ivil Appeal No 2013 of 1990
772 From the Judgment and Order dated 1491988 of the Central Administrative Tribunal Delhi in CCP No 17 of 1987 in T 246 of 1985
Anil Dev Singh CVS Rao TC Sharma and BK Pershad for the Appellant
Subodh Markandeya WA Nomani G Seshagiri Rao AK Raina Mrs Chitra Markandeya GD Gupta and Ashok K Mahajan for the Respondents
The Judgment of the Court was delivered by SAWANT J
Leave granted
The appeal is filed by the General Manager Northern Railways against the decision dated 14th September 1988 of the Central Administrative Tribunal New Delhi
In order to appreciate the grievance of the appel lant Railways against the impugned order it is necessary to state the relevant facts in brief
Respondent employees who are Traffic Apprentices belonged to Class III Service which has four grades and the four grades carry different pay scales as follows i Grade I Rs250 380 ii Grade II Rs335 425 iii Grade III Rs370 475 iv Grade IV Rs450 575 The promotion to the alternate grade in the said four grades is by selection
However the appointments to all the four grades is by promotion
Above Class III posts are Class II and Class I posts
Class I posts are in Junior Scale grade Senior Scale grade Junior Administrative Grade and Senior Administrative Grade
The entire Class II service is filled by promotion by selection from Class III service
In Class I service 60 per cent posts are filled by direct recruitment and 40 per cent by promotion from Class II service
The recruitment as well as promotion to Class I is through the Union Public Service Commission  UPSC  for short
All these posts are available as a promotion avenue to the incumbents of Class III posts
Class III service in the Traffic and Transportation Department consists not only 773 of Traffic Apprentices but also of other categories
Howev er the promotion to Class II post is not made exclusively from Class III service of Traffic and Transportation Depart ment
The incumbents of Class III service in Commercial Department are also entitled to be considered for promotion to Class II posts
Hence a combined seniority list of Class III service both in the Traffic and Transportation Department as well as the Commercial Department is pre pared
The promotions to further posts viz to Class I posts and to the posts of Junior Administrative Grade are thereafter made from the incumbents of the Class II posts
It has further to be noted that the appointments to the posts of Traffic Apprentices is by direct recruitment to the extent of 25 per cent of the annual vacancies in the posts of Section Controllers who are in the grade of Rs200 300 PS and in other posts in the same cadre in the Yard and Station categories
This was according to the scheme prepared by the Railway Board for improving control organisations on the Railways
The Traffic Apprentices thus directly recruited are on completion of the training first absorbed as Assistant Movement Inspectors etc
in the grade of Rs 150 225 and are eligible for promotion to the grade of Rs200 300 PSRs250 380 AS in the normal manner after selection as Section Controllers Station Masters Assistant Station Masters Yard Masters etc
provided they complete at least one year s service in the grade of Rs 150 225
Such promotions are however to be considered against 25 per cent of the annual vacancies
The Railway Board had further clarified the position that 25 per cent of the total annual vacancies in the grade Of Rs200 300 PS Rs250 380 AS were to be earmarked for Traffic Appren tices and if during any particular year it was not found possible to utilise this quota fully on account of suffi cient number of Traffic Apprentices being not eligible for promotion owing to their not having completed one year s service in the grade of Rs150 225 the deficit was to be carried forward to the next selection
By their further letter of December 18 1963 the Railway Board directed that with immediate effect the Traffic Apprentices on successful completion of the three years  training should be straight away brought on the scale of Rs200 300 PS Rs250 380 AS instead of being first absorbed in the scale of Rs 150225 PSRs205 270 AS as prevalent then
Thus it would be clear that Traffic Apprentices were to be directly recruited to fill vacancies to the extent of 25 per cent of the vacancies and the posts of Section Con trollers etc After recruitment they were to be imparted three years  special training and thereafter 774 they were required to serve for one year in the grade of Rs 150 225 Rs205 270 after which they were considered for selection to the grade of Rs200 300 PSRs250 380 AS
From 1963 they were to be straightaway absorbed in the grade of Rs200 300Rs250 380 after completion of their training period of three years but without having to quali fy through Selection Board first and without the condition of one year s service
The Traffic Apprentices were thus to fill vacancies to the extent of 25 per cent
This quota had to be carried forward in case of shortfall in any particular year and the remaining 75 per cent of the vacancies were earmarked for promotion to other departmental officials who were called rankers
