considering the respondent’s application and its rejection without proper reasoning caused prejudice.
• The respondent was entitled to be considered for an appropriate post in the bank.

Issues Framed by the Supreme Court

1. Whether the High Court was justified in setting aside the judgment of the First Appellate Court and restoring the judgment and decree of the Trial Court while answering the questions of law in favor of the respondent and against the Bank?
2. What order?

Treatment of the Issue by the Court

Authorities

Cases Relied Upon by the Court:

• General Manager (D&PB) and Others vs. Kunti Tiwary [(2004) 7 SCC 271] – Supreme Court of India: Reiterated that compassionate appointment is an exception to recruitment and not a matter of right.
• Balbir Kaur and Another vs. Steel Authority of India Ltd. [(2000) 6 SCC 493] – Supreme Court of India: Discussed that family benefit schemes are not a substitute for compassionate appointment.
• N.C. Santhosh vs. State of Karnataka [(2019) 7 SCC 617] – Supreme Court of India: A three-judge bench reiterated that compassionate appointment is a concession and not a right, and the criteria laid down in the applicable rules and schemes must be satisfied.
• State of Himachal Pradesh Vs. Shashi Kumar [(2019) 3 SCC 653] – Supreme Court of India: Observed that compassionate appointment is an exception to the general rule and that dependents must fulfill the terms of the policy.
• State of Himachal Pradesh vs. Parkash Chand [(2019) 4 SCC 285] – Supreme Court of India: Held that High Courts cannot direct compassionate appointments dehors the terms of the policy.
• Indian Bank vs. Promila [(2020) 2 SCC 729] – Supreme Court of India: Observed that eligibility for compassionate appointment must be as per the applicable scheme, and courts cannot substitute or alter the terms of the scheme.

Legal Provisions Considered by the Court:

• The 1998 Scheme of the Bank of Baroda: The scheme outlined the conditions for compassionate appointment, including financial eligibility criteria.

Judgment

How each authority was viewed by the Court?

• General Manager (D&PB) and Others vs. Kunti Tiwary [(2004) 7 SCC 271]*: Used to reinforce the principle that compassionate appointment is an exception to normal recruitment.
• Balbir Kaur and Another vs. Steel Authority of India Ltd. [(2000) 6 SCC 493]*: Distinguished on facts, as the scheme in this case had a specific formula for calculating income.
• N.C. Santhosh vs. State of Karnataka [(2019) 7 SCC 617]*: Used to reiterate that compassionate appointment is a concession and not a right.
• State of Himachal Pradesh Vs. Shashi Kumar [(2019) 3 SCC 653]*: Used to emphasize that dependents must fulfill the terms of the compassionate appointment policy.
• State of Himachal Pradesh vs. Parkash Chand [(2019) 4 SCC 285]*: Used to highlight that High Courts cannot direct compassionate appointments outside of the policy terms.
• Indian Bank vs. Promila [(2020) 2 SCC 729]*: Used to emphasize that eligibility for compassionate appointment must be as per the applicable scheme.

The Supreme Court allowed the appeal, setting aside the High Court’s judgment and dismissing the respondent’s suit. The Court emphasized that compassionate appointment is not a matter of right but an exception to the general rule of recruitment. It further clarified that the eligibility for compassionate appointment must be strictly in accordance with the applicable scheme. The Court found that the High Court had erred by not considering the factual details regarding the respondent’s family income and misapplied the law on compassionate appointment.

What weighed in the mind of the Court?

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

• The strict interpretation of the compassionate appointment scheme, emphasizing that eligibility must be determined by the terms of the scheme.
• The factual analysis of the respondent’s family income, which did not meet the criteria for compassionate appointment.
• The principle that compassionate appointment is an exception to the general rule of recruitment and not a matter of right.
• The need to ensure that compassionate appointment is only granted to families in genuine penury.

