B.S. Murthy & Ors v. A. Ravinder Singh & Ors.

The Order of the Court was passed by S. RAVINDRA BHAT, J. 1. The appellants are aggrieved by a common judgment and order of the erstwhile unified High Court of Andhra Pradesh in seve ral writ petitions.1 The High Court allowed those writ petitions and set aside the order2 of the Central Administrative Tribunal (CAT) in a batc h of ten original applications. The CAT’s order had allowed those applications and directed proper fixation of inter se seniority of Inspectors of Central Excise, as between direct recruits and promotees. T he promotee inspectors are aggrieved, and are appellants before this court. 2. Recruitment to the posts of Inspectors of Central Exci se is from amongst two channels- one, direct recruitment and the other, by promotion from in-service candidates: in accordance with the provisions of the Central Excise and Land Customs Group-C Recruitment Rul es, 1979 (hereafter the “1979 Rules” or “the Rules”) framed by the President of India under proviso to Article 309 of Constitution of India. The ratio between the direct recruits and the promotions -from amongst var ious in-service cadres on the ministerial line- was fixed unde r the Rules at 75%:25% (or 3:1). The Rules however, did not provide guidance for 1 W.P.Nos.11620/2004, 10601/2004; 13525/ 2004, 12970/ 2004, 21863/2004, 1834/ 2005, 1836/2005, 1838 of 2005, 1858/ 2005, 1861/ 20 05, 2011/2005, 1348/ 2005, 18149/ 2004, W.P. No.6098/2005, 6099/2005; 6100/ 20 05, & 6097/ 2005; all were decided on 16.03.2005. 2 Dated 29.12.2003 9 determination of inter seseniority of direct recruit inspectors (DRIs) and promotee inspectors (PRIs). Seniority lists were pre pared on the basis of executive instructions issued by the Government of India from time to time. It is an undisputed fact that inter se seniority was governed by an office memo3 dated 22.12.1959 (hereafter “1959 OM”) stipulating general guidelines to determine the seniority of various cat egory of employees in the Central Secretariat. The Central Excise De partment too followed it. The 1959 OM stipulated that seniority was determinable by the order indicated at the time of initial appointment (and not date of confirmation). Permanent Officers of each grade were to be ranked seniors to those officiating to that grade. The inter se seniority of the direct recruits was to be determined by the order of merit in which they are selected for such appointment on the recommendat ions of the U.P.S.C. or such selecting authority. Paras 2-5 of the 1959 OM provided the principles for determining inter se seniority of direct recruits and promotees. In the light of experience, the 1959 OM was chang ed, and another OM was issued, on 07.02.1986 4 (hereafter “1986 OM”). 3. Five Revenue Inspectors, from the promotion cadre (hereafter called generically also- apart from PRIs as “promotees”), promoted in 1983-1984 filed an application 5, challenging the inter se seniority list dated 08.07.1985 (hereafter “the 1985 list”) issued by the depar tment on the ground that the length of their continuous service was not taken into consideration while fixing seniority. This application however did not implead the direct recruit employees; it was allowed on 05.07.1988 (hereafter “CAT 1988 order”). CAT directed the department t o recast seniority in accordance with the 1986 OM after giving notice to the affected parties. A revised list was thereafter issued . DRIs, whose seniority was affected by the revised seniority lis t filed review applications6 in the disposed of applications. The CAT reiterated its main order, dated 05.07.1998 (hereafter “CAT review order”). The department then issued a final seniority list (as on 1.1.1992) on 30.4.1993 (hereafter “1993 final list”). Those promoted before 1986 also r equested the department to fix their seniority in terms of the CAT’s 1998 order. 3 Office Memo No. 9/11/55 RSP dated: 22.12.1959 4 OM No. 35014/2/80- Estt.(D), dated: 7.2.1986 5 O.A.NO. 156/1986 6 R.A. No. 29/1994 etc. B.S. MURTHY & ORS. v. A. RAVINDER SINGH & ORS. [S. RAVINDRA BHAT, J.] 4. CAT’s 1998 order was in the context of the 1986 OM, which was in-applicable to pre-1986 PRIs. Thereafter, the matter was referred to the Central Board of Excise and Customs (“CBEC”), which apparently clarified that the procedure of fixation of seniority notified in 1986 OM was to be applied to pre-1986 promotees too. A seniority list was then prepared in respect of the officers appointed prior to 1986 on the lines of 1986 OM. At this point, the DRIs filed Review application in R.A. No. 103/1993 against the 1993 final list. 5. The CAT, in an order doubted the basis of its previous decision and referred the batch of matters to a Full Bench- on the i ssue as to whether 1986 OM was prospective or retrospective. The Full Bench by its order clarified that the 1986 OM only operated prospectiv ely from 1.3.1986. On the basis of the finding of the Full Bench, the tribunal heard the review applications along with O.A. Nos. 1323/ 1993, 285/ 1994 and OA 906/1994. It is noteworthy that the Central Government preferred a Special Leave Petition to this court, against the CAT’s order in O.A.NO. 156/1986 which was dismissed as time-barred. 6. The tribunal considered the matter and the cases were disposed of by a common order dated13.2.1997 recording the f ollowing conclusions: (i) The O.M dated: 07.02.1986 was prospective; (ii) Pre- 07.02.1986 inter-se seniority was to be regulated in accordance with 1959 OM; (iii) There was no break-down of the quota rule:The 1959 O.M. was to be followed. (iv) Cases of those who officiating as Inspectors pr ior to 01.03.1986 but regularised after that date had to b e individually decided after determining the nature o f officiation, nature of the post, (to which officiation related) and the provisions of OM of 1959 and could not be generalised. (v) Pre 01.03.1986 cases where the selection process -for direct recruitment- but where appointment was made after that date werecovered by the OM dated: 7.2.1986. 7. Based on these findings, the 1993 final list was quashed; the department was directed to prepare another list, afresh. To comply with 11 the order, a special cell headed by the Superintendent of Central Excise was formed. A new final seniority list (dated 15.10.1997-hereafter “1997 list”) was issued based on recommendations of the special cell; it was declared as final on 1.1.1992. This 1997 final seniority list became the subject of scrutiny in RA 56/ 1998 in O.A.No.1323/1993 filed by the PRIs. These review applications were dismissed by an order dated 27.8.1999. CAT was however of the opinion that the matter had to attain a quietus to the long pending issue; it suggested the s etting up of acommittee consisting of senior Commissioner as chairman to arrive at consensus duly associating the representatives of DRIs and promotees. Any difference of opinion, was to be recorded in the note and fi nal decision was to be left to the Chief Commissioner, who i s the cadre controlling authority. 8. In due compliance with the order, a committee was formed. The CAT, in the meanwhile, disposed of the pending proceedings on 30.3.20007 taking note of the status report by the department, regarding preparation of the seniority list, based on the submission that the f inal decision of the Chief Commissioner was awaited. 9. The cadre controlling authority, considering the seniority list prepared by the committee circulated a tentative seniori ty list as on 01.01.2002 calling for objections. These objections were overruled and the final seniority list was published on 7.8.2002. This list was questioned by the promotees, who filed O.A. No. 938/ 2002 etc. The PRIs’ plea was that the seniority list finalised was not in conformity with the directions issued by CAT in O.A.NO. 1323/ 1993 as well as the principles in the 1959 and 1986 OMs. The department as well as the unofficial respondents, that is, DRIs, resisted the proceedings. The department’s position was that the procedure adopted was valid, in accord with the rules and that the vacancy position from time to time was taken into consideration.The DRIs contended that in fact PRIs occupied more than 25% quota and that the litigation was needlessly continued. 