After both the sources of recruitment merged in the scale of Rs200 300Rs250 300 a single unified cadre known as Relieving Transportation Assist ants stood constituted
It appears that the respondent s grievance in the writ petition filed before the Delhi High Court was that their seniority in the cadre of Relieving Transportation Assistants was not correctly fixed according to the quota rule of 2575 either because the quota rule was not ob served properly or the unfilled vacancies in the 25 per cent quota reserved for them were not carried forward from 1954 onwards
Hence they wanted their seniority list as Traffic Apprentices to be recast according to quota and rota rule and the seniority list which was prepared allegedly contrary to the said rule quashed
The learned Single Judge had rejected the petition on the ground that they had approached the Court too late and therefore their petition suffered from laches
The Division Bench in Letters Patent Appeal No 220 of 1972 did not agree with the learned Single Judge and decided the matter on merits and gave the finding that the Northern Railways had for the first time communicated by their letter of December 26 1967 to all the Divisional Superintendents that it was decided that the seniority of Traffic Apprentices appointed prior to December 18 1963 would be determined from the date of their promotion to the grade of Rs250 380 and not according to their quota against the vacancies which occured from 141954 onwards the date from which the direct recruitment of the Traffic Apprentices was permitted
The Court held that according to the correct interpretation of the various letters of the Railway Admin istration Traffic Apprentices were to be assigned seniori ty vis a vis rankers promotees according to their roster position taking into account the positions reserved for them viz 25 per cent of the actual annual vacancies with effect from 141954 carried forward in subsequent years
The Court also held that the Railway Administration subse quently modified its instructions contained in 775 their letter of December 26 1967 and issued another letter on April 19 1968 stating that the Traffic Apprentices would be deemed to have been promoted from the dates they were eligible provided vacancies were available in the particular year for theft absorption and that their interests would be protected by giving benefit of pro forma fixation of pay etc
A further letter of December 18 1968 thereafter followed from the headquarters of the Northern Railways in which it was made clear that the seniority had to be fixed with reference to the dates from which the Traffic Appren tices would have been promoted in the grade of Rs250 380 had the quota of the vacancies from 1954 onwards always been calculated correctly ie the vacancies from 1954 onwards should always have been taken into account to work out 25 per cent quota for the Traffic Apprentices
On these find ings the Division Bench stated as follows We may state here that all the Rankers who are likely to be affected by the decision in this case are party respondents
No right of any innocent third party is involved in the case
We are also not quashing any rule executive instruc tion or letter of the Railway Administration or any seniori ty list issued by the earlier than February 1971
The Su preme Court has not laid down any rigid rule of limitation in entertaining a writ petition under Article 32 or Article 226 of the Constitution of India
The Supreme Court was pleased to observe that it will almost always be proper for the court to hold that it is unreasonably delayed if the writ petition is filed beyond the period of limitation prescribed for a similar civil action
Thus if there are any exceptional facts and circumstances even the delay beyond the period of limitation prescribed for a civil action for the remedy may be reasonable or justified and the writ petition may still be entertained
The Court may however be reluctant to entertain such writ petitions but that does not mean that the court has no jurisdiction
If we are right in holding that the cause of action arose in February 1971 or even earlier in April 1968 then there is no question of any delay
But if we are not even then on the facts and circumstances of the case as discussed above we have not been able to persuade ourselves to agree with the learned single Judge that the writ petition is enormous ly delayed
By issuing the writ of mandamus in this case we are only setting at rest the uncertainty and disparity which is prevailing in the various divisions of the Northern Railway in the 776 matter of fixation of inter seniority of Traffic Apprentices and Rankers
The Railway Administration have themselves admired that in Allahabad division of Northern Railway Seniority has been granted to Traffic Apprentices according to their quota against the vacancies which occurred from 141954 onwards
In case of commercial apprentices who are similarly situated seniority has been assigned vis a vis remain according to their quota on the basis of their roster positions 1 5 9 etc
