Pandyan Grama Bank Officers Union v. Union of India & Ors.

IN THE HIGH COURT OF JUDICATURE AT MADRASDATED : 13.7.2009CORAMTHE HONOURABLE MR.JUSTICE S.NAGAMUTHUWrit Petition No.2215 of 1999Pandyan Grama Bank Officers Union6, Pichai StreetVirudhunagar 626 001...PetitionerVs.1. Union of India rep. by the Secretary to Government Ministry of Finance Department of Economic Affairs (Banking Division) Parliament Street New Delhi.2. Pandyan Grama Bank rep. by its Chairman 71, Kandhapuram Street Virudhunagar 626 001... Respondents-----Petition under Article 226 of the Constitution of India prayingfor awrit of Declaration declaring the selection processcontained in Clause 2(j) of III Schedule to the Regional Rural Banks(Appointment and Promotion of Officers and other Employees) Rules,1998 read with second respondent's circular No.PAD/47/98-99 dated16.12.1998 as ultra vires and null and void.-----For Petitioner : Mr.Sundar NarayanFor Mr.R.Yashod VardhanFor Respondent-1 : Mr.K.Ilango Addl. Solicitor GeneralFor Respondent-2 : Mr.NGR.Prasad----- https://hcservices.ecourts.gov.in/hcservices/ O R D E RWith the grievance that the promotion policy of the secondrespondent Bank (vide circular PAD/47/98-99 dated 16.12.1998) followsthe principle "merit-cum-seniority", instead of "seniority-cum-merit"in the matter of promotion of officers, the petitioner-Union isbefore this Court with this writ petition.2. The Government of India, Ministry of Finance, by notificationdated 29.7.1998, in exercise of the powers conferred by Section 29 ofthe Regional Rural Banks Act, 1976 read with Section 17 thereof andin supersession of the Regional Rural Banks (Appointment andPromotion of Officers and other employees) Rules, 1988, afterconsultation with the National Bank and the sponsor Banks specifiedin the Second Schedule to the Rules, made the Regional Rural Banks(Appointment and Promotion of Officers and Other Employees) Rules,1998. 3. As per the said Rules, appointment to the post of Scale IIIOfficer shall be made only by promotion and such promotion shall bemade on the basis of "seniority-cum-merit". Similarly, in respect ofappointment to the post of Scale II Officer also, it shall be only bypromotion and the same shall be made on the basis of "seniority-cum-merit". 4. Insofar as Scale III Officers are concerned, the selectionshall be on the basis of performance in the interview and PerformanceAppraisal Reports for preceding five years as per the division ofmarks, viz. 25 marks for interview and 75 marks for PerformanceAppraisal Report. Similarly, for Scale II Officers, the selectionshall be on the basis of performance in the written test, interviewand Performance Appraisal Reports for preceding five years as per thedivision of marks, viz. 60 marks for written test, 20 marks forinterview and 20 marks for Performance Appraisal Report.5. In pursuance of the said Rules, the second respondent issuedthe impugned promotion policy dated 16.12.1998. Clause 1 of the saidpolicy is thus: "Basis of Promotion: Promotion shall be made on the basis of "seniority cummerit".The mode of selection for Scale I Officers is prescribed in Clause 3which is as follows: https://hcservices.ecourts.gov.in/hcservices/ "The selection of the candidates shall be made by theCommittee on the basis of written test, interview andassessment of performance appraisal reports for thepreceding five years as an Officer in Scale I/FieldSupervisor."Clause 7 prescribes the selection process for promotion, as under:(a)Written Test: 60 marks(b)Interview: 20 marks(c)Performance: 20 marksTotal: 100 marksA)Written Test: The candidates shall (60 marks) required to appear for written test comprising of two parts, viz. PART (A) Covering Banking Law and practice of Banking and PART (B) Covering CreditPolicy, Credit Management including priority sector,economics and Management. 60 Marks allotted to writtentest shall be further divided as under:Part A: 30 marksPart B: 30 marksA list of only those candidates who secure a minimum of40% marks in each part shall be prepared and suchcandidates shall be called for interview.B) Interview : There shall be no (20 Marks) minimum qualification marks for the interviewC) Performance : Performance Appraisal Appraisal Reports for the preceding (20 marks) five years shall be considered for the purpose of awarding marks for promotion.Clause 10 prescribes the Selection List as under:"The select list of officers drawn by the Committeeshall be based on seniority in their immediatelyproceeding scale or cadre to which they belong in Bank'sservice." https://hcservices.ecourts.gov.in/hcservices/

