Reportable
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO.4977 OF 2009
(Arising out of SLP(C) No. 24123/2007)
Ajaya Kumar Das ...Appellants
Versus
State of Orissa & Ors. ...Respondents
JUDGEMENT
R.M. Lodha, J.
Leave granted.
2. The short question that arises for consideration in
this appeal by special leave is : is the direction issued by the
High Court that the pay fixation of the appellant and similarly
situated persons be done in accordance with the Government
Circular dated April 16, 1971 justified or the pay fixation of
these employees ought to be done as per Rule 74(b) of the
Orissa Service Code.
3. The controversy arises from the facts which may be
briefly noticed first. The appellant was appointed by the
Government of Orissa as Overseer (Electrical) on November
16, 1964. He was deputed to serve in the Orissa State
Electricity Board (for short, “OSEB”) in the then pay scale of
185-00-325. Later on, the post of Overseer was re-designated
as Sub-Assistant Engineer (for short, `SER’). The pay scale of
SERs in OSEB was revised from time to time. Since scale of
pay of SERs appointed directly by the OSEB was higher in
comparison to the Sub-Assistant Engineer on deputation with
OSEB and who were initially appointed by the Government of
Orissa as Overseers, it was decided to provide such SERs
(erstwhile Overseers) reducible personal pay. This was done
so that the SERs (erstwhile Overseers) like the appellant and
similarly situated persons do not get lesser salary in
comparison to the SERs appointed directly by the OSEB. The
appellant was promoted to the rank of Assistant Engineer
(Electrical) in 1981 and at the time of promotion he was in the
pay scale of 480-970 and drawing pay of Rs. 874. However,
his pay in the promotional rank of Assistant Engineer was fixed
at Rs. 850/- per month. The appellant was aggrieved thereby
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as, according to him, his pay should have been fixed on
promotion at Rs. 950/- per month in view of Rule 74(b) of the
Orissa Service Code (for short, “code”).
4. The appellant challenged his fixation of pay before
the High Court of Orissa by filing Writ Petition but on formation
of Orissa Administation Tribunal, the writ petition came to be
transferred to the Tribunal. The litigation has chequered history
but it is not necessary to go into that; suffice it to say that the
Tribunal by its Order dated December 23, 1999 directed that
the appellant’s pay on his promotion to the rank of Assistant
Engineer (Electrical) be fixed taking his last pay drawn in the
rank of SER into account and following the provisions of Rule
74(b) of the Code. This is how the Tribunal considered the
matter :
“Having bestowed our anxious considerations on the
submission of the learned counsel for the applicant
and perused the relevant papers on record, we are of
the opinion that annexure-6 decision of the
Government regarding protection of pay is in effect a
negative of the concept for pay protection. It was in
pursuance of Government decision that though
recruited by the O.S.E.B they were promoted by the
Government to the rank of Assistant Engineer when
they were enjoying higher scale of pay than the Sub-
Assistant Engineers under the Government. Since the
applicant was drawing pay at Rs. 874.00 per month in
the scale of pay of Rs. 480.00-970.00 he could not be
dragged to a lower scale of pay of Rs. 410.00-840.00
and his pay was fixed at Rs. 850.00 leading to
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reduction in his pay to the extent of Rs. 110.00 per
month. This can hardly be called protection of pay
which is sought to be ensured by annexure-6
instruction to be unfair and unreasonable and direct
that the applicant’s pay on his promotion to the rank
of Assistant Engineer (Electrical) be fixed taking his
last pay drawn in the rank of S.A.E. into account and
following the provisions of Rule 74(b) of the Orissa
Service Code and the differential salary paid to him
within a period of 4 months from the date of receipt of
a copy of this order.”
5. The State Government being dissatisfied with the
order of the Tribunal challenged the same before the High
Court. The grievance of the State Government before the High
Court was that the Tribunal passed the order inconsistent with
the Government Circulars, particularly the Circulars dated June
18, 1982 and March 17, 1983.
6. The High Court, although noticed that the pay of
the Government Servant cannot be reduced on promotion yet
by relying upon the Government Circular dated April 16, 1971,
directed that pay of the appellant in the next higher post, i.e.,
Assistant Engineer was required to be fixed in accord with the
said Circular. The effect of the High Court’s order is that it
reduces the scale of pay of the appellant. It is for this reason
that the appellant has come up in appeal by special leave.
