The Director, Directorate of Enforcement vs K. Sudheesh Kumar

The Director, Directorate of Enforcement vs K. Sudheesh Kumar - Supreme Court Case 2022

REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO.442 OF 2022
The Director, Directorate of Enforcement & Anr.     ..Appellant (S)
VERSUS
K. Sudheesh Kumar & Ors.                    ..Respondent (S)
J U D G M E N T 
M. R. Shah, J.
1. Feeling   aggrieved   and   dissatisfied   with   the   impugned
judgment and order dated 23.10.2019 passed by the High
Court of Kerala at Ernakulam in OP (CAT) No.171 of 2019, by
which the High Court has allowed the said original petition
(OP) and set aside the order passed by the learned Central
Administrative Tribunal, Ernakulam Bench and has declared
that respondent Nos.1 & 2 herein – original petitioners are
entitled to grade pay of Rs.6600/­ on their third financial
upgradation as per the Modified Assured Career Progression
1
(MACP) Scheme and they be paid the pension accordingly
with   effect   from   April,   2015,   the   Director,   Directorate   of
Enforcement, New Delhi and another – original respondents
before the High Court, have preferred the present appeal. 
2. That the private respondent Nos.1 & 2 herein were appointed
as Assistant Enforcement Officer (AEO) in the year 1976 and
1977, respectively. That in the year 2009, the Government of
India – Ministry of Personnel, Public Grievance and Pensions
(Department of Personnel and Training) notified the MACP
Scheme for the Central Government Civilian Employees. The
Scheme further provided as per clause 8.1 (which is relevant
so far as the present matter is concerned) ‘consequently upon
the implementation of Sixth CPC’s recommendations, grade
pay of Rs.5400 is now in two pay bands viz., PB­2 and PB­3.
It further provided that the grade pay of Rs.5400 in PB­2 and
Rs.5400 in PB­3 shall be treated as separate grade pays for
the purpose of grant of upgradations under MACP Scheme’.
However, it so happened that while granting third financial
upgradation   vide   order   dated   17.11.2009,   the   private
respondents herein and others were granted the grade pay of
2
Rs.6600 for PB­3 under MACP Scheme, though as per clause
8.1 PB­3 carried the grade pay of Rs.5400. However, on the
objection being raised by the Audit Department their grade
pays (GP) of Rs.6600 in PB­3 was modified/corrected as GP
of Rs.5400 as per clause 8.1. Therefore, respondent Nos.1
and   2   herein   approached   the   Central   Administrative
Tribunal, Ernakulam Bench and prayed to continue the GP
of Rs.6600 as per the earlier order dated 17.11.2009 and not
to make any recovery. A decision of the Madras High Court
was   pressed   into   service   by   which   a   similar   order   of
withdrawing the GP of Rs.6600 and to grant GP Of Rs.5400
for PB­3 was set aside. On relying upon the clause 8.1 of the
MACP Scheme by which the implementation of Sixth CPC’s
recommendations,   grade   pay   of   Rs.5400   was   in   two   pay
bands i.e., PB­2 and PB­3 and for grant of upgradation under
MACP Scheme they shall be treated as separate grade pays,
the learned Tribunal dismissed the original application (OA).
3. Feeling aggrieved and dissatisfied with the judgment and
order   passed   by   the   Central   Administrative   Tribunal
dismissing   the   said   OA,   respondent   Nos.1   &   2   herein
3
preferred the original petition before the High Court. By the
impugned judgment and order and ignoring clause 8.1 of
the MACP Scheme the High Court has allowed the said
petition   by   observing   that   the   next   promotion   post   of
Assistant Director which is in the PB­3 would be that of
Deputy Director which carries a grade pay of Rs.6600, when
the third financial upgradation is due to an employee, it has
to be of the next promotional post in the hierarchy as per
the Recruitment Rules. Feeling aggrieved and dissatisfied
with the impugned judgment and order passed by the High
Court, the department has preferred the present appeal. 
       