10. CAT, in its order dated 29.12.2000, considered the submissions and the record, and held that: (i) The direct recruit/promotion Register of Inspec tors, maintained in the office and forwarded to the Hyder abad-I Commissionerate was an authentic document which discloses 7 O.A.No. 429/1998, which challenged the final list of 1997 B.S. MURTHY & ORS. v. A. RAVINDER SINGH & ORS. [S. RAVINDRA BHAT, J.] the actual vacancies that arose in each year during the peri od from 1984-1991 and the exact ratio of 3:1 of DR and PR quota respectively; (ii) There were no excess promotions during the years 1983 to 1991; 25% of actual vacancies arising every year du ring that period were for the promotees. No direct recruit vacancy for any year was filled by promotees; (iii) The indents placed with, the Staff Selection Commi ssion for the recruitment of DRs were only for a part of vacanci es (due to partial, ban etc.) and not for the exact 75 % of the actual vacancies available in each year. There were no instances of suppression or under-reporting of vaca ncies available for direct recruits out of the permanent cadre strength in any year, to help the promotees. There was conseque ntly no justification for invoking para 5 of the O.M. of 1986. The department wrongly inferred that there were excess promotions by wrongly estimating the promotee quota on the basis of the indents placed for direct recruitment; (iv)(a) The date of appointment of direct recruits the da te for counting seniority-it is not from the date of recei pt of the dossiers from the recruiting authorities or the dat e of recommendation. Resultantly seniority of direct rec ruits appointed after 1.3.86 is to be revised only from the dat e of their respective appointments but not earlier to 1.3 .1986 as is wrongly done in the impugned seniority list, (b) Direct recruits of 1992 were to be given seniority only in that year but not in 1991 as was wrongly done in the impugned seniority list; (v) The seniority of five applicants in O.A.NO. 156 /86 originally fixed in terms of the order, had to be restore d and could not be altered. (vi) Those promoted ad hoc basis in any year in the vacancies available to them were eligible for seniority from the da te of their continuous officiation, if -they were promoted within their eligible quota of that year under the Recruitment Rules; (vii) Those promoted in 1983 against 17 posts diverted f rom Shillong, were entitled to seniority in terms of 1959 O.M; 13 (viii) Of 137 promotees regularised on 27.10.1988, seni ority of those applicants regularised under the earlier order in 1985 is to be fixed prior to 1.3.1986, on the said earlier d ate of their regularisation in 1985; (ix) Seniority of promotees functioning in temporar y posts not forming part of the cadre, is to be fixed from the date of promotion/ appointment. 11. Accordingly, the CAT allowed the applications and set aside the seniority list prepared as on 01.01.2002. The department was directed to revise and refix the seniority list in the cadre of Ins pectors in tune with the findings and the order dated 13.2.1997 in O.A.NO. 1322/1993. Another direction to as certain number of vacancies, which arose each year for working out DRIs and PRIs in the ratio of 3:1 on the basis of the direct recruit/promotion Register maintained during the 1991-1994 as well as the remaining period subsequent to 1999- on the basis of the authentic records maintained in the office was issued. 12. Aggrieved by CAT’s order dated 29.12.2003 the DRIs and the Central Government filed writ petitions before the High Court, which resulted in the impugned judgment. The High Court held that the vacancy register had no relevance for the purpose of promotion of in-ser vice candidates and such promotions could be only in proportion to the respective quota, based on indents placed by the department with the Staff Selection Board for direct recruitment. It also held that length of continuous service followed by regularisation cannot be counted for the purpose of seniority since the quota rule had not been infringed. It also held that validity of 1986 OM was not challenged in the applications by the promotee inspectors. It therefore, upheld the impugned seniority list dated 22.07.2002. Contentions of appellant-PRIs 13. It is urged on behalf of the PRIs by their senior counsel, Mr. R. Basant, that the High Court overlooked the fact that the Chairperson of the Committee which was constituted pursuant to the decision of the Full Bench (of CAT) submitted its first report to the Chief Commissioner by letter dated 28.3.20008 suggesting that direct recruit/promotee register of Inspectors maintained from 1884 to 1996 should be taken as the basis 8 C.No.11/39/92/99-Estt., dated 28.3.2000 B.S. MURTHY & ORS. v. A. RAVINDER SINGH & ORS. [S. RAVINDRA BHAT, J.] to arrive at number of vacancies year-wise to determine t he seniority since in terms of 1986 OM. The method of calculation of vacancies should be based on vacancy register. The extract of the report reads as under: “I have looked into ‘DR/Promotee register of Inspe ctors’ Hyderabad which has been forwarded by the Commissionerate. It has been maintained systematica lly showing the exact ratio of 3:1 as provided in the O.M. dated 22.12.1959 and O.M. dated 7.2.1986. There is, therefore, little scope to doubt authenticity of this register though nosignatures are appended. Moreover, it has been duly certified by the Joint Commissioner (F&V) of Hyderabad Commissionera te as having been maintained in the Establishment of Hyderabad Commissionerate now that this register is available, it woul d be better to go by it than on any assumption or principl e to determine the number of vacancies on thebasis of which th e seniority list is to be drawn up.” 14. It was submitted that the Chairperson of the Comm ittee submitted its second report to the Chief Commissioner on 11.1 0.2000 clarifying that the Special Cell’s formula of taking the actual number of DRIs appointed to arrive at the PRI quota was narrow . Instead, it suggested to take the indents placed to Staff Selection Commission (SSC) together with the appointments made on compassionate grounds, inter Commissionerate transfers, sports quota and surplus cell which were in the nature of direct recruitment as basis for arriving at number of direct recruit vacancies and to arrive at PRI quota by arriving the ratio of 3:1. 15. It was urged by Mr. Basant, that the January 2002 seniori ty list, completely ignored the previous directions of CAT, which had attained finality, and proceeded to apply the 1986 OM retrospectively, in regard to pre-1986 PRIs, as well as ad-hoc PRIs, without considering that most such PRIs were in fact promoted within the quota available to them, under the rules. It was submitted that the department ignored two salient facts, first, that as many as 110 appointments were made, which were adjustable only against the direct recruit quota (such as sports quota, compassionate appointments and inter Commissionerate transfers). Secondly, the existence of a ban-though partial in nature, preventing direct recruit ment, was a completely neutral fact, which could not have operated against the PRIs while determining the inter se seniority with DRIs. 15 16. It was urged by learned senior counsel that the method of calculation of promotee quota vacancies was flawed. The ap pellants urge that the quota is to be worked out, based on the total vacancies arising each year. This contention is supported by the 1979 Rules as well as 1986 OM. The department’s stand that quota is to be worked out, not on the total reported vacancies as per the vacancy register as envisaged in the 1986 OM but on the indents placed with the SSC for DR Is is unjustified. This position is contrary to the express terms of the OM. Indents placed with the SSC is only one, (among others) mode of direct recruitment. It is not the only basis for determination of quota either, for quotas are fixed by the Recruitment rules. According to the appellants the restricted interpretation of the 1986 OM by the departme nt would render it bad and violative of Articles 14 and 16 of the Constitution. 17. It is urged that the 1986 OM is an executive instruction and hence subordinate to statutory rules formulated under Article 309 of the Constitution. Rule 7 of the 1979 Rules empowers the department t o relax any of the rules with regard to any class or category of persons. In this case, the Ministry of Finance, Department of Expenditure imposed restrictions on filling up of direct recruit vacancies during the years 1984 to 1990 while exempting vacancies to be filled up purely by promotion in terms of the relevant recruitment rules from the purvi ew of those restrictions. These amounted to relaxation of the Recruitment Rules in exercise of the powers conferred under Rule 7 of those Rul es. The appellants also rely on the averments, in Paras 5(1)(c) & (d) of the department’s counter affidavit9, admitting that filling of vacancies by promotion, was exempt from the instructions relatin g to ban on recruitment, to the following effect. “…..Central Board of Excise & Customs has since clarified that there were restrictions on filling up direct r ecruit vacancies during the years 1984 to 1990 and the restrictions do not apply to vacancies which are to be filled up purely by way of promotion in terms of the relevant Recruitment Rule s.” 18. The appellants then rely on the replies given by the department, to the replies to queries (dated 29-08-2007, 30-10-2007, 13-11-2007 and 28-11-2007) made under the Right to Information Act (“RTI”). The reply to the RTI query10 9 Dated 25th August 2008 in CA 3969-3982/2009 arising out of SLP (C) 4784/2007 10 Given on 28-11-2007 (F.No.A.60/31/RTl/2007-Ad.lllB) by Govt of India, Ministry of Finance, Department of Revenue, Central Board of Excise and Customs B.S. MURTHY & ORS. v. A. RAVINDER SINGH & ORS. [S. RAVINDRA BHAT, J.] “the restrictions on filling up of direct recruit v acancies imposed by the Government do not apply to vacancies which are filled up purely by way of promotion in terms of recruitment rules provided the resultant vacancies in the lowest l evel of the cadre are not filled up during the period of the ban order” . Likewise, the letter dated 13-11-200711 refers to two earlier letters, (F.7 (1)-E. Coord/84 dated 20.06.1984, F.7 (1)-E-Co ord/86 dated 20.05.1986 and F.7 (1)-E-Coord.186 dated 15.07.1986), issued by the Govt. of India, department of revenue, alluding to the fact that “there were restrictions on the filling up of Direct Recrui t vacancies during the year 1984 -1990 in terms of instructions issued by Gover nment of India.” The appellants lastly rely on the reply dated 29.08.2007 12, which stated that “..The 25% promotee quota vacancies of Inspectors w ere worked out on the basis of actual vacancies available in each year.