All India Audit and Accounts Officers Association v. Union of India

1. This writ petition challenges the order of the Central Administrative Tribunal (“CAT”) dated 10.12.2012 in O.A. 731/2012, where the CAT held, inter alia, that Senior Audit and Senior Accounts Officers of the petitioner association cannot be granted Group A status under the existing legal framework, but rather, that the matter is to be resolved by Cabinet.

2. The cadre of Senior Audit Officers and Senior Accounts Officers was created by the Government of India in 1992 by upgrading 80% of the posts of Audit Officers and Accounts Officers (in the pay scale of Rs. 2375-3500 respectively) to a scale of pay meant for Group A officers of the Government of India, i.e. Rs. 2200-4000. Accordingly, although this cadre – to which the second and third petitioners belong – was placed on par with Group A in terms of the pay scale, their classification remained as Group B officers. Subsequently, on 29.8.2008, the Government of India, in exercise of its powers under proviso to 2013:DHC:4691-DB WP (C) 2698/2013 Page 2 Article 309 and clause (5) of Article 148 of the Constitution, notified the Central Civil Services (Revised Pay) Rules, 2008 (“2008 Rules”). Under these rules, Senior Audit and Accounts officers were placed in the PB (i.e. Pay Band) 3 band of the pay scale (8000 – 13500) with a monthly grade pay of Rs 5400/- (similar to Group A officers of the various departments of the Government of India) under Section XX entitled “Organized Account Cadres” of the 2008 Rules.

3. On 9.4.2009, crucially, the Department of Personnel and Training (“DOPT”), in supersession of its earlier order of 1998, in S.O. 946(E), noted that a central civil post holder carrying grade pay of Rs. 7600/-, Rs. 6600/- and Rs. 5400/- in the scale of pay of Rs. 15600-39-100 in PB-3 was to be classified as a Group A officer. Finally, on 17.4.2009, the DOPT – acting upon the Central Civil Service (Revised Pay) Rules, 2008 and following up on S.O. 946 – through OM No. 11012/7/2008-Estt. (A), noted as follows: “As per clause (4) of the central civil services (Revised Pay).Rules, 2008 … the pay band and qrade pay or the pay scales, as applicable, of every post/grade specified in column 2 of the First Schedule thereto shall be as specified against it in columns 5 and 6 thereof. Consequent upon the notification of the said rules, it has become necessary to prescribe revised norms for categorization of posts into the abovementioned four categories based on the pay band and grade pay or the pay scales as applicable, as approved by the Government. Accordingly, an Order classifying the various Central Civil Services posts into Group “A”, “B”, “C”, “D”, based on the revised norms of pay has been notified in the Gazette of India Extraordinary vide s.o. 946 (E) dated 09.04.2000.” The OM also noted, in the 4th paragraph, that “[i]n some Ministries/Departments, posts may exist which are not classified as per the norms laid down by this Department. lf, for any specific reason, a Ministry/Department proposes to classify the posts differently it would be necessary for that Department to send a specific proposal to Department of Personnel and Training giving full justification in support of the proposal within three months of this O.M. so that the exceptions to the norms of classification laid down in S.O. 946 (E) dated 09- 04 - 2009 can be notified.” Based on the above notifications of the DOPT and the Government of India, the petitioners argued that Senior Audit and Senior Accounts officers are entitled to be classified as Group A officers, along with the necessary service WP (C) 2698/2013 Page 3 benefits. Since the Central Government did not agree with their contention, they approached the CAT for relief.

4. The CAT rejected the petitioners’ argument on the ground that the creation of these posts by the Cabinet in 1992 – albeit in a higher pay scale – was subject to classification as Group B. CAT held that the subsequent revisions (by way of the 2008 Rules and the DOPT memoranda) had “not led to any change in the situation prevalent at the time of creation of the posts in question in which the applicants were placed by way of upgradation.” Secondly, the CAT noted that placement of the petitioners in a higher pay scale was without consultation with the UPSC, a mandatory precondition. Finally, CAT relied on the decision of the Supreme Court in Indian Rly SAS Staff Association v. Union of India, (1998) 2 SCC 651, to hold that “ the classification of posts into gazetted or non gazetted cannot be done purely on the basis of grade pay.” Accordingly, the petitioners’ request for classification as Group A officers was rejected, but given the terms of the 4th paragraph of the DOPT OM of 17.4.2009, it was left open to the Office of the Comptroller and Auditor General to approach the UPSC and Cabinet within four months to place the case that the officers in question should be classified under the Group A bracket.

5. The findings of the CAT in its impugned order have been questioned by the petitioners. Learned counsel for the petitioner, Ms. Haripriya Padmanabhan, argued that the classification of officers in question was clear under the 2008 Rules read with the DOPT memoranda, and as such, no question of referring the matter to the Cabinet arose. In her submission, the classification of the officers in question flowed naturally from the rules prescribed, and no further discretionary power was retained by the executive Government to alter such classification under the rules. Thus, in this submission (and contrary to the findings of the CAT), the status of Sr. Audit and Sr. Accounts officers, after classification under the PB-3 pay grade, and read in terms of the DOPT WP (C) 2698/2013 Page 4 memoranda of 9.4.2009 and 17.4.2009, was as Group A officers. Accordingly, the exception, provided under the 4th paragraph of the second DOPT memorandum, was to be engaged to remove the officers from Group A classification, rather than to entitle them to such classification in the first place. Moreover, submitted counsel, as several responses elicited from the Respondents through RTI applications demonstrate, no such action had been taken under the 4th paragraph to carve out an exception and exclude the officers in question from such classification.

