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Food Corporation of India etc. Vs. Om Prakash Sharma & Ors [1998] INSC 420 (14 August 1998)

S.C. Agarwal, M. Srinivasan, A.P. Misra Srinivasan, J.



Leave granted in S.L.P.

The Food Corporation of India (hereinafter referred to as Corporation) was established under the Food Corporation of India Act, 1945 (for short, the Act). Section 45 of the Act empowered the Corporation to make regulations for the purpose of giving effect to the provisions of the Act with the previous sanction of the Central Government. One of t he matters set out in sub-section 2 is `the method so appointment, the conditions of service etc. of the officer and employees of the Corporation other than the Secretary'.

For the first time in 1971 F.C.I. (Staff) Regulations were framed. Prior to that all matters relating to the service of employees were governed by Office Manual.

2. Under the 1971 Regulation, category 3 `comprised inter alia the posts of Assistant Grade I (for short AG-I), Assistant Grade- II (for short AG-II), Assistant Grade-III (for short AG-III), Typist and Telephone Operator in the General Administration Cadre as well as in the Godown Cadre.

The minimum educational qualification for the posts of AG I, AG II and AG III was graduation while it was matriculate for the other two posts. The mode of recruitment for the post of AG I was 100% promotion from the posts of AG II or Telex Operators failing which direct recruitment. The eligibility criterion was three years of service as AG II or Telex Operator. Th post of AG II was to be filled up by 100% promotion of those who had three years service as AG III, Typist or Telephone Operator failing which by direct recruitment.

3. On 1.5.1974 a circular was issued by the Corporation that it had been decided to make a differentiation at the time of first promotion from the recruiting grades between graduates and matriculates. According to the circular, the former would become eligible for promotion after three years of service while the latter would become eligible after five years of service. The circular also made it clear that promotions made in that manner will be made on provisional basis for the time being as a purely temporary measure and they may be regularised as son as formal amendment to the Regulations was made. On 22nd April, 1976 the F.C.I. (Staff) (30th Amendment) Regulations, 1976 was notified. It was deemed to have come into force on 1.5.74. That pertained to General Administration Cadre. Similarly F.C.I. (Staff) (43rd Amendment) Regulations, 1977 was notified on 10.2.77 with respect to Godown Cadre. The effect of the above amendments was to fix three years of service for graduates and five years of service for matriculates as eligibility criterion.

4. The validity f the amendments was challenged by four persons who were matriculates working as AG III in O.P. 1138/79 on the file of the High Court of Kerala. A learned Judge f that Court allowed the writ petition on 22.2.83 and quashed the same. The Corporation filed W.A. 430/1983 before a Division Bench of that Court. That appeal was withdrawn and dismissed. The 4th respondent in the writ petition who represented the graduates had filed W.A. 433/83 and it was pending.

5. Two similar writ petitions were filed before Andhra Pradesh High Court in W.P. Nos. 363 & 1168 of 1987 by non- graduates. Following the judgment of the Kerala High Court referred to above, the Andhra Pradesh High Court allowed the writ petitions. W.A. Nos. 905 & 907 of 1987 filed by the Corporation were dismissed by a Division Bench on 15.7.87.

After long delay the Corporation filed petitions for special leave in this Court. This Court refused to condone the delay and dismissed S.L.P. (C) Nos. 9387-88/1988 on 9.4.90. The Corporation's review petitions R.P. No. 449/93 was dismissed on 20.4.93.

6. Earlier in 1985, thirty non-graduates filed W.P.2835/85 on the file of the High Court of Madras. That petition was dismissed by a single Judge on the ground that identical matter was already pending in Kerala High Court.

The Petitioners filed W.A. 757/88 against the same. When the appeal was being heard, learned counsel for the Corporation stated on instructions that the amendment was withdrawn and consequential reliefs were given to the petitioners therein.

