Date of the Judgment: 18 September 2008
Judges: S.B. Sinha and Cyriac Joseph, JJ.
Can a senior employee claim retrospective promotion benefits merely because a junior employee, who was initially granted an out-of-turn promotion, received undue advantages? The Supreme Court addressed this question in a dispute between employees of the Kerala State Electricity Board (KSEB). The core issue revolved around conflicting claims of seniority and the validity of promotions granted within the Board’s Secretariat Service versus the General Establishment.
Case Background
The Kerala State Electricity Board (KSEB) had two service categories: Ministerial and Executive. On April 1, 1964, a separate ‘Board Secretariat Service’ was created, offering employees an option to transfer with lien rights to their parent wing.
Mr. Saratchandran P. (Respondent No. 1) was appointed as a Lower Division Clerk on May 11, 1962. L. Radhadevi and S.G. Rajappan were appointed on January 28, 1963, and March 11, 1968, respectively. Radhadevi and Rajappan opted for the Board Secretariat Service, while Saratchandran remained in the general establishment.
Due to their positions in the Board Secretariat Service, Rajappan and Radhadevi were promoted as Senior Superintendents on July 31, 1979, and March 17, 1977, respectively. Saratchandran was promoted to Junior Superintendent on November 9, 1979, Superintendent on August 1, 1986, and Senior Superintendent on July 14, 1987.
The Board Secretariat Service lacked the post of Senior Superintendent. Rajappan and Radhadevi were promoted to Assistant Accounts Officer on January 21, 1984, and March 3, 1983, respectively, while Saratchandran was promoted to the same post on December 23, 1992. Rajappan and Radhadevi were appointed as Accounts Officers on September 1, 1990, and Senior Accounts Officers on August 4, 1993, and December 17, 1992, respectively. Saratchandran was promoted to Accounts Officer on January 19, 1995, and retired on May 31, 1996. Radhadevi and Rajappan retired on July 31, 1993, and May 31, 1996, respectively.
Timeline:
| Date | Event |
|---|---|
| May 11, 1962 | Mr. Saratchandran P. appointed as Lower Division Clerk. |
| January 28, 1963 | L. Radhadevi appointed. |
| April 1, 1964 | Board Secretariat Service constituted. |
| March 11, 1968 | S.G. Rajappan appointed. |
| March 17, 1977 | L. Radhadevi promoted to Senior Superintendent. |
| July 31, 1979 | S.G. Rajappan promoted to Senior Superintendent. |
| November 9, 1979 | Mr. Saratchandran P. promoted to Junior Superintendent. |
| January 21, 1984 | S.G. Rajappan promoted to Assistant Accounts Officer. |
| March 3, 1983 | L. Radhadevi promoted to Assistant Accounts Officer. |
| August 1, 1986 | Mr. Saratchandran P. promoted to Superintendent. |
| July 14, 1987 | Mr. Saratchandran P. promoted to Senior Superintendent. |
| September 1, 1990 | L. Radhadevi and S.G. Rajappan appointed as Accounts Officer. |
| December 17, 1992 | L. Radhadevi appointed as Senior Accounts Officer. |
| December 23, 1992 | Mr. Saratchandran P. promoted to Assistant Accounts Officer. |
| August 4, 1993 | S.G. Rajappan appointed as Senior Accounts Officer. |
| July 31, 1993 | L. Radhadevi retired. |
| January 19, 1995 | Mr. Saratchandran P. promoted to Accounts Officer. |
| May 31, 1996 | S.G. Rajappan retired. |
| May 31, 1996 | Mr. Saratchandran P. retired. |
| July 23, 1996 | Supreme Court judgment in C.A.No.3967/1990. |
| June 7, 1997 | Board implemented the Supreme Court judgment by reverting eight officers. |
| February 3, 1998 | Review petition dismissed. |
| October 26, 1998 | Seniority of Mr. Saratchandran P. revised. |
| March 8, 1999 | Appellant rejected representation of First Respondent. |
| December 14, 2005 | Division Bench of the Kerala High Court modified the judgment. |
| September 18, 2008 | Supreme Court allowed the appeal and set aside the impugned judgment. |
Legal Framework
The employees of KSEB were governed by the Kerala State Electricity Board (Integration of Board Secretariat Establishment and General Establishment) Regulations, 1981, framed under Section 79-C of the Electricity (Supply) Act, 1948.
Regulation 5(c) of these regulations, as it stood in 1981, stated:
“5(c) Subject of clause(f) relative seniority of persons drawn from the Secretariat Establishment and General Establishment including Accounts Wing and holding equated posts shall be determined on the basis of their length of service in the cadre/category concerned at the time of integration.”
