STATE OF HIMACHAL PRADESH & ORS VS RAJ KUMAR & ORS. CASE

Landmark Cases of India / सुप्रीम कोर्ट के ऐतिहासिक फैसले

REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 9746 of 2011

STATE OF HIMACHAL PRADESH & ORS. ...APPELLANT(S)

VERSUS

RAJ KUMAR & ORS. …RESPONDENT(S)

WITH

CIVIL APPEAL NO. 9747 of 2011

ANURAG SHARMA AND ORS. ...APPELLANT(S)

VERSUS

STATE OF HIMACHAL PRADESH & ORS. …RESPONDENT(S)

J U D G M E N T

PAMIDIGHANTAM SRI NARASIMHA, J.

1.1 These appeals arise out of the decision of the High Court of Himachal

Pradesh allowing the writ petition and directing the State to consider the case

of the writ petitioners, Respondents no. 1 to 3 herein, for promotion under

Rules that existed when the vacancies arose and not as per the subsequently

amended rules. These directions were based on the decision of this Court in

the case of Y.V. Rangaiah v. J. Sreenivasa Rao1

. As we noticed a number of

decisions of this Court that have followed Rangaiah, and far more decisions

1 Y.V. Rangaiah v. J. Sreenivasa Rao (1983) 3 SCC 284, hereinafter referred to as ‘Rangaiah’.

that have distinguished it, we had to examine the issue afresh. The question

is whether appointments to the public posts that fell vacant prior to the

amendment of the Rules would be governed by the old Rules or the new

Rules. After examining the principle in the context of the constitutional

position of services under the State, and having reviewed the decisions that

have followed or distinguished Rangaiah in that perspective, we have

formulated the legal principles that should govern services under the State.

Applying the said principles, we have held that the broad proposition

formulated in Rangaiah does not reflect the correct constitutional position.

We have thus allowed the appeals following the principles that we have laid

down.

1.2 We will first refer to the facts leading to the present controversy.

Facts:

1.3 The Himachal Pradesh Recruitment and Promotion Rules, 19662 dated

01.03.1966 made in exercise of the powers under Article 309 of the

Constitution govern the post of Labour Officer. There were 5 posts of Labour

Officers and these were to filled by promotion from (i) factory Inspectors,

(ii) labour inspectors and (iii) sectt. superintendents, being the feeder

category. On 20.07.2006, Secretary, Labour and Employment Department

addressed a letter to the Labour Commissioner intimating sanction for

hereinafter referred to as the ‘1966 rules’.

creation of additional posts in the department which interalia included 7 more

posts for Labour Officers. As a consequence of the said decision, the total

posts for Labour Officers increased from 5 to 12. At this point in time

Respondents No. 1 to 3 were working as Labour Inspectors in the service of

the State.

1.4 Within four months from the sanction of the additional posts, the 1966

Rules came to be amended on 25.11.2006. Under the New Rules called the

H.P. Labour and Employment Department, Labour Officers, Class-II

(Gazetted) Ministerial Services R & P Rules, 20063

, recruitment to the post

of Labour Officer is to be made by promotion as well as direct recruitment in

the ratio of 75 per cent and 25 per cent respectively. The effect of the New

Rules coupled with the 7 new posts for Labour Officers is that, from out of

the total number of 12 posts of Labour Officers, the promotional posts

increased from 5 to 9 (being 75 per cent) and direct recruitment posts came

to 3 (being 25 per cent). Immediately thereafter, the Government issued a

notification creating 12 Labour zones in the State.

1.5 It is in the above-referred background, that Respondents No. 1 to 3

approached the Administrative Tribunal challenging the proposed action of

the State Government in filling up 25 per cent of the posts of Labour Officers

by direct recruitment. They contended that the vacancies arose in July 2006,

hereinafter referred to as ‘the New Rules’.

which is before the promulgation of the New Rules and therefore all the

vacancies must be filled only by promotion. By its order dated 24.01.2007,

the Tribunal directed the State Government to consider the grievance raised

in the Original Application as if it is a representation to it. The representation

was considered and rejected by the Government on 27.06.2007. Challenging

the rejection, the second Original Application was filed by the Respondents

before the State Administrative Tribunal.

1.6 While the matter was pending before the Tribunal, the State

Government proceeded further and issued an advertisement through the H.P.

Public Service Commission, calling for applications for filling up the 3 posts

of Labour Officers under the quota of direct recruitment. The Public Service

Commission completed the recruitment process and recommended the names

of Respondents No. 4 to 6. The recommendation was accepted and the said

Respondents were appointed. It is not in dispute that they joined duties on the

th and 5th of November, 2008. Questioning the legality and validity of the

said appointments, Respondents No. 1 to 3 filed Civil Writ Petition No.

3028/2008 before the High Court of Himachal Pradesh, which came to be

allowed by the Division Bench of the High Court by the impugned order on

28.12.2009. Challenging the decision of the Division Bench the State of

Himachal Pradesh preferred a Special Leave Petition before this Court, from

which the present Civil Appeal arises pursuant to leave being granted on

08.11.2011. Similarly, the direct recruit appointees, Respondents No. 4 to 6

also filed a Special Leave Petition, which is numbered Civil Appeal no.

9747/2011 after leave was granted.

2. The solitary argument advanced on behalf of Respondents No. 1 to 3,

which was accepted by the Division Bench was that the vacancies which arose

prior to the promulgation of New Rules were to be filled only as per the 1966

Rules and not as per the New Rules. The High Court formulated the issue and

proceeded to allow the Writ Petition on the ground that it is covered by the

decision of this Court in Y.V. Rangaiah v. J. Sreenivasa Rao (supra). The

operative portion of the judgment is extracted herein for ready reference:

“The question whether the vacancies occurring before

the amendment to the Recruitment and Promotion Rules

are to be filled up as per the old Recruitment and

Promotion Rules or by way of new Recruitment and

Promotion Rules is no more res integra in view of the

law laid down by their Lordships of this Court in Y.V.

Rangaiah and others versus J. Sreenivasa Rao, (1983)

3 SCC 284.”

Submissions:

3.1 In these appeals, we heard Shri P.S. Patwalia, Senior Advocate assisted

by Advocate-on-Record Shri Abhinav Mukerji, for the Appellant-State and

Shri. Prasanjit Keshvani, Ld. Advocate representing the Respondents and also

Shri. Ravindra Kumar Raizada, Senior Advocate assisted by Ms. Divya Roy,

Advocate-on-Record appearing for some other Respondents.

3.2 Shri P.S. Patwalia, learned Senior Advocate for the Appellant-State

made the following submissions. At the outset, he would submit, that there

was no challenge to the legality of the New Rules and therefore the

Respondents cannot seek a relief which is contrary to the Rules i.e., filling

up the posts by way of promotion as per the Old Rules. Secondly, the interdepartmental letter dated 20.07.2006 followed by the notification dated

02.01.2007 creating the posts was in furtherance of the new policy which was

brought into effect by the amendments made to the Rules. It was therefore

contended that the inter-departmental letter dated 20.07.2006 cannot be seen

as a standalone event and that it is part of the larger policy to restructure the

cadre. Thirdly, there is no vested right to promotion, though there is only a

right to be considered for promotion as per the rules which are in force at the

time of such consideration. Fourthly, the recruitment exercise undertaken by

the State is completely based on the policy consideration of the State which

the High Court failed to take into account. In support of this submission,

reliance was placed on judgments of this Court in K. Ramulu4

, Deepak

Agarwal5

and Krishna Kumar6

. It was finally contended that the High Court

erred in applying the decision of Rangaiah which was the case of promotion,

while the present case is about direct recruitment to the post of Labour

Officers.

3.3 Shri Keshwani followed by Shri Raizada, Senior Advocate for the

Respondents made the following submissions. They would contend that the

4 Dr. K. Ramulu & Anr v. Dr. S Suryaprakash Rao (1997) 3 SCC 59.

5 Deepak Agarwal v. State of U.P (2011) 6 SCC 725.

6 Union of India v. Krishna Kumar (2019) 4 SCC 319.

7 new posts were created before the promulgation of the New Rules and there

was no Governmental Policy regarding the applicability of the New Rules

retrospectively. Secondly, there is no evidence to show that the State made a

conscious decision to keep the posts vacant, to be filled as per the New Rules.

On the contrary, they would submit that the communication dated 20.07.2006

sanctioning the creation of the posts stated that they must be filled on a

regular basis. Thirdly, the High Court was right in applying the decision of

Rangaiah which settled the law on appointments to posts falling vacant prior

to the amendment of the rules by holding that they must be governed by the

old rules and not the new rules. Finally, to apply the New Rules to the pending

vacancies, the appointing authority must demonstrate that they had (i) taken

a conscious decision not to fill the vacancies until the promulgation of the

new rules and (ii) such a decision must be for a good and a valid reason. For

this purpose, reliance is placed on judgments of this Court in K. Ramulu7

Deepak Agarwal8

and D. Raghu9

to demonstrate that no such effort was made.

Issue:

4.1 The real question is whether the vacancies which arose prior to the

promulgation of the new rules are to be filled only as per the old rules and

not as per the amended rules? It is argued that this principle is no more resintegra as the Supreme Court recognised such a right in Rangaiah’s case and

7 Dr. K. Ramulu & Anr v. Dr. S Suryaprakash Rao (1997) 3 SCC 59.

8 Deepak Agarwal v. State of U.P (2011) 6 SCC 725.

9 D. Raghu v. R. Basaveswarudu 2020 SCC Online 124.

it has been followed in a large number of subsequent decisions. A list of such

judgments was forwarded to the Court by the Respondents. On the other

hand, while submitting that there is no such right, an even larger list of

decisions of this Court that distinguished Rangaiah was forwarded to us on

behalf of the State.

4.2 We have taken note of the fact that there are a large number of decisions

that have either followed the principle in Rangaiah or have distinguished it.

The principle in Rangaiah’s case has given rise to a number of decisions,

most of them have disapplied Rangaiah and have in fact, watered-down the

principle while distinguishing it. In this view of the matter, and for clarity

and certainty, it is necessary for us to review the subject and restate the

principle in simple and clear terms.

4.3 We will first examine the principle laid down in Rangaiah itself. We

will verify it in the context of the constitutional position provided in Chapter

XIV of the Constitution relating to services under the State. We will

thereafter examine the decisions that followed Rangaiah and also those that

have distinguished it. After restating the principle, we will apply it to the facts

of the case for arriving at our decision.