In view of that statement, the Division Bench set aside the order passed in the writ petition and observed that no reliefs need be given to the petitioners by the Court. It was represented to the Bench that four of the writ petitioners were not given relief by the Corporation. The Bench permitted them to approach the authorities of the Corporation for appropriate reliefs. When such representations were not considered favorably those petitioners filed Contempt Application 301/91 to punish the officers of the Corporation for contempt. The Zonal Manager of the Corporation who was the 1st respondent therein filed a counter affidavit in which he stated in para 2 as follows:

"It is respectfully submitted that the 43rd Amendment though was resolved to be withdrawn by the Board, the same was not withdrawn for want of Gazette Notification to this effect." In para 4 the same averment was repeated. It was further added :

"The Headquarters have instructed the Zonal Office to implement the judgment of the Andhra Pradesh High Court in W.P. Nos. 363 & 1168 of 1987." The pendency of some subsequent proceedings in Kerala High Court and an order passed therein were cited as reasons for not complying with the order of the Madras High Court.

The Division Bench did not accept the contentions of the Corporation and issued specific directions to promote the petitioners therein on the basis that the 43rd Amendment was withdrawn. Aggrieved thereby the Corporation filed SLP 16797/92 in this Court. We dismissed it by order dated 29.7.98.

7. In the meanwhile a Division Bench of the Kerala High Court took up for hearing W.A. 433/83 referred to by us in para 4 above. An order passed by the Corporation on 13.7.90 was produced before the Bench. It was stated in that order that a decision had been taken by the Southern Zone to implement the judgment of the Andhra Pradesh High Court in respect of Southern Zone including Kerala. In that situation the writ petitioners sought permission of the Court to withdraw the writ petition itself. Referring to the same, the Bench observed :

"It is in this background that Shri Dandapani the learned counsel for the contesting respondents, who are the writ petitioners, sought permission to withdraw the writ petition, O.P. No. 1138 of 1979 itself in the light of the decision taken by the Food Corporation of India, to apply the decision of the Andhra Pradesh High Court to the entire Southern Zone. Counsel for the Food Corporation of India submitted that a decision having been taken to repeal the impugned amendments and to restore the former provisions which treated the degree holders and matriculates on par for further promotion to the Cadre of Assistants Grade III, it becomes unnecessary for this Court to examine the validity of the impugned amended rules. In this background, we see not good reason for not according to the request of the petitioners in the writ petitions to withdraw the writ petitions itself, the corporation having taken the stand that the amended rules would be repealed and not given effect to. In view f the decision of the Food Corporation of India, what would stand revived will be the old rules." In such circumstances, the original writ petition was dismissed as withdrawn and the judgment of the single judge was set aside without expressing any opinion s to the correctness or otherwise thereof.

8. That order of the Kerala High Court was made on 26.11.90. On the same day, the Zonal Office of the Corporation issued Office Order No. 461/90/Esttt. I in the following terms :

"Consequent to the disposal of SLP 9387-88 of 1988 by the Supreme Court in their order dated 9.4.1990 and HQRS decision to withdraw the 43rd Amendment from the Food Corporation of India (Staff) Regulations, 1971 vide their telex message No. EP30 (10)/87 dated Nil July 1990 and Telex Massage No. EP 16(4) dated 14.9.90, the following officials are deemed to have been promoted provisionally to the post of Assistant Grade II (Deport) with effect from the dates noted against each." [List of officials omitted]...........................




"Consequent to the retrospective promotion to the post of Assistant Grade II(Depot) the above mentioned officials would be eligible for refixation of their pay on notional basis, but eligible for payment of arrears only from the actual date of joining in the post of Assistant Grade II (Depot). The seniority of the above officials in the post of Assistant Grade II (Depot) would be refixed and revised seniority list published shortly." Similarly another office Order N. 462/90/Estt.I was issued on the same day with another list of officials whose promotion was subject to Regional Vigilance Clearance.

9. The petitioner in W.P.(C) No. 20 of 1992 who belongs to the Godown Cadre in the South Zone has filed the writ petition challenging the said office orders. Besides praying for declaration that the said Office Orders are null and void ab initio, the petitioner prays also for declaring that the 30th and 43rd amendments still survive in the statute book, for issue of a mandamus restraining the respondents from rescinding the same and for declaring that the seniority list as it existed on 31.12.89 continued to hold good without prejudice to the content in of the petitioners that even the said list was not properly drawn.

10. Initially, the Corporation and the Zonal office (South Zone) of the Corporation were only made parties to the writ petition. Some non-graduates got themselves impleaded as respondents. By order dated 5.12.95, this Court, with a view to obviate multiplicity of proceedings, directed the writ petitioner to implead some or all of the non-graduates in the writ petition or some other non- graduates in a representative capacity, i.e. representing the body of non-graduates in the service of the Corporation all over the country. The petitioner filed an I.A. and the same was ordered on 8.1.96.