This regulation was later amended on November 7, 1985, following employee representations. The amended regulation stated:
“The relative seniority of persons drawn from the Secretariat establishment and the General Establishment including the Accounts wing shall be determined based on their ranking in the Advice list of the Kerala Public Service Commission or the Board as the case may be at the time of initial recruitment by the Kerala Public Service Commission or the Board to the respective establishment under the Board subject to the application of rules regarding obligatory departmental tests”.
The validity of this amendment was challenged and initially held invalid by the High Court of Kerala. However, the Supreme Court, in a judgment dated July 23, 1996, in C.A.No.3967/1990, allowed the appeal preferred by the KSEB, upholding the amendment.
Arguments
Arguments by the Appellant (Kerala State Electricity Board):
- The appellant’s counsel, Mr. George, argued that the first respondent (Mr. Saratchandran P.) claimed parity with his juniors, S.G. Rajappan and L. Radhadevi, who were promoted out of turn.
- Since Rajappan and Radhadevi had already retired, no action could be taken to revert them to their original posts.
- Granting retrospective promotion to the first respondent would be unjustified because the promotions of his juniors were irregular.
Arguments by the Respondent (Mr. Saratchandran P.):
- Mr. K. Rajeev, the counsel for the first respondent, contended that S.G. Rajappan and L. Radhadevi were junior to Mr. Saratchandran P.
- The High Court judgment, therefore, warranted no interference, as it correctly recognized the first respondent’s seniority.
- Mr. Saratchandran P. argued that he should receive all promotions given to his juniors from the dates they were promoted, with retrospective effect.
- He claimed that the Board had erred in issuing the order dated October 26, 1998, and had not understood the implications of the Supreme Court’s decision in C.A.No.3434/1984 (Om Prakash Sharma Vs. Union of India).
Submissions Table
| Main Submission | Sub-Submissions (Appellant – Kerala State Electricity Board) | Sub-Submissions (Respondent – Mr. Saratchandran P.) |
|---|---|---|
| Promotion Benefits |
✓ First respondent claimed parity with juniors. ✓ Juniors were promoted out of turn. |
✓ Juniors were indeed junior to the first respondent. ✓ First respondent should receive promotions with retrospective effect. |
| Retirement of Juniors | ✓ Juniors had retired, making reversion impossible. | ✓ High Court judgment should be upheld without interference. |
| Legality of Promotions | ✓ Granting retrospective promotion would be unjustified due to irregular promotions of juniors. |
✓ Board erred in issuing the order dated October 26, 1998. ✓ Board did not understand implications of Supreme Court’s decision in C.A.No.3434/1984. |
Issues Framed by the Supreme Court
- Whether the first respondent (Mr. Saratchandran P.) was entitled to promotion with retrospective effect, merely because his juniors, S.G. Rajappan and L. Radhadevi, had been promoted earlier due to an incorrect application of rules.
Treatment of the Issue by the Court
| Issue | How the Court Dealt With It |
|---|---|
| Whether the first respondent was entitled to promotion with retrospective effect. | The Court held that the first respondent was not entitled to promotion with retrospective effect. The promotions of his juniors were out of turn and later found to be illegal. The Court emphasized that Article 14, ensuring equality, applies only when parties are similarly situated, and no equity can be claimed based on an illegality. |
Authorities
The Court considered the following authorities:
- Kerala State Electricity Board (Integration of Board Secretariat Establishment and General Establishment) Regulations, 1981: Used to understand the rules governing seniority and promotion within the KSEB.
- Section 79-C of the Electricity (Supply) Act, 1948: Provided the legal basis for framing the regulations.
- C.A.No.3967/1990 (Supreme Court, July 23, 1996): Determined the validity of the amended Regulation 5(c).