Logical Reasoning:

The Court considered the argument that the respondent had passed 8th standard at the time of his father’s death and later completed his matriculation, but rejected this argument because the financial criteria of the scheme were not met. The Court also rejected the argument that the delay in considering the respondent’s application caused prejudice as the respondent did not meet the financial eligibility criteria. The court held that the High Court should have considered the factual details rather than just referring to the judgments in answering the questions of law. The court emphasized that the scheme must be strictly followed.

“It is necessary to reiterate that the appointment of a candidate on compassionate basis does not create any vested right and that it is only when a candidate is covered under all clauses of the Scheme applicable at the relevant point of time that he/she could be considered for compassionate appointment.”

“Since appointment on compassionate basis is an exception to the general rule for appointment by an open invitation, the exception has to be resorted to only when the candidate and his family is in penury so as to provide immediate succor on the death of the employee in harness.”

“In this regard, we would like to consider the issue regarding the consideration of the financial position of the respondent vis-a-vis the eligibility to be considered for appointment on compassionate grounds.”

Key Takeaways

• Compassionate appointment is not a matter of right but an exception to the general rule of recruitment.
• Eligibility for compassionate appointment must be strictly in accordance with the terms of the applicable scheme.
• Courts cannot direct compassionate appointments outside of the terms of the policy.
• Financial eligibility is a key factor in determining whether a dependent can be considered for compassionate appointment.
• The family must be in a state of penury to be considered for compassionate appointment.

Directions

The Supreme Court set aside the judgment of the High Court and dismissed the suit of the respondent.

Development of Law

The ratio decidendi of this case is that eligibility for compassionate appointment must be strictly in accordance with the terms of the applicable scheme, and financial eligibility is a key factor. This case reinforces the established position that compassionate appointment is an exception to the general rule of recruitment and not a matter of right. There is no change in the previous positions of law.

Conclusion

The Supreme Court’s judgment in Bank of Baroda vs. Baljit Singh clarifies the principles governing compassionate appointments. The court emphasized that such appointments are not a matter of right but are subject to the conditions laid down in the applicable scheme. The decision underscores the importance of adhering to the financial criteria specified in the scheme and ensures that compassionate appointments are granted only to families in genuine need. The judgment sets a precedent for future cases regarding compassionate appointments, reinforcing the need for strict adherence to the terms of the applicable scheme.

Category

Parent Category: Service Law

Child Category: Compassionate Appointment

Child Category: Eligibility Criteria

Child Category: Bank of Baroda Scheme

Parent Category: Service Law

Child Category: Financial Eligibility

Parent Category: Bank of Baroda

Child Category: 1998 Scheme

FAQ

Q: What is compassionate appointment?
A: Compassionate appointment is a provision that allows the dependent of a deceased government or bank employee to be appointed to a job without going through the regular recruitment process. It is intended to provide immediate relief to the family of the deceased employee.

Q: Is compassionate appointment a right?
A: No, compassionate appointment is not a right. It is an exception to the general rule of recruitment and is subject to the terms and conditions of the applicable scheme.

Q: What are the eligibility criteria for compassionate appointment?
A: The eligibility criteria for compassionate appointment vary depending on the specific scheme of the employer. Generally, it includes the financial condition of the family, educational qualifications, and other specific conditions as laid down in the scheme.

Q: What is the significance of the financial condition of the family?
A: The financial condition of the family is a key factor in determining eligibility for compassionate appointment. The scheme usually specifies a formula to calculate the family income, and only those families that meet the criteria are considered.

Q: Can a court direct a compassionate appointment outside the terms of the policy?
A: No, a court cannot direct a compassionate appointment that is outside the terms of the applicable policy or scheme. The appointment must be strictly in accordance with the terms of the scheme.

Q: What is the main takeaway from the Supreme Court’s judgment in Bank of Baroda vs. Baljit Singh?
A: The main takeaway is that compassionate appointment is not a matter of right and that eligibility must be strictly in accordance with the terms of the applicable scheme. Financial eligibility is a key factor, and courts cannot direct appointments outside of the policy.