11. Even in 1988, a writ petition viz. C.W.P. 7160/88 was filed in the High Court of Punjab and Haryana by Some non-graduates challenging the seniority list prepared on the basis of 30th Amendment of the Regulations. The validity of the amendment was challenged. A single Judge of the High Court allowed the same by judgment dated 8.11.89 following the first judgement of the Kerala High Court and adopting the reasoning thereof. Some graduates were respondents therein. They did not challenge the judgment. But the Corporation filed LPA 635/90 against the judgment. The same was dismissed on 28.7.92 by a Division Bench which also pointed out that the graduate employees were not aggrieved by the judgment of the single Judge and thus the controversy did not survive. The Corporated has filed SLP(C) No. 7698 of 1993 against that judgment.

12. W.P.(C) No. 174/95 has been filed in this Court under Article 32, Constitutions of India by some non- graduate employees who were appointed as typist/telephone operators in 1971 t 1973 in the Northern Zone challenging the validity of the amendments. According to them the Corporation having decided to implement the decision of the Andhra Pradesh High Court in the South Zone cannot discriminate against the employees in the other zones and apply the amended regulations to them.

13. All the above three matters are thus concerned with the same controversy relating to the validity of the 30th and 43rd amendments of the regulations. When these matters came up for hearing on 21.4.98, this Court took note of the fact that the relevant material regarding the considerations which weighed with the Corporation in making the change in amendments. On the other hand it was stated repeatedly in the said counter affidavit that the Corporation had decided to implement the judgment of the Andhra Pradesh High Court.

In Paragraph 2 thereof, it was, averred, that Writ Appeal no. 430 of 1983 on the file of the Kerala High Court was withdrawn persuant to the decision of the Corporation to implement the judgment of the Andhra Pradesh High Court. It was also stated that the revision of the seniority list persuant to the implementation of the judgment of the Andhra Pradesh High Court could not be completed on account of a subsequent order of the Kerala High Court. It should be mentioned here that the subsequent order of the Kerala High Court which was passed in another writ petition challenging the revised seniority list was only to the effect that promotions made during the pendency of the writ petition would be subject to the result thereof. In short, the Corporation did not choose to place any material before the Court to justify the amendments. Strangely, no other graduate employee excepting the petitioner in writ petition no. 20 of 1992 has come before us to support the amendment.

As observed by the Division Bench of the High Court of Punjab and Haryana, the Judgment of the Single Judge of that High Court in writ petition 7160 of 1988 was not challenged by the graduate employees who were parties thereto. It was only after this Court passed an order on 21.4.1998 directing the Corporation to file an additional affidavit and place the relevant materials which weighed with it in bringing about the impugned amendments, the Corporation filed an affidavit as stated earlier.

15. In the said affidavit, the following passages are relevant :- "It is submitted that part-II of Appendix-I of the FCI (Staff) Regulations provided that the mode of recruitment in the post of Assistant Garde-I as 100% promotion failing which by direct recruitment and that the eligibility criteria was 3 years as Assistant Grade-II or Telex Operator. The mode of recruitment for the post of Assistant Grade-II was 100% promotion failing which direct recruitment and that the eligibility criteria is 3 years as Assistant Grade -III or as Typist or as Telephone Operators. A copy of the said part-II of the Appendix-I to FCI (Staff) Regulation, 1971 is annexed herewith and marked as Annexure - A/A/-e. It is submitted that as such the Typists and Telephone Operators were equated with Assistant Grade-III for the purpose of promotion to Assistant Grade-II and the Telex Operators were treated at par with Assistant Grade-II for the purposes of promotion to Assistant Grade-I. It is submitted that as such not only promotional avenues were opened for the first time too Telex Operators, Typist and Telephone Operators.

