PUNJAB NATIONAL BANK Vs. VIJAY KUMAR KATHPALIA

JUDGEMENT

(1.) TO understand the controversy between the parties, the brief history of the case is as follows.

(2.) THE Punjab National Bank Limited (hereinafter called the Bank), was taken over by the Central Government under the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970 (Act 5 of 1970) (hereinafter referred to as the Act ). By virtue of Sections 7,8 and 9 read with other provisions of the Act, the control, management and administration of the Bank vested in the Central Government. There were officers of the following grades in the Bank with effect from 1st January, 1970: 'd' - Rs. 565-1130 'c' - Rs. 700-1315 'b' - Rs. 825-1490 'a' - Rs. 1150-1844 Subsequently, Grade 'e' was introduced in the following scale 'e' Rs. 325-640. Grades 'e' and 'd' generally consisted of technical officers. Sub-Accountants were also placed in Grade 'd'. By virtue of the settlement dated 23rd June, 1973, all Sub-Accountants were designated as Accountants and were placed in Grade 'c instead of Grade 'd'. Thereafter, only technical officers remained in Grades 'e' and 'd'. Some technical officers were also in Grades 'c\ 'b' and 'a'. On the basis of the Promotion Policy framed on 3rd May, 1976, Grade 'e' was abolished and the same was merged with Grade 'd1. Accountants came in Grade 'c and from amongst the Accountants and other members of Grade 'c promotions were made to the posts of Assistant 5 Managers/officers In charge, who were paid Rs. 50/- extra as duty allowance, although they were called 'c Grade Officers. From amongst the Assistant Managers/officers In charge, promotions were made to the posts of Managers 10 Grade 'b' and thereafter as Managers Grade 'a'. From amongst officers in Grade 'd', promotions of technical officers in that Grade to Grade 'c were automatically made the moment a technical officer in Grade 'd' reached the 15 basic pay of Rs. 700/- per month. In this manner, those technical officers who came in Grade 'c could be considered for further promotion to Assistant Managers/officers In charge in the same grade and then in the higher grades, 'b' 20 and 'a. This continued till the Board of Directors of the Bank in consultation with the Reserve Bank of India and with the previous sanction of the Central Government made regulations in exercise of the powers conferred by Section 19 read 25 with Section 12 (2) of the Act. The regulations were called Punjab National Bank (Officers) Service Regulations, 1979 (hereinafter referred to as the Regulations ). These Regulations came into force on 1st July 1979. Regulation 4 (1) provided four 30 Grades for Officers and specified the scales of pay which are as follows: (a) Top executive Scale VII Rs. 3000-3500 grade Scale VI Rs. 2750-3250 (b) Senior management Scale V Rs. 2500-2700 grade Scale IV Rs. 2000-2400 (c) Middle management Scale III Rs. 1800-2250 grade Scale II Rs. 1200-2000 (d) Junior management grade Scale I Rs. 700-1800 Regulation 7 provided for the categorisation of the officers of the Bank in the new grades and scales as follows: Posts Grade in which placed General Manager/additional Top Executive Grade General Manager Scale VII Deputy General Top Executive Grade Managers Scale VI Assistant General Senior Management Managers Grade Scale V Regional Managers/chiefs Senior Management at Head Office/chief Grade Manager/principal Staff Scale IV College Grade A Middle Management Grade Scale III. Grade B Middle Management Grade Scale II. Grade C. D. E. Junior Management Grade Scale I. Regulation 17 provided that 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 Central Government, if any Regulation 18 provided for the fixation of seniority. Clauses (2), (3) and (5) of Regulation 18 being relevant are reproduced below: 18 (2 ). Seniority of an officer in grade or scale shall be reckoned with reference to the date of his appointment in that grade or scale. Where there are two or more officers of the same length or service in that grade or scale, their inter-se seniority shall be reckoned with reference to their seniority in the immediately preceding grade or scale or the previous cadre to which they belonged in the Bank's service. Where two or more officers have the same length of service in such preceding grade or scale or such previous cadre, their seniority shall be determined with reference to their seniority in the immediately preceding grade or scale or cadre as the case may be. (3) The inter-se seniority of officers directly recruited in a batch to any grade or scale shall be reckoned with reference to the rank allotted to them at the time of such recruitment. (4 ). . . (5) Nothing in this regulation shall affect the seniority amongst themselves of the officers as existing immediately prior to the appointed date. The aforesaid provisions provided for fixation of seniority in the grade or scale with reference to the date of appointment in that grade or scale and in Clause (5), it was made clear that the regulation shall not affect the seniority amongst the officers as existed immediately prior to the appointed date and appointed date has been " fined as 1st July, 1979.

(3.) ON the basis of the aforesaid regulations, all the officers in grades 'c and 'd' were placed in the junior management grade scale I. Although regulation 7 talks of the officers in grade 'e' also being placed in junior management grade scale I, but grade 'e' and already been merged with grade 'd' in view of the promotion policy dated 3rd May, 1976. In accordance with regulation 18 a seniority list was prepared as on 1st January, 1981. In the seniority list so prepared, the officers in erstwhile grade 'd' were shown as junior to the erstwhile officers in grade 'c although all of them were placed in one seniority list consisting of officers in junior management grade scale I.