Central Administrative Tribunal - Ernakulam
Venugopalan Nair N C vs Southern Railway on 14 November, 2022
1 O.A No. 180/00501/2020
CENTRAL ADMINISTRATIVE TRIBUNAL
ERNAKULAM BENCH
Original Application No. 180/00501/2020
Monday, this the 14th day of November, 2022.
CORAM:
HON'BLE Mr. JUSTICE K. HARIPAL, JUDICIAL MEMBER
1. Venugopalan Nair N.C, aged 60 years,
S/o. Chellappan Nair,
Retired Station Superintendent, ERM,
Trivandrum Division, Southern Railway.
Residing at : Narekkattu House, Pindimana P.O.
Kothamangalam, Ernakulam District - 686 692.
2. Raju P.V., aged 60 years,
S/o. P.P. Varkey,
Retired Station Superintendent, Aluva,
Trivandrum Division, Southern Railway.
Residing at : Palakkadan House, Keezhillam P.O.,
Ernakulam District - 683 541. - Applicants
[By Advocate : M/s. Varkey & Martin]
Versus
1. Union of India represented by the General Manager,
Southern Railway, Park Town, Chennai - 600 003.
2. The Senior Divisional Personnel Officer,
Southern Railway, Trivandrum Division,
Trivandrum - 14.
3. The Senior Divisional Finance Manager,
Southern Railway, Trivandrum Division,
Trivandrum - 14.
4. The Railway Board,
Railway Bhavan, New Delhi - 110 001,
Represented by its Chairman. - Respondents
[By Advocate : Mr. S.R.K. Prathap, ACGSC]
The application having been heard on 18.10.2022, the Tribunal on
14.11.2022 delivered the following:
2 O.A No. 180/00501/2020
O R D E R :-
The applicants in this Original Application had commenced service in Southern Railway, Palghat Division as Assistant Station Masters on 20.09.1983 and 21.09.1983 respectively. At that time, they were drawing at the scale of Rs. 330-560. During the 6 th Pay Commission, the corresponding scale is with GP 4200 and in the 7 th Pay Commission, it is at Level-6.
2. According to the applicants, they were promoted as Station Master Grade-III while working in Palghat Division on 10.02.1986 at the revised scale of Rs.1400-2300 with corresponding scale having Grade Pay of Rs. 4200/-. While so, on their application, both of them were transferred to Trivandrum Division on 12.11.1992 and 13.11.1992 respectively. It is stated that they joined Trivandrum Division at the bottom level forgoing their seniority, in the category of Assistant Station Master. But from 01.02.1992 (sic.) they were promoted as Station Master Grade III in Trivandrum Division. Later, on 12.10.2005, both of them were promoted as Station Maser Grade- II. Both of them were granted financial upgradation with effect from 01.09.1998 at Rs. 9300-34800 + 4600/- as Grade Pay at Level 7 and with Grade Pay of Rs. 4800/- at Level 8 towards as 3 rd MACP. Both of them were later promoted as Station Superintendents on 3 O.A No. 180/00501/2020 01.11.2013 and then retired from service on superannuation on 31.12.2019.
