Supreme Court Denies Selection Grade Benefit: Rajasthan State Road Transport Corporation vs. Sadhu Singh (2022)

Introduction

Date of the Judgment: 4 February 2022

Citation: (2022) INSC 106

Judges: Dr Dhananjaya Y Chandrachud, J. and Surya Kant, J.

Can an employee with a history of disciplinary actions claim Selection Grade benefits? The Supreme Court of India addressed this question in a case involving the Rajasthan State Road Transport Corporation and one of its employees. This judgment clarifies the importance of a clean service record for employees seeking such benefits and also emphasizes the limitation period for filing a suit after retirement. The bench comprised of Justice Dr. Dhananjaya Y Chandrachud and Justice Surya Kant.

Case Background

The respondent, Sadhu Singh, was appointed as a Conductor by the Regional Manager of the Rajasthan State Road Transport Corporation (RSRTC) in Bikaner. On 25 January 1992, the Finance Department of the Government of Rajasthan issued an Office Order regarding the grant of Selection Grades to employees upon completing 9, 18, and 27 years of service. This order was applicable to RSRTC. Sadhu Singh was compulsorily retired on 4 January 2003. During his service, he faced 19 charge-sheets and departmental penalties. In 2010, nearly seven years after his retirement, Sadhu Singh filed a suit seeking the benefit of the Selection Grade. He claimed entitlement to the Selection Grade upon completion of 9, 18, and 27 years of service.

Timeline:

Course of Proceedings

The Additional Civil Judge (Junior Division) partially decreed the suit on 26 March 2012, directing that Sadhu Singh was entitled to the Selection Grade from 25 January 1992 on completion of 9 years of service and the second Selection Grade pay scale from 7 January 2002 on completion of 18 years of service. The First Appellate Court dismissed the appeal against this judgment on 21 January 2017. Subsequently, the High Court of Judicature at Rajasthan dismissed the Second Appeal on 7 August 2018.

Legal Framework

The case primarily revolves around the interpretation of the Office Order issued by the Finance Department of the Government of Rajasthan on 25 January 1992, which provided for the grant of Selection Grades to employees on completion of 9, 18, and 27 years of service. The Supreme Court also considered the provisions of the Limitation Act 1963, specifically Article 137, which prescribes a residuary period of limitation of three years. The Court also considered Clause 7 of the Office Order, which stipulates that Selection Grades are granted only to employees with a satisfactory service record.

The relevant portion of Clause 7, as extracted from the judgment, states:

“7. Selection Grades in terms of this order shall be granted only to those employees whose record of service is satisfactory. The record of service which makes one eligible for promotion on the basis of seniority shall be considered to be satisfactory for the purpose of grant of the Selection Grade.”

Arguments

Arguments by the Appellant (Rajasthan State Road Transport Corporation):

• Limitation: The suit was filed in 2010, nearly seven years after the respondent’s compulsory retirement in 2003, and was therefore barred by limitation. The residuary period of limitation of three years as per Article 137 of the Schedule to the Limitation Act 1963, had expired.
• Clean Service Record: To be eligible for the Selection Grade, an employee must have a clean record of service. The respondent had been served with 19 charge-sheets and departmental penalties, indicating an unsatisfactory service record.

Arguments by the Respondent (Sadhu Singh):

• Limitation: The suit was within limitation because it was filed after the rejection of the respondent’s representation for the grant of Selection Grades on 18 January 2010.
• Compulsory Retirement: The order of compulsory retirement is not a penalty.
• Evidence of Charge-sheets: The department did not produce sufficient evidence to establish all the charge-sheets and disciplinary penalties against the respondent.
• Nature of Penalties: Some of the penalties imposed on the respondent were without cumulative effect, implying they were minor in nature.

Issues Framed by the Supreme Court

The Supreme Court addressed the following issues:

1. Whether the suit instituted by the respondent was barred by limitation.
2. Whether the respondent was entitled to the grant of Selection Grade, considering his service record.

