Supreme Court Case Judgement – MACP on Promotional Hierarchy

IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 2016 OF 2020
(Arising out of SLP(C) No.21803 of 2014)
UNION OF INDIA AND OTHERS

…Appellants

VERSUS

M.V. MOHANAN NAIR

…Respondent

WITH

CIVIL APPEAL NO. 2017 OF 2020
(Arising out of SLP(C) No.22181 of 2014)
CIVIL APPEAL NO. 2018 OF 2020
(Arising out of SLP(C) No.23335 of 2014)
CIVIL APPEAL NO. 2019 OF 2020
(Arising out of SLP(C) No.23333 of 2014)
CIVIL APPEAL NO. 2020 OF 2020
(Arising out of SLP(C) No.18227 of 2015)
CIVIL APPEAL NO. 2021 OF 2020
(Arising out of SLP(C) No.31125 of 2016)
CIVIL APPEAL NO. 2022 OF 2020
(Arising out of SLP(C) No.33706 of 2016)
CIVIL APPEAL NO(s). 2044-2045 OF 2020
(Arising out of SLP(C)No(s). 5917-5918 of 2017
@ SLP(C)Diary No.6042 of 2017)

JUDGMENT

BANUMATHI, J.

Leave granted.

2. The instant batch of appeals have been filed assailing the orders of various High Courts dismissing petitions filed by the appellants, thereby upholding decisions rendered by different Benches of Central Administrative Tribunal granting financial up-gradation of grade pay in the next promotional hierarchy by placing reliance upon Union of India and others v. Raj Pal and another CWP No.19387 of 2011 dated 19.10.2011. In these batch matters, we are concerned with the question of whether the MACP Scheme entitles financial up-gradation to the next grade payor to the grade pay of the next promotional hierarchy.

3. In all these appeals, almost all the High Courts have followed the Raj Pal and Ved Prakash’s case and granted relief as prayed for by the Being aggrieved, the appellant- UOI has filed these appeals.

4. The main questions falling for consideration in these appeals are:-

Whether MACP scheme entitles financial up-gradation of pay to the next grade payor to the grade pay of the next promotional post as envisaged under the ACP scheme? Whether MACP Scheme envisages grant of financial up-gradation in Grade Pay Hierarchy and not in a promotional hierarchy?

As contended by the respondents, whether MACP scheme is disadvantageous to the employees in comparison to ACP scheme as long as the financial up-gradation is granted in the hierarchy of grade pay under MACP scheme?

Whether respondents are entitled to stepping up of their grade pay to be at par with grade pay of their juniors who were getting the higher grade pay on account of implementation of MACP Scheme?

Appeals relating to Issue No.III were ordered to be de-tagged and listed separately.

5. At the outset, it is to be pointed out that almost all the Tribunals/High Courts have only relied upon Raj Pal’s case for grant of financial up-gradation on promotional hierarchy and rejected the stand of the appellant-UOI that under MACP scheme, the employees are entitled to financial up-gradation of the next grade pay only. Since the matter was considered on merits and since the issue involves impact on the public exchequer and also interest of the staff of various establishments, we requested learned Senior counsel, Mr. Jaideep Gupta to assist the Court as amicus curiae which the learned Senior counsel has readily Mr. Kunal Chatterji, learned counsel has agreed to assist the learned Senior counsel-amicus.

Assured Career Progression (ACP) Scheme:-
6. The Government of India with a view to “deal with the problem of genuine stagnation and hardship faced by the employees due to lack of adequate promotional avenues”, introduced the Assured Career Progression (ACP) Scheme with effect from 09.08.1999 vide its Office Memorandum dated 09.08.1999. To mitigate the hardship in cases of acute stagnation in a cadre or in an isolated post, it has been decided to grant two financial upgradations under the ACP Scheme to Group ‘B’, ‘C’ and ‘D’ employees on completion of 12 and 24 years of regular service. As per ACP Scheme, isolated posts in Group ‘A’, ‘B’, ‘C’ and ‘D’ cadres which have no promotional avenues also qualify for similar benefits. The financial upgradations under the ACP Scheme is placement in the higher Pay Scale and financial benefits in the higher Pay Scale without regular promotion. Under the financial up-gradation, a grant of financial benefits under the ACP Scheme to the government servants concerned is on personal basis. Such financial up-gradation neither amounts to regular promotion nor requires the creation of a new post. Some of the salient features of the ACP Scheme are as follows:-

  • The ACP Scheme envisages merely placement in the higher pay- scale/grant of financial benefits (through financial up-gradation) only to the Government servant concerned on a personal basis and shall, therefore, neither amount to functional/regular promotion nor would require the creation of new posts for the purpose;
  • Under the ACP Scheme, two financial upgradations shall be allowed to Group ‘B’, ‘C’ and ‘D’ employees on completion of 12 years and 24 years of his/her regular service.
  • As per para 1 of Annexure-1 – conditions for grant of benefits under the ACP Scheme, it is stipulated that two financial upgradations would be available only if no regular promotion during the prescribed period (12 and 24 years) was granted to an employee. If an employee has already received one regular promotion, he/she would qualify for second ACP only on completion of 24 years of regular service. However, in case if two regular promotions have been received by an employee, no further benefit under the ACP Scheme would accrue in favor of the employee.
  • As per para 1 of the Office Memorandum dated 09.08.1999, the grant of financial upgradations under the ACP Scheme shall be subject to the conditions mentioned in the Annexure-I annexed thereon to the Office Memorandum dated 09.08.1999.