3. The grievance of the applicants is that by Annexure A-1 and A-2 notices, both of them were informed that 3 rd MACP granted to them with Grade Pay of Rs. 4800/-was incorrect and thus amounts granted to them towards the said hike was sought to be recovered. Annexure A-1 and A-2 are the show cause notices for which they gave replies. However, by Annexure A-5 and A-6 respectively the respondents have recovered an amount of Rs. 2,65,173/- from the terminal benefits of the 1st applicant and Rs. 1,48,108/- from the terminal benefits of the 2nd applicant. Aggrieved by the same, they have approached this Tribunal for quashing Annexure A-1 and A-2 communications, seeking to call for the records leading to Annexure A-10 and quash the same and also seeking declaration that the applicants are entitled to restoration of service benefits and retirement benefits withdrawn and amounts recovered in terms of Annexure A-1 and A-2 orders and to quash Annexure A-5 and A-6 to that extent. Similarly, respondents are sought to be directed to sanction and disburse the retirement benefits to the applicants as if Annexure A-1 and A-2 have not been passed and to refund the gratuity with interest. 4 O.A No. 180/00501/2020
4. According to the applicants, the contentions of the respondents are incorrect. The statement that they are not entitled to get the MACP with Grade Pay of Rs. 4800/- is illegal and unauthorised. In fact, according to them, it is true that while working at Palghat as Assistant Station Masters both of them were promoted as Station Masters Grade-III on 10.02.1986. However, on getting inter- divisional transfer to Trivandrum, the scale of pay was not protected. In Trivandrum Division, they continued to draw the same pay that they drew in Palghat Division in the scale of Rs. 1400-2300 and this aspect was not considered while issuing Annexure A-1 and A-2 orders. In this connection, referring to Annexure A-7 Office Memorandum dated 04.10.2012 of the Department of Personnel and Training, it was pointed out that the Department has clarified that whenever an official, in accordance with the terms and conditions of transfer on own volition to a lower post, is reverted to the lower post/grade from the promoted post/grade before being relieved for the new organisation/office, such past promotion in the previous organisation / office will be ignored for the purpose of MACPs in the new organisation/office. So, according to the learned counsel for the applicants, the promotion granted at Palghat as Station Master Grade- III is liable to be ignored for the purpose of granting MACP in Trivandrum Division. In that view of the matter, the challenge 5 O.A No. 180/00501/2020 against the grant of MACP with Grade Pay of Rs. 4800/- has no basis at all. Referring to Annexure A-8, the learned counsel submitted that the communication dated 31.01.2013 issued by the Railway Board stated that 'in respect of those cases where benefit of pay protection had been allowed at the time of unilateral transfer to other organization/unit and thus the employee had carried the financial benefit of promotion, the promotion granted in previous organization has to be reckoned for the purpose of MACP Scheme'. According to the learned counsel, Annexure A-8 communication is in contrast to the directions issued by the Department of Personnel & Training and therefore, illegal. The learned counsel also pointed out that realising this mistake, through the communication dated 23.11.2016, clarification given in Annexure A-8 by the Railway Board stands modified. Therefore, Annexure A-7 O.M. prevails. According to the learned counsel, on being transferred to a different division, fixation of salary on promotion should be done as per Annexure A-11. In other words, on being transferred and posted at Trivandrum Division and on the date of promotion of Station Master-III with effect from 01.02.1992, they ought to have been given refixation, but that was not granted. Referring to Annexure A-10, the learned counsel submitted that it is clearly in violation of Annexure A-7 communication of the Department of Personnel and Training and 6 O.A No. 180/00501/2020 therefore, Annexure A-10 is liable to be quashed. According to the learned counsel, the applicants have retired as Station Superintendents in Group C and at any event, if at all any amount is liable to be recovered, the action is bad in the light of the decisions in State of Punjab v. Union of India in Rafiqu Masih (Whitewasher) (2015) 4 SCC 34. He also placed reliance on a decision of the Madras High Court in Writ Petition No. 38124 and also the judgment of the Hon'ble Supreme Court in Madhya Pradesh Medical Officers' Association v. State of Madhya Pradesh and Others. Similarly, reliance was also placed on Thomas Daniel v. State of Kerala & Others (2022 Live Law SC 438).
5. On the other hand, on behalf of the respondents, a reply statement was filed by the 2nd respondent challenging the very maintainability of the O.A. The crux of the contentions of the respondents is that the applicants were granted promotion as Station Master Grade III while they were working as Assistant Station Masters in Palghat Division and later, they were transferred to Trivandrum Division on 13.11.1992 on reversion as Assistant Station Masters. They were promoted as Station Master III in Trivandrum Division with effect from 13.11.1992 itself and later, both were promoted as Station Master II on 11.08.2005 in the scale of Rs. 7 O.A No. 180/00501/2020 1400-2300 with Grade Pay of Rs. 4200/- in the 6 th Pay Commission. Subsequently, the scales of Station Masters II and III were merged into Rs. 5200-9000 with Grade Pay of Rs. 4200/- and that was treated as single promotion. Later, both were granted two financial upgradations under the MACP Scheme to the scale of Rs. 9300- 34800 with Grade Pay of Rs. 4600/- and with Grade Pay of Rs. 4800/- both with effect from 01.09.2008. Later, when it was realized that the grant of 3rd MACP in Grade Pay of Rs. 4800/- was incorrect and therefore, over payments made thereunder were sought to be recovered as per the refixation of pay as detailed in Annexures A-1 and A-2. That was recovered from the amounts payable to them, it is not liable to interfered with. Therefore, the application is sought to be dismissed.