4. Ms. Madhavi Divan, learned ASG appearing on behalf of the
appellants  has   vehemently  submitted  that  the  impugned
judgment   and   order   passed   by   the   High   Court   is   just
contrary to the decision of the Delhi High Court in the case
of National Council of Educational Research & Training
& Anr. Vs. Anita Gupta & Anr. 2016 SCC OnLine Del 4720
as well as to the decision of this Court in the case of Union
of India and others Vs. M.V. Mohanan Nair (2020) 5 SCC
421.   
4
4.1 It is submitted that on interpretation of very MACP Scheme,
it is observed and held by this Court that the employees are
entitled   to   the   grade   pay   as   provided   under   the   MACP
Scheme which has been framed on the recommendations of
the pay commission. It is submitted that on interpreting
MACP Scheme, it is specifically observed and held by this
Court that MACP Scheme envisages merely placement in
the immediate next higher grade pay in the hierarchy of the
recommended revised pay bands and grade pay as given in
Section 1, Part A of the First Schedule of the CCS (Revised
Pay)   Rules,   2008   and   has   nothing   to   do   with   the   next
promotional post. 
      
4.2 It is submitted that in the present case the High Court has
allowed the grade pay of Rs.6600. However, as per clause
8.1, PB­2 and PB­3 carried grade pay of Rs.5400 and it
specifically provided that the grade pay of Rs.5400 in PB­2
and   grade   pay   of   Rs.5400   in   PB­3   shall   be   treated   as
separate grade pays for the purpose of grant of upgradation
under   MACP   Scheme.   It   is   submitted   that   therefore
respondent Nos.1 & 2 – original petitioners as per the MACP
5
Scheme shall be entitled to the grade pay of Rs.5400 i.e.,
next grade pay for PB­3. It is submitted that as such by the
impugned judgment and order and directing to grant grade
pay   of   Rs.6600   the   High   Court   has   modified   the   MACP
Scheme and has granted the benefit of three steps upward. 
4.3 Making   the   above   submissions   and   relying   upon   the
aforesaid decisions, it is prayed to allow the present appeal.
5. The present appeal is vehemently opposed by Shri Mathai
Paikaday, learned Senior Advocate appearing on behalf of
the private respondent Nos.1 & 2 herein.  
5.1 It   is   vehemently   submitted   by   learned   Senior   Advocate
appearing on behalf of the private respondent Nos.1 & 2
that the employee shall be entitled to the next higher pay
and the submissions made on behalf of the appellants that
both PB­2 and PB­3 shall carry grade pay of Rs.5400 is
accepted in that case the purpose of higher­grade pay shall
be frustrated. It is submitted that when the next highergrade pay would be Rs.6600, the High Court has rightly
directed to grant grade pay of Rs.6600.  
5.2 It   is   submitted   that   it   is   true   that   the   High   Court   has
wrongly used the word next promotion post. It is submitted
6
that the question is not of next promotional post but the
question is of next higher grade pay. 
5.3 In the alternative it is prayed by the learned Senior Advocate
appearing on behalf of respondent Nos.1 & 2 and relying
upon the decision of this Court in the case of  State   of
Rajasthan Vs. Mahesh Kumar Sharma (2011) 4 SCC 257
that if this Court is inclined to accept the submissions made
on behalf of the appellants and set aside the judgment and
order passed by the High Court holding that respondent
No.1 & 2 shall be entitled to grade pay of Rs.5400, in that
case no recovery be ordered as respondent Nos.1 & 2 have
already   retired   and   the   difference   would   be   of   Rs.1200
approximately   per   month   so   far   as   the   pension   is
concerned.    
6. We have heard learned counsel appearing on behalf of the
respective parties. 
7. At   the   outset   it   is   required   to   be   noted   that   the   issue
involved in the present appeal is as such squarely covered
by the decision of this Court in the case of M.V. Mohanan
Nair (supra). By detailed judgment and order this Court has
7
interpreted the very MACP Scheme and it is observed and
held that under the MACP Scheme employees are entitled to
the immediate next higher grade pay as given in Section 1,
Part A of the First Schedule of the CCS (Revised Pay) Rules,
2008. It is specifically observed and held by this Court in
the aforesaid decision that MACP has nothing to do with the
next  promotional   post  and  what  the  employee  would  be
entitled would be the immediate next higher grade pay in
the hierarchy of the recommended revised pay bands and
grade pay as given in the CCS (Revised Pay) Rules, 2008. As
per clause 8.1 of the MACP Scheme ‘consequently upon the
implementation of Sixth CPC’s recommendations, grade pay
of PB­2 and PB­3 would be Rs.5400. It specifically provides
that the grade pay of Rs.5400 in PB­2 and Rs.5400 in PB­3
shall be treated as separate grade pays for the purpose of
