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2003 INSC 392
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Smart Summary

Factual and Procedural Background

The appellant joined the respondent Bank as a clerk/typist on 28 February 1972. After passing the written examination for promotion to Junior Management Grade-I (JMG-I) on 20 July 1980 and attending an interview on 27 November 1980, she was not included in the select list because she failed to secure the prescribed minimum of 6½ marks in the viva-voce. She challenged the promotion policy and her non-selection in OP 1323/1981.

On 1 August 1983 a Single Judge of the Kerala High Court held that fixing minimum qualifying marks for the interview gave undue predominance to viva-voce and directed that the appellant be promoted if her aggregate marks exceeded that of any selected candidate. A Division Bench affirmed the order on 29 November 1983.

The Bank’s Civil Appeal No. 1056/1984 reached the Supreme Court, which on 5 August 1993 upheld the validity of minimum interview marks but, owing to the long pendency and the appellant’s reliance on the High Court’s judgment, directed that she should still receive the benefit of promotion.

Consequently, the Bank granted her notional promotion to JMG-I with effect from 30 December 1980 and fixed her pay accordingly, but denied arrears of salary. The appellant filed OP 9673/1994 seeking full arrears; a Single Judge on 30 March 1998 allowed the claim. The Bank’s WA 1378/1998 and the appellant’s WA 1103/1998 (seeking interest) were heard together. A Division Bench applied the principle of “no work, no pay,” allowed the Bank’s appeal, and dismissed the appellant’s. The present Supreme Court appeals arise from that decision.

Legal Issues Presented

  1. Whether an employee who receives notional promotion pursuant to court orders is entitled to arrears of salary for the period during which she did not actually work in the promoted post.
  2. Whether the principle of “no work, no pay” applies when promotion is granted purely on notional grounds without any finding of illegality in the original non-promotion.
  3. Whether the appellant is entitled to interest on any arrears, if payable.

Arguments of the Parties

Appellant's Arguments

  • Relied on Union of India v. P. Sathikumarana Nair (1997) 10 SCC 663 and State Bank of India v. T. J. Paul (1999) 4 SCC 759 to contend that back-wages should accompany the notional promotion.
  • Asserted that the Single Judge’s order awarding full salary from 1980 was correct and that she also deserved interest on the arrears.

Respondent Bank's Arguments

  • Invoked the doctrine of “no work, no pay,” stressing that the appellant did not discharge duties of JMG-I during the period in question.
  • Highlighted that the Supreme Court in 1993 had upheld the legality of the original promotion policy; therefore, her non-promotion was not wrongful.
  • Maintained that the notional promotion and pay fixation fully satisfied the 1993 Supreme Court directions and that payment of arrears would be unwarranted.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Union of India v. P. Sathikumarana Nair (1997) 10 SCC 663 Relief granted where denial of a pay scale lacked justification. Held irrelevant; contained no ratio germane to arrears for notional promotion.
State Bank of India v. T. J. Paul (1999) 4 SCC 759 Consequences of quashing a removal order and remitting penalty. Distinguished; concerned disciplinary punishment, not arrears following notional promotion.
State of Haryana v. O. P. Gupta (1996) 7 SCC 533 Applied “no work, no pay” where promotions were granted notionally after correction of seniority. Treated as the governing authority; guided the conclusion that arrears were not payable.
Paluru Ramkrishnaiah v. Union of India (1989) 2 SCC 541 Reaffirmed that salary for a higher post cannot be claimed without actually working in that post. Cited as supportive precedent for denying arrears.
Virender Kumar, G.M., N. Rlys. v. Avinash Chandra Chadha (1990) 3 SCC 472 “No work, no pay” in cases of retrospective promotion. Relied on to bolster the Bank’s position and the High Court’s reasoning.

Court's Reasoning and Analysis

The Court noted that its own 1993 judgment upheld the Bank’s promotion policy, thereby confirming that the appellant’s original non-selection was lawful. The subsequent direction to promote her was characterised as an equitable relief extended only because protracted litigation had prevented her from re-appearing in later promotion exercises.

Given that the appellant had never discharged the functions of a JMG-I officer during the relevant period, the Court considered the grant of arrears to be unsupported by any legal right. It approved the High Court Division Bench’s application of established precedents—particularly State of Haryana v. O. P. Gupta—which consistently deny back-wages in cases of purely notional promotions. The authorities cited by the appellant were found to be factually and legally distinguishable, offering no basis to depart from the “no work, no pay” doctrine.

Accordingly, the Court concluded that the Bank’s action in granting only notional benefits fully complied with the earlier Supreme Court directions and satisfied both legal and equitable considerations.