…The promotee Inspectors promoted well within 25% promotee quota.” It is submitted therefore, that the department proceede d on a misconception that promotions made even within the quota available for the PRIs were to be treated as excess to the extent t hat indents were not (or could not be) made for direct recruitment to the cadre, through the SSC. 19. It was further argued by the appellants, that the department’s interpretation of the quota rule is untenable, in th at for the purpose of reckoning seniority, the quota for PRIs was taken to be one third of the total vacancies available and filled by direct recruitment. This is contrary to the rules, which provide, independently a q uota of 25% of the total vacancies. It was submitted that this interpretation, together with the fact that existence of a ban on direct recruitment was ignored, led the department to ignore the directions in the pr evious orders of the CAT, as well as the factual report of the commis sioner, which clearly existed that the vacancy register maintained at the relevant time, did not show that there was any under-reporting of direct recruit vacancies. 11 F.No.A.60/3 l/RTI/2007.AD.IIl.B by the Govt of Ind ia, Ministry of Finance, Department of Revenue, Central Board of Excise and Customs 12 F. No. I/Admn (22) Misc-42 /R.TIA/CPIO/M-I/2007/49 17 Contentions of the respondent DRIs and the department 20. It was urged on behalf of the DRIs, who succeeded before the High Court, that the impugned judgment does not call for interference. It is pointed out that the question of inter se seniority has been gone into on multiple occasions, and the department interpreted the previous rulings (which had attained finality) correctly while drawing up the seniority list. 21. It was urged that the previous seniority list (as on 01.1.1992) dated 15.10.1997 was not challenged by the PRIs; it was impugned by the DRIs. Therefore, PRIs cannot seek better seniority than wha t their position was in the list dated 15.10.1997 as on 1.1.1992. It was urged that the excess PRIs including the applicants were not given any seniority positions in the seniority list dated 15.10.1997 and the appellants as well as other excess PRIs did not challenge the said seniority li st in which they were not granted seniority and were shown at the bottom o f the list. Having not challenged the seniority list on 15.10. 1997. It was only challenged by the DRIs as they were aggrieved by their respective ranking positions in that list. The PRIs therefore, cannot question the positions assigned to them in the revised seniority list. It was argued that the CAT failed to notice this aspect, and held that it was not open for the PRIs again at a subsequent stage to contend that they ought to have been fixed in the seniority above 1991 and 1992 DRIs. They cannot be allowed to do so as the principle ofestoppel would squarely operate against them. 22. It was urged that the impugned judgment correctly appreciated that the vacancy register at the most indicated the vacancy position in cadre and was not meant to confer the benefit of promotion on in-service candidates more especially when the promotions were to be made with reference to vacancies indented for DRIs. Therefore, CA T’s observation that only in case of detection of under reporting/ suppression the bunching process had to be adopted and in other cases the vacancies position vis- a-vis the promotion was to be identified from the vacancy register, was untenable. It is also relevant that contrary to the premise underlying the contentions of PRIs, there is no conflict between Para 4 and 5 of the 1986 OM. This too was appreciated by the High Court. The pert inent issue, submit the DRIs, was whether PRIs can claim seniority over the DRIs when they occupied the posts beyond the prescribed ratio, subject to bunching process. Quite possibly some PRI swere pr omoted on temporary basis and some were promoted on ad-hoc basis. Assuming that they were promoted on regular basis, without properly assessing the B.S. MURTHY & ORS. v. A. RA VINDER SINGH & ORS. [S. RAVINDRA BHAT, J.] vacancies, that ipso facto could not confer any right to claim seniority from the date of their appointment, in as much as, the seniority can only be assigned when the vacancy crystallizes. It is always subject to the quota rule. That is what was followed in the 1959 OM, however, a slight change was brought in 1986 doing away with the slotting syst em and replacing the same with the bunching system. The bunching process has the effect of balancing the ratio as far as possible without much deviation and it acts as an effective catalyst and always equalizes the inequalities created by excess promotion or excess. 23. The respondents urge that there cannot be excess direct recruitment in as much as only clearvacancies would be report ed to the selection agencies whereas promotions would also be given on ad- hoc, temporary basis. In the process of fixation of seniority, there could be variation in the dates of promotion either in the promotee c adre or date of joining in the DRI cadre, but that should not be allowed to uproot the entire seniority list and efforts must be made to setrig ht the commissions or omissions as far as practicable. The High Court also correctly appreciated that para 5 of the 1986 OM did not cause prejudice to PRIs by the bunching process and any promotions beyond the bunching stage were treated as ad hoc promotions. The High Court correctly upheld the 1986 OM and observed that it contained principles for fixation of seniority when the intake is from two sources. In fact, in bunching systemthe PRIs would benefit in view of the fact that when the indented vacancies are not filled up in toto for non-availability of DRIs for various reasons, requisite promotions made to the extent of indented vacancies. 24. It is argued that the OMs are to be read as they are and nothing can be imported nor interpreted contrary to their intention. Quotas have been specifically fixed between DRIs and PRIs at 75% and 25%, the quota of PRIs is co-relatable to the indent placed fordirect recruitment with the SSB. Therefore, the quota has no relationto permanent strength or vacancy position. 25. It is contended that though a vacancy may arise, or exist, it may not necessarily be filled up immediately. Therefore, ev en if the direct recruit quota has not been filled up, PRIs should be given their share in terms of such vacancy positions. The dispute also aros e with regard to “identification” of the vacancies that is, whether it is assessed on the basis of the indents placed by the departments or by the SSC or on the basis of the vacancy position as reflected in the vacancy register. 19 It is pertinent to mention that DR/PRRegister is not a vacanc y register contrary to the observation that the same was said to be maintained by the department for the said purpose. Therefore, discrepanci es in such register were highlighted to CAT in the DRIs’ review peti tion. One discrepancy was that promotion were given to an individual aga inst a death vacancy which arose nearly 16 months after such promotion- this too was held to be a promotion within the promotee quota and seniority was sought to be extended to such promotion from the date of promotion by the CAT’s order. The CAT however, dismissed the review petition on the ground that the plea was nothing but an appeal in disguise and DRIs were free to appeal against the verdict. 26. It is argued therefore, that the maintenance of a Regis ter at best, served to identify vacancies. Instead of that register, the Departmental Promotion Committee (DPC) reports (ord ering the promotions with specific reference to nature of such vacancies against such promotions were given for the said period) would be more authentic in considering if promotions were made in the regular manner. However, CAT ignored the DRIs’ pleas, in its order. It was submitted that the vacancy register is not relevant when promotions are made but their relevance is important at the time of fixation of sen iority, as such promotions should conform to the quota prescription under the rules, as between PRIs and DRIs. The CAT, having observed that quota rule had not been broken down, should have held that promotions could have been given only in proportion to the PRI quota on the basis of indents placed by the department with the SSB and promotions could not be correlated to the vacancy position. The bunching system was introduced so as not to cause injustice to the promotee office rs. The Central Government’s clarification clearly provided that notwith standing the vacancies which were indented by the department Staff Selection Board were not filled up, yet, to the extent of the indent, promotions could be given by resorting to bunching system. Consequently, the interests of the PRIs were fully protected. 