7. Para 8 of the Annexure provides that the financial upgradations shall be purely personal to the employee and would have no relevance to his/her seniority position. In other words, there would be no additional financial upgradations for the senior employee on the ground that the junior employee has got a higher pay scale under the ACP Scheme. Para No.12 of Annexure-I provides that the ACP Scheme contemplates merely placement on a personal basis in the higher pay scale/grant of financial benefits only and shall not amount to the actual functional promotion of the employees concerned. We may usefully refer to the relevant features of the ACP Scheme as stipulated in Annexure-I to the Office Memorandum dated 09.08.1999-Conditions for Grant of Benefits under the ACP Scheme, which reads as under:-

Conditions for grant of benefits under the ACP Scheme:-
1. The ACP Scheme envisages merely placement in the higher pay-scale/grant of financial benefits (through financial up-gradation) only to the Government servant concerned on personal basis and shall, therefore, neither amount to functional/regular promotion nor would require creation of new posts for the purpose;

…………

4. The first financial up-gradation under the ACP Scheme shall be allowed after 12 years of regular service and the second up-gradation after 12 years of regular service from the date of the first financial up-gradation subject to fulfillment of prescribed conditions. In other words, if the first up-gradation gets postponed on account of the employee not found fit or due to departmental proceedings, etc. this would have a consequential effect on the second up-gradation which would also get deferred accordingly;

………

8. The financial up-gradation under the ACP Scheme shall be purely personal to the employee and shall have no relevance to his seniority position. As such, there shall be no additional financial upgradation for the senior employee on the ground that the junior employee in the grade has got higher pay-scale under the ACP Scheme;

……….

12. The proposed ACP Scheme contemplates merely placement on personal basis in the higher pay-scale/grant of financial benefits only and shall not amount to actual/functional promotion of the employees concerned. Since orders regarding reservation in the promotion are applicable only in the case of regular promotion, reservation orders/roster shall not apply to the ACP Scheme which shall extend its benefits uniformly to all eligible SC/ST employees also. However, at the time of regular/functional (actual) promotion, the Cadre Controlling Authorities shall ensure that all reservation orders are applied strictly;

……..

8. ACP Scheme was replaced by Modified Assured Career Progression (MACP) Scheme which became operational with effect from 09.2008. The Sixth Central Pay Commission has recommended the adoption of MACP Scheme primarily to rectify the problems arising from inter-departmental disparities:-

i) ACP Scheme led to creation of certain disparities within the employees in different organizations/departments who were directly recruited in the same pay scale who received different financial upgradations under the ACP Scheme because of the existence of different promotional hierarchical structure and different promotional pay scales in different organizations/ departments;

ii) Another adverse consequence in the implementation of the ACP Scheme was that the benefit of a higher pay scale was not available in the next post in the hierarchy also existed in the identical pay scale.

9. In order to bring systematic changes in the existing scheme of ACP so that all employees irrespective of existing hierarchical structure in their organizations/cadre get the same benefit, MACP was recommended by the Sixth Central Pay Commission which was accepted by the Government with certain modifications vide its Office Memorandum dated 05.2009. Under the Sixth Central Pay Commission, the revised pay structure has been implemented with effect from 01.01.2006; whereas benefits of ACP Scheme have been allowed till 31.08.2008. Vide Office Memorandum dated 19.05.2009, the Government of India introduced the MACP Scheme, in supersession of the ACP Scheme w.e.f. 01.09.2008. There shall be no change in distinction, classification or higher status on grant of financial upgradation under MACP as the upgradation is purely personal and merely placement in the next higher Grade Pay.

Modified Assured Career Progression (MACP) Scheme:-

10. Under the MACP Scheme, three financial upgradations are made available in the next grade pay to an employee who has completed 10, 20 and 30 years of regular service in the same post without getting any The benefit would be available at the next higher grade pay. Some of the salient features of the MACP Scheme are as follows:-

  • Para 2 of the MACP Scheme provides that the “MACP Scheme envisages merely placement in the immediate next higher grade pay in the hierarchy of the recommended revised pay bands and grade pay”.
  • As per para 10 of the MACP Scheme – Office Memorandum dated 19.05.2009, no stepping up of pay in the pay band or grade pay would be admissible with regard to junior getting more pay than the senior on account of pay fixation under the MACP Scheme.
  • As per para 11 of the said memorandum dated 19.05.2009, the differences in pay scales on account of financial upgradations under the ACP Scheme and MACP Scheme would not be construed as anomaly.

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