Supreme Court restores Tribunal decision on pay fixation for government employees.

The Supreme Court allowed the appeal, setting aside the High Court's order and restoring the Tribunal's decision. The appellant's pay is to be fixed in accordance with Rule 74(b) of the Orissa Service Code, ensuring no reduction in pay upon promotion. The State Government's challenge was dismissed, emphasizing the statutory protection provided by Rule 74(b) for government employees' pay fixation during promotions.

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Issues Involved:
The issue involves the interpretation of pay fixation for government employees u/s Rule 74(b) of the Orissa Service Code versus government circulars dated April 16, 1971, June 18, 1982, and March 17, 1983.

Issue 1: Pay Fixation - Rule 74(b) of the Orissa Service Code vs. Government Circulars

The appellant, appointed as Overseer (Electrical) by the Government of Orissa, challenged the fixation of his pay upon promotion to Assistant Engineer. The Tribunal directed his pay to be fixed as per Rule 74(b) of the Code, ensuring no reduction in pay on promotion. The State Government challenged this decision, arguing inconsistency with Circulars dated June 18, 1982 and March 17, 1983. The High Court, relying on the Circular dated April 16, 1971, directed pay fixation for the appellant as Assistant Engineer, resulting in a reduction in pay. The appellant appealed to the Supreme Court.

Issue 2: Interpretation of Rule 74(b) of the Orissa Service Code

Rule 74(b) of the Orissa Service Code mandates that upon promotion, a government servant's initial pay in the higher post should not be less than the pay received in the lower post. This rule aims to protect the scale of pay of an employee in the promotional cadre, ensuring they receive higher emoluments post-promotion. The rule safeguards against any reduction in pay for the employee upon promotion, emphasizing the importance of maintaining or increasing the employee's pay level.

Issue 3: Supremacy of Statutory Rules over Government Circulars

The Circulars dated June 18, 1982, March 17, 1983, and April 16, 1971, issued by the government, cannot override the statutory provision of Rule 74(b) of the Orissa Service Code if they result in a reduction of pay for the employee upon promotion. It is established that Statutory Rules framed under Article 309 of the Constitution can only be amended through proper legal procedures, not by executive orders or circulars. In this case, the appellant's pay fixation must adhere to Rule 74(b) of the Code, as it prevails over conflicting government circulars.

Conclusion:

The Supreme Court allowed the appeal, setting aside the High Court's order and restoring the Tribunal's decision. The appellant's pay is to be fixed in accordance with Rule 74(b) of the Orissa Service Code, ensuring no reduction in pay upon promotion. The State Government's challenge was dismissed, emphasizing the statutory protection provided by Rule 74(b) for government employees' pay fixation during promotions.

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