6. I heard the learned counsel on both sides. The personal profile of both the applicants are almost on similar lines. Both of them had joined as Assistant Station Masters in Palghat Division on 20.09.1983 and 21.09.1983 respectively. There is also not much dispute on the dates except some small variations on which promotions were given. But, it has come out that both of them were transferred to Trivandrum Division in November, 1992 and it is the rule that when they were shifted on transfer from one Railway Division to another Division, 8 O.A No. 180/00501/2020 they are bound to forfeit their seniority in the cadre and will join the new Division at the bottom of the cadre. Thus, both of them were admitted as Assistant Station Masters in Trivandrum Division on 12.11.1992 and 13.11.1992. As evident from Annexure A-11, even though they lost their seniority and were placed at the bottom of the seniority list, the Railways is bound to protect their pay, which was done. In other words, even though they had joined Trivandrum Division as Assistant Station Master, their pay was protected.
7. In the O.A, the applicants have stated that they were not granted any pay protection in the grade of Assistant Station Master while joining Trivandrum Division. This statement has been stoutly denied by the respondents. According to them, when they had joined duty as Station Master in Trivandrum Division in November, 1992 their pay was protected and that is evident from the documents produced by the applicants themselves. Applicants did not file any rejoinder also.
8. From the materials made available before the Tribunal, it is pertinent that the applicants were granted promotion while they were working as Assistant Station Master in Palghat Division and then while working as Station Master Grade-III they were transferred to Trivandrum Division. At that time, as noticed earlier, they are bound 9 O.A No. 180/00501/2020 to forgo the earlier promotion and joined Trivandrum Division as Assistant Station Master. The learned counsel for the applicants submitted that they have never worked as Assistant Station Master in Trivandrum Division, that they were promoted as Station Master Grade-III on the very same day. Copies of proceedings are not made available. It may be possible that after joining duty as Assistant Station Master in Trivandrum Division adopting bottom seniority, they might have been promoted as Station Master-III on a later occasion with retrospective effect from the date on which they had joined Trivandrum Division. Whatever it may be, for the reason that dates of joining duty at Trivandrum Division as Assistant Station Master and date of promotion as Station Master Grade-III happened to be the same, it cannot be stated that they were allowed to join duty in Trivandrum Division as Station Master Grade-III. Such a course cannot be allowed because the rule position is that, once Division is changed, the transferee is bound to forgo earlier seniority and should join duty as the junior most in the cadre in the new Division.
9. The learned counsel submitted with reference to Annexure A-11 that when they were promoted as Station Master Grade-III in Trivandrum Division they were not granted fixation as provided under the rules. But as a matter of fact, it has come out that when 10 O.A No. 180/00501/2020 they joined duty in Trivandrum Division, they were granted pay protection. That protected pay includes the pay fixed in Palghat Division on their being promoted as Station Master Grade III on 10.02.1986. The very same process cannot be repeated in Trivandrum Division since the pay stood protected and there is no complaint that their scale was brought down to that of Assistant Station Master.
10. The philosophy and purport in granting Assured Career Progression or MACP, as the case may be, is to ensure periodical hike in emoluments of numbers staff who are not given promotion. In other words, it is intended to avoid stagnation of the employees in a particular cadre. If any promotion is granted during the period in question, they are not entitled to get MACP. As rightly pointed out by learned Standing Counsel for the respondents, the MACP Scheme envisages three financial upgradations on completion of 10, 20 and 30 years. If they were granted any promotion in the interregnum, the question of claiming MACP does not arise. The specific case of the respondents is that both of them were granted promotion from the cadre of Assistant Station Master to Station Master in February 1986 while they were working in Palghat Division. Later, they were transferred to Trivandrum Division and then even though they were 11 O.A No. 180/00501/2020 allowed to join duty as Assistant Station Master; from the very day in November, 1992 onwards they were granted promotion as Station Master Grade-III. It is the common case that they were promoted as Station Master Grade II in August, 2005; at that time the pay scales of both Station Grade II and Station Master Grade III were merged with Grade Pay of Rs. 4200/- and promotion was treated as single promotion. That means, by the time they were granted promotion as Station Masters with effect form 11.08.2005 they had obtained 2 nd financial upgradation. Then it is the common case that both were granted financial upgradation in the scale of Rs. 9300-34800 with Grade Pay of Rs. 4600/- at Level 7 with effect from 01.09.2008. This was the 3rd financial upgradation. Both the parties agree that with effect from 01.09.2008 itself 3rd MACP was granted to them with Grade Pay of Rs. 4800/-. The grant of 3rd MACP is the subject matter of dispute. Realising that it was an error or mistake happened on the part of the Railway authorities, by Annexure A-1 and A-2 orders that benefit was recalled and their scales were refixed and amounts paid in excess were recovered from the terminal benefits. Thus, a sum of Rs. 2,65,173/- was recovered from the amounts payable to the first applicant. Similarly, Rs. 1,48,108/- was recovered from the amounts payable to the 2nd applicant. Aggrieved by the same, they made representations, which were rejected and thus Annexure A-5 and A-6 12 O.A No. 180/00501/2020 were passed whereby that much amount were already recovered.