27. The contesting respondents rely on the judgments of this court, reported as State Of West Bengal & Ors v Aghore Nath Dey & Ors 13; Devindra Prasad Sharma v State of Mizoram 14; Suraj Parkash Gupta v State of J& K 15 to argue that this court has previously ruled that 13 1993 (3) SCC 371 14 1997 (4) SCC 422 15 2000 (3) SCR 807 B.S. MURTHY & ORS. v. A. RA VINDER SINGH & ORS. [S. RAVINDRA BHAT, J.] wherever public servants are promoted in excess of their quota, such promotions would be deemed as irregular to the extent it vi olates the rules. The PRIs would be eligible only to the extent DRIs are appointed, and that the balance or excess PRIs would have to be bunched at the bottom of the seniority list. 28. The Central Government has supported the conclusions arrived at by the High Court. On its behalf, the Additional Solicitor General (ASG) Ms. Madhvi Divan, urged that the relative seniority of DRIs and PRIs has to be determined according to therotation of vacancies between DRIs and PRIs which shall be based on the quota of vacancies reserved for direct recruitment and promotion respectively in the Rec ruitment Rules. It was urged that the record clearly bears out that while finalizing the seniority of Inspectors for the years 1983 to 2002 as on 01.01.2002, vide seniority list dated 22.7.2002, the promotee quota vacancies were arrived at year wise, in terms of the indents placed to the SSC for direct recruitment and other appointments made under direct recruit quota i.e., on compassionate grounds, sports quota, vacancies kept aside for inter- Commissionerate transfers and surplus cell. 29. The Central Government also argued that in tune with the OM of 1986 all the excess PRIs including the appellants were not given any seniority position in the seniority list dated 15.10.1997. The appellants did not challenge that seniority list where they were not given any seniority position and were only shown at the bottom of the list, they can not challenge their seniority position in the impugned seniority list and cannot question their present seniority positions. The note in the seniority list dated 15.10.1997 with reference to the excess PRIs as regards to their seniority was self-explanatory, Therefore, the grievance of the appellants against the present seniority list was devoid of any merit. They are not entitled to any relief. 30. It is lastly urged that in accordance with the principle adopted that the indents placed to SSC together with actual a ppointment on compassionate grounds, sports quota and vacancies kept reser ved for Inter Commissionerate transfers while placing such indents shall be taken as the vacancies meant for direct recruitment, it was foun d that 789 vacancies arose during the period 1991- 2001 which indicated that the department could order 264 promotions -in that period. Thereafte r all the officers who were to be given seniority after 1999 inc luding the officers promoted against the vacancies that arose consequent to increase 21 in the promotee quota from 25 % to 33 1/3 %, since at that point of time all the vacancies under promotee quota were filled up, have been bunched and given seniority in the year 2000. Analysis and Reasoning 31. The rules in question, that is, 1979 Rules prescribes that recruitment to the post of Inspectors is from two s ources: direct recruitment (to the extent of 75% of the cadre) and promotions (to t he extent of 25% of the cadre). Promotions are made from seven fee der grade cadre posts: Upper Division Clerks (UDCs)/Steno Grade III; UDCs with a total of 13 years combined experience as UDCs and L ower Division Clerks (LDCs); Stenographers Grade II; Stenographers Grade II or Grade III with combined experience of 12 years; Woman Searcher with 7 years’ experience; Draftsman with seven years’ s ervice in the grade. The rules are silent about the principle on which inter se seniority of DRIs and PRIs is to be fixed. 32. The 1986 OM which is at the heart of the present controversy is reproduced below: “OFFICE MEMORANDUM Subject: General principles for determining the seni ority of various categories of persons employed in Central Ser vices. As the Ministry of Finance, etc. are aware, the Gen eral Principles for determination of seniority in the Central Services are contained in the annexure to Ministry of Home A ffairs OM No. 9/11/55-RPS dated 22-12-1959. According to Par a 6 of the said annexure, the relative seniority of direct re cruits and promotees shall be determined according to rotatio n of vacancies between the direct recruits and the promotees, which will be based on the quota of vacancies reserved for di rect recruitment and promotion respectively in the Recru itment Rules. In the Explanatory Memorandum to these Princip les, it has been stated that a roster is required to be maintain ed based on the reservation of vacancies for direct recrui tment and promotion in the Recruitment Rules. Thus, where appointment to a grade is to be made 50% by direct recruitment and 50% by promotion from a lower grade, the inter se seniority of direct recruits and promotees is deter mined on 1:1 basis. B.S. MURTHY & ORS. v. A. RA VINDER SINGH & ORS. [S. RAVINDRA BHAT, J.] 2. While the abovementioned principle was working satisfactorily in cases where direct recruitment and promoti on kept pace with each other and recruitment could also be made to the full extent of the quotas as prescribed, in case s where there was delay in direct recruitment or promotion, or where enough number of direct recruits or promotees did not become available, there was difficulty in determining seniority. I n such cases, the practice followed at present is that the slots meant for direct recruits or promotees, which could not be filled up, were left vacant, and when direct recruits or promotees became available through later examinations or selections, such persons occupied the vacant slots, thereby became se nior to persons who were already working in the grade on re gular basis. In some cases, where there was shortfall in direct recruitment in two or more consecutive years, this resulted in direct recruits of later years taking seniority over s ome of the promotees with fairly long years of regular service alr eady to their credit. This matter had also come up for consi deration in various court cases both before the High Courts a nd the Supreme Court and in several cases the relevant jud gment had brought out the inappropriateness of direct rec ruits of later years becoming senior to promotees with long years of service. 3. This matter, which was also discussed in the Nat ional Council has been engaging the attention of the Governme nt for quite some time and it has been decided that in future, while the principle of rotation of quotas will still be follow ed for determining the inter se seniority of direct re cruits and promotees, the present practice of keeping vacant s lots for being filled up by direct recruits of later years, the reby giving them unintended seniority over promotees who are already in position, would be dispensed with. Thus, if adequate number of direct recruits do not become available in any pa rticular year, rotation of quotas for purpose of determining se niority would take place only to the extent of the availabl e direct recruits and the promotees. In other words, to the extent direct recruits are not available, the promotees will be b unched together at the bottom of the seniority list, below the last position up to which it is possible to determine sen iority on 23 the basis of rotation of quotas with reference to t he actual number of direct recruits who become available. The unfilled direct recruitment quota vacancies would, however, be carried forward and added to the corresponding direct recrui tment vacancies of the next year (and to subsequent years where necessary) for taking action for direct recruitment for the total number according to the usual practice. Thereafter, in that year while seniority will be determined between direct recr uits and promotees, to the extent of the number of vacancies for direct recruits and promotees as determined according to the quota for that year, the additional direct recruits selected against the carried forward vacancies of the previo us year would be placed en bloc below the last promotee (or direct recruit as the case may be) in the seniority list based on the rotation of vacancies for that year. The same principle hold s good in determining seniority in the event of carry f orward, if any, of direct recruitment or promotion quota vacancies ( as the case may be) in the subsequent years. Illustration: Where the Recruitment Rules provide 50% of the vacanc ies in a grade to be filled by promotion and the remaining 50% by direct recruitment, and assuming there are 10 vacancies in the grade arising in each of the years 1986 and 198 7 and that 2 vacancies intended for direct recruitment re mained unfilled during 1986 and they could be filled durin g 1987, the seniority position of the promotees and direct recrui ts of these two years will be as under: 1986 1987 1. P1 9. P1 2. D1 10.D1 3. P2 11.P2 4. D2 12.D2 5. P3 13.P3 6. D3 14.D3 7. P4 15.P4 B.S. MURTHY & ORS. v. A. RA VINDER SINGH & ORS. [S. RAVINDRA BHAT, J.] 8. P5 16.D4 17.P5 18.D5 19.D6 20.D7 4. In order to help the appointing authorities in determ ining the number of vacancies to be filled during a year under e ach of the methods of recruitment prescribed, a vacancy r egister giving a running account of the vacancies arising and bei ng filled from year to year may be maintained in the pro fo rma enclosed. 5. With a view to curbing any tendency of underrepo rting/ suppressing the vacancies to be notified to the aut horities concerned for direct recruitment, it is clarified that promo tees will be treated as regular only to the extent to whic h direct recruitment vacancies are reported to the recruiting authorities on the basis of the quotas prescribed in the releva nt Recruitment Rules. Excess promotees, if any, exceed ing the share falling to the promotion quota based on the corresponding figure, notified for direct recruitme nt would be treated only as ad hoc promotees. 6. The General Principles of seniority issued on 22-1 2-1959 referred to above, may be deemed to have been modified to that extent. 