United Bank Officers' Association And ... vs United Bank Of India And Ors. on 10 December, 1982

[Cites 11, Cited by 6]

Patna High Court

United Bank Officers' Association And ... vs United Bank Of India And Ors. on 10 December, 1982

Equivalent citations: 1983(31)BLJR185

1. United Bank of India was a Public Limited Company. By the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970, this Bank like many other Banks was nationalised. The assets of the Bank were transferred to the Union Government. Those who were in the services of the Bank were statutorily given certain protections. The Act, however, empowers the Board or Directors of the Bank to frame regulations for its employees. The Regulations with which we are concerned were framed in the year 1979 and are called 'United Bank of India (Officers' Service Regulations 1979. The Regulations have to be framed in consultation with the Reserve Bank of India and previous sanction of the Central Government is also necessary. Both these conditions are fulfilled in the instant case.

2. Before the present Regulations came into force, nine categories of posts were existing in the Bank. Under the Regulations only four grades of posts with seven scales, being Scale I to Scale VII, were envisaged. The four grades being Top Executive Grade (Scales VI and VII) Senior Management Grade (Scales IV and V), Middle Management Grade (Scales II and III) and Junior Management Grade (Scale I). Chapter II of the Regulations deals with grades and categorisation of posts. Chapter III is in relation to fitment of existing officers and promotees in the new grades and scales of pay. Chanter IV relates to appointment, promotion etc.

3. It is also clear that from tine to tine the Bank would have to pro-mote eligible officers from lower grade to the higher grade. For that purpose a promotion policy was laid down which is printed in the form of a booklet being effective from 1-1-1931. On the title page of the booklet it is stated as follows:
Approved by the Board of Directors at its meeting held on 5-2-1981 vide Resolution No. 8.

Previous to this, promotion policy and system of appraisal of officers was published in a printed booklet in December, 1976. On the basis of the promotion policy now laid down, a number of officers have been promoted to the next higher scale with effect from 1-8-1981. The petitioners are not amongst them. They, therefore, challenge the promotions aforesaid. A copy of the order of promotion is Annexure '1' to this writ application. They also challenge Annexure '12' the promotion policy, a reference to which has already been made. It is also prayed that an appropriate writ may be issued requiring the Bank to conform to the requirements of the Regulations as provided under Clauses 6 and 18 and the Government guidelines, which is Annexure '2' to this writ application, as according to the petitioners the promotion policy is not in conformity with the guidelines issued under Annexure 2. It may be stated that the issue of guidelines is envisaged under Regulation 6(2) itself, which states that for the purposes of categorisation of posts under Regulation 6(1). every Branch of the Bank shall be classified by the Bank in accordance with the criteria to be approved by the Central Government. It may be stated at this stage that the guidelines as contained in Annexure 2 have been modified by the Central Government under Annexure 'D/1' dated 4-1-1980.

4. This first contention of the learned Counsel for the petitioners is that for the purpose of categorisation of posts every Branch of the Bank has to be classified as small, medium, large or exceptionally large according to the criteria approved by the Government. This is the requirement of Regulation 6(2). It is only after the said classification that categorisation of posts can take place under Regulation 6(1). The fitment of officers in the various posts is the next step. Thus where there is no classification of the Branches of the Bank under Regulation 6(2), there can neither be categorisation of posts nor fitment of officers is the grades and scales of pay. Admittedly classification under Regulation 6(2) was not made before the impugned promotions. Hence all steps leading to the promotion of officers, as contained in Annexure 1, are illegal and fit to be quashed.

5. It would now be convenient to real Regulation 6 which is as follows:

6(1). Having regard to the responsibilities and functions exercisable, every post of an officer in the Bank shall be categorised by the Board or any authority specified by the Board in this behalf as falling in any one of the grades or scales mentioned in Regulation 4 and such categorisation may be reviewed by the Board or such authority.

