Changes To Government Order Cannot Be Applied Retrospectively To Alter Established Seniority Rankings : Supreme Court

The Supreme Court observed that the seniority of the entire cadre working in an establishment could not be disturbed via a subsequent modification in the Government Order (G.O.) fixing the seniority of an employee in an establishment.

The bench comprising Justices Sandeep Mehta and R. Mahadevan said that giving a retrospective effect to the modification made in the G.O. (based on which the seniority was determined in an establishment) would have a catastrophic effect on the seniority of the entire cadre.

“if a Government Order is treated to be in the nature of a clarification of an earlier Government Order, it may be made applicable retrospectively. Conversely, if a subsequent Government Order is held to be a modification/amendment of the earlier Government Order, its application would be prospective as retrospective application thereof would result in withdrawal of vested rights which is impermissible in law and the same may also entail recoveries to be made.”, the court observed.

The dispute pertains to the grant of seniority to the appellant not from the date of induction into the services but from the date of upgradation/promotion to the skilled grade. The appellant was inducted in the semi-skilled grade in 1998, was promoted to the skilled grade in 1998, and was promoted to the highly skilled grade only in 2008, whereas other similarly situated private respondents who were inducted alongside the appellant were promoted to the highly skilled grade in 2003 itself.

Therefore, the appellant claimed parity with that of the seniority awarded to the private respondents who were inducted along with the appellant in the same year.

The appellant's seniority was determined based on the G.O. issued in the year 2002 which stated that the seniority in the skilled grade would have to be reckoned from the date of promotion to the skilled grade and not from the date of induction/entry in the semi-skilled grade.

In support of his plea that his seniority should be reckoned from the date of induction and not from the date of upgradation, the appellant referred to another G.O. issued in 2015 which had modified the 2002 G.O. and restored the G.O. issued in the year 1992 according to which the relevant date for fixation of seniority would be the date of initial appointment and not the date of upgradation/promotion to the skilled grade.

In essence, the appellant pleaded that the G.O. issued in 2015 should be given a retrospective effect so that his seniority could be determined from the date of the initial appointment.

Rejecting the appellant's contention, the judgment authored by Justice Sandeep Mehta observed that a modification made in an earlier 2002 G.O. via a subsequent 2015 G.O. could not be given a retrospective effect to avoid disturbing the entire seniority list which was fixed based on the 2002 G.O. being holding field for a decade.

“However, the clarification issued vide GO dated 4th August, 2015 does not operate retrospectively as it is specifically provided in the said GO that “henceforth”, the seniority in respect of Industrial Establishments will be governed by the relevant clause of OM dated 4th November, 1992.”, the court added.

Taking a cue from the case of Sree Sankaracharya University of Sanskrit and Others v. Dr. Manu and Another, the Court held that it is impermissible to give retrospective application to the modified 2015 GO.

“Applying these principles to the case at hand, we are of the view that the subsequent GO dated 4th August, 2015 cannot be read simply as a clarification and therefore cannot be made applicable retrospectively. The said GO has substantively modified the position governing seniority in the Industrial Establishments by reviving the earlier OM dated 4th November, 1992 and supersedes the orders/circulars dated 24th December, 2002 and 13th January, 2003, which were holding the field over more than a decade. Therefore, giving retrospective effect to the GO dated 4th August, 2015 would have catastrophic effect on the seniority of the entire cadre.”, the court observed.

The Court reasoned that the seniority list cannot be disturbed at a belated stage as it may adversely affect the employees whose seniority and rank have been determined in the meantime. The court noted that the applicability of the Government Order dated 4th August 2015 cannot enure to the benefit of the appellant as its operation is prospective.

“Thus, much water has flown under the bridge and retrospective application of the GO issued in 2015 would open floodgates of litigation and would disturb the seniority of many employees causing them grave prejudice and heartburn as it would disturb the crystallized rights regarding seniority, rank and promotion which would have accrued to them during the intervening period. To alter a seniority list after such a long period would be totally unjust to the multitudes of employees who could get caught in the labyrinth of uncertainty for no fault of theirs and may suffer loss of their seniority rights retrospectively.”, the court observed.

Accordingly, the appeal was dismissed.

Case Title: V. VINCENT VELANKANNI VERSUS THE UNION OF INDIA AND OTHERS, CIVIL APPEAL NO(S). 8617 OF 2013

Citation : 2024 LiveLaw (SC) 762

Click here to read/download the judgment