There is no reason why the appel lants should be deprived of what is legally due to them even if they have approached this Court after some delay
For the reasons stated above the Letters Patent Appeal is accepted the judgment of the learned single judge on ques tion No 1 is set aside and reversed and we hold that the writ petition was not belated and was not liable to dismiss al on the ground of laches
The finding on question No2 having been upheld by us the appellants are entitled to the grant of writ of mandamus directing respondents 1 to 3 to fix the seniority of Traffic Apprentices in the light of the observations made by the learned single Judge and as upheld by us
The seniority list Annexure E attached to the writ petition is quashed
The respondent Railway Administra tion shall draw the seniority list within 3 months from today and proceed to make confirmations andor further promotions in the higher grades in accordance with the law rules and orders in force from time to time
In the circum stances of the case we leave the parties to bear their own costs
 This decision of the Division Bench is of July 30 1975
Against this decision the Railways preferred a special leave petition which was dismissed
Thereafter the Railways prepared a fresh seniority list in 1976
It appears that this seniority list took care of the grievances only of the employees who were parties to the petition
Against the said seniority list therefore some of the Traffic Apprentices filed a writ petition being Writ Petition No 948 of 1976 challenging the seniority
That writ petition was trans ferred to the Tribunal and numbered as TA No 246 of 1985
It appears that in the meanwhile in 1983 the Railways in compliance with the judgments delivered by the High Courts of Allahabad and Punjab  Haryana prepared a fresh seniority list and the Tribunal disposed of the transfer petition TA No 246 of 777 1985 by order dated June 25 1986
By this order the Tribunal observed that the application before the Tribunal was to direct the respondent Railways the appellant herein to quash the impugned seniority list ie the seniority list of 1976 and to prepare a fresh seniority list and to make the confirmations and promotions inaccordance with the fresh seniority list
The Tribunal observed that that relief had already been granted by the Delhi High Court in LPA No 220 of 1972 by its decision which is already referred to above
Hence no fresh directions were necessary
The Tribu nal also found that a fresh seniority list had been prepared in 1983 in pursuance of the directions given by the High Court
It appears further that since the seniority list was not prepared within three months as directed by the High Court and according to respondent No 8 in that application before the Tribunal the seniority list was also not in conformity with the other directions contained in the High Court judgment a contempt petition was filed before the High Court and the same was pending before it
The Tribunal therefore stated that it expressed no opinion as regards the validity or otherwise of the seniority list prepared in pursuance of the High Court s directions
The Tribunal also made it clear that unless otherwise ordered by the competent authority or the High Court as the case may be the senior ity list prepared in pursuance of the directions of the High Court shall be acted upon and the confirmations and promotions made on the basis of that list within a period of four months from the date of the receipt of this order
Further promotions shall be made strictly in accordance with the list prepared in 1983 in pursuance of the directions of the High Court in LPA NO
220 of 1972
It appears therefore that the Railways had prepared a seniority list of 1983 in pursuance of the directions of the Delhi High Court in LPA No 220 of 1972 decided on July 30 1975
The grievance of the petitioners in TA No 246 of 1985 Writ Petition No 948 of 1976 was against the senior ity list of 1976 and since that seniority list was supersed ed by 1983 list which the Tribunal observed was in pursuance of the High Court s directions nothing survived in the grievance of the applicants there viz Chadha and others in that application
It further appears that according to the statement made on behalf of the appellant Railways the Railways had already worked out the promotions upto and inclusive of Class II posts by 14th 778 February 1988
However the applicants Chadha and others in TA No 246 of 1985 filed a contempt petition being CCP No 17 of 1987 before the Tribunal making a grievance that full effect had not been given to the judgment dated June 25 1986 of the Tribunal in TA No 246 of 1985
On that application the Tribunal passed the impugned order of September 14 1988 which is the subject matter of the present appeal
The Tribunal has observed that the full consequences of the judgment of the Tribunal were spelt out by the General Manager of the Railways in his letter of July 30 1982 forwarded to the Railway Board