The decision in the case of Y.V. Rangaiah v. J. Sreenivasa Rao:

5.1 The Petitioners in Rangaiah’s case were working as LDCs in the

Department of Registration and Stamps, Government of A.P. Under Rule

4(a)(1)(i) of the A.P. Registration and Subordinate Service Rules,

appointments to the promotional posts of Sub-Registrar Grade II from LDCs

were to be made from the panel of “approved candidates” made under Rule

34 (c). The panel was to be prepared by the prescribed authority in the month

of September every year and it could operate till a list for the subsequent

year was prepared. Importantly, the list had to contain names of as many

persons as there are vacancies. As the approved list was not prepared within

the prescribed time, promotions could not take place in time. In the

meanwhile, the amended rules came into force, as per which the petitioners

lost their chance to be considered for promotion. They contended before this

Court that their right to be considered for appointment for promotion would

not be lost with the advent of new rules as the vacancies occurring prior to

the amendment of the rules were to be filled under the unamended rules. In

other words, the contention was that the mandatory requirement under the

old rules was violated. It is in this context that the Court observed as under:-

“9. ….Under the old rules a panel had to be prepared

every year in September. Accordingly, a panel should

have been prepared in the year 1976 and transfer or

promotion to the post of Sub-Registrar Grade-II should

have been made out of that panel. In that event, the

petitioners in the two representation petitions who

ranked higher than respondents 3 to 15 would not have

been deprived of their right of being considered for

promotion. The vacancies which occurred prior to the

amended rules would be governed by the old rules and

not by the amended rules. It is admitted by counsel for

both the parties that henceforth promotion to the post

of Sub-Registrar Grade II will be according to the new

rules on the zonal basis and not on the State-wide basis

and, therefore, there was no question of challenging the

new rules. But the question is of filling the vacancies

that occurred prior to the amended rules. We have not

the slightest doubt that the posts which fell vacant prior

to the amended rules would be governed by the old rules

and not by the new rules.”

(emphasis supplied)

5.2 The question that arose in Rangaiah’s case related to the mandatory

obligation under the old rules to prepare an approved list of candidates and

also the number of persons to be placed in the list as per the vacancies

available. It is in this context that the Court observed that the vacancies would

be governed by the old rules. This decision is not to be taken to be laying

down an invariable principle that vacancies occurring prior to the amendment

of the rules are to be governed by old rules. It is important to note that the

Court has not identified any vested right of an employee, as has been read

into this judgment in certain subsequent cases.

5.3 However, as the observation in Rangaiah’s case has been construed as

a general principle that vacancies arising prior to the amendment of rules are

to be filled only as per the old rules, it is necessary for us to examine the

correct position of law. For this purpose, we will examine the constitutional

position and the status that governs the relationship between an employee and

the State.

Status of persons serving the Union and the States:

6.1 The relationship between the State and its employees is provisioned in

Part XIV of the Constitution. The provisions of this Part empower the Union

and the States to make Laws and executive Rules, to regulate the recruitment,

conditions of service10

, tenure11 and termination12 of persons serving the

Union or the States.

6.2 Article 310 provides that, except as expressly provided in the

Constitution, every person serving the Union or the States holds office during

the pleasure of the President or the Governor.

6.3 The legislative power conferred on the Parliament or a State

Legislature, to make Laws, or the executive power conferred on the President

or the Governor to make Rules under Article 309 is controlled by the doctrine

of pleasure embodied in Article 310. This is clear from the fact that Article

309 opens with the restrictive clause, ‘subject to the provision of the

Constitution. It is for this reason that the power of the legislature to make

laws and the executive to make Rules, for laying down conditions of services

of a public servant is always subject to the tenure at the pleasure of the

President or the Governor under Article 310.

10 Article 309, Constitution of India.

11 Article 310, Constitution of India.

12 Article 311, Constitution of India.

7.1 The Constitutional provision to provide public employment on the

basis of tenure at pleasure of the President or the Governor is based on

‘public policy’, ‘public interest’ and ‘public good’. The concept of holding

public employment at pleasure is explained in Constitution Bench decision

of this Court in Union of India v. Tulsiram Patel13

. The relationship between

the Government and its employees, as explained in this judgment can be

formulated as under14 :-

I. Unlike in the United Kingdom, in India it is not

subject to any law made by Parliament but is subject

only to what is expressly provided by the Constitution.15

II. The pleasure doctrine relates to the tenure of a

Government servant… , … means the period for which

an incumbent of office holds it.16

III. The position that the pleasure doctrine is not based

upon any special prerogative of the Crown but upon

public policy has been accepted by this Court in State

of U.P. v. Babu Ram Upadhya and Moti Ram Deka v.

General Manager, N.E.F., Railways, Maligaon,

Pandu17

IV. The only fetter which is placed on the exercise of

such pleasure is when it is expressly so provided in the

Constitution itself, that is when there is an express

provision in that behalf in the Constitution. Express

provisions in that behalf are to be found in the case of

certain Constitutional functionaries in respect of whose

tenure special provision is made in the Constitution as,

for instance, in clauses (4) and (5) of Article 124 with

13 Union of India v. Tulsiram Patel (1985) 3 SCC 398.

14 The relevant propositions in the Tulsiram case, as identified and extracted in ‘Law Relating

to Public Services’, Samaraditya Pal, 3rd Edition, Lexis Nexis, 2011 is adopted for convenience.

15 (1985) 3 SCC 398 @ 439

16 Ibid at 440.

17 Ibid at 441

respect to Judges of the Supreme Court, Article 218

with respect to Judges of the High Court. Article 148(1)

with respect to the Comptroller and Auditor-General of

India, Article 324(1) with respect to the Chief Election

Commissioner, and Article 324(5) with respect to the

Election Commissioners and Regional

Commissioners.18

V. Clauses (1) and (2) of Article 311 impose restrictions

upon the exercise by the President or the Governor of a

State of his pleasure under Article 310(1). These are

express provisions with respect to termination of

service by dismissal or removal as also with respect to

reduction in rank of a civil servant and thus come within

the ambit of the expression Except as otherwise

provided by this ‘Constitution’ qualifying Article

310(1). Article 311 is thus an exception to Article 310

and was described in Parshotam Lal Dhingra v. Union

of India,19 as operating as a proviso to Article 310(1)

though set out in a separate Article.20

VI. Article 309, is however, not such an exception. It

does not lay down any express provision which would

derogate from the amplitude of the exercise of pleasure

under Article 310(1). It merely confers upon the

appropriate legislature or executive the power to make

laws and frame rules but this power is made subject to

the provisions of the Constitution. Thus, Article 309 is

subject to Article 310(1) and any provision restricting

exercise of the pleasure of the President or Governor in

an Act or rule made or framed under Article 309 not

being an express provision of the Constitution, cannot

fall within the expression ‘Except as expressly provided

by this Constitution’ occurring in Article 310(1) and

would be in conflict with Article 310(1) and must be

held to be unconstitutional.21

VII. Clauses (1) and (2) of Article 311 expressly restrict

the manner in which a Government servant can be

18 Ibid at 447.

19 Ibid at 447

20 Ibid at 447.

21 Ibid at 447

dismissed, removed or reduced in rank and unless an

Act made or rule framed under Article 309 also

conforms to these restrictions, it would be void. The

restrictions placed by clauses (1) and (2) of Article 311

are two- (i) with respect to the authority empowered to

dismiss or remove a Government servant provided for

in clause (1) of Article 311, and (ii) with respect to the

procedure for dismissal, removal or reduction in rank

of a Government servant provided for in clause (2).22

(emphasis supplied)

7.2 Regardless of its origin, the doctrine of pleasure incorporated under

our constitutional scheme is to subserve an important public purpose. In Para

44 and 45 of Tulsiram Patel (supra), this Court has explained the purpose and

object of incorporating this principle:

“44. Ministers frame policies and Legislatures enact

laws and lay down the mode in which such policies are

to be carried out and the object of the legislation

achieved. In many cases, in a Welfare State such as

ours, such policies and statutes are intended to bring

about socio-economic reforms and the uplift of the poor

and disadvantaged classes. From the nature of things

the task of efficiently and effectively implementing these

policies and enactments, however, rests with the civil

services. The public is, therefore, vitally interested in

the efficiency and integrity of such services.

Government servants are after all paid from the public

exchequer to which everyone contributes either by way

of direct or indirect taxes. Those who are paid by the

public and are charged with public administration for

public good must, therefore, in their turn bring to the

discharge of their duties a sense of responsibility. The

efficiency of public administration does not depend only

upon the top echelons of these services. It depends as

much upon all the other members of such services, even

on those in the most subordinate posts. For instance,

railways do not run because of the members of the

22 Ibid at 447

Railway Board or the General Managers of different

railways or the heads of different departments of the

railway administration. They run also because of

engine-drivers, firemen, signalmen, booking clerks and

those holding hundred other similar posts. Similarly, it

is not the administrative heads who alone can see to the

proper functioning of the post and telegraph service.

For a service to run efficiently there must, therefore, be

a collective sense of responsibility. But for a

Government servant to discharge his duties faithfully

and conscientiously, he must have a feeling of security

of tenure. Under our Constitution, this is provided for

by the Acts and rules made under Article 309 as also by

the safeguards in respect of the punishments of

dismissal, removal or reduction in rank provided in

clauses (1) and (2) of Article 311. It is, however, as

much in public interest and for public good that

Government servants who are inefficient, dishonest or

corrupt or have become a security risk should not

continue in service and that the protection afforded to

them by the Acts and rules made under Article 309 and

by Article 311 be not abused by them to the detriment of

public interest and public good. When a situation as

envisaged in one of the three clauses of the second

proviso to clause (2) of Article 311 arises and the

relevant clause is properly applied and the disciplinary

inquiry dispensed with, the concerned Government

servant cannot be heard to complain that he is deprived

of his livelihood. The livelihood of an individual is a

matter of great concern to him and his family but his

livelihood is a matter of his private interest and where

such livelihood is provided by the public exchequer and

the taking away of such livelihood is in the public

interest and for public good, the former must yield to

the latter. These consequences follow not because the

pleasure doctrine is a special prerogative of the British

Crown which has been inherited by India and

transposed into our Constitution adapted to suit the

constitutional set-up of our Republic but because public

policy requires, public interest needs and public good

demands that there should be such a doctrine.

45. It is thus clear that the pleasure doctrine embodied

in Article 310(1), the protection afforded to civil

servants by clauses (1) and (2) of Article 311 and the

withdrawal of the protection under clause (2) of

Article 311 by the second proviso thereto are all

provided in the Constitution on the ground of public

policy and in the public interest and are for public

good.”

8. The principle of a public servant holding office at the pleasure of the

President or the Governor is incorporated in the Constitution itself (under

Article 310). This has a direct bearing on the powers of the Parliament or the

legislature to make Laws or the executive to make Rules for specifying

conditions of service provided under Article 309. This position is clearly

explained in the above-referred passages. In B.P. Singhal v. Union of India23

this Court explained the consequence of holding the office during the

pleasure of the President or the Governor:

“33. The doctrine of pleasure as originally envisaged in

England was a prerogative power which was unfettered.

It meant that the holder of an office under pleasure

could be removed at any time, without notice, without

assigning cause, and without there being a need for any

cause. But where the rule of law prevails, there is

nothing like unfettered discretion or unaccountable

action. The degree of need for reason may vary. The

degree of scrutiny during judicial review may vary. But

the need for reason exists. As a result, when the

Constitution of India provides that some offices will be

held during the pleasure of the President, without any

express limitations or restrictions, it should however

necessarily be read as being subject to the

“fundamentals of constitutionalism”.

