Pay Fixation Dispute and ACP Scheme: Supreme Court Ruling on Rule 11 Application

The case of Union of India & Ors. vs. Raj Kumar Anand & Ors. revolves around the issue of pay fixation under the Central Civil Services (Revised Pay) Rules, 2008 and the interpretation of the Assured Career Progression (ACP) scheme. In its judgment delivered on March 14, 2019, the Supreme Court considered the applicability of Rule 7 and Rule 11 under the revised pay structure in the context of an employee who had been granted the ACP and sought the benefit of the revised pay structure from the date of the upgradation.

The case began when Raj Kumar Anand, a government teacher, sought pay revision after he was granted an upgradation under the ACP scheme in 2006. The issue arose due to the differing interpretations of the rules under the 6th Central Pay Commission’s recommendations, particularly whether the pay of the respondent should be fixed under Rule 7 or Rule 11 of the 2008 Rules.

Background of the Case

The respondent, Raj Kumar Anand, was initially appointed as an Assistant Teacher in the East Delhi Municipal Corporation (EDMC) in 1994. He was later promoted to Trained Graduate Teacher (TGT) in 2007. On 25th April 2008, he was granted the ACP under the Assured Career Progression Scheme, placing him in the upgraded pay scale as a Trained Graduate Teacher.

In 2009, following the enforcement of the 6th Central Pay Commission recommendations, the government revised the pay scales, and Anand’s pay was fixed under Rule 7. However, Anand believed that his pay should have been revised under Rule 11 since he had been granted the ACP before the 6th Pay Commission’s rules were enforced.

The Central Administrative Tribunal (CAT) and the High Court of Delhi both ruled in Anand’s favor, agreeing that his pay should have been revised under Rule 11, and the fixation under Rule 7 was incorrect. The Union of India challenged these decisions before the Supreme Court.

Legal Issues Raised

Whether the pay fixation of Raj Kumar Anand under Rule 7 of the Central Civil Services (Revised Pay) Rules, 2008 was correct, or should it have been done under Rule 11?
Whether the provisions of the ACP scheme apply in this case and impact the pay revision?
The applicability of Note 2A of Rule 7 concerning upgradation of pay scales under the 6th Pay Commission recommendations.

Arguments by the Petitioner (Union of India)

The Union of India, represented by the Additional Solicitor General (ASG), argued:

The pay fixation under Rule 7 was correct, as it was in line with the provisions of the 6th Pay Commission recommendations.
The respondent’s case fell under the ambit of Rule 7, and there was no requirement to apply Rule 11.
Rule 7 was applicable because the pay scale upgradation was made as per the provisions of the 6th Pay Commission.
The High Court’s decision to apply Rule 11 was an error of law.

Arguments by the Respondent (Raj Kumar Anand)

Raj Kumar Anand, appearing in person, presented the following arguments:

The pay should have been fixed under Rule 11, which deals with the fixation of pay when an employee is placed in an upgraded pay scale under the ACP scheme.
The date of the upgradation under the ACP scheme was 10th August 2006, before the enforcement of the 6th Pay Commission’s recommendations, and therefore Rule 11 should apply.
Rule 7 applies to situations where the pay scale is revised due to the recommendations of the Pay Commission, not where the pay scale is upgraded under a scheme like ACP.
The Union’s reliance on Rule 7 is misplaced, as the ACP scheme and its upgradation should have been considered separately in the context of Rule 11.

Supreme Court’s Judgment

The Supreme Court, while reviewing the arguments, ruled in favor of Raj Kumar Anand, holding:

The pay of the respondent had to be fixed under Rule 11, as his upgradation under the ACP scheme occurred before the 6th Pay Commission’s rules were enforced.
Rule 11 is applicable in cases where the employee has been granted an upgradation under ACP and opted for revision of pay as per the new rules.
Rule 7 applies in cases where the pay scale upgradation was based on the recommendations of the 6th Pay Commission, which was not the case here.
Note 2A of Rule 7, which applies to cases of upgradation resulting from the Pay Commission recommendations, did not apply in this case, as the upgradation was made under the ACP scheme.

The Court observed:

“Since the respondent opted for the revised pay scale from the date of his upgradation under the ACP scheme, Rule 11 should have been applied to fix his pay. Rule 7 applies only to pay revisions based on the 6th Pay Commission’s recommendations.”

The Court also noted that the decision in K.V. Rama Raju & Ors. v. Union of India was distinguishable because that case involved upgradation based on the Pay Commission recommendations, unlike the present case where the upgradation was due to the ACP scheme.

As a result, the Court dismissed the appeal filed by the Union of India, upheld the High Court’s decision, and directed that Anand’s pay be revised in accordance with Rule 11.

Key Takeaways from the Judgment

Rule 7 applies to pay revisions based on Pay Commission recommendations, while Rule 11 applies to pay revisions following upgradation under schemes like ACP.
Employees who opt for revised pay scales after an upgradation under ACP should have their pay fixed under Rule 11.
The distinction between Rule 7 and Rule 11 is crucial in determining how pay fixation is handled in government services.
The decision highlights the importance of following the correct procedure for pay fixation based on the specific circumstances surrounding the upgradation.

Conclusion

The Supreme Court’s ruling in Union of India & Ors. vs. Raj Kumar Anand is an important clarification regarding the fixation of pay in government services under the revised pay structure. It clarifies the application of Rule 7 and Rule 11 of the Central Civil Services (Revised Pay) Rules, 2008, especially in cases where employees have been upgraded under the ACP scheme. This judgment serves as a significant precedent in understanding how pay fixation should be handled for government employees following various promotion and upgradation schemes.

Petitioner Name: Union of India & Ors..
Respondent Name: Raj Kumar Anand.
Judgment By: Justice Arun Mishra, Justice Navin Sinha.
Place Of Incident: Delhi.
Judgment Date: 14-03-2019.

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