The Tribunal then set out the said consequences as contained in General Manag er s letter and observed that the General Manager had cor rectly appreciated the consequences of the directions of the High Court and of the Tribunal
The Tribunal then stated that however in implementing the order the Railways did not give effect to the said judgments
The Tribunal then directed that the seniority list prepared on the basis of the panels of 1972 73 and 1978 79 for promotion to Class II posts should be revised
We are not concerned here with the said directions
However the Tribunal observed further that the Railways  contention that the earlier direction of the Tribunal did not entitle the petitioners ie Chadha and others to be considered for promotion to Class II or Class I or Junior Administrative Grade was not correct and the same was contrary to its order as well as to the implications of the said order spelt out by the General Manager himself
The Tribunal then went on to observe as follows   
When the Tribunal had directed not only confirma tion and promotion be made in accordance with the revised seniority list but also directed further promotions to be made on that basis it was the duty of the respondent not only to give promotion in Class III but also to give further promotion to Class II Class I and Junior Administrative Grade
Of course these promotions have to be given in accordance with the rules with effect from the date when the juniors were given promotion
The petitioners should have also been considered and promoted to Class II Class I or Juniors Administrative Grade just as their juniors were considered and promoted
Further inclusion in the panel of 1978 79 cannot therefore be insisted upon since they have already qualified
After the above clarification we do not think that there would be any further difficulty in implementing the order and in granting promotion to Shri Chadha and Shri 779 Sandhu in respect of whom alone this petition is pressed
It is stated that although the implications were correctly understood by the General Manager even where the orders were implemented to a certain extent no arrears have been paid
It is hereby clarified that on such promotion they would also be entitled to payment of arrears
The order of the Tribunal in T 24685 sic as further clarified hereinabove shall be implemented accordingly and compliance reported to the Tribunal within six weeks from today   The Tribunal also kept the matter before it on October 31 1988 and the Special Leave Petition giving rise to the present appeal was filed against the said decision of the Tribunal
Two additional facts need be stated
The combined seniority list which was prepared in 1983 of Class III posts for promotion to Class II posts was finalised in March 1987 and was made the basis of the postponed selection to Class II service as per orders of the Tribunal and panel was issued on 1331987
Thereafter on the basis of orders passed by the Tribunal on 9121987 the Traffic Apprentices who became eligible for promotion in the first batch after revision of seniority were considered by a Review Departmen tal Promotion Committee and interpolated in
the Class II panels of 1972 73 and 1975 76
As a result the seniority of the personnel from the Commercial Department was affected since direct recruit Traffic Apprentices from the Traffic and Transportation Department were given seniority according to the quota and rota rule from 1954 onwards
Hence Ms AP Chowdhary and KN Saxena officers belonging to the Commercial Department approached the Tribunal by their applications Nos 360 of 1988 and 936 of 1989 respectively challenging the new seniority list and also on the ground that they were not parties to the earlier proceedings
It further appears that three of the respondents Chadha Sandhu and Malik filed an application before the Tribunal making a grievance that they were not given their due promotion
That application is also pending before the Tribunal
It also appears that the Departmental Promotion Committee prepared two fresh panels the first panel was for promotions to the posts which were vacant between 1972 73 and 1975 76 and the second 780 for the vacant posts for the year 1978 79
In the second panel KN Saxena stands selected
In this appeal we are concerned with two limited issues viz i whether in the context of the history of the litigation and the decisions and directions of the High Court and the Central Administrative Tribunal the respond ents should be given promotions in all posts above Class II service as a logical corollary to their new ranking in the revised seniority list of 1983 and ii whether on such promotions being given they should be paid emoluments of such higher posts with retrospective effect
We have stated that we are concerned with the promotions of the respondents in the posts above Class II service because as stated earlier the appellant Railways have already worked out their promotions in Class II service
There is therefore no dispute with regard to the respondents  promotions in Class II service
However the dispute still survives with regard to their entitlement to the emoluments in Class II service with retrospective date
