2022 (2) TMI 55 - SC - Indian Laws

Supreme Court Upholds MACP Scheme: Employees Entitled to Next Higher Grade Pay

The Director, Directorate of Enforcement & Anr. Versus K. Sudheesh Kumar & Ors.

The Supreme Court held that under the Modified Assured Career Progression (MACP) Scheme, employees are entitled to the immediate next higher grade pay as ... Entitlement of Assistant Enforcement Officer (AEO) to grade pay on third financial upgradation as per the Modified Assured Career Progression (MACP) Scheme - payment of pension with effect from April, 2015 - Scope of grade pay and promotional post - HELD THAT:- The issue involved in the present appeal is as such squarely covered by the decision of this Court in the case of UNION OF INDIA (UOI) AND ORS. VERSUS M.V. MOHANAN NAIR [2020 (3) TMI 1393 - SUPREME COURT]. By detailed judgment and order this Court has interpreted the very MACP Scheme and it is observed and held that under the MACP Scheme employees are entitled to the immediate next higher grade pay as given in Section 1, Part A of the First Schedule of the CCS (Revised Pay) Rules, 2008. It is specifically observed and held by this Court in the aforesaid decision that MACP has nothing to do with the next promotional post and what the employee would be entitled would be the immediate next higher grade pay in the hierarchy of the recommended revised pay bands and grade pay as given in the CCS (Revised Pay) Rules, 2008. On considering the relevant clauses of the MACP Scheme, it appears that the MACP Scheme envisages placement in the immediate next higher grade pay in the hierarchy of the recommended revised pay bands and grade pay as given in Section 1, Part A of the First Schedule of the CCS (Revised Pay) Rules, 2008. Thus, the High Court has committed a grave error in allowing the grade pay of ₹ 6600 the grade pay which was available to the next promotional post as Deputy Director. Respondent Nos.1 & 2 as per PB2 were entitled to the grade pay of ₹ 5400 as PB3 as per clause 8.1. By the impugned judgment and order and while granting grade pay of ₹ 6600 to respondent Nos.1 & 2 virtually, the High Court has modified the MACP Scheme which has been framed by the Government on the recommendations of the expert body like the pay commission and its recommendations for the MACP Scheme. As observed and held by this Court in the case of M.V. Mohanan Nair the ACP which is now superseded by MACP Scheme is a matter of Government policy and interfering with the recommendations of the expert body like the pay commission and its recommendations for the MACP Scheme would have serious impact on the public exchequer - thus the impugned judgment and order passed by the High Court granting grade pay of ₹ 6600 to respondent Nos.1& 2 is unsustainable and deserves to be quashed and set aside. The impugned judgment and order passed by the High Court is hereby quashed and set aside and the judgment and order that of the Central Administrative Tribunal is hereby restored. It is observed and held that on implementation of MACP Scheme respondent No.1 and 2 herein shall be entitled to the grade pay of ₹ 5400 and not of ₹ 6600 as claimed by them. Their pensions be refixed accordingly - Appeal allowed. Issues:Interpretation of the Modified Assured Career Progression (MACP) Scheme regarding grade pay entitlement under the scheme.Analysis:The case involves a dispute over the entitlement to grade pay under the MACP Scheme for two Assistant Enforcement Officers. The Government of India introduced the MACP Scheme for Central Government Civilian Employees in 2009. The Scheme specified that grade pay of Rs. 5400 in pay bands PB2 and PB3 should be treated as separate for upgradations under the scheme. However, an error occurred during the grant of the third financial upgradation to the employees, resulting in a grade pay of Rs. 6600 being given instead of Rs. 5400 as per the scheme. The Audit Department later corrected this error, leading the employees to approach the Central Administrative Tribunal seeking to retain the higher grade pay of Rs. 6600. The High Court allowed their petition, considering the next promotional post's grade pay of Rs. 6600, contrary to the MACP Scheme's provisions.The Supreme Court analyzed the issue in detail, citing the case law of M.V. Mohanan Nair, which clarified that the MACP Scheme entitles employees to the immediate next higher grade pay as per the Revised Pay Rules, irrespective of the next promotional post's grade pay. The Court emphasized that the MACP Scheme's provisions must be strictly followed, and any deviation would impact government policies and the public exchequer. Therefore, the High Court's decision to grant a grade pay of Rs. 6600 was deemed unsustainable and against the scheme's framework.The Court held that the employees were entitled to a grade pay of Rs. 5400 as per the MACP Scheme and directed the restoration of the Central Administrative Tribunal's decision. However, considering the retired status of the employees and the difficulty in refunding the pension difference, the Court ordered no recovery of the pension difference until December 2021. From January 2022 onwards, the pension would be recalculated based on the correct grade pay of Rs. 5400. The appeal was allowed with these directions, emphasizing adherence to the MACP Scheme's provisions and the Revised Pay Rules.