grant of upgradations under the MACP Scheme’. Therefore,
respondent Nos.1 &2 as PB­2 shall be entitled to the next
grade pay of Rs.5400 as per clause 8.1 and as per Section 1,
Part A of the First Schedule of the CCS (Revised Pay) Rules,
2008. The High Court has allowed the grade pay of Rs.6600
by considering the next promotion post of Assistant Director
8
i.e., Deputy Director which carries a grade pay of Rs.6600.
However, the aforesaid interpretation would be contrary to
the MACP Scheme. On considering the relevant clauses of
the   MACP   Scheme,   it   appears   that   the   MACP   Scheme
envisages placement in the immediate next higher grade pay
in the hierarchy of the recommended revised pay bands and
grade pay as given in Section 1, Part A of the First Schedule
of the CCS (Revised Pay) Rules, 2008. Thus, the High Court
has committed a grave error in allowing the grade pay of
Rs.6600 ­ the grade pay which was available to the next
promotional post as Deputy Director. Respondent Nos.1 & 2
as per PB­2 were entitled to the grade pay of Rs.5400 as PB3 as per clause 8.1. 
8. By the impugned judgment and order and while granting
grade pay of Rs.6600 to respondent Nos.1 & 2 virtually, the
High Court has modified the MACP Scheme which has been
framed by the Government on the recommendations of the
expert   body   like   the   pay   commission   and   its
recommendations for the MACP Scheme. As observed and
held   by   this   Court   in   the   case   of  M.V.   Mohanan   Nair
(supra) the ACP which is now superseded by MACP Scheme
9
is a matter of Government policy and interfering with the
recommendations   of   the   expert   body   like   the   pay
commission and its recommendations for the MACP Scheme
would have serious impact on the public exchequer. It is
further   observed   that   the   recommendations   of   the   pay
commission for the MACP Scheme have been accepted by
the Government and implemented. It is further observed
that therefore the High Court has no jurisdiction to interfere
with the Government policies in the form of MACP Scheme
which   was   after   accepting   the   Sixth   Central   Pay
Commission. In view of the above and for the reasons stated
above and the binding decision of this Court in the case of
M.V. Mohanan Nair (supra) with which we also agree, the
impugned judgment and order passed by the High Court
granting grade pay of Rs.6600 to respondent Nos.1& 2 is
unsustainable and deserves to be quashed and set aside.
However, we observe that the view which we are taking
is on the premise that neither the MACP Scheme nor Clause
8.1 is under challenge and as per the law laid down by this
Court   in  M.V.   Mohanan   Nair   (supra),   an   employee   is
entitled to the higher grade pay as provided under MACP
10
Scheme, more particularly, as per Section 1, Part A of the
First   Schedule   of   the   CCS   (Revised   Pay)   Rules,   2008.
Therefore,   so   long   as   Clause   8.1   and   the   grade   pay
mentioned as per Section 1, Part A of the First Schedule of
the CCS (Revised Pay) Rules, 2008 stands, the employee
shall be entitled to the grade pay accordingly.  Therefore, if
any of the employees is aggrieved by Clause 8.1 and if in his
opinion, there is any anomaly the same has to be challenged
by   the   aggrieved   employee,   which   can   be   considered   in
accordance with law and on its own merits.  However, as the
same is not under challenge, we have to go by the MACP
Scheme as it is.  
9. In view of the above and for the reasons stated above the
impugned judgment and order passed by the High Court is
hereby quashed and set aside and the judgment and order
that   of   the   Central   Administrative   Tribunal   is   hereby
restored. It is observed and held that on implementation of
MACP   Scheme   respondent   No.1   and   2   herein   shall   be
entitled to the grade pay of Rs.5400 and not of Rs.6600 as
claimed   by   them.   Their   pensions   be   refixed   accordingly.
However, it is observed that as respondent Nos.1 & 2 are
11
the retired employees and till date they have received the
pension considering the grade pay of Rs.6600 and being
retired persons it will be very difficult for them to refund the
difference   in   the  pay   pension,   in   the   peculiar   facts   and
circumstances of the case we direct that there shall be no
recovery of the difference in the pension between the grade
pay of Rs.5400 and grade pay of Rs.6600 for the period
prior   to   December,   2021.   However,   on   refixation   of   the
pension as per the present judgment and order, fixing their
grade   pay   of   Rs.5400   they   shall   be   paid   the   pension
accordingly   from   January,   2022   onwards.   The   present
appeal   is   allowed   accordingly,   however,   with   the   above
observations and directions. No costs.      
…………………………………J.
                 (M. R. SHAH)
…………………………………J.
      (SANJIV KHANNA)
New Delhi, 
January 28, 2022.
12

