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Union Of India And Another v. Tarsem Lal And Others
Factual and Procedural Background
The respondent, an employee under the Railway Administration, was given a pro forma promotion with effect from 9-9-1997 but was actually promoted to the higher post of Master Craftsman (MCM) only in August 2001. He instituted an Original Application before the Central Administrative Tribunal (CAT), Chandigarh Bench, claiming pay and allowances from the earlier date of the pro forma promotion. The Union of India relied on Railway Board Circular dated 15-9-1964/17-9-1964 and Paragraph 228 of the Indian Railway Establishment Manual (IREM), Vol. I, to deny monetary arrears on the ground that the respondent had not worked in the higher post during the disputed period.
CAT allowed the application, citing this Court’s decision in Harbans Singh v. State of Punjab, and the Punjab & Haryana High Court dismissed the Union’s writ petition, thereby affirming CAT’s order. The Union of India and its functionaries appealed to the Supreme Court.
Legal Issues Presented
- Whether an employee who receives a pro forma promotion because of an earlier administrative error is entitled to draw the pay and allowances of the higher post from the date of the pro forma promotion even though he did not actually work in that post during the relevant period.
Arguments of the Parties
Appellants’ Arguments (Union of India)
- Paragraph 228 of the IREM expressly bars payment of arrears where an employee did not actually shoulder the duties of the higher post; CAT and the High Court failed to examine the legality and applicability of this provision.
- The tribunals relied mechanically on Harbans Singh without demonstrating its factual or legal relevance to the present case.
- The Supreme Court’s rulings in Virender Kumar v. Avinash Chandra Chadha and Union of India v. P.O. Abraham uphold the principle of “no work, no pay” and validate the impugned circular and Paragraph 228.
Respondent’s Position
- Claimed entitlement to full pay and allowances from 9-9-1997, the date of his pro forma promotion, despite not working in the higher post until August 2001.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Virender Kumar v. Avinash Chandra Chadha (1990) 3 SCC 472 | “No work, no pay” – employees not entitled to higher salary for periods they did not work in the promoted post. | Used as controlling authority to uphold the validity of IREM Para 228 and the Railway Board circular. |
| Union of India v. P.O. Abraham (order quoted in judgment) | Approved the same circular clause that denies arrears where duties were not performed. | Reaffirmed that deletion of the clause by CAT was improper, reinforcing “no work, no pay.” |
| Harbans Singh v. State of Punjab 1995 Supp (3) SCC 471 | Earlier decision relied upon by CAT/High Court to allow arrears. | Supreme Court held that reliance on this case was misplaced and it did not govern the present factual scenario. |
Court's Reasoning and Analysis
The Supreme Court examined Paragraph 228 of the IREM, which clearly stipulates that where promotion is lost due to administrative error, pay in the higher grade may be fixed pro forma, but the enhanced pay is only payable from the date of actual promotion and no arrears are payable for the earlier period of non-service in the higher post. The Court found that this provision embodies the principle of “no work, no pay,” a doctrine firmly established in Virender Kumar.
Referring to its earlier order in P.O. Abraham, the Court reiterated that the clause denying back wages is valid and in consonance with Supreme Court precedent. Consequently, the Tribunal and the High Court erred in granting arrears by relying solely on Harbans Singh, which the Supreme Court deemed inapposite to the present facts. The reliance on Harbans Singh was therefore “uncalled for.”
Holding and Implications
Appeal Allowed; Orders of the High Court and CAT Set Aside.
The respondent is not entitled to arrears of pay and allowances for the period 9-9-1997 to August 2001, as he did not perform the duties of the higher post during that time. The decision reaffirms the enforceability of Paragraph 228 of the IREM and the Railway Board circular, thereby strengthening the “no work, no pay” principle in cases of pro forma promotion. No costs were awarded.
Arijit Pasayat, J.— Leave granted.
2. The Union of India and its functionaries call in question correctness of the judgment rendered by a Division Bench of the Punjab and Haryana High Court dismissing the writ petition filed by the present appellants and affirming the order of the Central Administrative Tribunal, Chandigarh Bench, Chandigarh (in short “CAT”).
3. Background facts in a nutshell are as follows:
The respondent filed the original application claiming that he was entitled to pay and allowances from the date on which pro forma promotion was given and not from the date of actual promotion. The appellants relied on the circular dated 15-9-1964/17-9-1964 to contend that the claim was untenable.