7. These orders shall take effect from 1-3-1986. Se niority already determined in accordance with the existing principles on the date of issue of these orders will not be reopene d. In respect of vacancies for which recruitment action has a lready been taken, on the date of issue of these orders either by way of direct recruitment or promotion, seniority will cont inue to be determined in accordance with the principle in force pri or to the issue of this OM. 8. Ministry of Finance, etc. are requested to bring these instructions to the notice of all the attached/subo rdinate offices under them to whom the General Principles o f 25 seniority contained in the OM dated 22-12-1959 are applicable within 2 weeks as these orders will be e ffective from the next month. sd/- Joint Secretary to the Government of India” 33. The main issue before this Court is regarding application of Clause 4 and 5 of the OM of 1986 in the background of the 1979 Rules, which provide for 75% by direct recruitment and 25% by promotion. In terms of the rules, ratio for the two sources is three candidates from the direct recruitment channel and one candidate from the promotional channel has to be resorted to. As mentioned earlier there is no governin g rule meant to guide thefixing of inter-se seniority between the DR Is and PRs. That was done in accordance with the executive Office Memorandums. 34. The 1986 OM introduced the principle of rotation of quota along with bunching rule. In its termswhen in a particular year, if against the available vacancies, a given number of DRIs or PRIs are not available, after the last available candidate, from a particular channel,cand idates from the other channel or quota would be bunched at the end of the list and such seniority and will be treated as ad-hoc entrants, for the purposes of seniority. The effect of drawing seniority lists in the manner required of by the OM is that in a particular year, whenever the number of candidates appointed from either source– under the rule can potentially be treated as ad-hoc to the extent that vacancies are not reported to the SSC in a given year. 35. The question in this case is whether the ratio of the PRIs has to be drawn with respect to the indented vacancies for the DRI s. The counsel for the DRIs has argued in favour and the same has als o been done by the government while drawing the seniority list. The fall out of this mode of drawing the list is that if in a particular year there are less number of indented vacancies for DRIs or the vacancies ar e under reported the PRIs lose their right of seniority as given under 1979 Rules. 36. As is evident from the preceding factual discussion, the genesis of this dispute was the first round of litigation, initiated by the promotee Inspectors – who sought for proper fixation of their senior ity. This culminated in CAT’s 1988 order. Since direct recruits were not arrayed as parties, they preferred review applications, which we re disposed of in terms of the main 1988 order, dated 05.07.1988. B.S. MURTHY & ORS. v. A. RAVINDER SINGH & ORS. [S. RAVINDRA BHAT, J.] 37. This order required the department to frame the seniority list having regard to the OM of 07.02.1986. The order of CAT attained finality when this Court refused to entertain a special le ave petition, directed against it, on 12.03.1990. 38. The second limb of litigation was triggered by the publication of another seniority list of Inspectors (dated 30.04.1993) reflecting inter- se seniority between direct recruits and promotees as on 01.01.1992. This list was based on a retrospective application of the OM of 1986; it was challenged by direct recruit Inspectors in a number of applications, and review applications. These applications were he ard, and on 12.07.1994, referred to a Full Bench of CAT. On 21.11.1996, the Full Bench rendered its opinion, inter alia, holding that the 1986 could not be applied retrospectively. The bench of CAT which then heard the applications pending before it on merits held by its order of 13.02.1997 that the OM of 1986 could be applied only prospectively, and t hat the 1959 OM had to be followed for the period before the 1986 OM. It also held that the quota rota rule had not broken down, and that the case of PRIs who were regularised after the OM of 1986 had to be individually examined and their seniority, determined. In the light of these observations, the seniority list dated 30.04.1993 was quashed. 39. Review petitions and certain pending applications were disposed of by CAT, on 28.07,1999, when it observed that the fresh seniority list – to be prepared, should be preceded by consultations between the direct recruits and PRIs, whose views should be considered and appr opriate recommendations, made by Commissioner level officers. This order was sought to be reviewed, again: however, CAT disposed of those applications, by its clarificatory order dated 30.03.2000. 40. Acting on the basis of these orders, a report was prepared by a five-member committee (which held consultations among the employees, and seven sittings) and submitted on 28.03.2000. The Chief Commissioner asked the Chairperson (of the Committee) to re-examine the issue. In its report of 11.10.2000, the Chairpers on was of the view that to determine seniority and arrive at the correct figures of the relative quotas, it was necessary to take into account, and include appoi ntees made against the sports quota, those appointed on compa ssionate grounds, as well as those adjusted from the surplus c ells to arrive at the vacancies allocable to the share of direct recruits – in addition to vacancies reported to the Staff Selection Board. Th e Chief 27 Commissioner required the Chairperson of the Commit tee to submit its final report, which it did, on 27.12.2000. 41. The record in the present discloses that the Central Board of Excise and Customs had issued three directions, with reference to filling up vacancies in the cadre of Inspectors. The first letter dated 9.3.198816 directed the department to fill up only 12 vacancies as on 1.2.1988 out of 20 vacancies available for direct recruitment. The second l etter dated 4.7.198817 directed the respondents to fill up only 18 posts by dire ct recruitment out of 37 posts available as on 28.2.1989. The last, and third letter18 dated 29.3.1989 directed the department to fill up only 15 vacancies by direct recruitment against 27 anticipated vacancies up to 28.02.1989. A cumulative reading of these three letters would indica te that for the relative period, though 84 vacancies arose (were available) during the period (1988-89), only 45 were permitted to be filled up. 42. The other important aspect is that at the relevant ti me, only 10% of the direct recruit vacancies could be filled by compa ssionate appointment, in terms of the extant policies. However, during the same period 50 compassionate appointments were made. Similarly, 24 vacancies were filled by appointments under the sports quota. 39 vacancies were filled by inter Commissionerate transfers. Thus, in all 123 vacancies earmarked for DRIs were filled through these modes (i.e. compassionate appointment, sports quota and inter Commissionerate transfers). 43. From the above facts it is clear that for someof the ye ars, there was a partial ban on filling up of vacancies by DRIs and in addition to those, appointments were also made through different modes but the same were not reported. The department position in ad opting such practices is not of an unbiased employer; it is clearly erroneous. On one hand the department contends that the PRIs vacancies were t o be in proportion to those reported vacancies of the DRIs- to the SSC and on the other hand, itdid not report the correct number of vacancies recruited against the DRI quota, such as those appointed under the compassionate appointment quota and the sports quota. It is nobody’s case, nor can it be, that such vacancies were filled from the PRIs quota. The appointments had to be adjusted against the DRI quotas. 16 F.No.12034/19/SCC 87 -Ad.111,B, dated 9.3.1988 17 F.No. A.12034/ SR/ 18/ SCC 88 Ad.III B dated 4.7.1988 18 F. No. A. 12034/SR I 181 SCC 88 Ad. III B. B.S. MURTHY & ORS. v. A. RAVINDER SINGH & ORS. [S. RAVINDRA BHAT, J.] 44. The department’s affidavit, dated 25.08.2008 states that t he Board of Central Excise and Customs clarified that “there were restrictions on filling up direct recruit v acancies during the years 1984 to 1990 and the restrictions do not apply to vacancies which are to be filled up purely by way of promotion in terms of the relevant Recruitment Rules.” 45. The replies given by the department, to the replies to queries (dated 29-08-2007, 30-10-2007, 13-11-2007 and 28-11-2007) under the RTI query19 “the restrictions on filling up of direct recruit v acancies imposed by the Government do not apply to vacancies which are filled up purely by way of promotion in terms of recruitment rules provided the resultant vacancies in the lowest l evel of the cadre are not filled up during the period of the ban order” . 46. In fact the letter dated 13-11-2007 refers to two earlier letters, (F.7 (1)-E. Coord./84 dated 20.06.1984, F.7 (1)-E-C oord/86 dated 20.05.1986 and F.7 (1)-E-Coord.186 dated 15.07.1986 which also support the existence of the ban on direct recruitment, and further st ate that there were restrictions upon the appointments under the dir ect recruit quota, for the years 1984-1990; the letter dated 29-08-2007 in reply to an RTI query also admitted that the (promotions to) “25% promotee quota vacancies of Inspectors were worked out on the basis o f actual vacancies available in each year.