(who were till then available only for persons working as Assistant Grade-II or Grade-III respectively). It is submitted that in other words, the promotional avenues which were exclusively available to Assistant Grade-II or Grade-III respectively, were now open to others, namely the Telex Operators, Telephone Operators even without prescribing any quota for each of the categories made eligible for such promotions. It is submitted that an anomalous situation had arisen as a result, in as much as persons who are better qualified (minimum qualifications for being appointed as Assistant Grade-III is graduation) were treated equal to persons who are less qualified (minimum qualifications for appointment as Telephone Operators or Typists is Matriculation) for the purposes of promotion. It is submitted that the purpose of prescribing the minimum qualification as Graduation for appointment as Assistant Grade-III got defeated and in effect the entry point became `Matriculation' for those who entered the cadre as Typists or Telephone Operators. It is submitted that it was realised that it was not correct to equate the persons wh have higher academic qualifications (graduation) needing 4 more years of academic pursuit with these having lesser academic qualifications i.e. Matriculation.

It is submitted that as such, it was felt necessary either t create quotas or prescriber higher experience for those who are academically less qualified." ...................................




"It is submitted that it was felt that the non-existence of any quota resulting in treating the Typists or the Telephone Operators, who are generally Matriculate, at per with Assistant Grade III (whose minimum qualification was Graduation), was not only incorrect but also affected the efficiency of the ministerial staff to a great extent." ...................................




"It is submitted that it was felt that the differential criteria should be provided for the purpose of promotion for the category of Assistant Grade-III, Typist, Telephone Operator since Assistant Grade-III are graduates and the Telephone Operators, Typists are matriculates."

16. There is no attempt made in the affidavit to show that the nature of the work in the posts of AG-I or AG-II was such that it requires higher efficiency which could be expected only from graduates and not from non-graduates. In other words, there is nothing in the said affidavit to establish a nexus between the amendments and the alleged object of higher efficiency in the promotional posts of AG-I or AG-II. In the counter affidavit filed by a non-graduate respondent in the writ petition as early as in October, 1996, it was categorically stated that the duties to be carried ut by the persons holding the posts of AG-I and AG- II could be performed with equal efficiency by graduates as well as non-graduates. It was stated that the nature of the work in the two posts did not warrant a classification as graduates or non-graduates. It was pointed out that all the posts of AG-I and AG-III are clerical, non-selectional and non managerial. Along with the counter affidavit, the `job descriptions' of the three posts was also filed as an annexure. A perusal thereof shows that the nature of the work is not such as to make differentiation between graduates and non-graduates. It is seen from the `job descriptions' that a person holding the post of AG-III could be assigned with the same work as required to be performed by AG-I and AG-II but under close and immediate supervision of the supervisor. The Typists and Telephone operators are also expected to perform other duties listed for AG-III as required by their superiors. It is thus clear from the `job descriptions' that the duties performed by the typists and Telephone Operators as well as AG-III are similar in nature excepting that the typists and Telephone Operators are also attending to technical work on account of their technical qualification. None of the above matters has been touched upon by the Corporation in the additional affidavit filed as late as in May, 1998. This aspect has been rightly commented upon by learned counsel of the non-graduates.

17. In the counter affidavit filed on behalf of the non-graduates with our permission in the course of hearing in reply to the additional affidavit of the Corporation, it is reiterated that the non-graduates are performing the same duties as the graduates. The following passages in the said counter affidavit are relevant :- "The job description of Assistant Grade III and Assistant Grade II annexed by the deponent in his counter affidavit filed in the writ petition is marked as Annexure C-9 which is in the paper book of the writ petition from page Nos. 394 to 410. No justification whatsoever has been offered to the impugned amendments except a vague and self serving statement that efficiency was "affected" or "vitiated" to a great exrtent. The burden which the food Corporation of India was agreed to discharge was to show how having regard to the nature of duties of the pst, efficiency was affected. This burden has not even been attempted to be discharged.

The picture presented in para 3 of the affidavit tends t present a misleading picture as if the 30th amendment was introduced in order not to equate the typists and telephone operators with such of those AG.III [Gen] who possess qualification of graduation. These matriculate Asst. Gr.III [Gen] [Depot] were/are performing the duties of AG.III on par with Assistants Gr. III who possess qualification of Graduation. The duties and responsibilities of all the AG.III are one and the same and the salary paid is also the same.

It is reiterated that the typists apart from typing work are also attending to the work of AG.III as required in the job description.