As regards the promotion to posts above Class II service we find that initially when the petitioners ap proached the court their grievance was with regard to their seniority in and promotions to the grades in Class II serv ice
The High Court had also in its direction said nothing about the promotions to Class II service
However as stated earlier the appellants have worked out the promotions to Class II service on the basis of the new seniority list of Class III service of the year 1983
The respondents there fore have gained substantially since as stated earlier the promotions to Class II and above were not the subject matter of the writ petition before the High Court
We are afraid the Tribunal has gone beyond the scope of the origi nal petition while dealing with the contempt petition
The respondents therefore are not entitled to claim in these proceedings as a matter of right promotions to any higher posts
We however do not desire to make any observations which will come in their way if the UPSC is inclined to look into the matter
In that case the UPSC may constitute review Departmental Promotional Committee and give them proforma promotions and seniority in the promotional posts from the relevant years if they are otherwise eligible to the same
We say nothing more on the subject
As regards the emoluments of nigher posts with retrospective effect we find that the High Court had cate gorically denied the same to the respondents even on the basis of their claim to higher grades in Class III posts
Further even the entitlement
of the respon 781 dents to the higher grades in Class III posts as per the directions of the High Court was on the basis of the quota and rota rule which in itself is both inequitable and irra tional
Time and again the rule has been criticised on account of the absurd result to which it leads viz the deemed appointments have to be given to the concerned em ployees even from the dates when they were not in service and probably when they were still in their schools and colleges
We are informed across the Bar that this is the situation even with respect to some of the respondents herein
The quota and rota rule had to be worked out in the present case from the year 1954 as per the direction of the High Court and the Tribunal
There is therefore neither equity nor justice in favour of the respondents to award them emoluments of the higher posts with retrospective effect
It is for this reason that we are of the view that the decisions of this Court such as in PS Mahal  Ors
vs Union of India  Ors  directing the pay ment of higher emoluments with retrospective effect on account of the deemed promotions of earlier dates will not be applicable to the facts of the present case and have to be distinguished
It is true that the appellant Railways had failed to give correct effect to the decision dated July 30 1975 of the High Court in LPA No 220 of 1972 and had kept the matter hanging till this day for no fault of the respond ents
The High Court by its said decision had directed the appellant Railways to prepare a seniority list within three months from the date of the decision and also to proceed to make further promotions in the higher grades in accordance with law rules and orders in force from time to time
But it is equally true that during all these years the higher posts were not vacant and were manned by others and the appellant Railways had paid the incumbents concerned the emoluments of the said posts
The respondents have not actually worked in the said posts and therefore on the principle of no work no pay they will not be entitled to the higher salary
Hence we give no directions in this behalf and leave it to the appellant to give such relief as they may deem fit
The directions given above would be subject to the petitions which are already pending before the Central Administrative Tribunal New Delhi
The appeal is allowed accordingly with no order as to costs
TNA Appeal al lowed


Summary:
The respondent who was indenting and lifting goods from textile mills situated in different places and was main taining a current account with the appellant Bank for this purpose filed a suit against the Bank for accounts dam ages compensation and delivery of goods or their equivalent in money for non delivery of goods despite receiving pay ment thereof contending that there was an oral agreement with the appellant Bank regarding receipt and payment of bills etc
and receipt and storage of goods on his behalf and delivery of goods to him as and when required
and that under the said terms and conditions
the Banker constituted himself and acted as an express trustee andor agent of the respondent in relation to the said goods and documents and thus stood in fiduciary relationship with the respondent
The appellant
denying the allegations contended that it had never acted as an agent trustee or depositee of the respondent in respect of the goods and documents and that no fiduciary relationship existed between the parties