23 B.P. Singhal v. Union of India (2010) 6 SCC 331.

9. It is in this background that the employment of a public servant is to be

understood. Though the relationship between the employee and the State

originates in contract, but by virtue of the constitutional constraint, coupled

with the legislative and executive rules governing the service, the relation

attains a unique position. Identifying such a relationship as being a ‘status’,

as against a contract, this Court in Roshan Lal Tandon v. Union of India24

explained what such a ‘status’ constitutes. We have extracted hereinbelow

the exposition of the concept of ‘status’ as explained by the Constitution

Bench for ready reference. In this case, the petitioner Roshan Lal Tandon was

appointed as Train-Examiner – Grade ‘D’. At the time when he joined the

service, the promotion to the next post in Grade ‘C’ was governed by certain

rules which later came to be amended. Questioning the amendment, he

contended that he had a right to be promoted to Grade ‘C’ when he joined the

service and such a right could not have been altered by way of a subsequent

amendment. Rejecting this argument, this Court explained the relationship of

Government employment as a ‘status’ as under:

“6. We pass on to consider the next contention of the

petitioner that there was a contractual right as regards

the condition of service applicable to the petitioner at

the time he entered Grade ‘D’ and the condition of

service could not be altered to his disadvantage

afterwards by the notification issued by the Railway

Board. It was said that the order of the Railway Board

dated January 25, 1958, Annexure ‘B’, laid down that

promotion to Grade ‘C’ from Grade ‘D’ was to be based

on seniority-cum-suitability and this condition of

24 Roshan Lal Tandon v. Union of India (1968) 1 SCR 185.

service was contractual and could not be altered

thereafter to the prejudice of the petitioner. In our

opinion, there is no warrant for this argument. It is true

that the origin of Government service is contractual.

There is an offer and acceptance in every case. But once

appointed to his post or office the Government servant

acquires a status and his rights and obligations are no

longer determined by consent of both parties, but by

statute or statutory rules which may be framed and

altered unilaterally by the Government. In other words,

the legal position of a Government servant is more one

of status than of contract. The hall-mark of status is the

attachment to a legal relationship of rights and duties

imposed by the public law and not by mere agreement

of the parties. The emolument of the Government

servant and his terms of service are governed by statute

or statutory rules which may be unilaterally altered by

the Government without the consent of the employee. It

is true that Article 311 imposes constitutional

restrictions upon the power of removal granted to the

President and the Governor under Article 310. But it is

obvious that the relationship between the Government

and its servant is not like an ordinary contract of

service between a master and servant. The legal

relationship is something entirely different, something

in the nature of status. It is much more than a purely

contractual relationship voluntarily entered into

between the parties. The duties of status are fixed by

the law and in the enforcement of these duties, society

has an interest…

7. We are therefore of the opinion that the petitioner

has no vested contractual right in regard to the terms

of his service and that Counsel for the petitioner has

been unable to make good his submission on this aspect

of the case.”

10. The principle laid down in Roshan Lal Tandon’s case is followed in a

number of decisions of this Court.25 The following are the propositions

emanating from the principles laid down in these precedents.

(i) Except as expressly provided in the Constitution, every person

employed in the civil service of the Union or the States holds

office during the pleasure of the President or the Governor

(Article 310). Tenure at pleasure is a constitutional policy for

rendering services under the state for public interest and for the

public good, as explained in Tulsiram Patel (supra).

(ii) The Union and the States are empowered to make laws and rules

under Articles 309, 310 and 311 to regulate the recruitment,

conditions of service, tenure and termination. The rights and

obligations are no longer determined by consent of the parties but

by the legal relationship of rights and duties imposed by statute

or the rules. The services, thus, attain a status.

(iii) The hallmark of status is in the legal rights and obligations

imposed by laws that may be framed and altered unilaterally by

the Government without the consent of the employee.

(iv) In view of the dominance of rules that govern the relationship

between the Government and its employee, all matters

25 Union of India v. Arun Kumar Roy, (1986) 1 SCC 677; Narayana v. Purushotham (2008) 5

SCC 416; Brij Lal Mohan v. Union of India (2012) 6 SCC 502.

concerning employment, conditions of service including

termination are governed by the rules. There are no rights outside

the provision of the rules.

(v) In a recruitment by State, there is no right to be appointed but

only a right to be considered fairly. The process of recruitment

will be governed by the rules framed for the said purpose.

(vi) Conditions of service of a public servant, including matters of

promotion and seniority are governed by the extant rules. There

are no vested rights independent of the rules governing the

service.26

(vii) With the enactment of laws and issuance of rules governing the

services, Governments are equally bound by the mandate of the

rule. There is no power or discretion outside the provision of the

rules governing the services and the actions of the State are

subject to judicial review.

11. In view of the above principles, flowing from the constitutional status

of a person in employment with the State, we have no hesitation in holding

that the observations in Rangaiah that posts which fell vacant prior to the

amendment of Rules would be governed by old Rules and not by new Rules

do not reflect the correct position of law. We have already explained that the

26 Syed Khalid Rizivi V Union of India 1993 Supp (3) SCC 575 ; Hardev Singh v Union of

India 2011(10) SCC 121

27 Rajasthan Public Service Commission v. Chanan Ram, (1998) 4 SCC 202.

status of a Government employee involves a relationship governed

exclusively by rules and that there are no rights outside these rules that govern

the services. Further, the Court in Rangaiah’s case has not justified its

observation by locating such a right on any principle or on the basis of the

new Rules.

28 As there are a large number of judgments which followed

Rangaiah under the assumption that an overarching principle has been laid

down in Rangaiah, we have to necessarily examine the cases that followed

Rangaiah. We will now examine how subsequent decisions understood,

applied or distinguished Rangaiah.

Decisions that followed Y.V. Rangaiah & Ors. v. J. Sreenivasa Rao

12.1 The first case which followed Rangaiah is P. Ganeshwar Rao v. State

of A.P.

29 The Court was concerned about recruitment to the post of Assistant

Engineer governed by the special rules.30 The question that arose for

consideration was whether the vacancies arising in the category of Assistant

Engineers before the amendment to the special rules were to be considered as

per the amended or the unamended rules. Having considered explanation (c)

and the proviso of the special rules which used the expression “vacancies

arising in the category”, the Court concluded that the intendment of the

28 In fact, the case of Dr. K. Ramulu & Anr v. Dr. S Suryaprakash Rao (supra) is exactly this

where there was a specific requirement in the new amended rules to fill up the old vacancies

as per the new amended rules. The repealed rules had a provision for filling up the past

vacancies as per the new rules. Also, in P. Ganeshwar Rao v. State of A.P., 1988 Supp SCC

740 the intendment was to fill the vacancies as per the old rules.

29 P. Ganeshwar Rao v. State of A.P., 1988 Supp SCC 740.

30 AP Panchayat Raj Engineering Services (Special) Rules, 1963.

amended rule itself is to fill vacancies based on the rules that existed prior to

the amendment of the rules. This is a case that turned on the wording of the

amended rule itself. The Court observed as under:

“7. …The only question which has now to be considered

is whether the amendment made on April 28, 1980 to

the Special Rules applied only to the vacancies that

arose after the date on which the amendment came into

force or whether it applied to the vacancies which had

arisen before the said date also. The crucial words in

the Explanation which was introduced by way of

amendment in the Special Rules on April 28, 1980 were

“37 1/2 per cent of the substantive vacancies arising in

the category of Assistant Engineers shall be filled by the

direct recruitment”. If the above clause had read “37

1/2 per cent of the substantive vacancies in the category

of Assistant Engineers shall be filled by the direct

recruitment” perhaps there would not have been much

room for discussion. The said clause then would have

applied even to the vacancies which had arisen prior to

the date of the amendment but which had not been filled

up before that date. We feel that there is much force in

the submission made on behalf of the appellants and the

State Government that the introduction of the word

“arising” in the above clause made it applicable only

to those vacancies which came into existence

subsequent to the date of amendment.”

12.2 The decision, in this case, is based on the position of the amended rule.

Even in this case, the Court has not identified any general principle of vested

right of a public servant to be considered for vacancies arising prior to the

amendment of the rules. Without any analysis, the Court observed that the

principle as laid down in Rangaiah is applicable and proceeded with the

interpretation of the new rules.

13.1 N.T. Devin Katti v. Karnataka Public Service Commission31

, is a case

concerning appointment to the post of Tehsildar, a selection post governed

under 1975 Rules32

, to be filled from in-service candidates. While the

advertisement was issued in May 1975, the procedure for selection of

candidates by following the rules of reservation in favour of SC/ST

candidates was brought into force on 09 July 1975. The Court held that as the

advertisement expressly stated that the selection shall be made in accordance

with the existing rules, the candidates who have appeared in the written test

and have undergone viva voce acquired a vested right for being considered

for selection in terms of the advertisement. The Court held that, as the rules

have no retrospective effect, the recruitment process cannot be affected. It is

in this context, that the Court referred to the case of Rangaiah and P.

Ganeshwar Rao. The Court also relied on Calton33 which was related to the

appointment for the post of Principal under the U.P. Intermediate Education

Act, 1921, and Mahenderan’s 34 case which was related to the recruitment

process for direct appointment to the post of Motor Vehicle Inspector.

Changes made to the rules after the issuance of the advertisement was the

question under consideration. The Court observed:

“11. There is yet another aspect of the question. Where

advertisement is issued inviting applications for direct

recruitment to a category of posts, and the

31 N.T. Devin Katti v. Karnataka Public Service Commission, (1990) 3 SCC 157.

32 Karnataka Administrative Services (Tehsildars) Recruitment (Special) Rules, 1975.

33 A.A. Calton v. Director of Education and Anr (1983) 3 SCC 33.

34 P. Mahendran and Ors v. State of Karnataka (1990) 1 SCC 411.

advertisement expressly states that selection shall be

made in accordance with the existing rules or

Government orders, and if it further indicates the extent

of reservations in favour of various categories, the

selection of candidates in such a case must be made in

accordance with the then existing rules and

Government orders. Candidates who apply, and

undergo written or viva voce test acquire vested right

for being considered for selection in accordance with

the terms and conditions contained in the

advertisement, unless the advertisement itself indicates

a contrary intention. Generally, a candidate has right

to be considered in accordance with the terms and

conditions set out in the advertisement as his right

crystallises on the date of publication of advertisement,

however he has no absolute right in the matter. If the

recruitment Rules are amended retrospectively during

the pendency of selection, in that event selection must

be held in accordance with the amended Rules. Whether

the Rules have retrospective effect or not, primarily

depends upon the language of the Rules and its

construction to ascertain the legislative intent. The

legislative intent is ascertained either by express

provision or by necessary implication; if the amended

Rules are not retrospective in nature the selection must

be regulated in accordance with the rules and orders

which were in force on the date of advertisement.