Provided that the categorisation of the posts in existence on the appointed date shall be done before the expiry of two years from that date in accordance with guidelines of the Government, if any, and shall in respect of the posts in the senior management and top executive grades by done by a committee of the Managing Directors and such other persons as may be appointed by the Government for the purpose.

(2) For the purposes of categorisation of posts under Sub-regulation (1), every branch of the Bank shall be classified by the Bank, in accordance with criteria to be approved by the Government, as small, medium, large or exceptionally large category.

Regulation 7 states:

7. Subject to the provisions of Regulation 6, the various posts of officers in the Bank on the appointed date shall be categorised as specified in the Table below:
Table
Posts Grade in which placed

General Managers Top Executive Grade Scale VII
Deputy General Managers Top Executive Grade Scale VI
Assistant General Managers Senior Management Grade Scale V
Senior Staff Appointments Senior Management Grade Scale IV
Staff Officers' Grade-1
Staff Officers' Grade-II
and Officers in Grade-I
who have completed 16 years
satisfactory service as
Officers Middle Management Grade Scale III.
Officers' Grade-I with less
than 16 years service.
Officers' Grade-II and
Officers' Grade-III with 8
or more years of satisfactory
service as Officers Middle Management Grade Scale II
Officers' Grade-III with
less than 8 years service
as Officers Junior Management Grade Scale I.

6. It cannot be gainsaid that the Bank would have Branches in the four categories as mentioned in Regulation 6(2), Some would be small, others would be medium, a few would be large and still fewer exceptionally large. In order to assess the requirements of posts of different grades in each Branch this classification of the Branches was necessary. That is why classification made under Regulation 6(2) is to be followed by categorisation of posts.

7. Now two questions arise for consideration. They are;

(1) Can the fitment of existing officers in the new grades and scales of pay take place after coming into force of the Regulation or is it to be postponed till categorisation of post is made in accordance with Regulation 6.

(2) If the fitment factually takes place before the categorisation in accordance with Regulation 6, is it permissible to promote officers to the higher grades without the categorisation having been made under the said Regulation.

8. Taking up the first question, it appears to me that the language of Regulation 7 is peremptory. It says that the various posts of officers in the Bank or the appointed date (1-7-1979) shall be categorised as specified in the table above. On 1-7-1979 the officers were holding one of the posts as mentioned in Column I of the table. The corresponding posts have been indicated in Column 2, There does not appear to be any reason why the equivalence should not be determined. The said determination could not prejudice any one or act to his detriment. In this situation full effect must be given to the unambiguous words used In the Regulation. Fitment and categorisation must take place according to the mandate of the Regulation, as on the appointed date, irrespective of the fact whether the provisions of Regulation 6 have been complied with. It was suggested that the powers in Regulation 7 are subject to the provisions of Regulation 6. This is true. But this, in my opinion, only means that the said fitments shall not override any decisions taken under Regulation 6 or the action taken there under shall prevail.

9. It is to be observed that in the writ application no complaint has been made about any wrong fitment or categorisation having been done. It has also not been shown as to how, if action is taken under Regulation 7, it would act to the prejudice of any of the officers serving in the Bank. Indeed if any wrong fitment takes place internal remedy is provided in Regulation 13. This gives a right of appeal against erroneous fitment in the new scale of pay. The fitment in the new scale of pay follows the categorisation (See Rule 8)

10. It was contended by the contesting respondents that proviso to Regulation 6 is independent of Regulation 6(2). There is substance in this argument as well. The proviso contemplates categorisation of posts in existence on the appointed date before the expiry of two years from that date. If any guidelines are laid down by the Government they have to be followed. In the absence of the guidelines the other relevant regulation, namely, Regulation 7, alone provides the guidelines. The exercise of power is not dependent on the classification made under Regulation 6(2), In this view of the matter also no fault can be found with the categorisation of the existing posts or placement of officers in the new grades. I must also point out that the time fixed in the proviso is directory and not mandatory. Action taken even after two years does not become invalid on account of the limit of two years having been crossed in the matter of categorisation envisaged in the proviso to Regulation 6(1).