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Comments

  1. [Supreme Court decision dated 28/01/22 in CA No. 442 of 2022 - Director, Directorate of Enforement Vs K. Sudheesh Kumar sets aside Kerala HC- ASG misled SC citing irrelevant decision dt. 5.03.20 in M V Mohan Nair case to quash Kerala HC decision dt.23.10.19 - Needs Review]
    Dear Sir,
    UOI/DoR/Dte of enforcement invoked SC decision dated 5.03.20 in case of UOI Vs. Mohan Nair in CA No. 2016/2020 to mislead the SC by filing above CA against Kerala HC decision consequent to contempt petition.
    2. In Para 4 of Mohan Nair case, the SC framed the question to be decided in this case, whether financial upgradation under MACPS effective 1.09.08 may be granted in the promotional hierarchy as provided in earlier ACPS of 1999 (despite the fact that MACPS provides three financial upgradations in the hierarchy of grade pay i.e in the immediate next higher grade pay  which may or may not be in the next promotional grade).
    3. The answer was in the negative and Hon'ble SC upheld that financial upgradation under MACPS notified vide DOPT OM dated 19.05.09 effective from 1.09.08 is to be granted in the next immediate higher grade pay.
    4. The petitioners in Kerala HC & respondents in SC never asked MACP in promotional hierarchy but in the  the immediate next higher grade pay of Rs.6600 on completion of 30 years of service as provided under MACPS after grant of 2nd ACP in grade pay of Rs. 5400 in PB-3 under ACPS of 1999 on completion of 24 years of service in the promotional hierarchy (grade pay of Rs.6600 being next higher to the grade pay of Rs.5400 in PB-3).
    5. Further Para 8.1 which seeks to treat grade pay of Rs. 5400 PB-2 and Rs.5400 PB-3 as separate for the
    purpose of MACPS may not be applicable for those who were granted NFG pay in grade pay of Rs.5400 PB-2 after 4 years of service as group B officer and then 2nd ACP after 24 years of service in grade pay of Rs. 5400 PB-3 before operation of MACPS from 1.09.08. As the respondents got non-functional grade (NFG) in grade pay of Rs.5400 in PB-2 and then got 2nd ACP in GP of Rs.5400 PB-3 in the promotional hierarchy, the NFG pay can not be counted as one MACP for the purpose of grant of 3rd MACP, and that 2nd ACP granted after 24 years of service may not be renamed as 3rd MACP after 30 years of service by reopening the earlier fixation in terms of Para 11 read with Para 28C in Annexure-I of MACPS OM dated 19.05.09.
    6. Besides above, It may be pointed out that NFG is part of pay effective from 1.01.06 and MACPS effective from 1.09.08 is incentive scheme as claimed by UOI before Hon'ble Supreme Court  who in its decision dated 28.04.21 in CA 1579/2021 SLP (C) 15572/2021 UOI Vs. R K Sharma endorsed the contention of UOI stating that benefits flowing from ACP & MACP Schemes are incentives and are not part of pay. Hence NFG and MACP are different schemes which cannot be offset against one another.
    Dated:30.01.22
    With regards,
    Yours Sincerely,
    Sarvesh Singh Chauhan
    Ph.9818827573
    Email: sschauhan.cce@gmail.com
    PS. Please share mobile no. of Shri K. Sudheesh Kumar, client respondent.

    ReplyDelete

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