Determination of this question largely depends on the

facts of each case having regard to the terms and

conditions set out in the advertisement and the relevant

rules and orders. Lest there be any confusion, we would

like to make it clear that a candidate on making

application for a post pursuant to an advertisement

does not acquire any vested right of selection, but if he

is eligible and is otherwise qualified in accordance with

the relevant rules and the terms contained in the

advertisement, he does acquire a vested right of being

considered for selection in accordance with the rules as

they existed on the date of advertisement. He cannot be

deprived of that limited right on the amendment of rules

during the pendency of selection unless the amended

rules are retrospective in nature.”

13.2 This case concerns appointment to the post pursuant to an

advertisement prescribing certain qualifications. Candidates who have

applied on the basis of such qualifications have a right to be considered on

the basis of the advertisement and such a right cannot be taken away without

making a retrospective amendment to rules is the ratio of this case. The issue

involved in this case is different from the one confronting us. The case does

not throw much light on the issue involved in the present case.

14. In State of Rajasthan v. R. Dayal35

, selection for 9 existing vacancies

which were to be filled by the Rajasthan Service of Engineers (Building and

Roads Branch) Rules 1954 was in question. In a short order, relying on

Rangaiah, this Court observed that vacancies existing prior to the amendment

of the rules are required to be filled in accordance with the law existing as on

the date when the vacancies arose. It was held:

“6. As a consequence, any appointment made as on that

date should be consistent with the above Rule. In

support thereof, he placed reliance on the decision of

this Court in Y.V. Rangaiah v. J. Sreenivasa Rao.

…

8. Therefore, it is not in dispute and cannot be disputed

that while selecting officers, minimum requisite

qualifications and experience for promotion specified

in the relevant column, should be taken into

consideration against vacancies existing as on 1st April

of the year of selection. But since the Rules came to be

amended and the amendment became effective with

immediate effect and clause (11-B) of Rule 24-A

indicates that options have been given to the

Government or the Appointing Authority, as the case

35 State of Rajasthan v. R. Dayal (1997) 10 SCC 419.

may be, to revise the select list as existing as per the

law as on the date of the appointment or as may be

directed by a competent court, selection is required to

be made by the concerned DPC. An appointment made,

after selection as per the procedure, to the vacancies

existing prior to the amendment, is valid. But the

question is whether selection would be made, in the case

of appointment to the vacancies which admittedly arose

after the amendment of the Rules came into force,

according to the amended Rules or in terms of Rule 9

read with Rules 23 and 24-A, as mentioned

hereinbefore. This Court has considered the similar

question in para 9 of the judgment above-cited. This

Court has specifically laid that the vacancies which

occurred prior to the amendment of the Rules would be

governed by the original Rules and not by the amended

Rules. Accordingly, this Court had held that the posts

which fell vacant prior to the amendment of the Rules

would be governed by the original Rules and not the

amended Rules. As a necessary corollary, the vacancies

that arose subsequent to the amendment of the Rules are

required to be filled in in accordance with the law

existing as on the date when the vacancies arose.

Undoubtedly, the selection came to be made prior to the

amendment of the Rules in accordance with law then

existing since the anticipated vacancies also must have

been taken into consideration in the light of Rule 9 of

the Rules. But after the amended Rules came into force,

necessarily the amended Rules would be required to be

applied for and given effect to. But, unfortunately, that

has not been done in the present case. The two courses

are open to the Government or the Appointing

Authority, viz., either to make temporary promotions for

the ensuing financial year until the DPC meets or in

exercise of the power under Rule 24-A(11-B), they can

revise the panel already prepared in accordance with

the Rules and make appointments in accordance

therewith.”

15.1 In B.L Gupta v. M.C.D.36

, appointment to the post of Assistant

Accountant of DESU under MCD was under consideration. These posts were

to be filled in accordance with the statutory rules framed in 1978 which

provided for an examination. 171 vacancies arose for the said posts in 1993.

Only 79 persons who appeared in the examination were appointed. Writ

petitions were filed in the High Court of Delhi praying for all 171 vacancies

to be filled as per the examination. During the pendency of the writ petitions,

the rules were amended in 1995 which provided that 80% of the posts to be

filled by promotion and the remaining 20% by examination. The High Court

while deciding these writ petitions held that 79 posts were validly filled and

the remaining vacancies were to be filled as per the amended rules. The

question was whether the remaining vacancies are to be filled as per the

amended rules or the unamended rules. Allowing the appeals the Court held:

“9. When the statutory rules had been framed in 1978,

the vacancies had to be filled only according to the said

Rules. The Rules of 1995 have been held to be

prospective by the High Court and in our opinion this

was the correct conclusion. This being so, the question

which arises is whether the vacancies which had arisen

earlier than 1995 can be filled as per the 1995 Rules.

Our attention has been drawn by Mr Mehta to a

decision of this Court in the case of N.T. Devin Katti v.

Karnataka Public Service Commission [(1990) 3 SCC

157]. In that case after referring to the earlier decisions

in the cases of Y.V. Rangaiah v. J. Sreenivasa Rao

[(1983) 3 SCC 284] , P. Ganeshwar Rao v. State of A.P.

[1988 Supp SCC 740] and A.A. Calton v. Director of

Education [(1983) 3 SCC 33] it was held by this Court

that the vacancies which had occurred prior to the

36 B.L.Gupta v. M.C.D (1998) 9 SCC 223.

amendment of the Rules would be governed by the old

Rules and not by the amended Rules. Though the High

Court has referred to these judgments, but for the

reasons which are not easily decipherable its

applicability was only restricted to 79 and not 171

vacancies, which admittedly existed. This being the

correct legal position, the High Court ought to have

directed the respondent to declare the results for 171

posts of Assistant Accountants and not 79 which it had

done.

10. …The Rules of 1978 prescribe the mode in which

the promotions can be made. This mode has to be

followed before the appointments could be made. If no

statutory rules had existed, it may have been possible,

though we express no opinion on it, that the existing

incumbents may have been regularised. Where,

however, statutory rules exist, the appointments and

promotions have to be made in accordance with the

statutory rules specially where it has not been shown to

us that the Rules gave the power to the appointing

authority of relaxing the said Rules. In the absence of

any such power of relaxation, the appointment as

Assistant Accountant could only be made by requiring

the candidates to take the examination which was the

method which was prescribed by the 1978 Rules.”

15.2 In this short judgment, the Court proceeded on the premise that

Rangaiah and the subsequent decisions such as N.T. Devin Katti held that

vacancies occurring prior to the amendment should be governed by the old

rules. There is neither a discussion on the Constitutional position, nor is there

a reference to the principle governing service conditions of a Government

servant as laid down in Roshan Lal Tandon’s case. Suffice to say that the

Court has in its order referred to and followed Rangaiah. This is the fourth

case which has merely followed Rangaiah without examining the principle.

16.1 In Arjun Singh Rathore v. B.N. Chaturvedi,

37 the Court followed

Rangaiah in its short order. The case related to promotion to the post of Area

Managers or Senior Managers under the relevant Rules of 1988. While 15

vacancies were available for promotion, the rules came to be amended in

1998. Reversing the decision of the High Court, this Court observed that the

vacancies had to be filled as per the vacancies that existed prior to the

amendment of the rules under which the process of interviews and selection

had already taken place. The Court followed Rangaiah and observed:

“6. The above legal position has not been seriously

disputed by the learned counsel for Respondents 6 and

7. We are therefore of the opinion that the vacancies

which had occurred prior to the enforcement of the

Rules of 1998 had to be filled in under the Rules of 1988

and as per the procedure laid down therein...”

16.2 It is only to ensure a detailed analysis and review of the decisions that

have followed Rangaiah that we are referring to each of these judgments. We

notice that the follow up cases have simply referred to Rangaiah when the

Court felt that the selection process must be as per the rules which existed

prior to the amendment. None of these cases recognise the existence of any

vested right, nor do they referred to Constitutional position or the principle

laid down in Roshan Lal Tandon’s case.

37 Arjun Singh Rathore v. B.N. Chaturvedi, (2007) 11 SCC 605.

17.1 In State of Bihar v. Mithilesh Kumar,

38 the Court was concerned with

the appointment to the posts of Instructors and Assistant Instructors as per an

advertisement published on 30.12.2001. Pursuant to the advertisement, the

writ petitioner applied and was called for an interview on 09.11.2002.

Thereafter, on 14.11.2002, instructions were issued not to send any further

recommendations to the said post as the scheme under which the

appointments to the post were called for was no longer valid. The respondent

therein was declared successful in the interview but was not appointed and

therefore he approached the Court. While upholding the decision of the High

Court and dismissing the appeal, this Court following Rangaiah held:

“14. The learned counsel submitted that the conditions

of the advertisement inviting applications for filling up

the posts of Assistant Instructor (Electronics) in Kamla

Nehru Social Service Institute for Handicapped and

Rehabilitation Training Centre, Patna, could not have

been altered to the prejudice of the respondent on

account of a decision taken subsequently to have

persons with disabilities trained by professionally

established NGOs/institutions. Reliance was placed on

the decision of this Court in Y.V. Rangaiah v. J.

Sreenivasa Rao, where this Court in similar

circumstances had held that when service rules are

amended, vacancies which had occurred prior to the

amended Rules would be governed by the old Rules and

not by the amended Rules.

…..

23. While a person may not acquire an indefeasible

right to appointment merely on the basis of selection, in

the instant case the fact situation is different since the

claim of the respondent to be appointed had been

38 State of Bihar v. Mithilesh Kumar (2010) 13 SCC 467.

negated by a change in policy after the selection

process had begun.”

17.2 This is a case of selection by way of an advertisement and not

promotion of a Government servant from a post held by him. The Court

observed that the terms of the advertisement could not have been altered to

the prejudice of the respondent on the basis of a decision taken subsequently.

There was no occasion for the Court to consider the status of a public servant

in the context of rules governing his service.

18. In Kulwant Singh v. Daya Ram39

, the Punjab Police Rules, 1934 dealt

with the promotion of Constables to the post of Head Constables. The 1982

amendment to the Rule 13.7 mandated that constables considered for

promotion to be sent to a promotional course on the basis of seniority-cummerit. A batch of 15 constables was selected on the basis of the 1982 rules

and was sent for the course in April 1988. Thereafter, 71 vacancies arose and

another amendment to the rule in 1988 was made which provided for sending

constables to the promotional course on merit-cum-seniority basis. The issue

arose when the Senior Superintendent of Police issued a letter to the effect

that new rules would apply to the said promotions. Interdicting the decision

and reiterating the decision of the Tribunal which followed Rangaiah and the

subsequent decisions referred to in paras 38 to 41, the Court observed:-

“41. In B.L. Gupta [B.L. Gupta v. MCD, (1998) 9 SCC

223] the Court reiterated the principle stated in Y.V.

39 Kulwant Singh v. Daya Ram, (2015) 3 SCC 177.

Rangaiah [Y.V. Rangaiah v. J. Sreenivasa Rao, (1983)

3 SCC 284] , P. Ganeshwar Rao [P. Ganeshwar

Rao v. State of A.P., 1988 Supp SCC 740] and A.A.