11. I now examine whether promotions can be made without classification of the branches under Regulation 6(2) and consequential categorisation under Regulation 6(1).

12. That fitment of officers, whether in conformity with proviso to Regulation 6(2) or otherwise, had taken place cannot be doubted. In paragraph 18 of the counter affidavit of the Bank it is specially stated that "The Officers' Service Regulations having come into effect on 1-7-1979 the officers were fitted in the new scale/grade having their seniority as on 30-6-1979". In the petition itself it has been stated in paragraph 5 that petitioner No. 3 has been fitted in Middle Management (Upper) (Scale-III) as per United Bank of India (Officers) Service Regulation 1979.

13. The relevant Regulations in relation to promotion are contained in Chapter IV of the Regulations. Regulation 14 states:
All appointments in, and promotions to, the officers grade shall be made by the competent authority in the light of the guidelines of the Government, if any.

Regulation 17 is as follows:

(1) Promotions to all grades of officers in the Bank shall be made in accordance with the policy laid down by the Board from time to time having regard to the guidelines of the Government, if any.

(2) For the avoidance of doubts, it is clarified that this regulation shall also apply to promotions of any category of employees to the Junior Management grade.

None of these Regulations make promotion dependent or subject to any other Regulation. The only limitation in relation to the exercise of power is contained in these two Regulations and that is that the guidelines of the Government have to be followed. In my view, therefore, the exercise of power of promotion is not dependent on the classification of the branches of categorisation as mentioned in Regulation 6. I have already said that the Regulations relating to promotion are not made subject to any other Regulation. Even the underlying object and the scheme of Service Regulations do not lead to the conclusion that the power to promote should be exercised only after the classification and categorisation as mentioned above. Oaring the coarse of argument no special reason was assigned as to how the pro notions would adversely affect the officers of the Bank or that complete justice would not be done in the matter of promotion if promotions are made without waiting for classification and categorisation even though fitment as envisaged in Rule 7 in the new grade has taken place. I also cannot discern any reason for postponing the promotions even after fitment of existing officers on the appointed date has taken place in the new grade.

14. It was contended that preparation of a seniority list on All India Basis is a must before promotions can be made. Reference was made to Regulation 18. It was contended that seniority list having been prepared from year to year seniority was undetermined and hence promotion was not possible. On behalf of the Bank it was contended that seniority list as on 30-6-1979 is maintained by the Bank as per Regulation 18(5) and consequently year to year seniority list is not of importance so far as the impugned promotions are concerned, being the first both of promotions after the coming into force of the Service Regulations. Regulation 18(5) states:
Nothing in this regulation shall affect the seniority among themselves of the officers as existing immediately prior to the appointed date.

Thus the position as on 30-6-1979 having been determined inter se seniority among those officers is not affected. Only retirement, resignation or death affect the position of the officers in the seniority list as maintained by the Bank. In the writ application it has not been averred that (except for petitioners 3 and 4 whose individual cases shall be dealt with separately) there has been any wrong determination of seniority or any officer has been adversely affected in relation to his promotional prospect in view of wrong assumption regarding seniority. The failure to publish the seniority list of officers each year does not in my opinion, affect the impugned promotion.

15. It was contended that the seniority list of the year 1979 on which reliance was placed during the course of argument was not published. I need not. go into this controversy as I have already indicated that it had not been shown even during the course of argument that any person has been adversely affected because of wrong assumption in relation to his seniority.

