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5. It is contended by the appellants that the concept of promotion by seniority-cum-merit, did not contemplate prescribing of minimum qualifying marks for assessment of performance/interview, before applying the principle of seniority for promotion. It is contended that restricting the promotion to only those who secured the minimum qualifying marks, was violative of the seniority-cum-merit principle. It is further contended that even if any qualifying marks could be prescribed for assessing the minimum necessary merit required to meet the efficiency of administration, the fixation of an extremely high mark of 78 out of 100 as qualifying marks, had the effect of converting the criteria of promotion from seniority-cum-merit to merit-cum-seniority. The appellants placed strong reliance on the decisions of this Court in B.V. Sivaiah v. K. Addanki Babu [1998 (6) SCC 720] and Bhagwandas Tiwari v. Dewas Shajapur Kshetriya Gramin Bank [2006 (12) SCC 574] in support of their contentions.

6. On the contentions urged, the following two questions arise for our consideration :

(i) Whether minimum qualifying marks could be prescribed for assessment of past performance and interview, where the promotions are to be made on the principle of seniority-cum-merit?

(ii) Whether the first respondent bank was justified in fixing a high percentage (78%) as the minimum qualifying marks (minimum merit) for promotion?

Re : Question (i)

7. In State of Kerala vs. N. M. Thomas - 1976 (6) SCC 310, a seven- Judge Bench of this Court defined the concept of `seniority-cum-merit'. This Court held that "seniority-cum-merit" means that given the minimum necessary merit requisite for efficiency of administration, the senior though the less meritorious shall have priority." In Union of India vs. Lt. Gen. Rajendra Singh Kadyan - 2000 (6) SCC 698, this Court observed that "seniority-cum-merit" postulates the requirement of certain minimum merit or satisfying a benchmark previously fixed, and subject to fulfilling the said requirement, the promotion is based on seniority. It was pointed out that requirement of assessment of comparative merit was absent in the case of `seniority-cum-merit'.

Re : Question (ii)

11. The next question is whether fixing of 78% as minimum qualifying marks (that is as the minimum necessary merit) is unreasonable and arbitrary. The Rules in this case provide that the mode of selection is by interview and assessment of performance reports for the preceding three years as officer Scale I. The seniority list of officers in scale I was published on 4.12.1996. Thereafter, the promotion process was held by earmarking 60 marks for assessment of performance Reports (at the rate of 20 marks per year) and 40 marks were allotted for interview. The officers possessing the minimum qualifying marks of 78%, were then promoted on the basis of seniority. What should be the minimum necessary merit for promotion, is a matter that is decided by the management, having in mind the requirements of the post to which promotions are to be made. The employer has the discretion to fix different minimum merit, for different categories of posts, subject to the relevant Rules. For example, for promotions at lower levels, it may fix a lesser minimum qualifying marks and fix a comparatively higher minimum qualifying marks for higher posts. In the first respondent Bank, the post of officer-Grade II (Area Managers and Senior Managers) is a very senior position, next only to the top post of General Manager. As the officers promoted to Scale II were required to head larger branches or departments in the Head Office, shouldering higher responsibilities and virtually competing with commercial banks, it cannot be said that the fixing the minimum qualifying marks at 78% is excessive, unreasonable or arbitrary. We may refer to the following observations of this Court in K. Samantaray vs. National Insurance Col. Ltd. - AIR 2003 SCC 4422, in this context :

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======== In order be selected for promotion, obtaining 45 marks shall be compulsory"

It would thus be seen that the schemes for assessing minimum necessary marks are completely different in the two cases. While work performance carried only 30 marks in Bhagwandas's case, it carried 60 marks in this case. While period of service carried 40 marks in Bhagwandas's case, no marks are provided for `period of service' in this case. While the marks for interview were 30 in Bhagwandas's case, it is 40 in this case. The minimum qualifying marks was 78 out of 100 in this case. In Bhagwandas, the minimum qualifying marks prescribed was 45 marks out of 100. But ignoring the requirement of 45 out of 100, the selection Committee adopted a minimum of 45 out of 60 (that is aggregate of marks for work performance and Interview only) ignoring the marks of 40 for period of service though that was the highest segment. This Court was persuaded to interfere in that case, as the guidelines which prescribed the minimum qualifying marks as 45 out of 100 was ignored and the committee changed the minimum qualifying marks to 45 out of 60, thereby ignoring the marks secured for the period of service. Thus, the decision in Bhagwandas Tiwari will not assist the appellants.