Calton v. Director of Education [(1983) 3 SCC 33]

wherein it had been held that the vacancies which had

occurred prior to the amendment of rules were

governed by the old rules and not by the amended rules.

In Arjun Singh Rathore [Arjun Singh Rathore v. B.N.

Chaturvedi, (2007) 11 SCC 605] the views stated

in Y.V. Rangaiah [Y.V. Rangaiah v. J. Sreenivasa Rao,

(1983) 3 SCC 284] and R. Dayal [State of

Rajasthan v. R. Dayal, (1997) 10 SCC 419] were

reiterated.

42. The reference to the aforesaid proposition of law

makes it vivid that the decision rendered by the Tribunal

in Acchhar Chand case was in accordance with the

precedent of this Court and, in fact the Tribunal clearly

meant that.”

19.1 In Richa Mishra v. State of Chhattisgarh40

, the issue related to

appointment to the post of DSP. The State Government sent a requisition for

filling up various vacancies including the post of DSP in accordance with the

2000 Rules. Thereafter, the Chhattisgarh Police Executive (Gazetted) Service

Recruitment and Promotion Rules, 2005 were published. The appellant

therein participated in the selection process and she qualified at each stage.

However, her name was still not included in the list of successful candidates

since the 2000 Rules provided that the upper age limit for appointment to the

post of DSP was 25 years and she had already crossed the said age limit and

therefore was ineligible for the post in question. The question that arose for

consideration was whether the 2000 rules or the 2005 rules would apply.

40 Richa Mishra v. State of Chhattisgarh, (2016) 4 SCC 179.

Having examined the requisition for appointment, which was made prior to

the advent of the new rules and further applying the principle of Rangaiah

the Court observed as under:

“18. The High Court held that the first and second

requisitions to commence recruitment process against

the vacant seats to the post of DSP were made when the

2000 Rules were in force. Therefore, recruitment was

rightly undertaken under the 2000 Rules. The admitted

facts are that the process of selection started before the

2005 Rules were promulgated with the requisitions

dated 27-9-2004 and 26-3-2005 sent by the State

Government to CPSC. At that time, the 2000 Rules were

in vogue. For this reason, even in the requisition it was

mentioned that appointments are to be made under the

2000 Rules. Further, it is also an admitted fact that the

vacancies in question which were to be filled were for

the period prior to 2005. Such vacancies needed to be

filled in as per those Rules i.e. the 2000 Rules. This is

patent legal position which can be discerned from Y.V.

Rangaiah v. J. Sreenivasa Rao [Y.V. Rangaiah v. J.

Sreenivasa Rao, (1983) 3 SCC 284]….”

19.2 As is evident from the above, this decision also applied Rangaiah in

the context of the facts and without any reference to the Constitutional

position of the employment of a Government servant and the principle laid

down in Roshan Lal Tandon’s case.

Analysis:

20.1 Except in the case of P. Ganeshwar Rao, which not only followed

Rangaiah but also observed that the new Rules enabled the vacancies to be

filled as per the Rules that existed prior to the amendment, all the other

judgments adopted the principle in Rangaiah and directed appointments to be

made as per the rules that existed when the vacancies arose. These cases do

not discuss any source of such a right of a Government employee. There is

also no reference to any rule, be it old or new, to enable effectuation of such

a right. None of these cases refer to constitutional position of status or the

principle laid down in Roshan Lal Tandon’s case.

20.2 We will now discuss cases that have distinguished Rangaiah. These

decisions adopt different reasons for not following the principle laid down in

Rangaiah.

Decisions that have distinguished Rangaiah’s case:

21. In Union of India v. S.S. Uppal41 the respondent therein was being

considered for absorption to IAS for a vacancy that arose in 01.02.1989. The

Indian Administrative Services (Regulation of Seniority) Rules, 1987 were

amended on 03.02.1989. The respondent who was appointed on 15.02.1989

claimed that his seniority must be calculated from the date on which the

vacancy arose, i.e., 01.02.1989 and for this purpose he relied on the decision

in Rangaiah and that was accepted by the Tribunal. Reversing the decision

of the Tribunal, this Court held that Rangaiah has no application at all.

Further, relying on the decision in Shankarshan Dash v. Union of India42

which held that the existence of a vacancy does not give rise to a legal right

to a selected candidate, the Court held as under:

41 Union of India v. S.S. Uppal, (1996) 2 SCC 168.

42 Shankarshan Dash v. Union of India (1991) 3 SCC 47.

“15. The facts in the case before us are entirely

different. There has been no infraction of any rule or

violation of any instruction issued by the Government.

Respondent 1 has not been able to point out any

violation of rules or regulations on the part of the

Government by which he was prejudicially affected.

….

17. … He was actually inducted into the service on 15-

2-1989. The rules which were in force on that day for

determination of seniority will clearly apply to his case.

It is true that Uppal's name was included in a panel

drawn up sometime in August 1988. But mere inclusion

of his name in the panel did not confer upon him any

right to automatic appointment to the IAS. Nor can it be

said that he was to be treated as to have been appointed

from the date when a suitable post fell vacant. … The

seniority of an officer appointed into the IAS is

determined according to the seniority rules applicable

on the date of appointment to the IAS. Weightage in

seniority cannot be given retrospective effect unless it

was specifically provided in the rule in force at the

material time…”

22. State Bank of India v. Kashinath Kher43 is again a case where the

employee relied on the principle in Rangaiah to contend that promotion to

the post of Middle Management Grade Scale- II is to be made on the basis of

vacancies that arose in 1988, 1989 and 1990 without applying the new policy

that came into effect from 1990. In the first place, this is a case involving

service under the State Bank of India, not being a service under the State

governed by laws or rules made under Article 309. However, as we are

considering the principle laid down in Rangaiah and also the decisions that

followed and dissented it, we have examined this case. It is interesting to

43 State Bank of India v. Kashinath Kher (1996) 8 SCC 762.

note that the learned Judges assumed that Rangaiah’s case considered a

question of “retrospective application of the rule to the vacancies existing

prior to the rules”. In fact, Rangaiah does not observe anything like that and

we would leave it at this. This Court observed:

“14. The learned counsel for the respondents is not right

in contending that the vacancies have arisen in 1988,

1989 and 1990 and that the rule of relaxation cannot be

given in 1990 to the vacancies that have arisen in 1988,

1989 and 1990 and be considered according to the rules

in vogue when the vacancies had arisen. It is seen that

the policy decision was taken for the first time on 21-3-

1990 effective from 1-8-1988. In other words, the

promotions are required to be considered

retrospectively in the light of the decision to fill up the

vacancies existing as on August 1988. Therefore, it is

not a case of applying a rule which was made later to a

vacancy which was existing anterior thereto. Equally, it

is not correct to state that this principle is an unjust

principle. It is true that this Court in Y.V. Rangaiah v.

J. Sreenivasa Rao [(1983) 3 SCC 284] had considered

the question of retrospective application of the rule to

the vacancies existing prior to the rules, in paragraphs

7 and 8 of the judgment. But in that case, the rule was

in vogue for Sub-Registrars Grade II in Registration

Department of Andhra Pradesh. But no list was

prepared, promotion was not made according to the

existing rules. The list of eligible candidates was

prepared according to the amended Rules,

consequential to the zonal system introduced in Andhra

Pradesh under Article 371-D of the Constitution and

Presidential Order. It was held that the vacancies that

had arisen prior to making the amendment to the Rules

should be filled in accordance with the rules that were

in vogue prior to the amendment and vacancies that

arose subsequently should be filled according to the

amended Rules. That situation does not apply to the

factual matrix.”

23.1 K. Ramulu v. S. Suryaprakash Rao44

, is an important decision. The

issue related to applicability of the A.P. Animal Husbandry Services Rules,

1996 (which repealed the existing 1977 rules) to vacancies that arose before

the 1996 amendment to the promotional post of Assistant Director. Under

Rule 4, the Government was to prepare and operate the panel for the year

1995-96 for promotion to the said post. However, a conscious decision was

taken in 1988 by the Government not to fill up any vacancies until the

repealed rules were duly amended. In light of this, the Government did not

prepare and finalise the panel for promotion to the post of Assistant

Veterinary Surgeons to Assistant Director for the year 1995-96. It was held

that:

“12. …But the question is whether the ratio in Rangaiah

case would apply to the facts of this case. The

Government therein merely amended the Rules, applied

the amended Rules without taking any conscious

decision not to fill up the existing vacancies pending

amendment of the Rules on the date the new Rules came

into force. It is true, as contended by Mr H.S. Gururaja

Rao, that this Court has followed the ratio therein in

many a decision and those cited by him are P.

Ganeshwar Rao v. State of A.P., P. Mahendran v. State

of Karnataka, A.A. Calton v. Director of Education,

N.T. Devin Katti v. Karnataka Public Service

Commission, Ramesh Kumar Choudha v. State of M.P.

In none of these decisions, a situation which has arisen

in the present case had come up for consideration.

13. It is seen that since the Government have taken a

conscious decision not to make any appointment till the

amendment of the Rules, Rule 3 of the General Rules is

not of any help to the respondent...

44 K. Ramulu v. S. Suryaprakash Rao (1997) 3 SCC 59.

….

15. Thus, we hold that the first respondent has not

acquired any vested right for being considered for

promotion in accordance with the repealed Rules in

view of the policy decision taken by the Government

which we find is justifiable on the material available

from the record placed before us. We hold that the

Tribunal was not right and correct in directing the

Government to prepare and operate the panel for

promotion to the post of Assistant Directors of Animal

Husbandry Department in accordance with the

repealed Rules and to operate the same.”

23.2 This judgment clearly recognises the principle that a policy decision

taken by the Government in public interest would prevail over any claim to

fill up the vacancies. Further, when such a decision is taken, the employee has

no vested right for being considered for promotion in accordance with

repealed rules.

24.1 In Rajasthan Public Service Commission v. Chanan Ram45 an

advertisement for direct recruitment to 23 posts of Assistant Director (Junior)

under Rules, 198646 was released on 05.11.1993. The respondent therein

applied in pursuance of the said advertisement. Further, the last date for

applying in pursuance of this advertisement was 31.12.1993. However, on

28.12.1993, three days prior to the last date for applications, the State

Government asked the RPSC not to proceed with the recruitments.

Thereafter, on 19.04.1995, the rules were amended and consequently, the

45 Rajasthan Public Service Commission v. Chanan Ram, (1998) 4 SCC 202.

46 Rajasthan Agricultural Marketing Services Rules, 1986.

aforementioned advertisement was cancelled. Another consequence of the

amendment was that the post of Assistant Director (Junior) was abolished and

restructured as Marketing Officer. A fresh advertisement for 26 posts of

Marketing Officer was released and the 23 posts, in respect of which the

advertisement was issued, were carried forward. The respondent successfully

contended before the High Court that the recruitment must be based on the

rules that existed at the time of vacancies by relying on the decision on

Rangaiah and the subsequent cases that followed it. Rejecting the argument

and allowing the appeal this Court held:

“15…..On the contrary a three-Judge Bench judgment

of this Court in the case of Jai Singh Dalal v. State of

Haryana would squarely get attracted on the facts of the

present case. A.M. Ahmadi J., speaking for the threeJudge Bench in para 7 of the Report relying on an

earlier judgment of this Court in case of State of

Haryana v. Subash Chander Marwaha laid down that

when the special process of recruitment had not been

finalised and culminated into select list the candidate

did not have any right to appointment. In this

connection, it was observed that the recruitment

process could be stopped by the Government at any time

before a candidate has been appointed. A candidate has

no vested right to get the process completed and at the

most the Government could be required to justify its

action on the touchstone of Article 14 of the

Constitution.