The very fact that the work of AG.III [G] [Depot] are being carried out smoothly irrespective of officials possessing qualification f matriculation or graduation until this day clearly demonstrates that the qualification of matriculation is adequate to carry ut the nature of work prescribed for Assistant Grade III [Gen] and Assistant Grade III [Depot]. The nature of work prescribed in the job description vouches for this argument. It is also submitted that had the FCI management not been satisfied with the efficiency of the officials with qualification of matriculation as stated in the 3rd para of the affidavit it would not have gradually enhanced the quota from 10% to 20% and then to 30% for category IV employees [with minimum qualification of matriculation] for promotion to the post of AG. III (annexed as Annexure A-I).

The deponent further submits that prior tot he establishment of Food Corporation of India, the employees were working in the Food Department and the entry level post, i.e., Junior Clerk [which is equal to Assistant Grade - III] the qualification prescribed was only matriculation." ...................................




"That it is relevant to mention that pursuant to the orders passed by the Kerala, Madras and Punjab and Haryana High Courts and the Delhi High Court in its Judgment dated 11.01.1994 and 04.06.1981 in C.W.P. No. 3599 of 1993 and 4681 of 1993, the respondent Food Corporation of India-North zone issued office order dated 02.8.1995 and 11.08.1995 revising the seniority of Assistant Grade III [Min]/Typists numbering about 1206 rectifying the injustice created by the impugned amendments to the employees and similarly placed like the deponent in the North Zone as per the old regulations and only the employees of South Zone are suffering because of the inaction of the authorities in South Zone.

It may be relevant to mention that the revision is subject to the outcome of the petitions pending before this Hon'ble Court. A copy of the office order dated 02.08.1995 and 11.08.1995 are annexed herewith and marked as ANNEXURE A-3 [Collectively].

That the respondent Food Corporation of India have annexed annexures to the Additional Affidavit which are not at all relevant to the present dispute and nothing has been shown by them which would require such amendments to be carried out with retrospective effect. In fact, matriculates of FCI are holding the jobs of Assistant Managers and Deputy Manager [General]/District managers which is three and four steps respectively above the Assistant Grade-III level which is the post in dispute in the present proceedings. It is also submitted that the post of Assistant Manager and Deputy Manager are selection posts whereas the post of AG.III and AG.II are non-selection posts.

This clerical job of Assistant Grade III and Assistant Grade II can certainly be performed by matriculates with utmost efficiency when persons are thrust for such higher job, viz., Assistant Manager/Deputy Manager who are only matriculates. Extracts of all India integrated seniority list of Assistant managers [Gen]./Dept. as on 1984 is annexed as ANNEXURE A-4 and extract of all India integrated seniority of Deputy Managers [Genl.]/District Managers is annexed as ANNEXURE A-5."

18. Learned counsel for the petitioner in the writ petition and learned counsel for the Corporation have contended that the differentiation between a graduate and non-graduate in the matter of promotion is valid and in this case the same has been done by the impugned amendments in order to achieve higher administrative efficiency. Per contra the submissions made by a learned counsel for non- graduates are three fold :

(i) The amendments are arbitrary in the facts and circumstances of this case and violative of Articles 14 and 16 of the Constitution.

(ii) The amendments are invalid in so far as they are given retrospective effect so as to affect the promotion of non- graduates who became eligible for consideration for promotion by completing three years service as AG-III, Typist or Telephone operator before the amendment of the regulations.

(iii) The amendments should be read down to apply only to non-graduates who are working as Typists or Telephone operators and not to those who were working as AG. III having been promoted as such from category IV. The aforesaid second and third contention have been advanced only in the alternative to the first contention.

19. Our attention has been drawn to S.L. SACHDEV AND ANOTHER VERSUS UNION OF INDIA AND OTHERS (1980) 4 SCC 562.

It was held therein that once cadre is formed by recruiting persons drawn from different departments of the Government, there would normally be no justification for discriminating between them by subjecting one class to more onerous terms in the matter of promotional chances. It is observed that different tests should not be prescribed for determining their respective promotional opportunities and that too solely with reference to the source from which they were drawn. It was found on the facts that the duties, functions and responsibilities of all the UDCs in the Saving Banks Control Organisation and Savings Bank Interval Check Organization were identical and they were all in the same cadre drawing the same pay in the same grade and therefore different tests should not b laid for their promotion.