11. Referring to Annexure A-7, it was pointed out that promotion obtained in the previous organization is liable to be ignored. That is an Office Memorandum issued by the Department of Personnel and Training. Annexure A-8 indicates that the Railway insisted that in respect of those cases, where benefit of protection have been allowed at the time of unilateral transfer to other organisations/unit, and if the employee had carried the financial benefit of promotion, the promotion earned in the previous organization has to be reckoned for the purpose of MACP Scheme. In other words, the Railway has taken different stand with regard to the claims raised by the applicants. It is true that in Annexure A-9, they made a retreat, but Annexure A-10 communication suggests that it has come back to the position conveyed through Annexure A-8. In Annexure A-10, which is the communication issued by the Railway, it is shown as below :-
"Clarifications were sought by some divisions/units whether the benefit of fixation earned due to the higher grade in the previous organization is to be reckoned for the purpose of MACPs or to be ignored in the new organization in view of RBE 147/2015.
In this connection, a reference was made to Railway Board vide this Railways letter of even No. dated 21.03.2016 and now the Board vide letter No. PC-V/2009/MCP/9/SR dated 18.04.2016 (copy enclosed) have clarified that the cases of employees who seek transfer to lower post earning promotion in the old organization and benefit of pay fixation has been protected at the time of joining new organization on reversion, then the promotion earned in the previous organization has to be reckoned for the purpose of MACPS."13 O.A No. 180/00501/2020
This is a communication issued by the Southern Railway on 26.04.2016 on the basis of the communication issued from the Railway Board. The applicants cannot be heard to say that the respondents should ignore this communication which is squarely applicable in the case of the applicants. In other words, the benefits accrued by the applicants by virtue of the promotion obtained by them in Palghat Division when they were promoted as Station Master Grade - III, which was protected when they were transferred to Trivandrum Division cannot be ignored. It is true that the Railway has taken prevaricative stands. Basing on Annexure A-8, at first they had taken a stand as now found in Annexure A-10. Through Annexure A-9, they made a retreat, but Annexure A-10 is a subsequent communication dated 26.04.2016 which is squarely applicable and binding on the parties.
12. In matters concerning the administration of the Railways, Railway Board is the ultimate authority. Annexure A-10 was issued as clarified by the Board. Therefore, respondents are bound to follow the same.
