MACP Scheme granting financial up-gradation in next grade pay instead of Grade Pay in next promotional hierarchy is not unjust


Case name: Union of India v. M.V. Mohanan Nair


Case number:  Civil Appeal no. 2016 of 2020

Court: Supreme Court of India

Bench: Justice Banumathi, A.S. Bopanna, Hrishikesh Roy 

Decided on: 5th March, 2020

Relevant Act/ Sections: Modified Assured Career Progression (MACP) Scheme   


                         

Brief Facts and Procedural History:

1. 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 upgradation 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.

2. 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 respondents. Being aggrieved, the appellant UOI has filed these appeals.


ISSUE

1. Whether MACP scheme entitles financial upgradation of pay to the next grade pay or to the grade pay of the next promotional post as envisaged under the ACP scheme?

2. Whether MACP scheme is disadvantageous to the employees in comparison to ACP scheme as long as the financial upgradation is granted in hierarchy of grade pay under MACP scheme?

3. 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?



RATIO OF THE COURT

1. The court held that while the respondents are granted financial upgradations as per the prevailing rules of MACP Scheme, they can only claim the immediate next higher Grade Pay and not the Grade Pay in the next promotional hierarchy.

2. The learned ASG counsel on the behalf of appellant has submitted the brief features and conditions mentioned in ACP and MACP schemes. It added that the ACP had two financial upgradations (on completion of 12 and 24 years), whereas the MACP has three financial upgradations (on completion of 10, 20 and 30 years) which has contributed in reducing disparities among the organisations. Thus it was submitted that the counsel for respondents cannot preselect the benefit of financial upgradation in the next promotional hierarchy under the erstwhile ACP scheme and along with it, it is the prerogative of the Government to provide any financial benefit to its employees and so long as such scheme is not discriminatory or arbitrary, the Court may not interfere with schemes of Government fixing pay scales and granting incentives.

3. On the other hand, the counsel of respondent contended that when a person is to be given benefit, pay, allowance or upgradation, it has to be grade pay in the next promotional position. It was added that these were the “conditions of service” and the same cannot be altered at the will of the employer-Government. MACP scheme envisages merely placement in the immediate next higher grade pay and the word “hierarchy” cannot be dissected from the “recruitment” and “conditions of service”.

4. The learned amicus curiae appointed by the court contended that if financial upgradation is granted in the hierarchy of grade pay then MACP scheme would lead to a discriminatory treatment violating Article 14 of the Constitution of India.

5. When the expert body like Pay Commission has comprehensively examined all the issues and representations and also took note of inter-departmental disparities owing to varying promotional hierarchies, the court should not interfere with the recommendations of the expert body.

6. When the government has accepted the recommendation of the Pay Commission and has also implemented those, any interference by the court would have a serious impact on the public exchequer.

7. The court observed that In Secretary, Government (NCT of Delhi) and others v. Grade-1 Officers Association and others (2014) 13 SCC 296, the Supreme Court refused to interfere with the ACP Scheme as it would violate government policy and since exercise of judicial review would not be proper, upheld the ACP Scheme and the conditions therein.

8. In State of Tamil Nadu v. S. Arumugham (1998) 2 SCC 198, the Supreme Court has observed that the government has the right to frame a policy to ensure efficiency and proper administration and to provide to suitable avenues for promotion to officers working in different department.

9. The court observed that in the present batch of cases where the respondents are claiming financial upgradation in the grade pay of promotional hierarchy, no grounds are made out to show that the MACP Scheme granting financial upgradation in the next grade pay is arbitrary and unjust; warranting interference.

10. The court also held that the dismissal of case by the Supreme Court on the ground of delay in filing/non-filing, is not a binding precedent.

11. The superseding of MACP scheme by ACP is not any unilateral or random exercise of government. When the government has accepted the recommendation of the Pay Commission and has also implemented those, any interference by the court would have a serious impact on the public exchequer. And thus, dismissal of case by the Supreme Court on the ground of delay in filing/non-filing, is not a binding precedent.


DECISION HELD

1. In the result, the court ordered all the impugned orders in these batch of appeals are set aside and the appeals preferred by the Union of India are allowed.

2. Consequently, appeal arising out of SLP(C)No.33706 of 2016 is disposed of. No costs.


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