…The promotee Insp ectors promoted well within 25% promotee quota.” Thus, it was established that: (a) The PRIs, initially appointed on a temporary or ad-hoc basis, were regularized in two lots: one by an order in 1985, and 137 PRIs were regularized by an order dated 27.10.1988. (b) The direct recruits who sought seniority over the PRIs in this case, were appointed in 1992, against existing vacancies, which became available for filling, after the ban (imposed by the central government during 1984-1990) ended. The requisition to the SSC for filling these vacancies, were apparently made in 1991. 19 Refer to supra, f.n. 10 29 (c) Several vacancies (which fell to the share of the DRI quota) were not reported, to SSC, but were nevertheless filled- against the compassionate appointment quota (to the extent of 50 vacancies and 39 appointments against the sports quota; (d) the ban against resorting to direct recruitment, di d not apply to resorting to promotion, to the extent, promotion al vacancies existed. This is evident from the affidavit of the Central Government, as well as other materials on record. (e) The reply to a query, under the RTI, pointedly admitted that the promotions made in the PRI 25% quota were well within the permissible quota. 47. The contesting respondents and the Central Government justify the impugned judgment, contending that the PRIs had to be trea ted as ad-hoc promotees, in terms of the 1986 OM, because firstly , the proportion in which they were appointed against promotional vacancies were in excess of the proportion available to DRIs, given the number of requisitions made to SSC and, secondly, that there cannot be an assumption that the benefit of regularization to PRIs would include seniority over the DRIs who were appointed later, but were entitled to be treated as their seniors. These respondents have relied on the judgments of this court in Aghore Nath Dey & Ors ; Devindra Prasad Sharma ; and Suraj Parkash Gupta (referred to supra). 48. The decision in Aghore Nath Dey was one where the claim was by persons granted ad- hoc, temporary appointments for a fixed period, which was extended from time to time till their regularisation on 26-2-1980, by relaxation of the condition of selection by the Public Service Commission, which was an express condition of their ad hoc appointment and a requirement for regular appointment under the 1979 Rules. The court held that assuming the relaxation was valid, they could be treated as regularly appointed only with effect from 26-02-1980 upon relaxation of conditions, and their resultant absorption in the cadre of A ssistant Engineers, based on a rule framed at the sametime under Art icle 309 providing for fixation of their seniority from that date. In such circumstances, this court, held that there was no foundation for the claim that they could be treated at par with the direct recruits, regularly appointed prior to 26-2-1980. B.S. MURTHY & ORS. v. A. RAVINDER SINGH & ORS. [S. RAVINDRA BHAT, J.] 49. In Devindra Prasad Sharma the rules governed the situation, instructing that inter se seniority was to be fixed in accordance with the ratio applicable, under the rules, for the two channels, from the date of appointment. This court held that “The statutory rule 25(iii), as indicated above, cl early postulates that the inter se seniority of the direct recrui ts and the promotees has to be determined in accordance with quota and rotation. Accordingly, seniority was rightly det ermined as per the respective dates of appointment. Therefo re, the rotation has to be considered as per the date of appointment and in accordance with the vacancy under the rules. Otherwise, the rule of rota-quota unduly gets disturb ed.” 50. Suraj Prakash Gupta was a case, where the government relaxed the conditions, and regularized the services of ad-hoc promotees who were given appointment, against the vacancies that had to be filled by direct recruits. This court held, in such circumstances that: “..the Government was merely carried away by sympath y to the promotees. By not making direct recruitment aft er 1984, by restricting direct recruits to 10% rather than pe rmitting 20% and by deliberately promoting the Junior Engineer s to the other 10% quota of the direct recruits, the State Government had definitely acted in a biased manner. There is any amount of justification for the grievance of the direct re cruits that the State had passed an omnibus order on 2.1.98 regularising all ad hoc promotees (Electrical Wing) without consulting t he Commission, by way of deemed relaxation, in a wholl y arbitrary manner, counting the entire ad hoc servic e of promotion. Their illegal occupation of direct recruitment quota was not even noticed. Their eligibility or suitabilit y was not considered. It is probable that even those who had bad ACRs were regularly promoted. The requirement of following quota for each year was not respected. The regularisation s order dated 2.1.98 was therefore bad and was therefore ri ghtly quashed by the High Court. (This declaration is confi ned to Assistant Engineers and Assistant Executive Enginee rs (Electrical Wing) - as stated under Point No. 2 of t he High Court Court’s judgment). We confirm the view of the High Court on this point. The result is that the promotees have to 31 go through the Service Commission for getting into the gazetted category of Assistant Engineers. The Assis tant Engineers have to go through DPC for promotion as Assista nt Executive Engineers.” 51. Clearly in two judgments ( Aghore Nath Dey and Suraj Prakash Gupta) the promotions were made in disregard of the rules; even in excess of their quota, and against direct recruit quota. In Aghore Nath Dey, the promotee’s claim was to seniority prior to thei r regularization – which was achieved through a special rule, inserted by way of amendment. The claim was that seniority should be given to the promotees, over the direct recruits, who had been appointed earlier. In Suraj Prakash Gupta, promotions were made in excess of the quota and as against posts that should have fallen due to direct recruits, in their quota. The ratio in these decisions is inapplicable, because there is nothing to indicate that the promotees (who were regularized in 1988) exceeded their quota. Furthermore, the department’s pleading, specifically admits that the promotees were appointed against vacancies availab le to the PRI quota. 52. This court, in K.V. Subba Rao & Ors. v. Government of Andhra Pradesh20 held that, promotion and seniority shall be reckoned from the date of appointment, not retrospectively from the dat e when the vacancy arose. M. Nirmala v State of AP 21 is a judgment, where the government issued an order, banning recruitment. Stop gap, ad-hoc promotions were given, to many employees, in 1974; they were eligible to be considered for regular promotion only after two years, subject to passing a test. Many of them sought relaxation, which was gr anted; they were ultimately regularized in 1978 without the test. They sought shifting of the date of promotion, to an earlier date, which this court held, was inadmissible: “In 1973, the ban on recruitment through Public Ser vice Commission was partially lifted. By G.O. Ms. No. 725 dat ed December 28, 1973, the Government of Andhra Pradesh directed the Public Service Commission to conduct a spec ial qualifying test for recruitment in. Group IV servic es with a view to regularising the temporary appointments made during 20 1988 (2) SCR1118 21 1986 (3) SCR 507 B.S. MURTHY & ORS. v. A. RAVINDER SINGH & ORS. [S. RAVINDRA BHAT, J.] the ban period. One of the conditions of eligibilit y for appearing at the said qualifying test was, as fixed by the Public Service Commission, two years of service as on 1.1.1973. As the petitioners were appointed after April, 1974, the question of their appearing at the said qualifying tes t did not arise. It appears that those who appeared at the said tes t were all absorbed in the regular service. On the representati on of the temporary employees who were not absorbed, the Public Service Commission conducted another special qualifying tes t as directed by the Government by G.O. Ms. No. 787 d ated November 9, 1976. The petitioners could not avail themselves of the said test as they had not put in two years of service as on 1.1.1976 as fixed by the Public Service Commission.” 53. This court, in M. Subba Reddy v A.P. State Road Transport Corporation22 considered a situation where departmental candidates were given ad-hoc promotions against direct recruit vacancies when a ban on direct recruitment was in force. Upon later regula rization (of such promotions) it was contended that the regularizations related back and that the promotees were to be accorded seniority over direct recruits, who entered the service. The court rejected this argument, holding as follows: “mere inaction on the part of the Government cannot be made a ground to contend that the quota rule has broken down. In the present case, in the absence of direct recruitm ent, the appellants could not have got seniority over direct recruits. Where there is inaction on the part of the Governme nt or employer or imposed ban on direct recruitment in fil ling up the posts meant for direct recruits, it cannot be held that the quota has broken down.” 54. State of Uttaranchal & Ors. v Dinesh Kumar Sharma 23 was a decision, where this court held that the seniority is to be reckoned not from the date when the vacancy arose, but from the date on whi ch the appointment is made to the post. The judgment in AFHQ/ISOs SOs (DP) Association & Ors. V. Union of India (UOI) & Ors24 distinguished Subba Reddy (supra) specifically in the context of periods when a ban in recruitment exists 22 2004 Supp (2)SCR7 23 2006 Supp (10) SCR 1 24 2008 (3) SCC 331 33 “28. In M. Subba Reddy and Anr., etc. v. A. P. State Road Transport Corporation and