7. Rule 74(b) of the Orissa Service Code reads thus :
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“Where a Government servant holding a post is
promoted or appointed to another post carrying duties
and responsibilities of greater importance than those
attached to the post held by him, initial pay in the time
scale of the higher post shall be fixed at the stage
next above the pay notionally arrived at by increasing
his pay in respect of the lower post by one increment
at the stage at which such pay has accrued:
Provided that where a Government servant,
immediately before his promotion or appointment to
higher post, is drawing pay at the maximum of the
time scale of the lower post, his initial pay in the time
scale of the higher post shall be fixed at the stage,
next above the pay notionally arrived at by increasing
his pay in respect of the lower post by an amount
equal to his last increment in the time scale of the
lower post:
Provided further that the provision of this sub-
rule shall not apply when a Government servant
holding a class-I post is promoted or appointed to
another class-I post.”
8. Rule 74(b) of the Code, thus, provides that on promotion
of a Government servant, his initial pay in the time scale of
promotional post needs to be fixed at the stage next above the
pay notionally arrived at by increasing his pay in respect of the
lower post by one increment at the stage at which such pay has
accrued. In a case where the Government servant immediately
before his promotion has been drawing maximum of the time
scale of the lower post, his pay on the promotional post needs
to be fixed by notionally increasing his pay in respect of lower
post by an amount equal to his last increment. In other words
on promotion, a Government servant, by virtue of Rule 74(b),
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gets higher pay than what he was getting immediately before
his promotion. Rule 74(b) of the Code is aimed at protecting
the scale of pay of a Government employee in his promotional
cadre and seeks to ensure that in no case an incumbent is
directed to receive less emoluments, less pay than what he was
drawing prior to his promotion. This provision statutorily ensures
that the State Government employee gets the benefits of
receiving higher scale of pay than that of the post held by him
prior to such promotion. Surely, in the light of Rule 74(b), initial
pay in the time scale of higher post of a Government servant
cannot be fixed which is less than the pay he was getting
immediately before promotion.
9. The Circular dated June 18, 1982 contemplates that
the completed years of service rendered by SERs under the
OSEB should be treated as having been rendered under the
Government in the Government scale of SERs and their pay in
the scale of Assistant Engineers under the Government be
fixed following the principle under Rule 74(b) of the Code. The
aforesaid Circular was modified by a subsequent Circular dated
March 17, 1983 whereby a clarification was made that in case
of promotion of SERs of OSEB to the rank of Assistant
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Engineer under Government, if the pay so fixed as per
principles laid down in the Government Circular dated June 18,
1982 becomes less than the pay last drawn by them under the
Board, the difference may be allowed to them by reducible
personal pay to be absorbed in future increments.
10. Neither the Circular dated June 18, 1982 nor the
subsequent Circular dated March 19, 1983 modifying the earlier
Circular dated June 18, 1982 can override the statutory
provision contained in Rule 74(b) of the Code if it results in
reduction of pay of the employee on promotion. That Orissa
Service Code has been framed under Article 309 of the
Constitution of India is not in dispute. It is well settled that
Statutory Rules framed under Article 309 of the Constitution
can be amended only by a Rule or Notification duly made under
Article 309 and not otherwise. Whatever be the efficacy of the
Executive Orders or Circulars or Instructions, Statutory Rules
cannot be altered or amended by such Executive Orders or
Circulars or Instructions nor can they replace the Statutory
Rules. The Rules made under Article 309 of the Constitution
cannot be tinkered by the administrative Instructions or
Circulars.
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11. Seen thus, upon promotion of the appellant to the
rank of Assistant Engineer from SER, his pay in the time scale
of Assistant Engineer has to be fixed as per Statutory Rule
74(b), more particularly, in a situation such as the present one
because by relying upon the Government Circulars dated June
18, 1982 or March 19, 1983 or April 16, 1971, the appellant’s
scale of pay gets reduced.
12. The State Government has not challenged the
applicability of Rule 74(b) of the Code in the matter. That being
the position, the appellant’s pay has to be fixed in accordance
with Rule 74(b) of the Code and not otherwise. The view of the
Tribunal, therefore, that the appellant’s pay be fixed on his
promotion to the rank of Assistant Engineer (Electrical) taking
his last pay drawn in the rank of Sub-Assistant Engineer and
following the provisions of Rule 74(b) of the Code being
eminently just, proper and in accordance with law warranted no
interference at the hands of the High Court.
13. Appeal, accordingly, has to be allowed and is allowed.
The order dated March 2, 2006 passed by the High Court
impugned in the present appeal is set aside and the order
dated December 23, 1999 passed by Orissa Administrative
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Tribunal is restored. The differential salary shall be paid to the
appellant now within two months from today. No order as to
costs.
……………………J
(Tarun Chatterjee)
……………………J
(R. M. Lodha)
New Delhi
July 31, 2009.
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