6. The said promotion policy is challenged in this writ petitionmainly on the ground that it prescribes promotion only on the basisof merit and seniority is not given due consideration. This,according to the petitioner, is against the Regional Rural banks(Appointment and Promotion of Officers and other Employees) Rules,1988 as well as the judgment of the Supreme Court in B.V.Sivaiah v.K.Addanki Babu [(1998) 6 SCC 720]. The learned counsel for thepetitioner would submit that if merit alone is taken as criteria,then, the seniority will have no relevance and as such, the seniorpeople will never get an opportunity for promotion. He would rely onthe judgment of the Hon'ble Supreme Court in Harigovind Yadav v. RewaSidhi Gramin Bank [(2006) 6 SCC 145] also.7. In the counter filed by the second respondent, in paragraph4, it is stated as follows: "... for the written test, the Bench mark is 40%. If acandidate secures the Bench mark, then he is subjectedto an interview. At the interview, if he is declaredsuitable, then the senior most among the candidates whohad secured minimum Bench mark is promoted. Even if acandidate secures high marks in the written test, hewill not be promoted if there is a senior who hassecured the Bench marks and qualified at the interview.This procedure is in conformity with the principle ofseniority-cum-merit referred to by the Supreme Court inthe decision reported in 1998 (3) LLN 951 B.V.Siviah andothers (vs) K.Adanthi. We have strictly followed thejudgment of the Hon'ble Supreme Court. We are giving inthe annexure the list of candidates who qualified in thewritten test and those who have been promoted. It willbe noticed that even though 146 officers have qualifiedin the written test, irrespective of the marks securedby them in the written test, the Committee forconsidering the promotion has selected 48 officers inthe order of seniority amongst the officers foundsuitable at the interview. This only confirms ourcontention that promotion was based on seniority-cum-merit."8. The learned counsel appearing for the second respondent woulddemonstrate from the annexure appended to the counter as to how thepromotion has been all along given strictly following the principleof "seniority-cum-merit". He has taken me through the said list toshow that though some officers had secured less marks in thequalifying test, they were promoted on the basis of their seniority.Thus, according to the respondents, the grievance of the petitionerUnion is misconceived. https://hcservices.ecourts.gov.in/hcservices/

9. I have considered the rival submissions.10. Before going into the merits of the case, let me analyse asto what is the difference between "seniority-cum-merit" and "merit-cum-seniority", as concluded by the Hon'ble Supreme Court in the caseof B.V.Sivaiah cited above. In paragraph 18 of the said judgment,the Supreme Court has held as under:"We thus arrive at the conclusion that the criterion of"seniority-cum-merit" in the matter of promotionpostulates that given the minimum necessary meritrequisite for efficiency of administration, the senior,even though less meritorious, shall have priority and acomparative assessment of merit is not required to bemade. For assessing the minimum necessary merit, thecompetent authority can lay down the minimum standardthat is required and also prescribe the mode ofassessment of merit of the employee who is eligible forconsideration for promotion. Such assessment can bemade by assigning marks on the basis of appraisal ofperformance on the basis of service record and interviewand prescribing the minimum marks which would entitle aperson to be promoted on the basis of seniority- cum-merit."11. Again in paragraph 37 of the same judgment, the SupremeCourt has held as under:"During the course of hearing of the appeal, the learnedcounsel for the respondent-Bank has placed before us therelevant documents relating to the impugned selectionand promotion. On a perusal of the said documents, wefind that 50 marks out of the total of 100 marks wereprescribed as the minimum qualifying marks for interviewand only those who had obtained the qualifying marks ininterview were selected for promotion on the basis ofseniority. It was, therefore, a case where a minimumstandard was prescribed for assessing the merit of thecandidates and those who fulfilled the said minimumstandard were selected for promotion on the basis ofseniority. In the circumstances, it cannot be said thatthe selection has not been made in