Ors. AIR2004SC3517, relied upon by Mr. L. N. Rao, learned senior Advocate appearing on behalf of AFHQ Civil Service (Direct Recruits-Gazet ted) Officers’ Association, this Court while dealing with inter se seniority between direct recruits and promotees to th e posts of Assistant Traffic Manager (for short “ATM”) and Assi stant Mechanical Engineer (for short “AME”) in A.P. State Road Transport Corporation, held that rota rule is inbui lt in the quota prescribed in Item 3, Annexure ‘A’ (Section B) t o A.P. SRTC Employees (Recruitment) Regulations, 1966 and could not be deviated from. In that case, the appellant p romotees were promoted to the posts of ATMs/AMEs temporarily under Regulation 30 as there were no direct recruits available. They were promoted subject to being reverted to substantive po sts on approved candidates becoming available. Regulati on 34(6) states that the revertees shall subsequently be considered for repromotion against the quota of vac ancies reserved for promotees. Therefore, one has to read Regulation 3 of the A.P. SRTC Employees (Service) Regulations, 1964 with Regulations 30 and 34 of the Recruitment Regula tions. It is only when such revertees are repromoted as pe r Regulation 34, they can be deemed to have been appoi nted to the posts of ATM or AME. Therefore, when the appellant s were tentatively appointed to the post of ATMs/AMEs originally for want of direct recruits and to the posts reserved for dir ect recruits, it cannot be said that they were first ap pointed to that category within the meaning of Regulation 3 of the Service Regulations. Therefore, seniority had to be fixed between the direct recruits and the promotees strictly in accordanc e with the quota provided for in Item 3 of Annexure ‘A’ (Section B) . The said Regulations prescribe a quota of 1:1, which leads to rota for confirmation. The contention of the app ellants before this Court was that they had a right to be pr omoted within their quota during the years 1981 to 1987, w hen vacancies for promotees’ quota became available. M. Su bba Reddy, appellant in that case, was regularized from 27.12.1986 vide order dated 9.9.1988, when no direct recruits were available and, therefore, it was improper for the Corporation to place direct recruits above the promotees. The B.S. MURTHY & ORS. v. A. RAVINDER SINGH & ORS. [S. RAVINDRA BHAT, J.] appellant submitted that in such a case the quota in Item 3(1 ) of Annexure ‘A’ to the Recruitment Rules would not a pply; that the said item prescribed only quota and not ro ta for seniority and that the direct recruits could not cl aim appointment from the date of vacancy in their quota be fore their selection . They added that seniority was dealt with on ly by Regulation 3 of the Service Regulations, 1964 and not b y Regulation 34 of the Recruitment Regulations, 1966. That in view of the 15.9.1995 amendment, Regulation 34 referred t o only allocation of vacancy and not for determinatio n of seniority. A total ban for direct recruitment was im posed by the State from the year 1977 to 1988 and, thus, the purported quota-and-rota rule contained in Item 3 of Annexure ‘A’ could not have been given effect to. The majority view of this Court was that where there is inaction on the part of the Gov ernment or employer or imposed ban on direct recruitment in fi lling up the posts meant for direct recruits, it cannot be held t hat the quota has broken down. We, with respect, do not support the view of the learned Judges that in the facts an d circumstances of the case the quota has not broken down because of inaction on the part of the Government in imposing ban in filling up the posts meant for direct recrui ts. The appellants in the said case were promoted in a regular manne r having been regularized in service with retrospectiv e effect. Their services were not regularized from the date of their initial ad hoc promotion but with effect from the date when the vacancies became available. Their services after regularization would not be by way of a stop-gap arrangement. The direct recruits who were appointed in the years 1990 and 1991, in terms of Item 3 of Annexure ‘A’ would be considered to have been appointed only after the ir successful completion of training. They were borne in the cadre in the years 1990-91 and, thus, prior thereto they cannot claim seniority. The learned third Judge, dissenting wi th the learned two Judges, has held that the direct recruit can clai m seniority from the date of his regular appointment, he cannot claim seniority from a date when he was not borne i n the service. Thus, the direct recruits of 1990 and 1991, by reason of the impugned seniority list, could not have been placed 35 over and above the appellants-promotees because the purported quota and rota rule contained in Item 3 of Annexure ‘A’ could not have been given effect to because the State Government had imposed total ban for direct recruitment from the year 1977 to 1988. In such a situation, the sai d quota rule became inoperative. We agree with the dissentin g view of the learned Judge that in the facts of the case, the quota rule became inoperative because the direct recruits were borne in the cadre when they were appointed against the vacancies meant for them.” The judgment in Pawan Pratap Singh v. Reevan Singh 25 considered several previous precedents, on the issue, incl uding the Constitution Bench decision in Direct Recruit Class II Engg. Officers’ Assn. v. State of Maharashtra26. The correct position was summarized by Lodha, J. in the following manner: “(i) The effective date of selection has to be unders tood in the context of the service rules under which the appointment is made. It may mean the date on which the process of selection starts with the issuance of advertisement or the fa ctum of preparation of the select list, as the case may be. (ii) Inter se seniority in a particular service has to be determined as per the service rules. The date of ent ry in a particular service or the date of substantive appoin tment is the safest criterion for fixing seniority inter se b etween one officer or the other or between one group of officers and the other recruited from different sources. Any departure therefrom in the statutory rules, executive instructions or otherwis e must be consistent with the requirements of Articles 14 and 16 of the Constitution. 25 2011 (2) SCR 831- a view followed later, in State of U.P. v. Ashok Kumar Srivastava, (2014) 14 SCC 720 and, more recently, endorsed in K. Meghachandra Singh v. Ningam Siro (2020) 5 SCC 689 that “seniority should not be reckoned retrospectively unless it is so expressly provided by the relevant Service Ru les. The Supreme Court held that seniority cannot be given to an employee who is yet to be borne in the cadre and by doing so it may adversely affect the employees who have b een appointed validly in the meantime”. Also Dinesh Kumar Gupta &Ots v High Court of Judicature, Rajasthan 2020 SCC OnLine (SC) 420 26 (1990) 2 SCR 900 B.S. MURTHY & ORS. v. A. RAVINDER SINGH & ORS. [S. RAVINDRA BHAT, J.] (iii) Ordinarily, notional seniority may not be gra nted from the backdate and if it is done, it must be based on objecti ve considerations and on a valid classification and mu st be traceable to the statutory rules. (iv) The seniority cannot be reckoned from the date of occurrence of the vacancy and cannot be given retrospectiv ely unless it is so expressly provided by the relevant servi ce rules. It is so because seniority cannot be given on retro spective basis when an employee has not even been borne in the cadre and by doing so it may adversely affect the employe es who have been appointed validly in the meantime.” 55. In a concurring opinion, Aftab Alam, J. reiterated the position and alluded to additional authorities on the subject and said: ”To the decisions referred to on this point in the main judgment I may add just one more in Suraj Parkash Gupta v. State of J and K (2000) 7 SCC 561]. The decision relates to a dispute of seniority between direct recruits and promotees but in that case the Court considered the question of anteda ting the date of recruitment on the ground that the vacancy against which the appointment was made had arisen long ago. In para 18 of the decision the Court framed one of the poi nts arising for consideration in the case as follows: “18. ... (4) Whether the direct recruits could clai m a retrospective date of recruitment from the date on whi ch the post in direct recruitment was available, even though the direct recruit was not appointed by that date and was appo inted long thereafter? This Court answered the question in the following t erms: (Suraj Parkash Gupta case) “Point 4 Direct recruits cannot claim appointment from the d ate of vacancy in quota before their selection 80. We have next to refer to one other contention rai sed by the Respondent direct recruits. They claimed that th e direct recruitment appointment can be antedated from the da te of occurrence of a vacancy in the direct recruitment quota, eve n 37 if on that date the said person was not directly recruit ed. It was submitted that if the promotees occupied the qu ota belonging to direct recruits they had to be pushed down, whenever direct recruitment was made. Once they wer e so pushed down, even if the direct recruit came later, he shoul d be put in the direct recruit slot from the date on which such a slot was available under the direct recruitment quota.” These decisions were reiterated, and followed in a thr ee-judge bench judgment in P. Sudhakar Rao & Ors. v U. Govinda Rao & Ors27 which ruled that seniority cannot be given to any appointee from a date anterior to his or her appointment, in the cadre. 