20. Learned counsel for the non-graduates referred to Kumari Shrilekha Vidyarthi and Other Versus State o U.P. and Others (1991) 1 SCC 212, wherein it was held that once it is shown that the impugned State action is uniformed by reason in as much as there is not discernible principle on which it is based, the burden would shift to the State to repel the attack by disclosing the material and reasons which held to the action being taken in order to show that it was an informed decision which was reasonable.

21. It is by now settled by several decisions of this Court that educational qualification is a proper basis of classification for promotion. In the State of Jammu & Kashmir Versus Shri Triloki Nath Khosa and Others (1974) 1 SCC 19, it was held that classification on the basis of educational qualifications made with a view to achieving administrative efficiency can not be said to rest on any fortuitous circumstance. The Constitution Bench which decided the case took care to add that one has always to bear in mind the facts and circumstances of the case in order to judge the validity of a classification.

22. In Mohammad Shujat Ali and Others Versus Union of India and Others (1975) 3 SCC 76, another Constitution Bench referred to the earlier rulings of this Court including Triloki Nath Khosa & Others (1974) 1 SCC 19 and stated the law thus :

"But from these decisions it cannot be laid down as an invariable rule that whenever any classification is made on the basis of variant educational qualifications, such classification must be held to be valid, irrespective of the nature and purposes of the classification or the quality and extent of the differences in the educational qualifications. It must be remembered that "life has relations not capable always of division into inflexible compartments". The moulds expand and shrink. The test of reasonable classification a has to be applied in such case on its peculiar facts and circumstances."

23. In Punjab State Electricity Board, Patiala & Another Versus Ravinder Kumar Sharma & Others (1986) 4 SCC 617, the challenge was of fixation of quota between diploma holders and non-diploma holders among linemen for promotion to Line Superintendent. Placing reliance on a passage in the judgment in Mohd. Shujat Ali & Ors. vs. U.O.I. & Ors. (1975) 3 SCC 76, the Curt upheld the judgment of the High Court and the courts below which struck down the fixation of quota for promotion. The Bench did not however, make any reference to Trilki Nath Khsa & Ors. (1974) 1 SCC 19. Authority & Ors. 1989 Supp. (1) SCC 116, this Court considered all the earlier cases n the subject and held that prescription of a longer period of experience for the diploma holders to be eligible for promotion to a cadre to be made from graduates and diploma holders was not violative of equality class. On the facts it was found that a report of an Expert Committee was taken into consideration for prescribing the requisite qualification. The Court took note of the fact that there may be cases where the differences in the educational qualification may not be sufficient to give any preferential treatment to one class of candidates as against anther. The Court said that whether the classification is reasonable or not must necessarily depend upon facts f each case and the circumstances obtaining at the relevant time.

Ors. 1989 (Supp (2) SCC 344, the Court held that ordinarily it is for the Government to decide upon the consideration which in its judgment should underlie a policy to be formulated by it. But if the considerations are such as prove to be of no relevance to the object of the measure framed by the government it is always open to the court to strike down the differentiation as being violative of Articles 14 and 16. On the facts of the case it was found that the conditions of employment and the incidents of service recognised no distinction between graduate and non- graduate officers and for all material purposes they were effectively treated as equivalent. It was pointed out that the history of the evolution of the Kerala Excise and Prohibition Subordinate Service had shown no uniformity either in approach or in object and that a consistent or coherent policy in favour of graduates was absent. It was also pointed that the cadre was one and graduates and non- graduates were equal members of the same. Their pay was found to be the same and the nature of the duties whether graduate or non-graduate was identical. Hence, it was held that the prescription of ratio dividing the quota of promotion between graduates and non-graduates was invalid as it violated of Articles 14 and 16 of the Constitution.

Ors. (1993) 2 SCC 340, this Court pointed out that since the decision in Triloki Nath Khosa & Ors. (1974) 1 SCC 19 this Curt had been holding uniformly that even where direct recruits and promotees were integrated into a common class, they could for purposes of promotion to the higher cadre be classified on the basis of educational qualifications. On the facts, it was found that the degree holders and diploma holders represented two different categories and since 1969 they were treated differently in the matter of pay, designation and in the matter of promotion though they were discharging identical functions and duties. It was also found that the ratio 3:1 had been in vogue between graduates and diploma holders since prior to 1965 and it was therefore permissible to the rule making authority if it thought it necessary in the interest f administration to limit the promotional chances of non-graduates to one out of four vacancies on the basis of academic qualifications.