4. According to CAT the only question which was to be decided was whether the respondent was entitled to his pay and allowances from August 2001 on which date he was actually promoted as MCM or with effect from 9-9-1997 from which date he has been given promotion on pro forma basis. The appellants denied him the arrears with effect from 9-9-1997 on the ground that he has not worked on the promotional post during the said period and as such he was not entitled to the revised pay from that date. Reliance was placed on para 228 of the Indian Railway Establishment Manual (in short “IREM”), Vol. I dealing with employees who have lost promotion on account of administrative error. It inter alia provides that in such cases the pay should be fixed on pro forma basis and the enhanced pay was to be allowed from the date of actual promotion and no arrears on this account were to be paid for the past period as he did not actually perform the duties and responsibilities of the higher post. The Tribunal relying on a decision of this Court in Harbans Singh v. State of Punjab 1995 Supp (3) SCC 471, (1995) 31 ATC 201 held that the stand was unsustainable. The Tribunal's order was assailed before the High Court.
5. The High Court as noted above dismissed the writ petition relying on the judgment in Harbans Singh case 1995 Supp (3) SCC 471, (1995) 31 ATC 201.
6. Learned counsel for the appellants submitted that the view of the Tribunal as affirmed by the High Court does not reflect the correct position in law. Para 228 of IREM was pressed into service to contend that the Tribunal or the High Court in the instant case did not express any view on the legality of the provision. CAT and the High Court merely relied on Harbans Singh case 1995 Supp (3) SCC 471, (1995) 31 ATC 201 without indicating as to how the factual scenario of that case has any application to the facts of the present case.
7. There is no appearance on behalf of the respondents in spite of notice.
8. Para 228 of IREM reads as follows:
“228. Erroneous promotions.—(1) Sometimes due to administrative errors, staff are overlooked for promotion to higher grades which could either be on account of or wrong assignment of relative seniority of the eligible candidate at the time of ordering promotion or some other reasons. Broadly, loss of seniority due to the administrative errors can be of two types:
(i) where a person has not been promoted at all because of administrative error, and
(ii) where a person has been promoted but not on the date from which he would have been promoted but for the administrative error.
Each such case should be dealt with on its merits. The staff who have lost promotion on account of administrative error should on promotion be assigned correct seniority vis-à-vis their juniors already promoted, irrespective of the date of promotion. Pay in the higher grade on promotion may be fixed pro forma at the proper time. The enhanced pay may be allowed from the date of actual promotion. No arrears on this account shall be payable as he did not actually shoulder the duties and responsibilities of the higher posts.”
9. This Court had occasion to deal with the same issue in Union of India v. P.O Abraham. In that case the appeal was filed against the order of the Ernakulam Bench of CAT. Reliance was placed by the Union of India and its functionaries in that case on Railway Board's circular dated 15-9-1964/17-9-1964 which inter alia provided as follows:
“No arrears on this account shall be payable as he did not actually shoulder the duties and responsibilities of the higher post.”
10. One Bench of CAT held that clause to be invalid. But in Virender Kumar v. Avinash Chandra Chadha (1990) 3 SCC 472, (1990) 14 ATC 732, (1990) 2 SCR 769 the view was held to be not correct. The order in Abraham case reads as follows:
“This appeal is directed against the order of the Central Administrative Tribunal, Ernakulam Bench, in OA No. 649/90 dated 30-9-1991. Though the appeal challenges the order in its entirety. Mr Goswami, learned Senior Counsel for the appellants, fairly stated that the appeal is now confined only to the payment of back wages ordered to be given by the Tribunal.
By the order under appeal, the Tribunal has allowed the application which challenged the Railway Boards circular dated 15-9-1964/17-9-1964. The said circular inter alia, contains the following clause:
‘No arrears on this account shall be payable as he did not actually shoulder the duties and responsibilities of the higher posts.’
Consequent to the deletion of the above clause, further directions were given. Learned counsel submits that the clause, which has been directed to be removed, is in accordance with the judgment of this Court in Virender Kumar v. Avinash Chandra Chadha (1990) 3 SCC 472, (1990) 14 ATC 732, (1990) 2 SCR 769. This Court, in that case, held on principle of ‘no work no pay’ that the respondents will not be entitled to the higher salary as they have not actually worked in that post. The clause, which has been directed to be deleted by the Tribunal, being in consonance with the ruling of this Court, we are of the opinion that the Tribunal was not right in directing the deletion of that clause. Accordingly, to that extent this appeal is allowed. The result is that the respondents will be given deemed promotion, if any, before retirement and also the benefit in the matter of fixing pension. No costs.”
11. In view of what has been stated in Virender case (1990) 3 SCC 472, (1990) 14 ATC 732, (1990) 2 SCR 769 and P.O Abraham case the Tribunal and the High Court were not justified in granting relief to the respondents. Reliance on Harbans Singh case 1995 Supp (3) SCC 471, (1995) 31 ATC 201 was uncalled for.
12. The orders are set aside. The appeal is allowed but in the circumstances without any order as to costs.
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