16. The attack on the promotion policy was two-fold It was contended that the policy is not according to the guidelines laid down by the Central Government ; and, secondly, the guidelines do not provide objective assessment for determining the suitability for promotion. The governmental guidelines provide that promotion from one scale to another or from one grade to another shall be on the basis of merit, with weightages, if any, for seniority, educational/professional qualifications etc., as may be prescribed by the Board from time to time. Thus, it would be seen that wide discretion is given to the Board in formulating promotional policy. Clauses 3.3(b) and (c) of the Policy lay down the method of reckoning the length of service in Middle Management Scale Grade II and Middle Management Scale Grade III. It was contended that this is in conflict with paragraphs 3.1 to 3.3. What, however, has been lost sight of is that Clause 3 as a whole deals with seniority. The various sub-paragraphs have to be read together to find out the true meaning and effect on the promotion policy. It is not that one sub-paragraph supersedes the other. In Clause 3.3(b) and (c) the length of service in erstwhile officers grade III is ignored for the purpose of reckoning the length of service completed in Middle Management Grade Scale II. Similarly the length of service in the erstwhile officers grade I is ignored for the purpose of reckoning the length of service completed in Middle Management Grade Scale III. I do not find any unreasonableness in this. It would be noticed that in Regulation 7 (which has already been quoted) three grades of erstwhile officers are eligible to be fitted in Middle Management Grade Scale II and Scale III posts. It is only the last category included in that grade whose length of service is not to be taken into account. Indeed, it would have been inequitable if the length of service of officers in the erstwhile senior posts had been equated with those of the junior most posts. As to whether even in the junior most post some period should have been taken into account or not is a matter of policy which the Board has to determine. We do not have material on the basis of which the petitioners could successfully contend that there is irrationality in the policy.

17. It was contended that paragraphs 6.5.1 and 6.5.2 of the Policy are unreasonable and arbitrary as the marks allotted for interview are sufficient to write off the marks obtained for professional qualification in banking and the seniority factor. Strong reliance in this connection was placed on a decision of the Supreme Court in the case of Ajay Hasia v. Khalid Mujib . It has to be observed that Ajay Hasia's case related to admission in an Engineering College. The allotment of 33 1/3% marks for oral interview was held to be arbitrary and unreasonable. The time allotted for interview was between 2 to 3 minutes on an average. Of course, there is an observation in the judgment which may lead to the conclusion that the discussion in the judgment is also relevant in relation to public services. The other case relied upon was Miss Arti Sapru v. State of Jammu and Kashmir . This case related to admission in Medical College. There 30 per cent mark was allotted for viva voce examination. The average time devoted to oral interview of each candidate was 4 minutes. In that context relying on Ajay Hasia's case and other cases (all relating to admission in educational institutions) it was held that the allotment of 30 per cent mark was excessive. But the case more directly in point is the case of Lila Dhar v. State of Rajasthan . The Rajasthan Judicial Service Rule prescribed 25 per cent marks for oral interview in the case of selection of Munsifs. This was held to be free from constitutional vice. Dealing with Ajay Hasia's case, it was held that the observations in that case relating to public employment were per incuriam. It was further held that the weight to be given to the interview test should depend on the requirement of the service to which recruitment is made, the source materials available for recruitment, the composition of the Interview Board and several like factors. Appendix I to the promotion policy shows that for lower grades marks allotted for interview are less as compared to those of higher grades. The qualities of initiative and to some extent leadership required in senior posts cannot be evaluated through written tests and the like. In the words of Chinnappa Reddy, J.
...there are yet no written tests which can evaluate a candidate's initiative, alertness, resourcefulness, dependableness, co-operativeness, capacity for clear and logical presentation, effectiveness in discussion, effectiveness in meeting and dealing with others, adaptability, judgment, ability to make decision, ability to lead, intellectual and moral integrity. Some of these qualities may be evaluated, perhaps with some degree of error, by an interview test, much depending on the constitution of the interview Board.

In the instant case the average time taken in the interview was nearly 1ft minutes. Detailed sets of questions were given to the interview Board. The file of past performance of each officers was available to the Board. The personnel of interview Board consisted of two outside experts and one representative of the Bank. In my view, therefore, the principles laid down in Lila Dhar's case (supra) are applicable in the instant case. The allotment of percentage of marks for interview on a sliding scale has not been shown to be arbitrary or unreasonable by the petitioners. It need hardly be emphasised that the initial onus to show unreasonableness is on the petitioners and only when the initial onus has been discharged that the burden shifts on the respondent Bank. Here, however, I am of the view that the allotment of marks for interview as mentioned in Appendix I to the promotion policy was not arbitrary.