56. From the above discussion, it is clear that no appointee from any one channel (direct recruits or promotees) can lay claim to seniority from a date before her or his appointment. That being the position in law, it would be now necessary to consider the reasons which weighed with the High Court to hold that the promotees (in regular and subs tantive capacity from 1988) had to make way for direct recruits, wh o were appointed in 1991-92. Simply stated, the High Court was of the opinion that promotees had to be treated as occupying posts in e xcess of the quota allocated to them, on an application of the 1986 OM. Now, as a matter of fact the materials on record establish that there were promotee vacancies at a time when the ban on direct recruitment w as in force (during 1984-1990). To the query dated 11-06-2007, the Commissionerate concerned, at Hyderabad stated, in its reply dated 30-08-2007, as follows: “In this Commissionerate whatever vacancies occurred i n a year, the same weredivided in the ratio 3:1 during the period 1986 to 1990 and the share of vacancywhich comes for direct recruit were reported to SSC and the promotee quota vacancies were filled upby holding DPC. The same letter also stated that: “..the 25% promotee quota vacancies were washed (si c worked) out on the basis of actual vacancies availa ble in each year.” The reply further stated that all the promotions were made on regular basis. The rationale for the argument that promotions are to be 27 (2013) 8 SCC 693 B.S. MURTHY & ORS. v. A. RAVINDER SINGH & ORS. [S. RAVINDRA BHAT, J.] treated in excess of the promotee quota, is that the requisite number of vacancies falling to the share of direct recruitment were not reported to the SSC. For this logic, Para 4 and Para 5 of the 1986 OM were relied upon. 57. As is apparent, Para 4 is procedural, and talks of a vacan cy register, which would contain a “running account of the vacancies arising and being filled from year to year” . This was deemed necessary, because of the Para 3 of the same OM which e ntails the procedure of bunching rule. 58. Hence, it is essential to keep in mind that Para 5, (which has been the basis of the High Court judgment, to hold that the PRIs were in excess of their quota) was meant to cater to a contingency that is of under reporting direct recruit vacancies to the pub lic service commission (in this case, the SSC) which resulted in an unfair advantage to promotees who would “steal a march” over such direct re cruits, appointed later. It was in such contingencies, that is, of under-reporting vacancies, that the consequence of deeming promotions to be ad-hoc could be resorted to. If one keeps this perspective in min d, the correct direction of inquiry, (which in this court’s opinion was und ertaken by CAT) was to see what were the number of regular vacancies relative to the quotas, with specific reference to the vacancy register. This approach, however, was discredited by the High Court, which held that the vacancy register “at the mostindicates the vacancy position in DRI/PRI cad re and it is notintended to confer the benefit of promotion on in- servicecandidates more especially when the promotio ns are tobe effectedwith reference to the vacancies indent ed for D.R.ls. Therefore, theobservation of the tribunalth at only in case of detection of under, reporting/suppression t he bunching process had to be adoptedand in other case s the vacancies position vis-a-vis the promotionhas to be identi fied from the vacancy register is untenable.” 59. As discussed, the materials on record indicate that promotional vacancies did exist, at the relevant period. There was a ban on direct recruitment. The reasons for the ban are now obscure; but the fact remains that it was in force for six years (1984-90). During this period, undoubtedly, no requisitions were made to the SSC for filling direct recruit 39 vacancies. However, the linear logic, applied by the High Court, to conclude that by virtue of Para 5 of the OM of 1986, the prom otions made during the same period had to be treated as in excess of the quota, because they were not in proportion to the requisition s for direct recruitment. This view is plainly fallacious, because it equates executive policy -of not filling vacancies, due to financial or other compulsions with deliberate underreporting, meant to result in unfair advantage to the PRIs. In the present case, direct recruitment through the SSC wa s not resorted to because of a ban, and not due to under-reporting. Thus, the contingency visualized in Para 5 never arose. Not only were promotions made within the quota, and were regular (as they were pre ceded by proceedings of the Departmental Promotion Committee, and culminated in regularization, in 1988), there were in fact regular vacancies, within the promotee quota. 60. The existence of PRI vacancies is a matter of ob jective fact– as can be seen from the replies to the RTI que ries (see f.n.10-12 supra). Those vacancies fell to the share of PRIs, in terms of the 25% quota earmarked for them, under statutory rules. In such circumstances, to say that those promoted, by resort to DPCs and regularized later, should be treated as ad-hoc promotees, would be contrary to express rules. In other words, by giving e ffect to Para 5 of the 1986 OM, (and treating the promotions as ad-hoc for purposes of inter se seniority), the statutory rules are virtually given a go by e. It is also contrary to the stated objective sought to be ach ieved by Para 3 of the 1986 OM, which is to “present practice of keeping vacant slots for being filled up by direct recruits of lat er years, thereby giving them unintended seniority over promotees who are already in position, would be dispensed with.” The promotions of the PRIs before this court therefore, have to be treated as regula r. This court is of the opinion, that the reasoning of the High Court, i n overlooking these aspects, is clearly in error. 61. The other aspect – which the High Court ignored, is that a number of vacancies were filled from amongst the qu ota for compassionate appointment, and the sports quota. They were not reported to the SSC. In such circumstances, to treat the promotees as exceeding the quota set apart for them (though as a matter of fact, they were accommodated within the quota) is not warranted. Furthermore, the materials on record also show that though there was a ban on direct B.S. MURTHY & ORS. v. A. RAVINDER SINGH & ORS. [S. RAVINDRA BHAT, J.] recruitment, it did not apply to vacancies which were to be filled up by way of promotion in terms of the Recruitment Rules. 62. For the above reasons it is held, that the High Court fell into error in setting aside the order of the CAT, which is hereby re stored. Therefore, it is held that: (i) No excess promotions took place during the period 1983 and 1991. 25% of the actual vacancies arising every year during that period were for the promotees. No direct recruit vacancy for any year was filled by promotees. (ii) Indents/requisitions placed with, the SSC for the recruitment of DRIs were for a part of the vacancies and not for the exact 75% of the actual vacancies available in each year. (iii) The record does not bear out instances of suppression or under-reporting of vacancies available for direct recruit s out of the permanent cadre strength in any year, to help the promotees. As a result, there is no justification for invoking para 5 of the O.M. of 1986. The department erroneously proceeded as if there were excess promotions by wrongly estimating the promotee quota on the basis of the indents placed for direct recruitment; (iv) (a) The date of appointment of direct recruits the date for counting seniority- it is not from the date of receipt of the dossiers from the recruiting authorities or the date of recommendation. Resultantly seniority of direct recruits appointed after 01.03.86 has to be revised only from the date of their respective appointments but not earlier to 01.03.1986 as was done in the impugned seniority list, (b) Direct recruits of 1992 could be given seniority only in that year but not earlier, or in 1991 as was erroneously done in the impugned seniority list; (v) The seniority of five applicants in O.A.NO. 156/86 originally fixed in terms of the order, had to be restored and could not be altered. (vi) Those promoted ad hoc basis in any year in the vacancies available to them were eligible for seniority from the date 41 of their continuous officiation, if -they were promote d within their eligible quota of that year under the Recruitment Rules; (vii) Those promoted in 1983 against 17 posts diverted from Shillong, were entitled to seniority in terms of 1959 O.M; (viii) Of 137 promotees regularised on 27.10.1988, seniority of those applicants regularised under the earlier order in 1985 has to be fixed prior to 1.3.1986, on the said earlier date of their regularisation in 1985; (ix) Seniority of promotees functioning in temporary posts no t forming part of the cadre, is to be fixed from the date of promotion/ appointment. 63. The impugned judgment and order is accordingly set aside; the appeals by the PRIs are allowed in the terms of the above findings. The consequential action, by way of drawing and publishing a final seniority list, in accordance with the present findings, shall be completed within three months. The writ petition is also disposed of in the above terms. There shall be no order on costs. Ankit Gyan Appeals allowed. (Assisted by : Iram Jan, LCRA) B.S. MURTHY & ORS. v. A. RAVINDER SINGH & ORS. [S. RAVINDRA BHAT, J.]