Holding and Implications

APPEALS DISMISSED.

The Supreme Court affirmed the Division Bench’s decision: the appellant is not entitled to arrears of salary or interest for the period prior to her actual assumption of duties. The principle of “no work, no pay” remains authoritative in cases of retrospective, notional promotion. The ruling produces no new legal precedent but reinforces existing jurisprudence that monetary benefits do not follow where higher duties were not actually performed.

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    A.K Soumini v. State Bank Of Travancore And Another

    S. Rajendra Babu, J.— Leave granted.

    2. The appellant, having initially succeeded partially before a learned Single Judge but lost before a Division Bench of the Kerala High Court in WAs Nos. 1378 and 1103 of 1998 has filed the above appeals. The appellant was appointed as clerk/typist in the service of the respondent Bank on 28-2-1972. She undertook the written test for promotion to officer, Junior Management Grade (Groups A and B) on 20-7-1980. Having come out successful, as per the procedure required she appeared for an interview on 27-11-1980 and though according to her claim she fared well she was not included in the final list of 180 employees selected for promotion. The appellant filed OP No. 1323 of 1981 challenging her non-selection for promotion, questioning also incidentally the provision in the promotion policy which required the candidates to get at least a minimum of 6 1/2 qualifying marks, in the interview. The learned Single Judge, by his order dated 1-8-1983 held that such predominance cannot be given to the interview by stipulating for minimum qualifying marks of 6 1/2 to be secured in the interview and allowed the petition in the following terms:

    “In moulding relief in this case, I think it would be unjust at this distance of time to quash the whole selections. Persons who have not approached the court in time would not be entitled to any relief and therefore interest of justice would be served if I direct that the petitioner also be selected if the aggregate total marks she has obtained both in the written and oral tests exceeds that of anyone who is now selected. It has to be proceeded on the basis that there are no qualifying minimum marks fixed for the interview. In the matter of seniority among those selected etc., the petitioner on the basis of this order should be given consequential benefits if she is selected. Order accordingly. The original petition is allowed as above. There will be no order as to costs.”

    3. On appeal by the Bank, the Division Bench also seems to have affirmed the same by its judgment dated 29-11-1983, and the same was said to have been reported also in ILR 1984 (1) Ker 135.

    4. Thereupon, the Bank pursued the matter further before this Court in CA No. 1056 of 1984, and this Court by an order dated 5-8-1993 while following the earlier decisions upholding the provisions prescribing minimum marks for interview in a selection, held that the requirement of 6 1/2 marks for qualifying in the viva voce, as prescribed in the promotion policy of the Bank cannot be held to be invalid and the judgment of the High Court taking the contrary view, cannot be upheld. At the same time, keeping in view the lapse of time due to the pendency of the appeal in this Court and the fact that the appellant herein also did not appear in subsequent tests, held as follows:

    “4. We, however, cannot lose sight of the fact that in view of the decision of the High Court in her favour whereby it has been directed that the respondent should be treated as selected if the aggregate total marks both in written and oral tests exceed that of anyone who is now selected, the respondent did not appear in subsequent tests. She should not be made to suffer on account of the pendency of the appeal in this Court for more than 10 years. We, therefore, consider it appropriate in the interest of justice to direct that the decision of this Court reversing the view of the High Court with regard to the validity of requirement of minimum marks for qualifying in viva voce should not operate to the prejudice of the respondent and she should be given the benefit of the decision of the High Court.
    5. Before we part with this case it may also be mentioned that the learned counsel for the respondent has pointed out that the requirement of 33 marks for viva voce is not in consonance with the norms laid down by this Court for the marks to be prescribed for viva voce and for the written test in selection. Since we have not disturbed the decisions of the High Court insofar as the respondent is concerned, we do not propose to go into this question. It is left to the Bank, if so advised, to take necessary steps and review its promotion policy in the light of the decision of this Court.
    6. The appeal is allowed and the judgment of the High Court quashing the requirement of minimum marks for qualifying in viva voce in the promotion policy of the Bank, is set aside subject to the direction that insofar as the respondent is concerned, she would be given the benefit of the judgment of the High Court. No order as to costs.”

