Case Note & Summary
The litigation arose from a dispute over promotion to the post of Assistant Director in the A.P. Animal Husbandry Service. The first respondent, a Veterinary Assistant Surgeon employed in the A.P. Animal Husbandry Department, approached the Andhra Pradesh Administrative Tribunal seeking a direction for preparation of a panel of candidates for promotion as Assistant Director under Rule 4 of the A.P. Subordinate Service Rules, known as the General Rules. The Tribunal, by order dated June 5, 1996 in O.A. No. 1224/96, directed the State Government to prepare and operate the panel for the years 1995-96. A review application was dismissed on August 19, 1996. The State and contesting respondents filed special leave petitions, which became Civil Appeal No. 406-407 of 1997, challenging the Tribunal's direction. The material facts showed that the A.P. Animal Husbandry Service Rules, 1996 were made in G.O. Ms. No. 54 of the Animal Husbandry & Fisheries Department dated June 6, 1996 and came into force on June 12, 1996, repealing the earlier Rules made in G.O. Ms. No. 729 dated September 24, 1977. Under the old rules, each class of post was a separate unit for promotion. The Government had appointed a one-man Commission headed by Sri V. Sundaresan, I.A.S., to examine anomalies; the Commission submitted its report on June 25, 1990. The Government had, as early as November 22, 1988, taken a decision to amend the repealed rules. After receiving comments from the Director of Animal Husbandry on September 20, 1995, several meetings were held, and the Government consciously decided not to fill vacancies until the rules were amended. After the Tribunal's direction, temporary promotions were advised, but the process of finalizing a panel could not materialise. The core legal issues were whether the respondent had a right to be considered for promotion under the existing Rules for 1995-96, whether the Government could refuse to prepare the panel because of its policy decision to amend the rules, and whether the Tribunal's direction was correct in law. The appellants argued that the respondent had no right to promotion, and that the Government had power to revise policy and make fresh rules; the Tribunal's direction was contrary to that policy. The respondent argued that he had a right to be considered under the Rules in force in 1995-96, that Rule 4 read with Rule 3 mandated preparation of the panel by September 30 each year, and that the amended rules were only prospective from June 12, 1996. The Supreme Court examined Rule 4 of the General Rules and its second proviso, which permits the appointing authority not to prepare a panel where it does not consider it necessary, subject to recording a certificate that vacancies are not available or that preparation is not considered necessary. The Court emphasized that this power could not be exercised arbitrarily and must rest on valid and relevant considerations. It found that the Government had taken a conscious decision on administrative grounds not to fill pending vacancies until the amendment process was completed, and the new rules came into force on June 12, 1996. Relying on Shankarsan Dash v. Union of India and State of Bihar v. Md. Kalimuddin, the Court reiterated that a selected candidate does not acquire an indefeasible right to appointment, and that the State is under no legal duty to fill up vacancies if its decision not to do so is bona fide and based on appropriate reasons. The Court held that the Tribunal erred in directing preparation and operation of the panel when the Government's decision was not arbitrary. The appeals were allowed and the Tribunal's direction was set aside.
Headnote
A) Service Law - Promotion - Right to Promotion - A.P. Subordinate Service Rules, Rule 4 - A selected candidate or an eligible employee does not acquire an indefeasible right to be promoted or appointed merely because vacancies exist or a panel is due; the State may take a policy decision not to fill vacancies if bona fide and not arbitrary; the Tribunal erred in directing preparation and operation of panel for 1995-96 when the Government had consciously decided not to fill vacancies pending amendment of service rules; Held that the direction was unsustainable. (Paras Not mentioned) B) Service Law - Preparation of Panel - Power Not to Prepare Panel - A.P. Subordinate Service Rules, Rule 4 second proviso - The second proviso empowers the appointing authority not to prepare a panel where it does not consider it necessary, but this power must be exercised on valid and relevant considerations and not arbitrarily; the Government's decision not to fill pending vacancies until the A.P. Animal Husbandry Service Rules were amended was an administrative decision supported by the ongoing rule revision process, which was completed on June 12, 1996; Held that such decision could not be interfered with. (Paras Not mentioned) C) Service Law - Amendment of Rules - Prospective Operation and Existing Rights - A.P. Animal Husbandry Service Rules, 1996 and Repealed Rules, 1977 - The new rules came into force with effect from June 12, 1996 and repealed the old rules; the first respondent's claim to be considered under the old rules for the 1995-96 panel could not stand because the Government had already taken a conscious decision not to fill vacancies pending amendment, and the new rules did not preserve any accrued right; Held that the Tribunal's direction ignored the Government's policy to recast the service rules. (Paras Not mentioned) D) Precedent - Selection Does Not Create Right to Appointment - Constitution Bench in Shankarsan Dash v. Union of India, (1991) 3 SCC 47 - The Supreme Court followed the principle that notification of vacancies and selection do not create an indefeasible right to appointment; the State is under no legal duty to fill up all or any vacancies, but must act bona fide and respect merit if vacancies are filled; applying this to the present case, the Government's decision not to prepare the panel pending rule amendment was not arbitrary, and the Tribunal's direction was set aside; Held that the appeal succeeds. (Paras Not mentioned)
Issue of Consideration
Whether the Andhra Pradesh Administrative Tribunal was correct in directing the Government to prepare and operate the panel for the years 1995-96 for promotion to the post of Assistant Director in the A.P. Animal Husbandry Service despite the Government's decision not to fill vacancies pending amendment of the A.P. Animal Husbandry Service Rules.
Final Decision
The Supreme Court held that the Government's decision not to prepare the panel pending amendment of the A.P. Animal Husbandry Service Rules was not arbitrary and was supported by valid administrative reasons; the Tribunal erred in directing preparation and operation of the panel for 1995-96. The appeals were allowed and the Tribunal's order was set aside.
Law Points
- selected candidates do not acquire indefeasible right to appointment
- State under no legal duty to fill up vacancies
- decision not to fill vacancies must be bona fide and not arbitrary
- if vacancies filled comparative merit must be respected
- power under second proviso to Rule 4 not to prepare panel must be based on valid relevant considerations
- policy decision to amend service rules and not fill vacancies pending amendment is valid administrative ground
- Tribunal cannot compel preparation of panel when Government consciously decided not to fill pending amendment