16. In the facts of the present case it cannot even be

suggested that the action of the State of Rajasthan was

in any way arbitrary in intercepting the earlier

recruitment process pursuant to the first advertisement

dated 05-11-1993 Annexure P-1 as the Rules themselves

had got amended and the posts earlier advertised had

ceased to exist.”

24.2 As is evident from the above, after referring to the decisions in

Rangaiah, P. Ganeshwar and other decisions, the Court adopted the principle

that the State has a right to stop a recruitment process at any time before the

appointment takes place. This is to say that there is no vested right to get the

process completed. This is important for the reason that while it holds that

there is no right of an employee, it recognises the obligation of a State to

justify its action on the touchstone of the Article 14 of the Constitution.

25.1 In G. Venkateshwara Rao v. Union of India47 the appellant therein

expected appointment by promotion against a vacancy that arose in 1991,

being the very next candidate on the panel. However, the proposal remained

pending till 1993 and in the meanwhile cadre restructuring took place and as

a result of which another candidate became eligible to be appointed. Relying

on Rangaiah he contended that vacancies must be filled as per the rules that

existed prior to the restructuring. Rejecting the argument, the Court observed

as under:

“4….the learned advocate appearing in support of this

appeal reiterated the same contentions and urged that

the view taken by CAT, Hyderabad is erroneous and

cannot be sustained. While dealing with the first

contention, he urged that if the Railway Board were to

take the decision expeditiously, the appellant could

have been accommodated on such dereserved vacancy.

He urged that there was no impediment in taking the

decision of dereservation and it was merely an inaction

on the part of the Railway Board which had deprived

the appellant of being appointed against the vacancy.

47 G. Venkateshwara Rao v. Union of India (1999) 8 SCC 455.

We do not set any substance in this contention because

nothing has been pointed out to us from the record

which would justify this contention. The learned

counsel for the appellant drew our attention to the

decision of this Court in Y.V. Rangaiah v. J. Sreenivasa

Rao [(1983) 3 SCC 284 : 1983 SCC (L&S) 382] and in

particular, he relied upon paras 4 and 9. We have gone

through the judgment and in our opinion, the ratio

thereof has no application. It was a case dealing with

delay in preparing panel for promotional cadre under

the then existing rules which were substituted by new

rules. The panel was prepared under the new rules.

5. Coming to the second contention as regards

restructuring of the cadre, it is quite clear that the

restructuring appears to have been made for the

efficient working in the Workshop Unit. We, therefore,

do not see any substance in this contention.”

25.2 While distinguishing Rangaiah’s principle this Court recognised yet

another factor on the basis of which the Government need not fill up the

vacancies as per the old rules. The reason mentioned in this case is

restructuring the cadre. While upholding the contention that restructuring is

undertaken for efficient working of the unit, this Court justified the decision

of the Government not to fill up the vacancies as per the principle in

Rangaiah.

26.1 In Delhi Judicial Services Association v. Delhi High Court,

48 the Court

formulated the issue as, “in view of the submission made at the Bar, the first

question that requires consideration is whether the temporary posts having

been created prior to the amendment of Rules, is it the law that require those

48 Delhi Judicial Services Assn. v. Delhi High Court, (2001) 5 SCC 145.

posts to be filled up only in accordance with the unamended Rules and not

otherwise?” Rejecting the contention and distinguishing Rangaiah on the

facts of the case, the Court held as under:

“5… In Rangaiah case [(1983) 3 SCC 284] this Court

on a consideration of the relevant rules as well as the

instructions issued by the Government, came to hold

that a list of approved candidates was required to be

prepared as of 1-9-1976 for making appointments to the

grade of Sub-Registrar Grade II by transfer, but no such

list having been prepared and instead, the same having

been drawn up in 1977, by which time the amended

rules had come into force, it was held that the legitimate

right and expectations of those who were entitled to be

included in the list which ought to have been prepared

in September 1976 cannot be frustrated on account of

the fact that the panel had not been prepared and it was

so prepared only in the year 1977. It is on this

conclusion, the Court had held that the vacancies

available prior to 1-9-1976 ought to be filled up under

the unamended rules. The aforesaid decision will have

no application to the case in hand inasmuch as in the

Delhi Higher Judicial Service there is no requirement

of preparation of any panel or list of candidates eligible

for promotion by any particular date. Then again,

merely because posts were created under Rule 16, it

was not obligatory for the appointing authority to fill

up those posts immediately…”

26.2 This decision recognised yet another exception to the application of the

principle in Rangaiah case. Court held that even if vacancies were created

prior to the amendment of the Rules, there is no obligation upon the

authorities to fill those vacancies immediately. The decision made direct

inroads into the principle of Rangaiah.

27.1 In Shyama Charan Dash v. State of Orissa49 the appellant therein was

working as a Block Level Extension Officer which is a feeder category to the

post of Sub-Assistant Registrar. While he was eligible to be appointed to the

vacancies in the post of Sub-Registrar, the rules came to be amended in 1991

reducing his chances to be appointed. Relying on Rangaiah he contended that

the vacancies that arose prior to the amendment must be filled as per the rules

existing prior to the amendment. This Court held that:

“5. It is appropriate at this stage to make reference to

some of the decisions relied upon by the learned counsel

on either side. Y.V. Rangaiah v. J. Sreenivasa Rao

[(1983) 3 SCC 284] being a case where not only there

was omission to prepare the promotion panel in time as

per rules then in force but the amended rules dispensed

with the original provision for considering LDCs along

with UDCs for promotion, adversely affecting their

promotional prospects, has no application to the case

on hand…

….

9. …As long as the IPOs, as a class or category, are

rendered eligible even from 1986 and that is not

challenged, the differences, if any, existing and based

on the scales of pay among them, when resolved to be

done away with in the undoubted exercise of its power

by the State, as a matter of policy, cannot be

legitimately challenged by the appellants merely

because due to the enlargement of the horizon of

consideration resulting therefrom, the chances of

consideration for promotion of Industrial Supervisors

become diminished. The reasons, which weighed with

the State Government in doing so, are found to be

genuine, real and substantive and meant to do

substantial justice to all categories or grades of posts

equated for purposes of Rule 7 of the Rules. The fact

that in different proceedings where claim for identical

scales of pay came to be contested by the Government

49 Shyama Charan Dash v. State of Orissa, (2003) 4 SCC 218.

or rejected by the Tribunal, is no justification to

countenance the claim of the appellants in these

proceedings inasmuch as the criteria to be applied in

dealing with such claims are totally different or, at any

rate, may be one only among several requirements to be

satisfied. Consequently, the challenge on behalf of the

appellants has no merit whatsoever and shall stand

rejected.”

27.2 This is again a case where the Court upheld the decision of the

Government not to fill up the vacancies as per the old rules. The decision of

the Government was upheld because the Court found that the policy decision

is genuine, real and substantive and meant to do substantial justice to all

categories or grades of posts equated for the purpose of Rule 7. These

decisions demonstrate that this Court never applied the principle in

Rangaiah’s case when the policy decision of the Government required

amendment of rules for a justifiable reason.

28.1 In State of Punjab v. Arun Kumar Aggarwal,

50 the second issue in the

case was “whether the old 1941 Rules or the new 2004 Rules, which became

effective from 09.07.2004 will be applied for filling up the vacancies which

arose during 2000-2001 under the old 2001 Rules for promotion to the post

of SDO in the State of Punjab”. The respondents therein contended that they

have an indefeasible right to be promoted to the post of SDO as per the

decision in Rangaiah case. Rejecting the argument, the Court held as under:-

“30. There is no quarrel over the proposition of law that

normal rule is that the vacancy prior to the new Rules

50 State of Punjab v. Arun Kumar Aggarwal (2007) 10 SCC 402.

would be governed by the old Rules and not by the new

Rules. However, in the present case, we have already

held that the Government has taken conscious decision

not to fill the vacancy under the old Rules and that such

decision has been validly taken keeping in view the facts

and circumstances of the case.

…..

35. All the decisions referred to above are related to

amendment of the Rules. We have already held that the

1941 Rules were repealed by the 2004 Rules. The facts

of those cases are, therefore, not applicable to the facts

of the present case.

…..

38. We hold that the Government has taken a conscious

decision not to fill up the posts under the old 1941

Rules. The impugned order of the High Court is set

aside. We may at this stage point out that the problem

seems to have been compounded by the inaction/casual

approach of the Government detrimental to public

interest. The State Government shall now fill up the

vacant posts in accordance with the 2004 Rules within

a period of three months from today. All the eligible

candidates who satisfy the criteria laid down under the

2004 Rules shall be considered. The entire process of

recommendation and appointment shall be completed

within three months from today.”

28.2 This is yet another case where deviating from Rangaiah’s principle this

Court recognized the decision of the Government not to fill the vacancies

arising prior to the amendment as per the old rules for the reason that there is

a conscious decision of the Government.

29.1 In Deepak Agarwal v. State of U.P.51

, the question arose as to whether

the appellants therein were entitled to be considered for promotion to the post

of Deputy Excise Commissioner under the U.P. Excise Group ‘A’ Service

51 Deepak Agarwal v. State of U.P., (2011) 6 SCC 725.

Rules, 1983. The prayer was for consideration to the vacancies which

occurred prior to the amendment of 1999 Rules. Reliance was placed on

Rangaiah which was rejected. The Court observed as under:-

“24. We are of the considered opinion that the judgment

in Y.V. Rangaiah case would not be applicable in the

facts and circumstances of this case. The aforesaid

judgment was rendered on the interpretation of Rule

4(a)(1)(i) of the Andhra Pradesh Registration and

Subordinate Service Rules, 1976. The aforesaid Rule

provided for preparation of a panel for the eligible

candidates every year in the month of September. This

was a statutory duty cast upon the State. The exercise

was required to be conducted each year. Thereafter,

only promotion orders were to be issued. However, no

panel had been prepared for the year 1976.

Subsequently, the Rule was amended, which rendered

the petitioners therein ineligible to be considered for

promotion. In these circumstances, it was observed by

this Court that the amendment would not be applicable

to the vacancies which had arisen prior to the

amendment. The vacancies which occurred prior to the

amended Rules would be governed by the old Rules and

not the amended Rules.