18. It was contended in the oral submission to the Court that the Bank had dropped the written test in the case of promotion from Junior Management Scale 1 to Middle Management Scale II. This was not justified. In my view, the dropping of written test would not bring infirmity in the promotion policy when, as is shown by Appendix I itself, seniority factor, professional qualification in banking, performance on the job and potentiality for growth and development are taken into account. Written test cannot be said to be a necessary requirement for determining the suitability for promotion in management posts of a Bank. It will also be observed that petitioner No. 1 and other Unions have been agitating for the dropping of the written test.

19. It was contended that the promotion policy was published in June 1981 and approved by the Board on 24-7-1981. The promotion process including interview were held prior to the formulation of the policy. The promotions were thus made in the absence of any promotion policy and for this reason also the promotions were liable to be quashed This contention, in my view, cannot be accepted. The Board of Directors held its meeting on 5-2-1981. In that meeting it was resolved as follows:
Resolved that promotion policy submitted under Note No. M.D.T.P./15/P01/26/81 dated 24-7-1981 by the Chief Officer, Management Service be and is hereby approved subject to amendments as agreed in in the meeting and set out in the annexures to the minutes.

It would thus be seen that the policy was specifically approved in the meeting held on 5-2-1981. In the meeting held on 30-3-1981 the following resolution was passed;
Resolved further that the revised annexure relating to promotion policy, referred to in Resolution No. 2 of the minutes as placed before the Board under cover of the Note dated 28-3-1981 of the Chief Officer Management Services be and is hereby recorded.

The contention that it was in July 1981 that the promotion policy was formulated is based upon the following statement in the counter-affidavit (page 131 of the brief):
Even the promotion policy after having been finalised and published in booklet form was placed before the Board on 24th July, 1981, as item 18(i) and the Board unanimously approved the promotion policy as printed in the booklet form, copy of which has been attached with the writ application.

But there also it is made clear that the policy was finalised earlier and it was the booklet from which was placed before the Board and the form in which it was printed was also approved. I have already quoted earlier the two resolutions of the Board. They make it abundantly clear that the Policy was first approved in the meeting held on 5-2-1981. The language of the resolution is quite clear. It says that the promotion policy "be and is hereby approved subject to certain amendments as agreed in the meeting". The meeting held on 30-3-1981 only confirmed the earlier proceeding and the promotion policy as revised was placed for information. The booklet which is annexure to the writ application itself states:
Approved by the Board of Directors at its meeting held on 5-3-1981 vide resolution No. 8.

It also states that it is effective from 1-1-1981. The contention of the petitioners cannot, therefore, be accepted.

20. Learned Counsel contended that the interview Board was not constituted in conformity with Clauses 6.5.1 of the promotion policy. This argument is based on a belated affidavit filed in Court when the case was taken up for hearing on 23-9-1982, a copy of the said affidavit having been served on counsel for the other side only a day earlier (22-9-1982). Since the assertions made in the affidavit relate to questions of fact, I am of the view that without amendment of the writ application having been allowed and without an opportunity having been given to the respondents to meet the case, the petitioners cannot be permitted to raise a new plea relating to facts.