13. In my opinion, Annexure A-10 is more reasonable, logical and appropriate. As seen in the case of the applicants, they were first given promotion as Station Master Grade - III while they were 14 O.A No. 180/00501/2020 working in Palghat Division. That was the first financial upgradation given to them in 1986. That was protected even after they were transferred to Trivandrum Division and posted as Assistant Station Master. Later in 2005, they were promoted as Station Master Grade
-II. Later, two financial upgradations were granted to them with effect from 01.09.2008, at first with Grade Pay of Rs. 4600/- and second giving Grade Pay of Rs. 4800/-. Admittedly, an employee is entitled to get only three MACPs or three financial upgradations. Such upgradations were granted to them for the first time when they were promoted as Assistant Station Master Grade III in Palghat Division, effect of which was protected even after a Division change. Secondly, they were granted promotion as Station Master Grade II and thereafter two more upgradations are seen given; one in the scale of 9300-34800 with Grade Pay of Rs. 4600/-. On the same day, they were granted 4th upgradation at the very same scale with Grade Pay of Rs. 4800/-. The last upgradation granting Grade Pay of Rs. 4800/- stands scrapped by the Railways after realizing the mistake. In my reading, there is no justification in quashing Annexures A-1 and A-2 or Annexure A-5 and A-6. Therefore, the prayer for setting aside Annexure A-1 and A-2 and Annexure A-5 and A-6 is not acceptable and to that extent, the O.A is liable to be dismissed. 15 O.A No. 180/00501/2020
14. At the same time, the learned counsel has highlighted the decisions in Rafiq Masih and other cases. Evidently, both of them retired as Station Superintendents, which is a Group 'C' post. In the oft quoted Rafiq Masih, Supreme Court has taken an elaborate survey of the question of recoverability of excess amounts paid to employees by way of mistake etc., After making survey of various authorities, the Supreme Court has held that as far as possible in the case of employees, after long lapses of time it is not equitable to effect recovery from their pay. The Supreme Court has summarised the discussion stating that in the following categories, recoveries from the employees would be impermissible in law:-
"(i) Recovery from an employees belonging to Class-III and Class- IV service (or Group 'C' and Group 'D' service).
(ii). Recovery from retired employees, or employees who are due to retire within one year, of the order of recovery.
(iii) Recovery from employees, when excess payment has been made for a period in excess of 5 years, before the order of recovery is issued.
(iv) Recovery in cases where an employee has wrongfully been required to discharge duties of a higher post, and has been paid accordingly, even though he should have rightfully been required to work against an inferior post.
(v) In any other case, where the Court arrives at the conclusion, that recovery if made from the employee, would be iniquitous or harsh or arbitrary to such an extent, as would far outweigh the equitable balance of the employer's right to recover."
15. The applicants fall within the first three categories. They have retired as Group C employees; by the time proceedings were initiated they had already retired from service and the amounts in question are the sums drawn by them when they were granted MACP at the Grade 16 O.A No. 180/00501/2020 Pay of Rs. 4800/- with effect from 01.09.2008. In other words, after granting them benefits with effect from 01.09.2008 the Annexure A-1 and A-2 were issued, after about 12 years, on 16.01.2020. It is impermissible. In the circumstances, the amounts of Rs. 2,65,173/- and 1,48,108/- recovered from their retirement benefits shall be refunded to them within a period of two months from the date of receipt of a copy of this order. As already noticed, grant of Grade Pay @ Rs. 4800/- with effect from 01.09.2008 was a clear mistake. Before that they were already granted three financial upgradations. Therefore, the pay refixed by the respondents cannot be faulted and pension being paid in accordance with the above observations alone shall be payable to the applicants. The O.A is disposed of as above. No costs.
(Dated, this the 14th November, 2022.) JUSTICE K. HARIPAL JUDICIAL MEMBER ax 17 O.A No. 180/00501/2020 Applicant's Annexures Annexure A-1 - True copy of the letter bearing No. V/P.524/II/VII PC/Optg. I dated 16.01.2020 issued to the first applicant.
Annexure A-2 - True copy of the letter bearing No. V/P.524/II/VII PC/Optg. I dated 16.01.2020 issued to the second applicant. Annexure A-3 - True copy of the representation submitted by the 1st applicant dated 17.01.2020.
Annexure A-4 - True copy of the representation submitted by the 2nd applicant dated 17.01.2020.
Annexure A-5 - True copy of the details of terminal benefits issued to the first applicant.
Annexure A-6 - True copy of the details of terminal benefits issued to the second applicant.
Annexure A-7 - True copy of the O.M No. 35034/3/2008-Estt.(D) (Vol. II) dated 04.10.2012.
Annexure A-8 - True copy of the RBE No. 8 of 2013 dated 31.01.2013 of the Railway Board.
Annexure A-9 - True copy of the RBE No. 147 of 2015 dated 23.11.2015 of the Railway Board.
Annexure A-10 - True copy of the PB circular number 45 of 2016 dated 23.04.2016.
Annexure A-11 - True copy of the amended Rule 1313 (FR 22) (1)(a)(1) of the IREC vide RBE No. 198 of 1991 dated 12.12.1991.
Respondents' Annexures NIL ************** 18 O.A No. 180/00501/2020 19 O.A No. 180/00501/2020