accordance with theprinciple of "seniority-cum-merit". We are, therefore,unable to uphold the impugned judgment of the HighCourt."12. The above judgment in B.V.Sivaiah case came to be consideredby another Division bench of the Hon'ble Supreme Court in Harigovind https://hcservices.ecourts.gov.in/hcservices/ Yadav v. Rewa Sidhi Gramin Bank [(2006) 6 SCC 145], wherein, in para21, the Supreme Court has held as under:"... But, admittedly, there was no overall minimum andthe procedure required assessment of comparative merit.This is not therefore a case of the appellant failing tosecure the minimum necessary merit required forpromotion but a case where the appellant's entitlementto promotion was sought to be assessed by adopting aprocedure which allotted 20 marks for seniority, 40marks for performance, 15 marks for posting at rural anddifficult centres and 25 marks for interview. The Bankhas persisted in adopting the merit-cum-seniorityprocedure in spite of the decisions of this Court inseveral grounds of litigation referred to above. As theentire promotion procedure adopted by the Bank as perits policy dated 2.2.1989 has stood rejected by the HighCourt and this Court in Sivaiah as also in the earlierround of litigation of the appellant, the promotion ofthe third respondent and non-promotion of the appellantby adopting the very same procedure is liable to beinterfered with.22. Interviews can be held and assessment ofperformance can be made by the Bank in connection withpromotions. But, where the procedure adopted does notprovide the minimum standard for promotion, but only theminimum standard for interview and does the selectionwith reference to comparative marks, it is contrary tothe rule of "seniority-cum-merit". ... "13. A perusal of the above two judgments would make one toclearly understand that insofar as the promotion on the basis of"seniority-cum-merit" is concerned, the promotion policy canprescribe a procedure to assess the merit of the candidates so as toensure whether they come within a particular Bench mark. If thereare several candidates who have entered into the area ofconsideration, after having secured the Bench mark, then, theselection shall be made only on the basis of seniority and not on thebasis of mark secured in the test. While the principle "seniority-cum-merit" lays greater emphasis on seniority, "merit-cum-seniority"lays greater emphasis on merit and ability and seniority plays a lesssignificant role, becoming relevant only when merit is approximatelyequal.14. According to the petitioner, a reading of the impugnedpromotion policy would show that seniority is never taken intoaccount for the purpose of promotion and that the promotion is madeonly on the basis of the marks secured. But, that is not the correct https://hcservices.ecourts.gov.in/hcservices/ understanding of the policy. A perusal of the counter filed by therespondent and also the annexure appended thereto would make it veryclear that the promotion policy impugned in the writ petitionprovides for promotion only on the principle of "seniority-cum-merit"and not on "merit-cum-seniority". Paragraph 4 of the counterextracted above would show that if the Bench mark of 40%, asprescribed for the written test, is secured by the candidate, then,he would be allowed for interview and thereafter, the selection ismade only on the basis of seniority and not on the basis of marksobtained in the written test as well as interview. Thus, in myconsidered opinion, though the promotion policy does not say in everso many words that the selection would be made from the candidateswho have secured the Bench mark, only on the basis of seniority, inits implementation all along it has proved so. In view of the saidposition, I do not think that the petitioner could have any moregrievance in this regard. To make it clear, it is reiterated thatthe impugned policy shall be interpreted for all practical purposesin future, only as clarified in paragraph 4 of the counter (asextracted in para 7 of this order). So, no more adjudication isrequired in this writ petition, except the above clarification.In the result, the writ petition stands disposed of with theclarification indicated above. Sd/- Asst.Registrar/true copy/ Sub Asst.RegistrarkplToThe Secretary to GovernmentMinistry of FinanceDepartment of Economic Affairs (Banking Division)Parliament StreetNew Delhi.+1 cc to Mr.R.Yashod Vardhan, Advocate, SR.No.30784+1 cc to Mr.K.Elangoo, Advocate, SR.No.30991+1 cc to Mr.N.G.R.Prasad, Advocate, SR.No.30781W.P.No.2215 of 1999.SV {CO}TP/31.7.2009.