25. In the present case, there is no statutory duty cast

upon the respondents to either prepare a year wise

panel of the eligible candidates or of the selected

candidates for promotion. In fact, the proviso to Rule 2

enables the State to keep any post unfilled. Therefore,

clearly there is no statutory duty which the State could

be mandated to perform under the applicable Rules. The

requirement to identify the vacancies in a year or to take

a decision as to how many posts are to be filled under

Rule 7 cannot be equated with not issuing promotion

orders to the candidates duly selected for promotion. In

our opinion, the appellants had not acquired any right

to be considered for promotion. Therefore, it is difficult

to accept the submissions of Dr. Rajeev Dhavan that the

vacancies, which had arisen before 17-5-1999 had to be

filled under the unamended Rules.

26. It is by now a settled proposition of law that a

candidate has the right to be considered in the light of

the existing rules, which implies the “rule in force” on

the date the consideration took place. There is no rule

of universal or absolute application that vacancies are

to be filled invariably by the law existing on the date

when the vacancy arises. The requirement of filling up

old vacancies under the old rules is interlinked with the

candidate having acquired a right to be considered for

promotion. The right to be considered for promotion

accrues on the date of consideration of the eligible

candidates. Unless, of course, the applicable rule, as in

Rangaiah case lays down any particular time-frame,

within which the selection process is to be completed.

In the present case, consideration for promotion took

place after the amendment came into operation. Thus,

it cannot be accepted that any accrued or vested right

of the appellants has been taken away by the

amendment.

….

28. In our opinion, the matter is squarely covered by the

ratio of the judgment of this Court in Dr. K. Ramulu. In

the aforesaid case, this Court considered all the

judgments cited by the learned Senior Counsel for the

appellant and held that Rangaiah case would not be

applicable in the facts and circumstances of that case.

It was observed that for reasons germane to the

decision, the Government is entitled to take a decision

not to fill up the existing vacancies as on the relevant

date. It was also held that when the Government takes

a conscious decision and amends the rules, the

promotion have to be made in accordance with the rules

prevalent at the time when the consideration takes

place.”

29.2 This is a very important case which recognises many points of

distinction. (a) The Court found that there is no statutory duty cast on the

Government to prepare panels as in the case of Rangaiah, (b) a candidate has

a right to be considered only as per the existing rules, i.e., “the rule in force”,

the principle in Rangaiah has no universal application, (e) for reasons

germane to its decision, the Government is entitled to take a conscious

decision about the filling of the vacancies and the rules applicable. This

decision made deep inroads into the principle laid down in Rangaiah’s case.

30.1 M.I. Kunjukunju v. State of Kerela52

, related to a claim made by the

appellant therein to the post of Industrial Extension Officers. In this case that

the selection process commenced on 25.06.1992 when the Commission

invited applications and prescribed the method of appointment and

qualifications for the post of Industrial Extension Officers. It was contended

that the new rules issued in 2001 could not have a retrospective effect to take

away the vested right. The vested right argument was considered in detail and

the Court rejected the same on the ground that no vested right exists and held

as under:

“19. Therefore, it is clear that a candidate on making

application for the post pursuant to an advertisement

does not acquire any vested right for selection. If he is

eligible and is otherwise qualified in accordance with

the relevant rules, he does acquire right for being

considered for selection as per existing rules.

….

22. In the present case, the Rules have not been framed

under the proviso to Article 309 of the Constitution of

India. The legislature has framed the 1968 Act in

exercise of power conferred under Article 309 of the

Constitution of India. Under the 1968 Act, the State

Government was empowered to make Rules either

52 M.I. Kunjukunju v. State of Kerala (2015) 11 SCC 440.

prospectively or retrospectively to regulate the

recruitment and condition of service of persons

appointed to public services and posts in question with

the Department of Industry and Commerce of the State

of Kerala.

23. In view of such delegation of power of the

legislature to the State under the 1968 Act, the Special

Rules framed by the State Government giving

retrospective effect from 1-7-1983 cannot be held to be

illegal or invalid.

….

26. In the present case, we find that the appellants have

not derived any benefit out of the old Government order

which was in force at the time of advertisement. We,

therefore, hold that no vested right or benefit accrued

to the appellants have been taken away by sub-rule (2)

of Rule 1 of the Special Rules.”

30.2 This is a case where the Government made rules which clearly applied

retrospectively to facts that existed before and after the amendment. The

Court held that no right subsists for consideration to the vacancies that existed

prior to the commencement of the rules.

31.1 In State of Tripura v. Nikhil Ranjan Chakraborty,

53 the Court

considered a submission that additional posts in ‘Group A’ and ‘Group B’ of

Schedule IV must be considered only on the basis of the rules that existed

prior to the amendment on 24.12.2011. The Court found no difficulty in

straight away applying the decision of this Court in Deepak Agarwal (supra)

which distinguishes Rangaiah to hold as under: -

“9. The law is thus clear that a candidate has the right

to be considered in the light of the existing rules,

53 State of Tripura v. Nikhil Ranjan Chakraborty (2017) 3 SCC 646.

namely, “rules in force on the date” the consideration

takes place and that there is no rule of absolute

application that vacancies must invariably be filled by

the law existing on the date when they arose. As against

the case of total exclusion and absolute deprivation of

a chance to be considered as in Deepak Agarwal in the

instant case certain additional posts have been included

in the feeder cadre, thereby expanding the zone of

consideration. It is not as if the writ petitioners or

similarly situated candidates were totally excluded. At

best, they now had to compete with some more

candidates. In any case, since there was no accrued

right nor was there any mandate that vacancies must be

filled invariably by the law existing on the date when

the vacancy arose, the State was well within its rights

to stipulate that the vacancies be filled in accordance

with the Rules as amended. Secondly, the process to

amend the Rules had also begun well before the

Notification dated 24-11-2011.

10. In our view, the instant case is fully covered by the

law laid down by this Court in Deepak Agrawal and the

High Court was completely in error in allowing the writ

petition and in dismissing the writ appeals. We,

therefore, allow these appeals, set aside the judgment

under appeal and dismiss Writ Petitions (Civil) Nos.

104, 105, 106, 153 and 181 of 2012.”

31.2 The Court reiterated that there is no rule of absolute application that

vacancies must be filled as per the law existing on the date when they arose.

The Court held that there is neither an accrued right nor is there a mandate

under the rules to fill the vacancies as per the law that existed. The Court

recognised the right of the Government to stipulate the vacancies in

accordance with rules as amended.

32.1 By 2019 the perspective in which this Court has considered the decision

in Rangaiah was clear. By this time, the Court recognized many exceptions

to the principle. In Union of India v. Krishna Kumar54

, this Court noted that,

“the decision of this Court in Y.V. Rangaiah v. J. Sreenivasa Rao has been

construed in subsequent decisions as a case where the applicable rule

required the process of promotion or selection to be completed within a

stipulated time-frame”. This case relates to a claim made by Havaldars for

being considered for the post of Naib Subedar for the vacancies which

occurred prior to the changes that were made in the structure of Assam Rifles

in 2011. The High Court accepted the submission and directed the applicants

to be considered for the posts as per the pre-amended rules. Allowing the

appeal this Court held as under:-

“10. In considering the rival submissions, it must, at the

outset, be noted that it is well settled that there is no

vested right to promotion, but a right be considered for

promotion in accordance with the Rules which prevail

on the date on which consideration for promotion takes

place. This Court has held that there is no rule of

universal application to the effect that vacancies must

necessarily be filled in on the basis of the law which

existed on the date when they arose. The decision of this

Court in Y.V. Rangaiah v. J. Sreenivasa Rao [Y.V.

Rangaiah v. J. Sreenivasa Rao, (1983) 3 SCC 284 :] has

been construed in subsequent decisions as a case where

the applicable Rules required the process of promotion

or selection to be completed within a stipulated timeframe. Hence, it has been held in H.S. Grewal v. Union

of India [H.S. Grewal v. Union of India, (1997) 11 SCC

758 : 1998 SCC (L&S) 420] that the creation of an

intermediate post would not amount to an interference

with the vested right to promotion…..

….

13. In view of this statement of the law, it is evident that

once the structure of Assam Rifles underwent a change

54 Union of India v. Krishna Kumar (2019) 4 SCC 319.

following the creation of the intermediate post of

Warrant Officer, persons holding the post of Havaldar

would be considered for promotion to the post of

Warrant Officer. The intermediate post of Warrant

Officer was created as a result of the restructuring

exercise. The High Court was, in our view, in error in

postulating that vacancies which arose prior to the

amendment of the Recruitment Rules would necessarily

be governed by the Rules which existed at the time of

the occurrence of the vacancies. As the decided cases

noted earlier indicate, there is no such rule of absolute

or universal application. The entire basis of the

decision of the High Court was that those who were

recruited prior to the restructuring exercise and were

holding the post of Havaldars had acquired a vested

right of promotion to the post of Naib Subedar. This

does not reflect the correct position in law. The right is

to be considered for promotion in accordance with the

Rules as they exist when the exercise is carried out for

promotion.”

32.2 Apart from holding that there is no rule of universal application to the

effect that vacancies must necessarily be filled on the basis of the law that

existed on the date when they arose, this Court also held that the right is to

be considered for promotion in accordance with rules as they exist when the

exercise is carried out for promotion.

33.1 In State of Orissa v. Dhirendra Sundar Das55

, the Court was concerned

with appointment by promotion to Orissa Administrative Service, Class II

Cadre. The employees contended that OAS Class II Rules, 1978 read with

OAS Class II, Regulations, 1978 were in force at the time when the State

decided to fill up the 150 OAS Class II posts on 28.4.2008. It was their

55 State of Orissa v. Dhirendra Sundar Das, (2019) 6 SCC 270.

contention that the subsequent restructuring cannot affect their right to be

considered for the 150 posts as per the 1978 Rules. For this purpose, reliance

was placed on Rangaiah. Rejecting this contention, the Court allowed the

appeal by holding:

“9.14. Reliance placed by the counsel for the

respondents on Y.V. Rangaiah v. J. Sreenivasa Rao in

order to submit that the vacancies which had arisen

under the old Rules would be governed by the old Rules,

is of no avail.

9.15. A similar submission was rejected by this Court in

Deepak Agarwal v. State of U.P. [Deepak Agarwal v.

State of U.P., (2011) 6 SCC 725 : (2011) 2 SCC (L&S)

175]…

….

10. On the aforesaid grounds, we hold that the judgment

of the Division Bench is liable to be set aside since the

contesting respondents did not have a vested or

fructified right of promotion to OAS Class II posts

which had arisen during the recruitment year 2008. The

names of the contesting respondents were merely

recommended for consideration. In the meanwhile, in

2009 the State had restructured the cadre, and

abolished the OAS Class II cadre. The reconstituted

cadre viz. the Orissa Revenue Service Group 'B' cadre

came in its place. Hence, the direction of the Division

Bench to appoint the contesting respondents in the

vacancies which had occurred in the abolished cadre,

in accordance with the repealed 1978 Rules, was

contrary to law, and liable to be set aside.”

33.2 Following the line adopted in Deepak Agarwal v. State of U.P. (supra)

this Court held that the respondents therein do not have a vested and fructified

right and therefore held that the appointments need not be made as per the old

rules.