    5. The Bank promoted the appellant to the cadre of JMG-I, with retrospective effect from 30-12-1980, and her seniority also seems to have been fixed, accordingly, while at the same time fixing notionally and revising her pay scale as on 5-8-1993 at Rs 3900, indicating also that the annual increment will fall due on 1-2-1994 and thereafter, on the first of February every year. But the appellant also wanted arrears of salary for all such period and seeking such relief filed OP No. 9673 of 1994. A learned Single Judge by his order dated 30-3-1998 held that she would be entitled to get the full salary from 1980 onwards and further observed, “Therefore, while calculating and disbursing the salary due to the petitioner for the above period, allowances must be made in the salary which the petitioner drew after getting the promotion in 1980.” The Bank was directed to pass orders in this regard within one month from the date of receipt of the copy of the order.

    6. Aggrieved, the Bank filed WA No. 1378 of 1998. The appellant, aggrieved by non-award of interest on the arrears directed to be paid, filed WA No. 1103 of 1998. The Division Bench allowed the appeal filed by the Bank and dismissed the appeal filed by the appellant, observing that the case on hand is one to which the principle of “no work, no pay” can be legitimately pressed into service and the employer Bank was justified in declining to pay the full salary for the period in respect of which notional promotion and revision of pay scales was also made. Hence, this appeal.

    7. The respective learned Senior Counsel on either side reiterated the stand taken before the High Court. On a careful consideration of the entire materials on record including the earlier decision of this Court in the very matter between parties, we are unable to approve the reasoning of the learned Single Judge, which is the sheet anchor of the submission for the appellant before us, besides placing reliance upon the decisions reported in Union of India v. P. Sathikumarana Nair (1997) 10 SCC 663 and State Bank of India v. T.J Paul (1999) 4 SCC 759. Even on a cursory glance at the decision in Nair (1997) 10 SCC 663 it could be seen that no principle of law for any guidance or to operate as any precedent seems to be laid down therein and relief was granted for the reason that there was no valid justification to deny a particular scale to a few only based on geographical location of the institutions in which they served and therefore it has no relevance at all to the issue raised in this case. The decision in Paul (1999) 4 SCC 759 dealt with a case of penalty of removal imposed on the employee concerned and on such punishment being found to be ultra vires, the powers of the authority and the court remitting the case for consideration of the Appellate Authority for imposition of any punishment lesser than the loss of job. This case cannot be of any assistance to the issue raised in this case.

    8. In State of Haryana v. O.P Gupta (1996) 7 SCC 533, (1996) 33 ATC 324 this Court had occasion to deal with a claim for arrears in a case where in adjudicating a dispute relating to seniority. This Court directed the department concerned to prepare a fresh seniority list strictly in accordance with the rules ignoring inconsistent administrative instructions and in compliance thereof a fresh seniority list came to be prepared and eligible persons were even given notional promotion by the department from a deemed date. When such promotees claimed for payment of arrears of salary as well, this Court rejected the claim applying the principle of “no work, no pay” and set aside the orders of the High Court, countenancing such claims to be illegal for the reason that the promotees did not work for the period in the promoted capacities. In coming to such conclusions this Court followed the earlier decisions reported in Paluru Ramkrishnaiah v. Union of India (1989) 2 SCC 541, (1989) 10 ATC 378 and Virender Kumar, G.M, N. Rlys. v. Avinash Chandra Chadha (1990) 3 SCC 472, (1990) 14 ATC 732.

    9. So far as the case on hand is concerned, the appellant was denied promotion in terms of the promotion policy under which it was necessary for a candidate to secure at least minimum eligibility marks of 6 1/2 at the interview and the learned Single Judge allowed the claim only on the ground that such prescription of minimum marks was not valid. Though, the Division Bench also affirmed the same, this Court overruled the said decision and upheld such prescription. But taking into account the pendency of the appeal in this Court for a considerable time, and on account of which the appellant also did not appear in the subsequent tests, benefit to promote her was not denied. The fact that her non-promotion was legal and there has been no unlawful interference with her right to promotion or to serve in the promoted category was obvious and could not be minced over or completely ignored in the light of the judgment of this Court, allowing the appeal by the Bank. While that be the position, the grant of relief to her, keeping in view the delay merely due to pendency of proceedings before court, was more in the nature of a gesture of gratis and not by way of any right, to which she was found to be entitled to. Consequently, the notional promotion given to her by the Bank with suitable revision of her pay scales itself is more than sufficient to meet the requirements, be it either in law or in equity. The further claim for payment of arrears as well is far-fetched and can have no basis in law. The Division Bench, in our view, properly approached the question in the light of the relevant guiding principles and the same could not be said to be either arbitrary, unreasonable or unsound in law to warrant our interference.

    10. The appeals, in the light of the above conclusions, fail and shall stand dismissed. No costs.

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    A.K Soumini v. State Bank Of Travancore And Another
    (Aug 14, 2003)