The trial court decreed the suit holding that from the evidence and entries in the current account it could be inferred that there was agreement or arrangement between the parties and the appellant acted as agenttrustee of the respondent
and that there was fiduciary relationship be tween the parties
The High Court affirming the decree of the trial court
held that 710 if the respondent had paid the value of the goods and the appellant Bank neither delivered the goods nor rendered accounts
a fiduciary relationship could exist between the respondent and the Bank in respect of the goods for which value was paid by the respondent
In the appeal by special leave on behalf of the appel lant Bank it was contended that the Bank was only a collect ing agent for the supply of goods and not an agent or trustee for the respondent adjustment of bills by debiting to the current account without cheques from the respondent would not change the ordinary relationship of bank and customer no special relationship was created either by opening the current account or storing the goods meant for delivery to the respondent and there was nothing to take the parties outside the usual course of banking business and the bank received and took charge of the goods only as bailee and any inference of fiduciary relationship between
parties was unwarranted and unjustified
Dismissing the appeal
this Court
HELD 1
The courts below were not justified in holding that a fiduciary relationship could exist between the par ties in respect of goods for which the suit claim was based
This inference was drawn primarily from the debit entries in the respondent s current account
Collection of bills
remittances to mills
meeting expenses of storing the goods and debiting the same to the current account even without cheques from the respondent could not lead to an inference that the Bank acted as agent of the respondent and that there was fiduciary relationship between parties
There is nothing in this method of operation to take the parties outside the ordinary relationship of banker and customer
This is the normal method of banking operation and the maintenance of the current account in the instant case is not outside this principle
716D G Law of Banking by Lord Chorley 10th ed
at 167 168 and Paget s Law of Banking 9th ed
at82 83
referred to
21 Banks take charge of goods articles securities as bailee and not as trustee or agent
Bailment is the delivery or transfer of possession of a chattel or other item of personal property with a specific mandate which required the identical res either to be returned to the bailor or to be dealt with in a particular way by the bailee as per direc tions of the bailor
One important  distinguishing feature between agency and bailment is that the bailee does not represent the bailor
He merely exercises
with the leave of the bailor under contract or otherwise certain 711 powers of the bailor in respect of his property and the bailee has no power to make contracts on the bailor s be half nor can he made the bailor simply as bailor liable for any acts he does
717D F Fridman s Law of Agency 5th ed
p 23 referred to
In the instant case there is nothing to indicate that the Bank represented some of the parties or the respondent with authority to change the contractual or legal relation ship of parties
It cannot therefore
be held that the Bank acted as agent of the respondent
717G 22 The banker bailee gratuitous or for reward
is bound to take the same care of the property entrusted to him as a reasonable prudent and careful man may fairly be expected to take of his own property of the like descrip tion
A paid bailee must use the greatest possible care and is expected to employ all precautions in respect of the goods deposited with him
If the property is not delivered to the true owner the banker cannot avoid his liability in conversion
718C D Having regard to the finding of fact recorded by the courts below it is immaterial whether the Bank acted as bailee or in any other capacity
On the evidence adduced by the parties it has been established that the respondent did pay the price of the goods in respect of which he based his claim in the suit
The Bank having received the price of the goods from the respondent has failed to deliver the same
This finding has not been seriously disputed and the evi dence adduced by the Bank was insufficient to establish the factum of delivery of goods to the respondent
Therefore the bank could not avoid the liability to return the goods as agreed upon or to pay an equivalent amount to the respond ent
Even if it is assumed that the goods were delivered to a wrong person the Bank has to own the responsibility to pay the respondent
The liability of the banker to customer in such a case is absolute even if no negligence is proved
717H 718A B E Halsbury s Laws of England 4th ed
3 paras 93 and 94
The Law Relating to Banking by TG Reeday 4th ed
p 81 and Law and Practice relating to Banking by FE Ferry 5th ed
p 21 referred to
In practice the bankers do not set up the statute of limitations against their customers or their legal represen tatives
There is no reason for making an exception to this practice in the instant case