Supply & Drainage Board & Ors. (1994) 6 SCC 282, this Court reiterated that higher educational qualification is a permissible basis of classification but the acceptability thereof will depend on the facts and circumstance of each case. In that case it was found that differentiation between degree holders and diploma holders was ancient and the former were given different designation and Gazetted status and higher scale of pay whereas diploma holders did not have such benefits. In such circumstances the Court Said :

"The aforesaid shows that higher educational qualification has relevance insofar as the holding of higher promotional post is concerned, in view of the nature of the functions and duties attached to that post. The classification has, therefore, nexus with the object to be achieved. This apart history also supports the differentiation sought to be made by the rule in question. We, therefore, uphold the classification as valid."

28. One of us (Justice Agrawal) spoke for the Division Bench which decided Rajasthan State Electricity Board Electricity Board & Anr. (1997) 3 SCC 103. The entire case law was traced in the judgment and it was held that educational qualifications could be made the basis for classification of employees in State Service in the matter of pay scales, promotion, etc. On the fact a and circumstances of that case, the court upheld a reservation of 25% vacancies for candidates possessing the prescribed additional qualifications and prescription on longer length of service for those who did not possess such qualifications for the purpose of promotion.

29. An analysis of the aforesaid rulings shows that the validity of the classification has to be judged on the facts and circumstances of each case. We have already pointed out that in the facts of the present case no material has been placed before us by the Corporation to Justify the amendments introducing a classification between graduates and non-graduates. We have also referred to the conduct of the Corporation which chose to accept the judgment of Andhra Pradesh High Court an d implement the same on the basis of which the Board decided to withdraw the amendments and representations were made to that effect in the High Courts of Kerala and Madras. As stated earlier, even in the affidavits filed in this Court, the Corporation has referred to the decision of the Board to withdraw the amendments.

30. In such circumstances we hold that the amendments to the Regulations making a differentiation between graduates and non-graduates in the matter of promotion for the posts of AG-I and AG-II offend the equality clause and are therefore unconstitutional.

31. In the view we have expressed above it is unnecessary for us to consider the alternative contentions put forward by the non-graduates with reference to the retrospective operation of the rule and the non- applicability of the rule to non-graduates holding the posts of AG-III. We would, however, for the sake of completion set out the list of decisions cited by learned counsel in support of the contention that the amendments are invalid insofar as they seek to have retrospective affect :

1. T.R. Kapur and Others Versus State of Haryana & Ors. 1986 (Supp) SCC 584.

2. P.D. Aggarwal and Others Versus State of U.P. and Others (1987) 3 SCC 622.

3. K. Narayanan and Others versus State of Karnataka and Others 1994 Supp. (1) SCC 44

4. Union of India and Others versus Tushar Ranjan Mohanty and Others (1994) 5 SCC 450.

5. Chairman, Railway Board and Others versus C.R. Rangadhamaiah and Others (1997) 6 SCC 623.

32. The last of the above cases has been decided by the Constitution Bench in which on of us (justice Agrawal) was member and he spoke for the Bench. It will be advantageous to quote the following passage in that judgment.

"In many of these decisions the expressions "vested rights" or "accrued rights" have been used while striking down the impugned provisions which had been given retrospective operation so as to have an adverse effect in the matter of promotion, seniority, substantive appointment, etc., of the employees. The said expressions have been used in the context of a right flowing under the relevant rule which was sought to be altered with effect from an anterior date and thereby taking away the benefits available under the rule in force at that time. It has been held that such an amendment having retrospective operation which has the effect of taking away a benefit already available to the employee under the existing rule is arbitrary, discriminatory and violative of the rights guaranteed under Article 14 and 16 of the Constitution."

33. If the principle laid down in the above judgment is applied here, there is no doubt that the impugned amendments in the present case can not operate retrospectively.

34. In the result, the impugned amendments are struck down as unconstitutional. The appeal filed by the Corporation and the Writ Petition (C) No. 20 of 1992 fail and are hereby dismissed. In Writ Petition No. 174 of 1995 prayer B is unnecessary and therefore negatived. The parties will bear their respective costs.


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