34.1 In Rajasthan State Sports Council v. Uma Dadhich56

, the respondent

therein was appointed under the Rajasthan State Sports Council on the posts

of Coach Grade-III on 20.03.1986. She was promoted to Coach Grade-II in

1990 and Coach Grade-I in 1997. Promotion to the post of Sports Officer

from the Cadre of Coach Grade-I was challenged by the respondent on the

ground that the posts fell vacant in the year 2003-2004, for which the 2006

Rules changed the qualification from mere seniority to seniority-cum-merit

could not be applied. Allowing the appeal this Court has held as under:-

“5. There is merit in the submission which has been

urged on behalf of the appellants that the respondent

had no vested right to promotion but only a right to be

considered in accordance with the rules as they existed

on the date when the case for promotion was taken up.

This principle has been reiterated in several decisions

of this Court. (See H.S. Grewal v. Union of India [H.S.

Grewal v. Union of India, (1997) 11 SCC 758], Deepak

Agarwal v. State of U.P. [Deepak Agarwal v. State of

U.P., (2011) 6 SCC 725], State of Tripura v. Nikhil

Ranjan Chakraborty [State of Tripura v. Nikhil Ranjan

Chakraborty, (2017) 3 SCC 646] and Union of India v.

Krishna Kumar [Union of India v. Krishna Kumar,

(2019) 4 SCC 319]).

6. The judgment in Y.V. Rangaiah v. J. Sreenivasa Rao

dealt with a situation where the rules required that the

promotional exercise must be completed within the

relevant year. Rangaiah case [Y.V. Rangaiah v. J.

Sreenivasa Rao, (1983) 3 SCC 284], has hence been

distinguished in the judgments noted above.

7. Rule 9(4) of the Rajasthan State Sports Council

Service Rules, 2006 on which reliance has been placed

on behalf of the appellant does not indicate that the

vacancies must be filled in on the basis of Rules as they

prevail in the year in which they have occurred. Rule

9(4) is in the following terms:

56 Rajasthan State Sports Council v. Uma Dadhich (2019) 4 SCC 316.

“9. (4) The appointing authority shall

determine the vacancies of earlier years, yearwise which were required to be filled in by

promotion, if such vacancies were not

determined and filled earlier in the year in

which they were required to be filled in.”

34.2 The Court considered a large number of decisions that distinguished

Rangaiah’s case and held as a matter of principle that rules that exist on the

date when the case for promotion was taken up would hold the field. The

Court further observed that there is no rule which specifically mandates that

the vacancies prior to the amendment must be filled as per the rules that

existed and not the new rules. This is a complete reversal of the principle set

to have been laid down in Rangaiah’s case.

35. Finally, the case of D. Raghu v. R. Basaveswarudu57

, is yet another

decision that has not followed the principle in Rangaiah’s case.

The Court held as under:-

“129.8. The High Court was in error in holding that it

has to be necessarily held that the vacancies which

arose prior to the revised Recruitment Rules coming

into force has to be filled up under the then existing

Rules (the 1979 Rules) relying upon case law including

Rangaiah. There was a conscious decision taken to not

fill up vacancies based on the restructuring, and what

is more, letters dated 28-10-2002 and 14-11-2002 show

that promotion to the post of Inspector was to be

effected based on the new Recruitment Rules.”

57 D. Raghu v. R. Basaveswarudu, (2020) 18 SCC 1.

Analysis:

36. A review of the fifteen cases that have distinguished Rangaiah would

demonstrate that this Court has been consistently carving out exceptions to

the broad proposition formulated in Rangaiah. The findings in these

judgments, that have a direct bearing on the proposition formulated by

Rangaiah are as under:

1. There is no rule of universal application that vacancies must be

necessarily filled on the basis of the law which existed on the date

when they arose, Rangaiah’s case must be understood in the context

of the rules involved therein.58

2. It is now a settled proposition of law that a candidate has a right to

be considered in the light of the existed rules, which implies the "rule

in force" as on the date consideration takes place. The right to be

considered for promotion occurs on the date of consideration of the

eligible candidates59

3. The Government is entitled to take a conscious policy decision not

to fill up the vacancies arising prior to the amendment of the rules.

The employee does not acquire any vested right to being considered

for promotion in accordance with the repealed rules in view of the

58 Deepak Agarwal v. State of U.P., (2011) 6 SCC 725, Para 26; Union of India v. Krishna

Kumar, (2019) 4 SCC 319, Para 10.

59 Deepak Agarwal v. State of U.P., (2011) 6 SCC 725, Para 26; Union of India v. Krishna

Kumar, (2019) 4 SCC 319, Para 10.

policy decision taken by the Government.60 There is no obligation

for the Government to make appointments as per the old rules in the

event of restructuring of the cadre is intended for efficient working

of the unit.61 The only requirement is that the policy decisions of the

Government must be fair and reasonable and must be justified on the

touchstone of Article 14.62

4. The principle in Rangaiah need not be applied merely because posts

were created, as it is not obligatory for the appointing authority to

fill up the posts immediately.63

5. When there is no statutory duty cast upon the State to consider

appointments to vacancies that existed prior to the amendment, the

State cannot be directed to consider the cases.64

37.1 The above-referred observations made in the fifteen decisions that have

distinguished Rangaiah’s case demonstrate that the wide principle enunciated

therein is substantially watered-down. Almost all the decisions that

distinguished Rangaiah hold that there is no rule of universal application to

the effect that vacancies must necessarily be filled on the basis of law that

60 K. Ramulu v. Suryaprakash Rao, (1997) 3 SCC 59, Paras 12 and 13, Shyam Chandra Das v.

State of Orissa, (2003) 4 SCC 218, Para 9, State of Punjab v. Arun Kumar Aggarwal, (2007)

10 SCC 402, Para 38; Deepak Agarwal v. State of U.P., (2011) 6 SCC 725, Para 28.

61 G. Venkateshwara Rao v. Union of India, (1999) 8 SCC 455, Para 4.

62 Rajasthan Public Service Commission v. Charan Ram, (1998) 4 SCC 202, Para 15; K.

Ramulu v. Suryaprakash Rao, (1997) 3 SCC 59, Para 15.

63 In Delhi Judicial Services Association v. Delhi High Court, (2001) 5 SCC 145, Para 5.

64 Deepak Agarwal v. State of U.P., (2011) 6 SCC 725, Para 25.

existed on the date when they arose. This only implies that decision in

Rangaiah is confined to the facts of that case.

37.2 The decision in Deepak Agarwal (supra) is a complete departure from

the principle in Rangaiah, in as much as the Court has held that a candidate

has a right to be considered in the light of the existing rule. That is the rule in

force on the date the consideration takes place. This enunciation is followed

in many subsequent decisions including that of Union of India v. Krishna

Kumar (supra). In fact, in Krishna Kumar Court held that there is only a "right

to be considered for promotion in accordance with rules which prevail on the

date on which consideration for promotion take place.”

37.3 The consistent findings in these fifteen decisions that Rangaiah’s case

must be seen in the context of its own facts, coupled with the declarations

therein that there is no rule of universal application to the effect that vacancies

must necessarily be filled on the basis of rules which existed on the date which

they arose, compels us to conclude that the decision in Rangaiah is impliedly

overruled. However, as there is no declaration of law to this effect, it

continues to be cited as a precedent and this Court has been distinguishing it

on some ground or the other, as we have indicated hereinabove. For clarity

and certainty, it is, therefore, necessary for us to hold;

(a) The statement in Y.V. Rangaiah v. J. Sreenivasa Rao that,

“the vacancies which occurred prior to the amended rules would

be governed by the old rules and not by the amended rules”, does

not reflect the correct proposition of law governing services under

the Union and the States under part XIV of the Constitution. It is

hereby overruled.

(b) The rights and obligations of persons serving the Union and

the States are to be sourced from the rules governing the services.

Application of the principle to the facts of the present case:

38.1 Returning to the facts of the present case, we have noticed that the High

Court has proceeded on the premise that the vacancies occurring before the

amendment of the Rules on 25.11.2006 must be governed by the 1966 Rules.

The decision of the High Court took within its sweep even the 7 new posts of

Labour Officers that were sanctioned by an inter-departmental letter dated

20.07.2006, which included even the 3 posts allocated for direct recruitment.

The direction of the High Court to encompass even the 3 posts allocated for

direct recruitment was on the ground that the posts were sanctioned on

20.07.2006, which is prior to the amendment of the Rules on 25.11.2006.

38.2 We have already held that there is no right for an employee outside the

rules governing the services. We have also followed and applied the

Constitution Bench decisions in Union of India v. Tulsiram Patel (supra) and

more particularly the decision in Roshan Lal Tandon v. Union of India (supra)

that the services under the State are in the nature of a status, a hallmark of

which is the need of the State to unilaterally alter the rules to subserve the

public interest. The 2006 rules, governing the services of the Respondents

came into force immediately after they were notified. There is no provision

in the said rules to enable the Respondents to be considered as per the 1966

Rules. The matter must end here. There is no other right that Respondents no.

1 to 3 can claim for such consideration.

39.1 The alternative plea of the Government based on its policy decision to

restructure the cadre by creating additional posts and also providing for direct

recruitment by amending the rules, as a justification for not filling up the

vacancies that arose prior to the amendment is fully supported by the

following decisions of this Court.65

39.2 The material placed on record shows that the additional posts of Labour

Officers are created on 20.07.2006 and immediately thereafter the 12 labour

zones were created. This is followed by amendment to the Rules with effect

from on 25.11.2006 restructuring the cadre. The facts fully justify the

alternative submission made by the State and we have no hesitation in

accepting the said submission.

65 K. Ramulu v. S. Suryaprakash Rao, (1997) 3 SCC 59; Rajasthan Public Service Commission

v. Chanan Ram, (1998) 4 SCC 202; G. Venkateshwara Rao v. Union of India, (1999) 8 SCC

455; Shyama Charan Dash v. State of Orissa, (2003) 4 SCC 218; State of Punjab v. Arun

Kumar Aggarwal, (2007) 10 SCC 402; Deepak Agarwal v. State of U.P., (2011) 6 SCC 725;

State of Tripura v. Nikhil Ranjan Chakraborty, (2017) 3 SCC 646; Union of India v. Krishna

Kumar (2019) 4 SCC 319; State of Orissa v. Dhirendra Sundar Das, (2019) 6 SCC 270;

Rajasthan State Sports Council v. Uma Dadhich, (2019) 4 SCC 316.

40. For these reasons stated above we set aside the judgment of the High

Court in CWP No. 3028 of 2008 dated 28.12.2009 and allow Civil Appeal No.

9746 and Civil Appeal No. 9747 of 2011. There shall be no order on cost.

……………………………….J.

[UDAY UMESH LALIT]

……………………………….J.

[S. RAVINDRA BHAT]

……………………………….J.

[PAMIDIGHANTAM SRI NARASIMHA]

NEW DELHI;

MAY 20, 2022

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STATE OF HIMACHAL PRADESH & ORS VS RAJ KUMAR & ORS. CASE

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