- C.A.No. 3434/1984 (Om Prakash Sharma Vs. Union of India, 1985 (Supp) SCC, 218): First Respondent contended that the Board has not understood the full implication of the decision in this case
Authorities Considered by the Court
| Authority | How the Court Considered It |
|---|---|
| Kerala State Electricity Board (Integration of Board Secretariat Establishment and General Establishment) Regulations, 1981 | The Court examined the regulations to understand the rules governing seniority and promotion within the KSEB. |
| Section 79-C of the Electricity (Supply) Act, 1948 | The Court noted that this section provided the legal basis for framing the regulations. |
| C.A.No.3967/1990 (Supreme Court, July 23, 1996) | The Court referred to this judgment, which had determined the validity of the amended Regulation 5(c). |
| C.A.No. 3434/1984 (Om Prakash Sharma Vs. Union of India, 1985 (Supp) SCC, 218) | The Court noted the First Respondent’s contention that the Board has not understood the full implication of the decision in this case. |
Judgment
Treatment of Submissions
| Submission | How the Court Treated It |
|---|---|
| Appellant’s argument that the first respondent claimed parity with juniors who were promoted out of turn. | The Court agreed that the promotions of the juniors were out of turn and later found to be illegal, thus not justifying retrospective promotion for the first respondent. |
| Appellant’s argument that the juniors had retired, making reversion impossible. | The Court acknowledged this fact but focused on the illegality of the initial promotions as the primary reason for denying retrospective benefits. |
| Respondent’s argument that the High Court judgment should be upheld without interference. | The Court overturned the High Court judgment, stating that it was incorrect in granting retrospective promotion and monetary benefits. |
| Respondent’s argument that he should receive promotions with retrospective effect from the dates his juniors were promoted. | The Court rejected this argument, emphasizing that the first respondent was not entitled to promotion with retrospective effect. |
View of Authorities by the Court
- Kerala State Electricity Board (Integration of Board Secretariat Establishment and General Establishment) Regulations, 1981: The Court used these regulations to establish the framework for determining seniority and promotion.
- Section 79-C of the Electricity (Supply) Act, 1948: The Court acknowledged this section as the legal basis for framing the regulations.
- C.A.No.3967/1990 (Supreme Court, July 23, 1996): The Court relied on this judgment to reinforce the validity of the amended Regulation 5(c), which played a crucial role in determining seniority.
- C.A.No. 3434/1984 (Om Prakash Sharma Vs. Union of India, 1985 (Supp) SCC, 218): The Court did not find this case analogous to the present case.
What weighed in the mind of the Court?
The Supreme Court’s decision was primarily influenced by the principle that equality under Article 14 applies only to similarly situated individuals, and no one can claim equity based on an illegality. The Court emphasized that the out-of-turn promotions granted to the junior employees were the result of an incorrect application of rules and, therefore, did not entitle the senior employee to retrospective promotion benefits.
| Reason | Percentage |
|---|---|
| Illegality of out-of-turn promotions | 40% |
| Application of Article 14 | 30% |
| Parties not similarly situated | 20% |
| No entitlement to equity based on illegality | 10% |
Fact:Law Ratio
| Category | Percentage |
|---|---|
| Fact (consideration of factual aspects of the case) | 30% |
| Law (consideration of legal principles) | 70% |
Logical Reasoning
The Court’s reasoning was based on the following key points:
- The promotions of S.G. Rajappan and L. Radhadevi were out of turn and, therefore, illegal.
- The first respondent was not unjustly denied promotion, nor did he suffer any pecuniary loss or prejudice.
- Article 14 cannot be invoked simply because an employer committed an illegality benefiting some employees.
- The constitutional scheme of equality applies only when parties are similarly situated, and no equity can be claimed based on an illegality.
The Court quoted:
“Article 14 as is well known is a positive concept. Provisions of Article 14 cannot be invoked only because some illegality has been committed by an employer as a result whereof some employee has obtained benefit. The Constitutional Scheme of equality clause would apply only in a case where the parties are similarly situated. No equity can be claimed on the basis of an illegality.”
For these reasons, the Supreme Court set aside the High Court’s judgment and allowed the appeal.
Key Takeaways
- An employee cannot claim retrospective promotion benefits solely because a junior employee received undue advantages due to an incorrect application of rules.
- Article 14 of the Constitution applies only when parties are similarly situated, and no equity can be claimed based on an illegality.
- Out-of-turn promotions that are later found to be illegal do not automatically entitle senior employees to similar benefits with retrospective effect.
Development of Law
The ratio decidendi of this case is that an employee cannot claim retrospective promotion benefits solely because a junior employee received undue advantages due to an incorrect application of rules. This clarifies that seniority alone does not guarantee retrospective benefits if the promotions of junior employees were irregular and illegal.
Conclusion
The Supreme Court allowed the appeal, setting aside the High Court’s judgment. The Court held that Mr. Saratchandran P. was not entitled to retrospective promotion benefits simply because his juniors, S.G. Rajappan and L. Radhadevi, had been promoted earlier due to an incorrect application of rules. The Court emphasized that Article 14 applies only to those similarly situated and that no equity can be claimed based on an illegality.