6. Learned counsel for the Finance Ministry argued that as the posts were created in 1992 as Group B services despite a pay scale equivalent to Group A, the interim rearrangement of Classification did not affect these posts. Rather, it was argued, the Cabinet was the proper authority to alter the classification of these posts. Learned Counsel also drew the attention of the Court to an Office Memorandum of the Ministry of Finance, Department of Expenditure, dated 4.9.2013, noting that: “… the office of the C&AG may look into the issue afresh keeping in view the existing hierarchical structure, the promotional stream, the organizational set up involving the posts of Senior Audit Officers/Accounts Officers vis-à-vis the organized Group “A” Service of I&AD and whether this issue will lead to disturbance of the same …” It was therefore argued that, given these instructions, the Court may allow the C&AG to consider the matter afresh and take the necessary action based on its internal deliberations and through the proper channels. Finally, learned counsel relied upon the judgment of the Supreme Court in Union of India v. PV Hariharan, (1997) 3 SCC 568, to submit that the Court must not interfere with pay scales, and on the judgment in Indian Railway SAS Staff Association and Others v. Union of India, (1998) 2 SCC 651, for the proposition that the “[c]lassification of posts into gazetted or non gazetted cannot be done purely on the basis of scales of pay.”

7. The Central Government’s submissions were supported by the learned counsel appearing for the Comptroller and Auditor General, and in particular, it was emphasized that the C&AG, for its part, had supported the classification of the WP (C) 2698/2013 Page 5 officers in question as Group A officers, and given the instructions of the Finance Ministry, a fresh look into the matter by the C&AG would be the best course of action.

8. The preceding discussion would reveal that the limited question that arises for this Court’s consideration is whether Senior Audit Officers and Senior Accounts Officers are entitled to classification as Grade A officers under the existing framework of rules applicable to them. Though the posts were originally, and indeed, specifically, created as Group B posts, significant subsequent developments have taken place since that classification. It is incontrovertible that the Revised Pay Rules of 2008 bracket the officers in question in the PB 3 band of pay scale (8000 – 13500) with grade pay of Rs 5400/-. The relevant portions of the Rules are extracted below. Rule 3, the definition clause, inter alia, provides that: “(4) "present scale" in relation to any post/grade specified in column 2 of the First Schedule means the scale of pay specified against that post in column 3 thereof; (5) "pay in the pay band" means pay drawn in the running pay bands specified in Column 5 of the First Schedule. (6) "grade pay" is the fixed amount corresponding to the prerevised pay scales/ posts. (7) "revised pay structure" in relation to any post specified in column 2 of the First Schedule means the pay band and grade pay specified against that post or the pay scale specified in coltimn 5 & 6 thereof, unless a different revised pay band and grade pay or pay scale is notified separately for that post.” The relevant provisions of the first schedule are as follows: “THE FIRST

SCHEDULE (SEE RULES 3 & 4) PART - A Section I Revised Pay Bands and Grade Pays for posts carrying present scales in Group'A', 'B', 'C' & 'D' except posts for which different revised scales are notified separately. WP (C) 2698/2013 Page 6 Present scale Revised Pay scale

┌────────────────────────────────────────────────────────────────────────────────────┐
│

┌─────────────────────────────────────────────────────────────────────────────────────────────────────┐
│                                                          Corresponding Pay                          │
│                                                          Band &                                     │
│                                                              Grade Pay                              │
│       Sl.      Post (2)             Present   Revised Pay           Grade        Para No. Of        │
│                                     scale     Pay     Band          Pay(6)       the Report         │
│       No                                                                                            │
│                                     (3)       Scale   (5)                        (7)                │
│       (1)                                     (4)                                                   │
├─────────────────────────────────────────────────────────────────────────────────────────────────────┤
│       1.        Section Officer      6500-    7500-        PB-2                                     │
│                                      10500    12000                    4800                7.56.9   │
│       2.       Assistant             7450-    7500-        PB-2        4800                7.56.9   │
│                Accounts/Audit                                                                       │
│                                      11500    12000                                                 │
│                Officer                                                                              │
│       3.       Audit/Accounts        7500-    8000-        PB-2        5400                7.56.9   │
│                Officer                                                                              │
│                                      12000    13500                                                 │
│       4.       Sr.Audit/Accounts     7500-    8000-        PB-3        5400                7.56.9   │
│                Officer                                                                              │
│                                      12000    13500                                                 │
│             *Also applicable to employees of Indian Audit & Accounts Department                     │
│    ******                              **********                             *****”                │
└─────────────────────────────────────────────────────────────────────────────────────────────────────┘

18. Finally, on the question of the mandatory consultation with the UPSC for the upgradation of the officers in question from Group B to Group B, the CAT order does not mention the particulars of any rule that requires such consultation. Neither has the learned counsel for the Central Government – despite an opportunity granted by this Court through its order dated 10.9.2013 – placed on record any circular/memorandum that such requires such consultation.

19. Accordingly, the impugned order of the CAT dated 10.12.2012, as also the Office Memoranda of the Central Government dated 11.4.2011, 17.6.2011 and 7.7.2011, which deny the petitioners classification as Group A officers alongwith the attendant benefits, are liable to be set aside as unreasonable and arbitrary given the clear textual mandate of the relevant rules. Thus, the classification of Senior Audit and Senior Accounts officers are Group A officers is mandated under the applicable rules. A direction in terms of the claims made by the petitioners is given; effect shall be given by the respondents, to these directions within six weeks. The writ petition is allowed in these terms, without any order as to costs.

S. RAVINDRA BHAT

(JUDGE)