2007 (12) TMI 562 - SC - Indian Laws

Promotion Invalid Due to Exam Non-Compliance; Corrected by Department; Retirement Benefits Based on Original Position

Union of India (UOI) and Ors. Versus Narendra Singh

Union of India (UOI) and Ors. Versus Narendra Singh - TMI ISSUES PRESENTED and CONSIDEREDThe core legal questions considered in this judgment include:Whether the respondent's promotion to Senior Accountant was valid under the applicable statutory rules.Whether the Department's correction of the erroneous promotion was lawful.Whether the Tribunal and High Court's decisions to set aside the Department's correction were justified.Whether the respondent was entitled to a relaxation of the rules regarding the passing of the Departmental Examination for Accountants.Whether the respondent should be allowed to continue in the promoted position until retirement, despite the promotion being deemed invalid.ISSUE-WISE DETAILED ANALYSIS1. Validity of the Respondent's PromotionThe relevant legal framework includes the Indian Audit and Accounts Department (Senior Accountant) Recruitment Rules, 1988, which require that an Accountant must have three years of regular service and must have passed the Departmental Examination for Accountants to be eligible for promotion to Senior Accountant.The Court noted that the respondent had not passed the required examination and thus was not qualified for the promotion. The rules were framed under Article 148 of the Constitution, making them statutory in nature, and the promotion was therefore not in compliance with these rules.2. Lawfulness of the Department's CorrectionThe Court found that the Department's action to correct the erroneous promotion was lawful. Mistakes in promotion due to misinterpretation of rules can be corrected, provided due process is followed, including giving the employee an opportunity to show cause, as was done in this case.3. Tribunal and High Court's DecisionsThe Court disagreed with the Tribunal and High Court's decisions to set aside the Department's correction. The Tribunal had directed the authorities to consider the respondent's case for relaxation under Rule 5, but the Court found that the reasons for not granting relaxation were valid and in conformity with the statutory rules.4. Relaxation of RulesRule 5 of the Recruitment Rules allows for discretionary relaxation by the Comptroller and Auditor General of India. The Court found that there was no valid reason to relax the requirement of passing the Departmental Examination, as many other eligible candidates were awaiting promotion. The power to relax should not be used to perpetuate a mistake.5. Continuation in Promoted Position Until RetirementDespite the invalidity of the promotion, the Court considered the respondent's long service in the promoted position and his imminent retirement. It allowed the respondent to continue as Senior Accountant until his retirement date, December 31, 2007, but determined that his pensionary and retiral benefits should be calculated as if he had remained an Accountant.SIGNIFICANT HOLDINGSThe Court held that the respondent's promotion was invalid due to non-compliance with statutory rules requiring the passing of the Departmental Examination. The Department's correction of this mistake was lawful, and the Tribunal and High Court erred in setting aside this correction.'Mistakes are mistakes and they can always be corrected by following due process of law.'The Court established that discretionary powers to relax rules should be exercised sparingly and not to perpetuate mistakes, especially when eligible candidates are available.The Court concluded by allowing the respondent to remain in the promoted position until retirement but determined that his retirement benefits should reflect his original position as an Accountant.