21. It was contended that the promotion was bad on account of fewer number of candidates having been called for interview than indicated in the Government guidelines (Annexure 2). This argument is confined to the cases of petitioners 3 and 4 as made out in paragraph 28 of the writ petition. Paragraph 3 of the Governmental guidelines states the minimum eligibility in terms of number of years of service for promotion from one officer's scale to another. For promotion from Junior Management Grade. Middle Management Scale II and Middle Management Scale III, the minimum period of satisfactory service prescribed is 7 years, 8 years and 5 years respectively. The guidelines lay down in paragraph 4 that where the number of eligible officers is less than three time the number of posts available in the next higher scale/grade, the eligibility aforesaid may be relaxed suitably. The promotion policy permits the relaxation from 7 years to 5 years in the case of Junior Management Grade and from 5 years to 3 years in the case of Middle Management Scale II and 4 years in the case of Middle Management Scale III. Thus the maximum relaxation which is possible has itself been laid down. It is stated in Annexure "M" to the Bank's counter-affidavit that as against 30 available posts only 70 candidates who had the minimum length of service of 4 years in Scale III were available and they had all been called for interview. The extent to which relexation should be given is a matter of administrative policy. It is for the competent authority to decide the extent of relaxation. The effect of the governmental guidelines is not that, come what may, the candidates for interview for each post must always be three times the number of available posts.

22. It was contended that petitioners 3 and 4 were eligible for promotion to Senior Management (Lower) Scale IV. They were eligible for being called for interview. In spite of this they were not so called. Respondent No. 56, who had evidently inferior claim to that of petitioner No, 4, was called for interview, thereby violating Article 16(1) of the Constitution. It was contended that the length of service of petitioners 3 and 4 in Grade I should have been taken into consideration. But that would be contrary to the promotion policy as contained in paragraph 3.3(c). The validity of this provision has already been considered. In that view of the matter, the length of service in Grade I has rightly been ignored for the purpose of assessing the eligibility of petitioners 3 and 4. It was contended that petitioner No. 3 was appointed as a Staff Officer Grade II on 6-1-1977. He was thus eligible for being considered for promotion to Senior Management Grade IV. The Bank, on the other hand, contends that the relevant date for reckoning the eligibility is not date of appointment on officiating basis but the date of confirmation. Petitioner No. 3 was appointed on officiating basis 6-1-1977 and confirmed on 6-7-1977. If the date of confirmation is relevant, it can not be disputed that he was ineligible for being considered for promotion. Reference in this connection is made to the previous promotion policy, Clause 9 whereof reads as follows:
A general condition applicable in all cases of promotion is that an officer selected for promotion is placed in a position of higher responsibility for a period of six months, after which his promotion is given effect to subject to his having performed satisfactorily in that post for that period.

This clause permits the performance of an officer to be watched for six months. If his performance is not satisfactory he may be brought down to the lower post from which he has been promoted. But when the performance is satisfactory he continues in the promoted post. This clause, in my view, does not mean that even if an officer has not been brought down yet his entry into the promoted post is to be reckoned from a date on the expiry of six months from promotion. In my opinion, for the purpose of reckoning the period of service in the promoted post, his continuous officiation in the promoted post is to be taken into account. Thus, for the purpose of reckoning the period of service as Staff Officers Grade II post, the entire period for which petitioner No. 3 has been officiating on the post must be counted. Similar would be the position so far as petitioner No 1 is concerned. There is some dispute with respect to the date on which petitioner No. 4 was appointed on officiating basis. According to the Bank it was 24-2-1977. He was confirmed on 23-8-1977 and thus he was ineligible for promotion. But if the officiating period is also to be taken into consideration and counted as service in the relevant grade, he too would be eligible. I am, therefore, of the view that petitioners 3 and 4 were both eligible for being considered for promotion. They are thus entitled to appropriate relief by this Court. Taking the totality of the circumstances into consideration I am of the view that instead of quashing the impugned promotions a direction should be given by this Court to the Bank respondent requiring it (a) to consider the case of petitioners 3 and 4 for promotion by constituting an Interview Board in accordance with the guidelines and promotion policy. If possible, the assistance of those who had earlier held the interview should be obtained; and (b) in case these petitioners, or either of them, is found fit for promotion, he or they should be promoted with effect from the date either juniors have been promoted. They should be given all the benefits in relation to pay and seniority retrospective.

23. In the result, the writ application of petitioners 3 and 4 is allowed to the limited extent as indicated above but is dismissed in relation to the other reliefs claimed in this writ application. In the circumstances, there will be no order as to costs.

Lalit Mohan Sharma, J.

24. I agree.

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