Treatment of the Issue by the Court:

Authorities

The Supreme Court considered the following authorities:

• State of Rajasthan and Others vs Shankar Lal Parmar [(2011) 14 SCC 235] – Supreme Court of India: This case was relied upon to interpret Clause 7 of the Office Order, which mandates a satisfactory service record for the grant of Selection Grade. The Court held that only employees with an untainted service record are eligible for Selection Grade.
• Article 137 of the Schedule to the Limitation Act 1963: This provision was considered for determining the limitation period for filing the suit.
• Office Order of 25 January 1992 issued by the Finance Department of the Government of Rajasthan: This order was the basis for the claim of Selection Grade benefits.

Judgment

How each authority was viewed by the Court?

• State of Rajasthan and Others vs Shankar Lal Parmar [(2011) 14 SCC 235]: The Supreme Court followed this judgment, emphasizing that only employees with a satisfactory service record are eligible for Selection Grade.
• Article 137 of the Schedule to the Limitation Act 1963: The Court applied this provision to determine that the suit was filed beyond the prescribed limitation period.

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily influenced by two factors: the delay in filing the suit and the respondent’s blemished service record. The Court emphasized that the respondent waited seven years after his retirement to claim the Selection Grade benefits, which was beyond the limitation period. Additionally, the Court highlighted that the respondent had been subjected to numerous disciplinary proceedings, which indicated an unsatisfactory service record.

The Court’s reasoning was based on the interpretation of Clause 7 of the Office Order, which clearly states that only employees with a satisfactory service record are eligible for Selection Grade. The Court found that the respondent’s service record was not satisfactory due to the 19 charge-sheets and penalties imposed on him. The Court also considered the Limitation Act, which bars suits filed beyond the prescribed period.

The Court rejected the respondent’s argument that the suit was within limitation because it was filed after the rejection of his representation. The Court also rejected the argument that the penalties were minor, stating that the imposition of any penalty indicates an unsatisfactory service record. The Court did not consider any alternative interpretations and focused on the plain meaning of the relevant provisions and the facts of the case.

The decision was made based on the following reasons:

• The suit was filed seven years after the respondent’s retirement, exceeding the limitation period.
• The respondent’s service record was not satisfactory due to the numerous disciplinary actions.
• The conditions stipulated for the grant of Selection Grade were not met by the respondent.

The Supreme Court quoted the following from the judgment:

“The respondent waited for seven long years after his retirement to pursue a claim for the grant of Selection Grade. This was clearly beyond the residuary period of limitation of three years provided in Article 137 of the Schedule to the Limitation Act 1963.”

“Clause 7 makes it clear that only those employees would be entitled for grant of Selection Grades, whose service record has been satisfactory and are otherwise eligible for promotion on the basis of seniority but have not been able to get the same as there might not be any channel of promotion or for want of sanctioned posts in the cadre.”

“On the touchstone of the above principles, it is evident that the respondent had been subjected to several disciplinary proceedings and as many as 19 charge-sheets were issued against him which resulted in penalties of a varying nature. The service record of the respondent cannot be regarded as untainted or clean.”

There was no minority opinion in this case. The bench consisted of two judges, both of whom agreed on the judgment.

Key Takeaways

• Employees seeking Selection Grade benefits must have a clean and satisfactory service record.
• Suits for service-related benefits must be filed within the prescribed limitation period, usually three years from the date of the cause of action.
• A history of disciplinary actions can disqualify an employee from receiving Selection Grade benefits.
• The imposition of any penalty, even without cumulative effect, indicates an unsatisfactory service record.

Directions

The Supreme Court allowed the appeal, set aside the judgment of the High Court, and dismissed the suit instituted by the respondent.

Development of Law

The ratio decidendi of this case is that an employee with a blemished service record is not entitled to Selection Grade benefits, and any suit for such benefits must be filed within the prescribed limitation period. This case reinforces the principle that a clean service record is a prerequisite for the grant of Selection Grade and clarifies that a delay in filing a suit can result in its dismissal.

Conclusion

In the case of Rajasthan State Road Transport Corporation vs. Sadhu Singh, the Supreme Court ruled against the respondent, holding that his suit was barred by limitation and that he was not entitled to the Selection Grade benefits due to his blemished service record. This judgment highlights the importance of maintaining a clean service record and adhering to the limitation period for seeking service-related benefits.